Half Yearly Report

RNS Number : 5672H

Rights and Issues Inv Trust PLC

12 July 2012

 



HALF YEARLY MANAGEMENT REPORT

for the six months ended 30th June 2012

CHAIRMAN'S STATEMENT

The Eurozone crisis again dominated stock markets in the first six months. Repeated cycles of impending disasters followed by short-term solutions and periods of optimism giving way to new concerns has been played through over and over. The net effect has been a 1.2% rise in the FTSE All-Share Index.

The Trust has put in a very sound performance with the net asset value of the capital shares rising by 14.9% to 3453.2p. This is partly a rebound from the difficult second half of 2011 but also reflects the very solid corporate results announced so far in 2012.

The interim dividend has been maintained at 8.5p per income share. The Board continues to review the level of distributions and, in the light of the full year results, will carefully consider as to whether it is appropriate to resume a progressive dividend policy.

It remains unclear how long the current Euro situation will last though it will inevitably lead market sentiment for the rest of this year. This uncertainty should however present new opportunities for the Trust.

David Bramwell

Chairman

July 2012

You can view or download copies of the half year and annual reports from our website at www.rightsandissues.co.uk.

The half year report is to be posted to shareholders and is available at the registered office of the Company.

Risks and uncertainties

Cautionary statement

This half-yearly report contains forward-looking statements that involve risk and uncertainty. These have been made by the directors in good faith based on the information available to them at the time of their approval of this report. Due to the inherent uncertainties, including stock market risk factor, actual results may differ materially from those expressed or implied by these forward-looking statements.

There are a number of potential risks and uncertainties which could have a material impact on the Trust's performance over the remaining six months of the financial year and could cause actual results to differ materially from expected and historical results. Recent volatility in the stock market and in financial markets has added to uncertainty. The Trust's results continue to be exposed to the risk of market price. Further information on the principal long-term risks and uncertainties of the Trust is included in the latest annual report.

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

for the six months ended 30th June 2012

	Six months ended 30th June 2012
	Revenue		Capital		Total
	£		£	£
Investment income	1,068,609		-	1,068,609
Other operating income	146,677		-	146,677
Total income	1,215,286		-	1,215,286
Gains/(Losses) on fair value
through profit or loss assets	45,470		9,821,000	9,866,470
	1,260,756		9,821,000	11,081,756
Expenses
Investment management fee	-		-		-
Other expenses	258,988		-	258,988
	258,988		-	258,988
Profit before tax	1,001,768		9,821,000	10,822,768
Tax	-		-		-
Profit for the period	1,001,768		9,821,000	10,822,768
Earnings per share
Return per income share	16.8p		99.8p		116.6p
Return per capital share	35.6p		449.1p		484.7p

The total column of this statement represents the Consolidated Statement of Comprehensive Income, prepared in accordance with IFRS. The supplementary revenue return and capital return columns are both prepared under guidance published by the Association of Investment Companies. All items in the above statement derive from continuing operations. All income is attributable to the equity holders of the parent company and there are no minority interests.

The interim dividend of 8.5p net (2011: 8.5p net) per income share and amounting to £209,100 (2011: £209,100) is payable on 30th September 2012 to shareholders on the register as at 24th August 2012. The sum accruing by way of dividend to the Capital shareholders will, in view of the small sum involved be included in the final dividend.

Six months ended 30th June 2011						Year ended 31st December 2011
Revenue		Capital		Total		Revenue			Capital			Total
£	£		£		£			£			£
1,006,393		-	1,006,393		2,157,373				-		2,157,373
159,267		-	159,267		308,100				-		308,100
1,165,660		-	1,165,660		2,465,473				-			2,465,473
69,334	11,949,904		12,019,238		(18,345)			(2,217,348)			(2,235,693)
1,234,994	11,949,904		13,184,898		2,447,128			(2,217,348)				229,780
-		-		-		-			-			-
262,822		-	262,822		539,079				-		539,079
262,822		-	262,822		539,079				-			539,079
972,172	11,949,904		12,922,076		1,908,049			(2,217,348)			(309,299)
-		-		-		-			-			-
972,172	11,949,904		12,922,076		1,908,049			(2,217,348)				(309,299)
15.9p		121.4p		137.3p		30.3p			(22.5)p			7.8p
35.1p		546.5p		581.6p		70.2p			(101.4)p			(31.2)p

The financial information contained in this Half Yearly Financial Report does not constitute statutory accounts as defined in Sections 434 - 436 of the Companies Act 2006. The information for the six months to 30th June 2012 and 30th June 2011 has not been audited.

The information for the year ended 31st December 2011 has been extracted from the latest published audited accounts which have been filed with the Registrar of Companies. The report of the auditors on those accounts contained no qualification or statement under Section 498 (2), (3) or (4) of the Companies Act 2006.

The auditors have reviewed the financial information for the six months ended 30th June 2012 pursuant to the Auditing Practices Board guidance on Review of Interim Financial Information.

CONSOLIDATED BALANCE SHEET

as at 30th June 2012

	30th June		30th June	31st December
	2012	2011		2011
	£	£		£
Non-current assets
Goodwill	65,191	65,191		65,191
Investments - Fair value through profit or loss	70,936,599	73,216,860		63,788,437
	71,001,790	73,282,051		63,853,628
Current Assets
Trading investments	664,680	945,718		649,857
Trade and other receivables	447,463	388,707		443,655
Amounts due from group undertakings	-		-		-
Cash and cash equivalents	5,907,939	7,901,954		2,907,025
	7,020,082	9,236,379		4,000,537
Total Assets	78,021,872	82,518,430		67,854,165
Current Liabilities
Trade and other payables	654,054	949,795		294,705
Current tax payable	-		-		-
	654,054	949,795		294,705
Total assets less current liabilities	77,367,818	81,568,635		67,559,460
Net Assets	77,367,818	81,568,635		67,559,460
Equity
Called up share capital	1,225,000	1,225,000		1,225,000
Share premium account	225,326	225,326		225,326
Retained reserves:
Capital reserve	46,116,376	42,039,379		41,611,944
Revaluation reserve	28,575,812	36,999,061		23,259,244
Dividend equalisation reserve	1,225,304	1,079,869		1,237,946
Total equity	77,367,818	81,568,635		67,559,460
Net asset value per share
Income shares	834.7p		873.2p		735.2p
Capital shares	3453.3p		3651.7p		3004.6p

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

for the six months ended 30th June 2012

			Share						Dividend
	Share		premium		Capital		Revaluation		equalisation
	capital		account		reserve		reserve		reserve			Total
For the six months	£		£	£		£		£			£
ended June 2011
Balance at
31st December 2010	1,225,000		225,326	39,952,082		27,136,454		1,115,507			69,654,369
Profit for the period	-		-	2,087,297		9,862,607		972,172			12,922,076
Total recognised income
and expense	1,225,000		225,326	42,039,379		36,999,061		2,087,679			82,576,445
Dividends	-		-		-		-	(1,007,810)			(1,007,810)
Balance at
30th June 2011	1,225,000		225,326	42,039,379		36,999,061		1,079,869			81,568,635
			Share						Dividend
	Share		premium		Capital		Revaluation		equalisation
	capital		account		reserve		reserve		reserve			Total
For the six months	£		£	£		£		£			£
ended June 2012
Balance at
31st December 2011	1,225,000		225,326	41,611,944		23,259,244		1,237,946			67,559,460
Profit for the period	-		-	4,504,432		5,316,568		1,001,768			10,822,768
Total recognised income
and expense	1,225,000		225,326	46,116,376		28,575,812		2,239,714			78,382,228
Dividends	-		-		-		-	(1,014,410)			(1,014,410)
Balance at
30th June 2012	1,225,000		225,326	46,116,376		28,575,812		1,225,304			77,367,818

CONSOLIDATED CASH FLOW STATEMENT

for the six months ended 30th June 2012

		Group			Group
	2012			2011
	£			£
Cashflows from operating activities
Profit before tax	10,822,768			12,922,076
Adjustments for:
(Gains)/losses on investments	(9,821,000)			(11,949,904)
Purchase of investments	(3,298,352)			(2,236,063)
Proceeds of investments	5,971,190			3,398,915
Movement in trading investments	(14,823)			(295,485)
Operating cash flows before movements in working capital	3,659,783			1,839,539
Decrease/(increase) in receivables	(3,808)			12,260
Increase/(decrease) in payables	(215,951)			103,076
Net cash from operating activities before income taxes	3,440,024			1,954,875
Income taxes paid		-			-
Net cash from operating activities	3,440,024			1,954,875
Cash flows from financing activities
Dividends paid	(439,110)			(439,110)
Net cash (used in)/from financing activities	(439,110)			(439,110)
Net increase/(decrease) in cash and cash equivalents	3,000,914				1,515,765
Cash and cash equivalents at beginning of year	2,907,025			6,386,189
Cash and cash equivalents at end of period		5,907,939		7,901,954

NOTES TO THE HALF YEARLY FINANCIAL REPORT

for the six months ended 30th June 2012

1.   Accounting Standards

The condensed interim financial report has been prepared in accordance with International Financial Reporting Standards (IFRSs), including IAS 34 "Interim financial reporting" as adopted by the European Union. The same accounting policies and methods of computation are followed in the interim financial report as those used in the Company's latest published annual financial statements.

2.   Dividends

	2012		2011
Amounts recognised as distributions to equity holders in the period:
Income (Paid)
Final dividend for the year ended 31st December 2011
of 17.0p (2010: 17.0p) per share	418,200		418,200
Capital (Paid)
Final dividend for the year ended 31st December 2011
of 1.2750p (2010: 1.2750p) per share	20,910		20,910
Capital Supplementary (Accrued)
Payable 2nd January 2013 of 69.4878p (2012: 68.6829p) per share	569,800		563,200
Dividends on non-equity shares:
Cumulative preference 5.5% (Accrued)	5,500		5,500
	1,014,410		1,007,810
Income
Proposed interim dividend for the year ended
31st December 2012 of 8.5p (2011: 8.5p) per share	209,100		209,100

This was approved by the Board on 12th July 2012 and has not been included as a liability at 30th June 2012.

3.  Income

	2012		2011
Total income comprises:
Dividends	1,068,609		1,006,393
Interest	614		764
Other income	146,063		158,503
	1,215,286		1,165,660

4.   Related Party Transactions

Transactions between the company and its subsidiaries, which are related parties have been eliminated on consolidation.

The Company's subsidiary company Discretionary Unit Fund Managers Limited manages the Discretionary Unit Fund and acts as principal in respect of all transactions of units in the Fund. In respect of this its fee for the six months amounted to £146,063 (2011: £158,503) and the amount owed by the Fund at the period end was £23,074 (2011: £Nil).

5.   Going concern

The Directors believe that it is appropriate to adopt the going concern basis in preparing the financial statements. The assets of the Company consist mainly of securities that are readily realisable and, accordingly, the Company has adequate financial resources to continue in operational existence for the foreseeable future.

DIRECTORS' STATEMENTOF RESPONSIBILITY FOR THE HALF YEARLY REPORT

The Directors are responsible for preparing the half yearly financial report in accordance with applicable law and regulations.

The Directors confirm that to the best of their knowledge:

•         the condensed set of financial statements has been prepared in accordance with IAS 34 "Interim financial reporting"; and

•         the half yearly management report includes a fair review of the information required by DTR 4.2.7R and 4.2.8R. 

This report was approved on 12th July 2012.

D. Bramwell

Chairman

APPENDIX

TOP TEN HOLDINGS

Holding	Investment	Value £
2,700,000	Brammer	7,006,500
1,625,000	RPC Group	6,305,000
10,425,000	Scapa Group	5,733,750
1,609,230	Hill & Smith Holdings	5,149,536
2,100,000	Colefax Group	4,830,000
1,800,000	VP	4,761,000
8,480,000	Renold	2,904,400
635,000	Diploma	2,828,925
500,000	Domino Printing Sciences	2,700,000
764,325	British Polythene Ind	2,667,494

 

END

 

 

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