Interim Management Statement
FINSBURY GROWTH & INCOME TRUST PLC
Interim Management Statement - three months to 30 June 2014 (unaudited)
Finsbury Growth & Income Trust PLC invests principally in the securities of UK
listed companies with the objective of achieving capital and income growth and
providing a total return in excess of that of the FTSE All-Share Index. A
maximum of 20% of the Company's portfolio, at the time of acquisition, can be
invested in quoted companies worldwide.
In the 3 month period ended 30 June 2014 the Company's net asset value total
return was 1.0% and the share price total return was 0.9%. These results
compare to the total return from the FTSE All-Share Index, the Company's
benchmark, of 2.2% over the same period. Post period end, to 1 August 2014, the
Company's net asset value total return was -3.2% and the share price total
return was -3.7%. The total return from the benchmark index was -1.0%.
The Company paid a first interim dividend of 5.1p per share (first interim
dividend 2013: 4.8p per share) on 6 May 2014 in respect the year ending 30
September 2014.
During the 3 month period the Company issued 4,025,000 new shares at a premium
to the higher of the Company's cum or ex income net asset value per share
prevailing at the time of their issue raising £20.6 million. Following the
period end, to 5 August 2014, the Company has issued a further 1,050,000 new
shares at a premium to the Company's cum income net asset value per share
prevailing at the time of their issue raising a further £5.5 million. As at 5
August 2014 the Company has 96,385,212 shares in issue.
General Meeting
Due to the number of shares issued, the Directors convened a General Meeting,
on Monday, 14 July 2014, at which shareholder permission was obtained to enable
the Board to continue the policy of issuing new shares into the market in
accordance with the above mentioned policy at a premium to the higher of the
cum or ex income NAV per share when demand arose. Resolutions empowering the
Directors to allot new equity shares to an amount equal to approximately 10% of
the issued share capital of the Company and a to disapply pre-emption rights in
respect of any such issuance were duly passed.
Change of Auditors
The Company Announced on 19 June 2014 that it had appointed
PricewaterhouseCoopers LLP as auditors to the Company. This followed a
competitive tender process and was on the recommendation of, and overseen by,
the Audit Committee. PricewaterhouseCoopers LLP will be proposed for
re-appointment as auditors to the Company at the next Annual General Meeting to
be held in February 2015.
In accordance with Section 520(2) of the Companies Act, a letter to confirm
this, dated 19 June 2014, was posted to Shareholders.
Appointment of Alternative Investment Fund Manager and Depository
The Directors of the Company announced on 21 July 2014 that the Company had
adjusted its operational arrangements to ensure that it will comply with AIFMD.
The Directors of the Company further announced the appointment of Frostrow
Capital LLP (`Frostrow') as the designated Alternative Investment Fund Manager
for the Company on the terms and subject to the conditions of the alternative
investment fund management agreement between the Company and Frostrow (the
`AIFM Agreement'), which terminates and replaces the existing management,
administrative and secretarial services agreement between the Company and
Frostrow (the `Existing Management Agreement'). The AIFM Agreement is based on
the Existing Management Agreement and only differs to the extent necessary to
ensure that the relationship between the Company and Frostrow is compliant with
the requirements of AIFMD, except that the Company and Frostrow have
voluntarily agreed to delete all provisions relating to the performance fee
payable by the Company to Frostrow under the Existing Management Agreement.
Lindsell Train Limited (`Lindsell Train') will continue to be responsible for
the management of the Company's portfolio of investments under a new portfolio
management agreement with Lindsell Train (the `PMA') and Frostrow, which
terminates and replaces the existing investment management agreement between
the Company and Lindsell Train (the `Existing IMA'). The PMA is based on the
Existing IMA and only differs to the extent necessary to ensure that the
relationship between the Company, Lindsell Train and Frostrow is compliant with
the requirements of AIFMD, except that the Company and Lindsell Train have
voluntarily agreed to delete all provisions relating to the performance fee
payable by the Company to Lindsell Train under the Existing Portfolio
Management Agreement.
The Company has also appointed BNY Mellon Trust & Depositary (UK) Limited (the
`Depositary') as its depository in accordance with AIFMD on the terms and
subject to the conditions of the depositary agreement between the Company,
Frostrow and the Depositary (the `Depositary Agreement'). The Depositary
Agreement will replace the existing custody agreement between the Company and
the Bank of New York Mellon. Under the terms of the Depositary Agreement the
Company has agreed to pay the Depositary a fee of 2 basis points of the
Company's gross assets including cash, plus any applicable VAT.
Each of the AIFM Agreement, the PMA and the Depositary Agreement entered into
effect on 22 July 2014.
Supplementary Prospectus
On 21 July 2014 the Company published a supplementary prospectus which is
supplemental to, and should be read in conjunction with, the Prospectus
published on 16 December 2013 (the 'Prospectus') in connection with the placing
of up to 30,000,000 shares.
The supplementary prospectus was required following the Company's announcement
of the Appointment of Alternative Investment Fund Manager and Depository under
the Alternative Investment Fund Manager Directive and the removal of
performance fee provisions, which constitutes a significant new factor relating
to information included in the Prospectus.
A copy of the supplementary prospectus was submitted to the National Storage
Mechanism and is available for inspection at www.morningstar.co.uk/uk/NSM
The supplementary prospectus is also available on the Company's website,
www.finsburygt.com
A copy of both the Prospectus and the supplementary prospectus can also be
viewed at the offices of Frostrow Capital LLP, 25 Southampton Buildings, London
WC2A 1AL.
Block Listing
In connection with the Prospectus the Company made an application to the UK
Listing Authority for a block listing, for general business purposes, of
10,000,000 Ordinary Shares of 25 pence each which were admitted to the Official
List and to the London Stock Exchange for the shares to trade on its main
market with effect from 23 July 2014.
Trust Characteristics
30 June 2014 31 March 2014
Number of holdings 25 25
Net assets (£m) 487.3 468.9
Net yield 2.1% 2.0%
Gearing (AIC basis) 4% 4%
Share price (p) 515.00 515.50
NAV (p) per share 508.39 510.44
Premium of share price to NAV per 1.3% 1.0%
share
Source: Frostrow Capital LLP
Sector Analysis
% of % of
investment portfolio investment portfolio
at 30 June 2014 at 31 March 2014
Financials 21.0 21.8
Consumer Services 28.7 28.6
Consumer Goods 40.8 38.6
Technology 9.5 11.0
Total 100.0 100.0
Source: Frostrow Capital LLP
Portfolio
Name % of % of
investment portfolio investment portfolio
at 30 June 2014 at 31 March 2014
Unilever 9.2 9.0
Diageo 8.6 8.4
Pearson 6.9 6.5
Reed Elsevier 6.7 6.1
Heineken Holdings (A Shares)* 6.4 6.6
London Stock Exchange 5.9 6.0
A.G. Barr 5.4 5.4
Daily Mail & General Trust (A 5.1 5.4
Shares)
Schroders 5.1 5.5
Burberry Group 5.0 3.0
Top 10 Investments 64.3 61.9
Fidessa 4.8 5.8
Sage Group 4.7 5.2
Rathbone Brothers 4.7 4.5
Hargreaves Lansdown 4.4 5.1
Greene King 3.0 3.4
Mondelez^ 2.5 2.4
Dr Pepper Snapple^ 2.2 2.2
Euromoney Institutional 2.0 2.3
Investor
Thomson Reuters~ 1.7 1.7
Young & Co's Brewery
(non-voting) 1.6 1.5
Top 20 Investments 95.9 96.0
Kraft Foods Group^ 1.5 1.5
Fuller Smith & Turner 1.3 1.3
The Lindsell Train Investment
Trust 0.7 0.7
Celtic 0.4 0.4
Frostrow Capital LLP+ 0.2 0.1
Celtic Convertible Preferred** - -
Celtic 6% (cum preference)** - -
Total Investments 100.00 100.00
Source: Frostrow Capital LLP
* Listed in the Netherlands
^ Listed in the United States
~ Listed in Canada
+ Unquoted Partnership Interest
** Non-Equity - Preference Shares
Total Return Performance % (to 30 June 2014)
3 Months Calendar 1 Year 3 Years
Year to date
Share Price 0.9 0.5 15.0 62.0
NAV per share 1.0 0.5 16.1 61.2
Benchmark* 2.2 1.6 13.1 29.2
Source: Morningstar
* Index source: FTSE International Limited (FTSE") © FTSE 2014
- FTSE All-Share Index measured on a total return basis.
Past performance is not a guide to future performance.
This Interim Management Statement has been prepared solely to provide
information to meet the requirements of the UK Listing Authority's Disclosure
and Transparency Rules.
This Interim Management Statement is available on the Company's website
www.finsburygt.com.
The Company's Net Asset Value per share is announced daily and is available,
together with the share price, on the TrustNet website at www.trustnet.com
SEDOL Code:
Ordinary Shares - 0781606
ISIN - Ordinary Shares GB0007816068
Bloomberg - FGT LN
Epic - FGT
For further information contact:
Victoria Hale on 020 3170 8732
Frostrow Capital LLP
Company Secretary
5 August 2014
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