Interim Management Statement - Replacement

RNS Number : 7265T

Acorn Income Fund Ld

22 November 2013

ACORN INCOME FUND LIMITED

CORRECTION TO INTERIM MANAGEMENT STATEMENT ANNOUNCEMMENT

This announcement replaces that released on 19 November 2013 at 18.10 under RNS Number 4580T.

There is one change to the previous announcement in relation to the Financial Highlights section, as follows:

Numis Smaller Companies Index EX Investment Companies (Capital Return) as at 30 June 2013 was 5,525.53 not 5,225.53 as previously stated.

All other details remain unchanged. The full corrected announcement is as follows:

ACORN INCOME FUND LIMITED (the "Company")

Interim Management Statement for the period 1 July to 19 November 2013 (the "Period") as required under the Disclosure and Transparency Rule 4.3.2.

Investment Objectives and Policy

The objectives of the Company are to provide the Company's shareholders with a high income and also the opportunity for capital growth.

The Company's portfolio is invested in equities and high income and fixed interest securities in order to achieve its investment objectives. It is the aim of the Company to provide both income and capital growth predominantly through investment of approximately 70 to 80% of the portfolio in smaller capitalised United Kingdom companies, admitted to the Official List of the United Kingdom Listing Authority and traded on the London Stock Exchange or traded on AIM; and by investing approximately 20 to 30% of its assets in high yielding securities which will be predominantly fixed interest securities (including corporate bonds, preference and permanent interest bearing shares, convertible and reverse convertible bonds and debentures) but may include up to 15% of the portfolio (measured at the time of acquisition) in high yielding investment company shares.

Financial Highlights

	30 June 2013	31 October 2013	% change or return
Ordinary share NAV	292.15	346.50	18.60
Ordinary share mid price	298.75	352.75	18.07
ZDP share NAV	108.07	112.45	4.05
ZDP share mid price	119.50	119.50	0
Numis Smaller Companies Index Ex Investment Companies (Capital Return)	5,525.53	6,357.43	15.06

Material Events and Transactions

Following the placing to raise £10m through the issue of new Ordinary Shares and new Zero Dividend Preference Shares in May 2013 demand for the Company's shares has remained strong. During the Period the Company has issued new shares to the market (either direct issue of new shares under the placing programme or issues out of treasury) on 24 separate occasions. As at 19 November 2013 an aggregate of 3,421,146 Ordinary Shares and 4,592,248 Zero Dividend Preference ("ZDP") shares have been issued to raise approximately £16.5m. In all cases the Ordinary Shares and ZDP shares were issued in ratio so as to maintain the same capital structure and the "package" of both shares was issued at a premium to NAV.

There are certain advantages in terms of cost and administration time to be gained by making smaller issues of new shares out of treasury than directly issuing new shares under the placing programme. For this reason the Company sought shareholder approval at the General Meeting in August to issue new shares with the intention that they be bought back immediately into treasury allowing demand for smaller tranches of shares to be met by selling out of treasury.

On 2 September 2013 the Company issued a supplemental prospectus in respect of its placing programme of up to 14m new ordinary shares and 19m new ZDP shares.

Issued share capital of the Company:

As at the date of this announcement, the issued share capital of the Company was 14,906,602 Ordinary Shares and 20,009,368 ZDP Shares.

Dividends

The Company announced a fourth interim dividend on 22 August 2013 of 3.0 pence per Ordinary Share which was paid on 30 September 2013. The directors anticipate declaring a fifth interim dividend of 3.0 pence per Ordinary Share to be paid in December 2013.

Largest holdings (% of Gross Assets) as at 31 October 2013:

Smaller Companies Portfolio	%
Electrocomponents	3.38%
VP plc	3.18%
Berendsen plc	3.00%
Acal plc	2.83%
Tyman plc	2.81%
Castings plc	2.66%
Cineworld Group plc	2.64%
Brewin Dolphin Holdings plc	2.62%
British Polythene Industries plc	2.62%
UK Mail Group plc	2.61%

Income Portfolio
Long Gilt Receivable Fixed Price	1.47%
TSY 5%	1.32%
Real Estate Credit Pref	0.79%
GE Capital Funding 8%	0.75%
Credit Suisse	0.65%
UK Treasury 1.25%	0.59%
Lloyds 7.5884%	0.59%
University of Cambridge	0.54%
Rabobank Nederland 6.875%	0.53%
British Sky Broadcasting 3 1/8%	0.52%