Final Results

RNS Number : 1390M

Value and Income Trust plc

19 May 2010

 



VALUE AND INCOME TRUST PLC

PRELIMINARY statement of annual RESULTS

FOR THE YEAR ENDED 31 MARCH 2010

SUMMARY

	31 March 2010	31 March 2009
Net asset value per share valuing debt at par (including income)	231.8p	165.6p
Net asset value per share valuing debt at market value (including income)	218.3p	129.6p
Ordinary share price	169.0p	88.5p
Discount of ordinary share price to net asset value per share valuing debt at market value (including revenue)	22.5%	31.7%
Total interim dividend and proposed final dividend per share	7.6p	7.5p
Total assets less current liabilities	£141.8m	£111.5m

THE YEAR

·      Net Asset Value total return (with debt at market value) of +76.3% over one year and -9.8% over three years.

·      Share price total return of +99.9% over one year and -22.5% over three years.

·      FTSE All-Share Index total return of +52.3% over one year and -0.7% over three years.

·      Dividends for the year up 1.3% - increased for 23rd consecutive year

DIVIDEND

The Directors recommend that a final dividend of 3.8 pence per share (2009 - 3.7 pence) is paid on 16 July 2010 to shareholders on the register on 18 June 2010.  The ex-dividend date is 16 June 2010. An interim dividend of 3.8 pence per share (2009 - 3.8 pence) was paid on 8 January 2010.

CONTACT

For further information, please contact:-

Matthew Oakeshott or Angela Lascelles of OLIM Limited, Investment Manager

www.olim.co.uk

Tel: [phone]

VALUE AND INCOME TRUST PLC

GROUP STATEMENT OF COMPREHENSIVE INCOME

	Year ended			Year ended
	31 March 2010			31 March 2009
	Revenue	Capital	Total	Revenue	Capital	Total
	£'000	£'000	£'000	£'000	£'000	£'000
Investment income
Dividend income	3,867	-	3,867	4,350	-	4,350
	________	________	________	________	________	________
Rental income	3,634	-	3,634	3,314	-	3,314
Interest income on short-term deposits	313	-	313	215	-	215
Underwriting commission	24	-	24	-	-	-
	________	________	________	________	________	________
Other operating income	3,971	-	3,971	3,529	-	3,529
Other comprehensive income
Unrealised gains/(losses) on investment properties	-	3,009	3,009	-	(9,304)	(9,304)
	________	________	________	________	________	________
	7,838	3,009	10,847	7,879	(9,304)	(1,425)
Gains and losses on investments
Realised gains/(losses) on held-at-fair-value investments	-	1,014	1,014	-	(7,673)	(7,673)
Unrealised gains/(losses) on held-at-fair-value investments	-	26,053	26,053	-	(23,076)	(23,076)
	________	________	________	________	________	________
Total income	7,838	30,076	37,914	7,879	(40,053)	(32,174)
	________	________	________	________	________	________
Expenses
Investment management fees	(250)	(582)	(832)	(253)	(591)	(844)
Other operating expenses	(852)	-	(852)	(402)	-	(402)
VAT recoverable on investment management fees	562	432	994	-	-	-
Finance costs	(3,501)	-	(3,501)	(3,501)	-	(3,501)
	________	________	________	________	________	________
Total expenses	(4,041)	(150)	(4,191)	(4,156)	(591)	(4,747)
	________	________	________	________	________	________
Profit/(loss) before tax	3,797	29,926	33,723	3,723	(40,644)	(36,921)
Taxation	-	(149)	(149)	-	1,400	1,400
	________	________	________	________	________	________
Profit/(loss) for the period	3,797	29,777	33,574	3,723	(39,244)	(35,521)
	________	________	________	________	________	________
Earnings per ordinary share (pence)	8.34	65.37	73.71	8.17	(86.15)	(77.98)
	________	________	________	________	________	________

The Board is proposing a final dividend of 3.8p per share, making a total dividend of 7.6p per share for the year ended 31 March 2010 (2009: 7.5p per share) which, if approved, will be payable on 16 July 2010.

The total column of this statement represents the Group Statement of Comprehensive Income, prepared in accordance with IFRS.

The revenue return and capital return columns are supplementary to this and are 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 Value and Income Trust PLC, the parent company. There are no minority interests.

VALUE AND INCOME TRUST PLC

COMPANY STATEMENT OF COMPREHENSIVE INCOME

	Year ended			Year ended
	31 March 2010			31 March 2009
	Revenue	Capital	Total	Revenue	Capital	Total
	£'000	£'000	£'000	£'000	£'000	£'000
Investment income
Dividend income	3,867	-	3,867	4,350	-	4,350
	________	________	________	________	________	________
Rental income	1,245	-	1,245	1,195	-	1,195
Interest income on short-term deposits	310	-	310	188	-	188
Underwriting commission	24	-	24	-	-	-
	________	________	________	________	________	________
Other operating income	1,579	-	1,579	1,383	-	1,383
	________	________	________	________	________	________
Other comprehensive income
Unrealised gains/(losses) on investment properties	-	1,337	1,337	-	(2,963)	(2,963)
	________	________	________	________	________	________
	5,446	1,337	6,783	5,733	(2,963)	2,770
Gains and losses on investments
Realised gains/(losses) on held-at-fair-value investments	-	806	806	-	(7,795)	(7,795)
Unrealised gains/(losses) on held-at-fair-value investments	-	27,760	27,760	-	(27,831)	(27,831)
	________	________	________	________	________	________
Total income	5,446	29,903	35,349	5,733	(38,589)	(32,856)
	________	________	________	________	________	________
Expenses
Investment management fees	(167)	(388)	(555)	(169)	(394)	(563)
Other operating expenses	(363)	-	(363)	(268)	-	(268)
VAT recoverable on investment management fees	562	432	994	-	-	-
Finance costs	(1,851)	-	(1,851)	(1,851)	-	(1,851)
	________	________	________	________	________	________
Total expenses	(1,819)	44	(1,775)	(2,288)	(394)	(2,682)
	________	________	________	________	________	________
Profit/(loss) before tax	3,627	29,947	33,574	3,445	(38,983)	(35,538)
Taxation	-	-	-	17	-	17
	________	________	________	________	________	________
Profit/(loss) for the period	3,627	29,947	33,574	3,462	(38,983)	(35,521)
	________	________	________	________	________	________
Earnings per ordinary share (pence)	7.96	65.75	73.71	7.60	(85.58)	(77.98)
	________	________	________	________	________	________

The total column of this statement represents the Statement of Comprehensive Income of the Company prepared in accordance with IFRS.

The revenue return and capital return columns are supplementary to this and are 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 Value and Income Trust PLC, the parent company. There are no minority interests.

VALUE AND INCOME TRUST PLC

STATEMENT OF FINANCIAL POSITION

	Group				Company
	As at		As at		As at		As at
	31 March 2010		31 March 2009		31 March 2010		31 March 2009
	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000
ASSETS
Non current assets
Investments held at fair value through profit or loss		88,638		62,301		104,471		76,427
Investment properties held at fair value through profit or loss		48,750		44,850		16,675		15,175
		_______		_______		_______		_______
		137,388		107,151		121,146		91,602
Current assets
Cash and cash equivalents	5,670		4,903		5,551		4,830
Other receivables	325		1,605		316		1,339
	_______		_______		_______		_______
		5,995		6,508		5,867		6,169
		_______		_______		_______		_______
TOTAL ASSETS		143,383		113,659		127,013		97,771
Current liabilities
Other payables		(1,629)		(2,189)		(1,052)		(1,945)
		_______		_______		_______		_______
TOTAL ASSETS LESS CURRENT LIABILITIES		141,754		111,470		125,961		95,826
Non-current liabilities
Debenture stock	(35,396)		(35,420)		(20,396)		(20,420)
Deferred tax	(793)		(644)		-		-
	_______		_______		_______		_______
		(36,189)		(36,064)		(20,396)		(20,420)
		_______		_______		_______		_______
NET ASSETS		105,565		75,406		105,565		75,406
		_______		_______		_______		_______
EQUITY ATTRIBUTABLE TO EQUITY SHAREHOLDERS
Called up share capital		4,555		4,555		4,555		4,555
Share premium		18,446		18,446		18,446		18,446
Retained earnings		82,564		52,405		82,564		52,405
		_______		_______		_______		_______
TOTAL EQUITY		105,565		75,406		105,565		75,406
		_______		_______		_______		_______
Net Asset Value per ordinary share (pence)		231.76		165.55		231.76		165.55
		_______		_______		_______		_______

VALUE AND INCOME TRUST PLC

GROUP STATEMENT OF CHANGES IN EQUITY

Group	Year ended 31 March 2010				Year ended 31 March 2009
	Share	Share	Retained	Total	Share	Share	Retained	Total
	capital	premium	earnings		capital	premium	earnings
	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Net assets at 31 March 2009	4,555	18,446	52,405	75,406	4,555	18,446	91,339	114,340
Net profit/(loss) for the year	-	-	33,574	33,574	-	-	(35,521)	(35,521)
Dividends paid	-	-	(3,415)	(3,415)	-	-	(3,413)	(3,413)
	________	________	________	________	________	________	________	________
Net assets at 31 March 2010	4,555	18,446	82,564	105,565	4,555	18,446	52,405	75,406
	________	________	________	________	________	________	________	________
Company
	Year ended 31 March 2010				Year ended 31 March 2009
	Share	Share	Retained	Total	Share	Share	Retained	Total
	capital	premium	earnings		capital	premium	earnings
	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Net assets at 31 March 2009	4,555	18,446	52,405	75,406	4,555	18,446	91,339	114,340
Net profit/(loss) for the year	-	-	33,574	33,574	-	-	(35,521)	(35,521)
Dividends paid	-	-	(3,415)	(3,415)	-	-	(3,413)	(3,413)
	________	________	________	________	________	________	________	________
Net assets at 31 March 2010	4,555	18,446	82,564	105,565	4,555	18,446	52,405	75,406
	________	________	________	________	________	________	________	________

VALUE AND INCOME TRUST PLC

GROUP STATEMENT OF CASH FLOWS

	Year ended 31 March 2010		Year Ended 31 March 2009
	£'000	£'000	£'000	£'000
Cash flows from operating activities
Dividend income received		3,873		4,705
Rental received		3,892		3,147
Interest received		177		215
Other income		24		-
VAT on management fees refunded		994		-
Operating expenses paid		(1,234)		(1,552)
		_________		_________
NET CASH FROM OPERATING ACTIVITIES		7,726		6,515
Cash flows from investing activities
Purchase of investments	(18,426)		(18,214)
Sale of investments	18,407		13,931
	_________		_________
NET CASH OUTFLOW FROM
INVESTING ACTIVITIES		(19)		(4,283)
Cash flow from financing activities
Interest paid	(3,525)		(3,525)
Dividends paid	(3,415)		(3,413)
	_________		_________
NET CASH OUTFLOW FROM FINANCING ACTIVITIES		(6,940)		(6,938)
		_________		_________
NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS		767		(4,706)
Cash and cash equivalents at 1 April 2009		4,903		9,609
		_________		_________
Cash and cash equivalents at 31 March 2010		5,670		4,903
		_________		_________

VALUE AND INCOME TRUST PLC

NOTES TO PRELIMINARY STATEMENT OF ANNUAL RESULTS:

1	Accounting policies
	The financial statements have been prepared in accordance with International Financial Reporting Standards (IFRSs) which comprise standards and interpretations approved by the International Accounting Standards Board (IASB) together with interpretations of the International Accounting Standards and Standing Interpretations Committee approved by the International Accounting Standards Committee (IASC) that remain in effect, and to the extent that they have been adopted by the European Union. The functional and reporting currency of the Group is pounds sterling because that is the currency of the primary economic environment in which the Group operates.
	(a)  Basis of preparation
	The financial statements have been prepared on a going concern basis and on the historical cost basis, except for the revaluation of certain financial assets. The principal accounting policies adopted are set out below. Where presentational guidance set out in the Statement of Recommended Practice Financial Statements of Investment Trust Companies and Venture Capital Trusts (the SORP) issued by the Association of Investment Companies (AIC) in January 2009 is consistent with the requirements of IFRSs, the directors have sought to prepare the financial statements on a basis compliant with the recommendations of the SORP.
	The directors are of the opinion that the Group is engaged in a single segment of business, being investment business.
	(b)  Basis of consolidation
	The consolidated financial statements incorporate the financial statements of the Company and the entity controlled by the Company (its subsidiary). Control is achieved where the Company has the power to govern the financial and operating policies of an investee entity so as to obtain benefits from its activities. All intra-group transactions, balances, income and expenses are eliminated on consolidation. The investment in the subsidiary is recognised at fair value in the financial statements of the Company. This is considered to be the net asset value of the shareholders' funds, as shown in its statement of financial position.
	Audax Properties plc, a wholly owned subsidiary of the Company, charges expenses wholly to income.
	On consolidation, however, an adjustment is made to charge 70% of the investment management fee paid by Audax Properties plc to capital. The allocation has no effect on the total return of the Company or the Group.
	(c) Presentation of Statement of Comprehensive Income
	In order to reflect better the activities of an investment trust company and in accordance with guidance issued by the AIC, supplementary information which analyses the Statement of Comprehensive Income between items of a revenue and capital nature has been presented alongside the Statement of Comprehensive Income. In accordance with the Company's status as a UK investment company under section 833 of the Companies Act 2006, net capital returns may not be distributed by way of dividend. Additionally the net revenue is the measure that the directors believe to be appropriate in assessing the Company's compliance with certain requirements set out in section 842 of the Income and Corporation Taxes Act 1988.
	(d)  Income
	Dividend income from investments is recognised as revenue for the period on an ex-dividend basis. Where no ex-dividend date is available, dividends receivable on or before the period end are treated as revenue for the period.
	Where the Group has elected to receive dividend income in the form of additional shares rather than cash, the amount of cash dividend foregone is recognised as income. Any excess in the value of shares received over the amount of cash dividend foregone is recognised as a gain in the income statement.
	Interest receivable from cash and short term deposits and interest payable is accrued to the end of the period.
	Rental and other income are recognised as earned.
	(e)  Expenses and Finance Costs
	All expenses and finance costs are accounted for on an accruals basis. Expenses are presented as capital where a connection with the maintenance or enhancement of the value of investments can be demonstrated. In this respect, the investment management fees are allocated 30% to revenue and 70% to capital to reflect the Board's expectations of long term investment returns. Any performance fees payable are allocated to capital, reflecting the fact that, although they are calculated on a total return basis, they are expected to be attributable largely to capital performance. It is normal practice for investment trust companies to allocate finance costs to capital on the same basis as the investment management fee allocation. However as the Company has a significant exposure to property, and property companies do not charge finance costs to capital, the directors consider it inappropriate to allocate finance costs to capital.
	(f)  Taxation
	Deferred tax is recognised in respect of all temporary differences that have originated but not reversed at the balance sheet date, where transactions or events that result in an obligation to pay more tax in the future or the right to pay less tax in the future have occurred at the balance sheet date. This is subject to deferred tax assets only being recognised if it is considered more likely than not that there will be suitable profits from which the future reversal of the temporary differences can be deducted.  Due to the Company's status as an investment trust company, and the intention to continue to meet the conditions required to obtain approval for the foreseeable future, the Company has not provided deferred tax on any capital gains and losses arising on the revaluation or disposal of investments.
	This is not the case for the subsidiary company and hence the Group where such provision is made, calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity.
	(g) Dividends payable
	Interim dividends are recognised as a liability in the period in which they are paid as no further approval is required in respect of such dividends.  Final dividends are recognised as a liability only after they have been approved by shareholders in general meeting.
	(h) Investments
	All investments have been designated upon initial recognition as fair value through profit or loss. Investments are recognised and derecognised on the trade date where a purchase or sale is under a contract whose terms require delivery within the timeframe established by the market concerned, and are initially measured at fair value. Subsequent to initial recognition, investments are recognised at fair value through profit or loss. For listed investments, this is deemed to be bid market prices or closing prices for SETS stocks sourced from the London Stock Exchange. SETS is the London Stock Exchange electronic trading service covering most of the market including all FTSE 100 constituents and most liquid FTSE 250 constituents along with some other securities. Gains and losses arising from changes in fair value are included in net profit or loss for the period as a capital item in the income statement and are ultimately recognised in the retained earnings.
	In respect of investment properties, fair value is established by half-yearly professional valuation on an open market basis by King Sturge and Co, Chartered Surveyors and Valuers and in accordance with the RICS Valuation Standards.
	(i) Cash and cash equivalents
	Cash and cash equivalents comprises deposits held with banks.
	(j)  Non - current liabilities
	All loans and borrowings are initially recognised at cost, being the fair value of the consideration received, less issue costs where applicable. After initial recognition, all interest-bearing loans and borrowings are subsequently measured at amortised cost. Amortised cost is calculated by taking into account any discount or premium on settlement. The costs of arranging any interest-bearing loans are capitalised and amortised over the life of the loan.
	(k) Adoption of new and revised Accounting Standards
	At the date of authorisation of these financial statements, various Standards, amendments to Standards and Interpretations which have not been applied to these financial statements, were in issue but were not yet effective (and in some cases, had not yet been adopted by the EU). These have not been applied to these financial statements.
	The directors anticipate that the adoption of these Standards and Interpretations in future periods will have no material impact on the financial statements of the Group.

2             Approval and Publication of Statutory Financial Statements and Annual General Meeting

The financial information contained within this preliminary results announcement does not constitute the Company's statutory financial statements for the years ended 31 March 2010 or 31 March 2009 but is derived from those financial statements.

Statutory financial statements for the year ended 31 March 2009 have been delivered to the Registrar of Companies. The independent auditor's report in respect of the year ended 31 March 2009 was unqualified and did not contain statements under Section 498 of the Companies Act 2006.

The preliminary results announcement for the year ended 31 March 2010 was approved by the Board of Directors on 18 May 2010.

The independent auditor has not yet reported on the financial statements for the year ended 31 March 2010.

The Annual Report and Statutory Financial Statements for the year ended 31 March 2010 will be posted to shareholders in June 2010 and copies will be available from the Manager, OLIM Limited, Pollen House, 10/12 Cork Street, London, W1S 3NP (www.olim.co.uk), or from the Secretaries, Aberdeen Asset Management PLC, 7^th Floor, 40 Princes Street, Edinburgh, EH2 2BY.

The statutory financial statements for the year ended 31 March 2010 will be delivered to the Registrar of Companies following the Company's Annual General Meeting which is to be held at 7^th Floor, 40 Princes Street, Edinburgh, EH2 2BY on Friday 9 July 2010 at 12.30 pm.

Please note that past performance is not necessarily a guide to the future and that the value of investments and the income from them may fall as well as rise and may be affected by exchange rate movements.  Investors may not get back the amount they originally invested.

For Value and Income Trust plc

Aberdeen Asset Management PLC

Secretaries

18 May 2010

 

END

 

 

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