Interim Results

Merrill Lynch World Mining Tst PLC 31 July 2002 FOR IMMEDIATE RELEASE 31 July 2002 MERRILL LYNCH WORLD MINING TRUST plc Interim Results for the six months ended 30 June 2002 Performance per share to 30 June 2002 Six months Five years (on a total return basis) (from 1 July 1997) Net asset value per share +26.5% +56.1% Effect of buybacks on net asset value +0.4% - Underlying investment performance +26.1% - Ordinary share price +39.9% +57.0% HSBC Global Mining Index* +7.8% +7.6% MSCI World Equity Index -12.9% +12.1% *Capital only, adjusted for exchange rates relative to sterling. Performance based on mid-market values with net income reinvested on ex-dividend date. Sources: Merrill Lynch Investment Managers, Datastream. • As at 30 June 2002, the net asset value per share and share price were 150.64p and 131.50p respectively (31.12.01, NAV 118.48p, share price 96.50p). For further information please contact: Ian Barby 020 7743 5224 Graham Birch 020 7743 2690 Nigel Webb 020 7743 5938 Merrill Lynch Investment Managers or William Clutterbuck The Maitland Consultancy 020 7379 5151 The Chairman, Peter Wilmot-Sitwell, comments: 'The first six months of 2002 continued to be successful for the Company. The mining sector has been one of the few areas of the market to achieve positive returns. The net asset value per share ('NAV') increased by 26.5% (on a total return basis) to 150.64p as at 30 June 2002 and the share price increased by 39.9% to 131.50p. This compares with a 7.8% rise in the benchmark (capital only) and a 12.9% fall in world equities, as measured by the MSCI World Equity Index (on a total return basis). The Manager's stock selection, in particular the over weighting of gold mining company shares, was responsible for achieving a material outperformance against the benchmark. 'During May, the NAV and share price reached new heights of 179.50p and 157.00p respectively, both substantially above the previous highs recorded last year. 'Since May, both the NAV and the share price have fallen back considerably, and at 30 July stood at 125.12p and 105.75p respectively. This reflects more uncertain conditions and, in particular, a correction in the level of mining share prices, although it still represents a positive advance since the Company's year end. 'Earnings of 1.08p per share are lower because the level of dividend income received from the platinum companies in the portfolio was, as we expected, less than last year's exceptional levels. It is hoped that the portfolio's income level will increase in the second half of the year, on the back of earnings growth in the gold mining sector. 'The Manager has introduced a small amount of gearing over the period. During July this has been increased and is now approximately 5.0%. 'We were disappointed to learn of the details of the proposed South African Minerals Industry Charter through a report leaked to the media last week. We were subsequently relieved to read the South African Government's response to these rumours and very much hope that commonsense will prevail. Otherwise it will be difficult for us to continue to encourage investment in South Africa.' Commenting upon the outlook for the Company, Graham Birch of Merrill Lynch Investment Managers, the Investment Manager, notes: ' The global stockmarket remains in a state of shock following the falls of the past two and a half years. Sentiment will take time to recover and we therefore expect that investors will continue to focus on sectors with strong cash generative characteristics. Mining shares could thus continue their outperformance in comparison with world equities. Whether the sector can maintain its rise in absolute terms will depend on continuing recovery in metal markets. For this we will need monetary policy to remain accommodating.' CONSOLIDATED REVENUE STATEMENT for the six months ended 30 June 2002 Six months Six months Year ended ended 30 June ended 30 June 31 December 2002 2001 2001 £'000 £'000 £'000 (unaudited) (unaudited) (audited) Note Income 3 4,062 8,308 11,650 Less: Investment management fees 4 (1,187) (1,017) (1,938) Operating expenses 5 (322) (263) (494) ------- ------- -------- Net return before finance costs and taxation 2,553 7,028 9,218 Interest payable and similar charges (135) (311) (383) ------- ------- -------- Revenue on ordinary activities before taxation 2,418 6,717 8,835 Taxation on ordinary activities (660) (1,853) (2,401) ------- ------- -------- Revenue on ordinary activities after taxation 1,758 4,864 6,434 Dividends in respect of equity shares 6 - - (5,148) ------- ------- ------- Transfer to revenue reserve 1,758 4,864 1,286 ==== ==== ==== CONSOLIDATED STATEMENT OF TOTAL RETURN PER ORDINARY SHARE for the six months ended 30 June 2002 Six months Six months Year ended ended 30 June ended 30 June 31 December 2002 2001 2001 (unaudited) (unaudited) (audited) Calculated on weighted average shares: Earnings per ordinary share 1.08p 2.88p 3.82p Capital return per ordinary share 30.80p 16.27p 7.85p ------- ------- ------- Total return per ordinary share 31.88p 19.15p 11.67p ==== ==== ==== Calculated on actual shares: Earnings per ordinary share 1.08p 2.89p 3.87p Capital return per ordinary share 30.85p 16.33p 7.95p ------- ------- ------- Total return per share 31.93p 19.22p 11.82p ==== ==== ==== Ordinary dividend per share - - 1.45p Special dividend per share - - 1.70p ==== ==== ==== CONSOLIDATED BALANCE SHEET as at 30 June 2002 30 June 30 June 31 December 2002 2001 2001 £'000 £'000 £'000 (unaudited) (unaudited) (audited) Fixed assets Investments at valuation 253,418 223,657 192,314 ----------- --------- ---------- Current assets Investments of subsidiary undertakings 2,879 1,023 2,002 Debtors 2,241 516 8,659 Cash at bank - - 9,850 ----------- --------- --------- 5,120 1,539 20,511 ----------- --------- --------- Creditors - amounts falling due within one year Bank overdraft (8,867) (2,939) - Other creditors (4,202) (5,619) (15,972) ---------- --------- --------- (13,069) (8,558) (15,972) ---------- --------- --------- Net current (liabilities)/assets (7,949) (7,019) 4,539 ---------- ---------- --------- Total assets less current liabilities 245,469 216,638 196,853 Provision for liabilities and charges - (69) (127) ----------- --------- --------- Net assets 245,469 216,569 196,726 ====== ====== ====== Capital and reserves Share capital 8,147 8,410 8,302 Capital redemption reserve 22,772 22,509 22,617 Other capital reserves 4,547 (31,466) (45,729) ---------- ---------- ---------- 35,466 (547) (14,810) Special reserve 203,395 208,688 206,686 Revenue reserve 6,608 8,428 4,850 ---------- ---------- ---------- Total equity shareholders' funds 245,469 216,569 196,726 ====== ====== ====== Net asset value per share 150.64p 128.76p 118.48p ====== ====== ====== CONSOLIDATED CASH FLOW STATEMENT for the six months ended 30 June 2002 Six months Six months Year ended ended 30 June ended 30 June 31 December 2002 2001 2001 (unaudited) (unaudited) (audited) £'000 £'000 £'000 Net cash flow from operating activities 1,576 8,687 9,520 Returns on investment and servicing of finance (135) (311) (383) Taxation paid (536) (290) (1,002) Capital expenditure and financial investment: Purchase of fixed asset investments (54,617) (48,430) (81,508) Proceeds from the sale of fixed asset investments 43,586 56,958 104,914 Exchange loss on foreign currency transactions (151) (133) (269) Equity dividends paid (5,149) (2,197) (2,197) Purchase of ordinary shares (3,291) (1,784) (3,786) --------- ------- -------- (Decrease)/increase in cash in the period (18,717) 12,500 25,289 ===== ===== ===== RECONCILIATION OF NET RETURN BEFORE FINANCE COSTS AND TAXATION TO NET CASH FLOW FROM OPERATING ACTIVITIES Six months Six months Year ended ended 30 June ended 30 June 31 December 2002 2001 2001 (unaudited) (unaudited) (audited) £'000 £'000 £'000 Net return before finance costs and taxation 2,553 7,028 9,218 Net (purchases)/sales of investments by subsidiary undertakings (131) 2,892 1,605 Decrease/(increase) in debtors 52 (204) (159) Increase/(decrease) in creditors 183 44 (142) Tax on investment income included within gross income (177) (306) (466) Profit on investments by subsidiary undertakings (904) (767) (536) ------- ------- ------- Net cash flow from operating activities 1,576 8,687 9,520 ==== ==== ==== NOTES ON THE INTERIM RESULTS 1. Principal activity The principal activity of the Company is that of an investment trust company within the meaning of section 842 of the Income and Corporation Taxes Act 1988. The principal activity of its two subsidiary undertakings, Merrill Lynch Gold Limited and World Mining Investment Company Limited, is investment dealing. 2. Basis of preparation The interim financial statements have been prepared on the basis of the accounting policies set out in the Company's financial statements at 31 December 2001. Income and operating expenses have been accrued in accordance with the same principles used in the preparation of the annual financial statements. The taxation charge has been calculated by applying an estimate of the annual effective tax rate to the profit for the period. 3. Income Six months Six months Year ended ended 30 June ended 30 June 31 December 2002 2001 2001 £'000 £'000 £'000 (unaudited) (unaudited) (audited) Income from investments: Dividends: UK listed 116 484 752 Overseas listed 3,015 7,056 10,244 ------- ------- -------- 3,131 7,540 10,996 ------- ------- -------- Interest receivable and other income: Deposit interest and other income 27 1 118 Profit on investments by subsidiary undertakings 904 767 536 ------- ------- -------- 931 768 654 ------- ------- -------- Total income 4,062 8,308 11,650 ==== ==== ===== 4. Investment management fees Six months Six months Year ended ended 30 June ended 30 June 31 December 2002 2001 2001 £'000 £'000 £'000 (unaudited) (unaudited) (audited) Investment management fees 1,167 977 1,850 Irrecoverable VAT thereon 20 40 88 ------- ------- ------- 1,187 1,017 1,938 ==== ==== ==== The investment management fee is levied quarterly, based on the gross assets on the last day of each quarter. All investment management fees are charged to revenue. 5. Operating expenses Six months Six months Year ended ended 30 June ended 30 June 31 December 2002 2001 2001 £'000 £'000 £'000 (unaudited) (unaudited) (audited) Custody fee 123 103 195 Administration fee 72 61 114 Registrars' fees and other administrative costs 94 76 129 Directors' emoluments 33 23 56 ----- ----- ----- 322 263 494 === === === 6. Dividend The Board has not declared an interim dividend, as dividends are considered and paid annually in respect of each accounting period. 7. Gearing ratio The ratio of borrowings to net assets were 3.6% (31.12.2001 : nil) 8. Ordinary shares 30 June 2002 30 June 2001 31 December 2001 The weighted average number of ordinary shares in issue during each period, on which the return per ordinary share was calculated, was: 163,254,853 168,787,815 168,244,008 The actual number of ordinary shares in issue at the end of the period on which the net asset value per share was calculated was: 162,945,461 168,200,000 166,045,461 Share price 131.50p 105.75p 96.50p 9. Publication of non-statutory accounts The financial information contained in this interim statement does not constitute statutory accounts as defined in section 240 of the Companies Act 1985. The financial information for the six months ended 30 June 2001 and 2002 has not been audited. The information for the year ended 31 December 2001 has been extracted from the latest published audited financial statements, which have been filed with the Registrar of Companies. The report of the auditors on those accounts contained no qualification or statement under sections 237(2) or (3) of the Companies Act 1985. 31 July 2002 33 King William Street London EC4R 9AS This information is provided by RNS The company news service from the London Stock Exchange

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