Preliminary Results

RNS Number : 6688F

Value and Income Trust plc

28 May 2013

 



VALUE AND INCOME TRUST PLC

PRELIMINARY statement of annual RESULTS

FOR THE YEAR ENDED 31 MARCH 2013

SUMMARY

		31 March 2013
Net asset value per share valuing debt at par (including income)		298.2p
Net asset value per share valuing debt at market value (including income)		269.8p
Ordinary share price		210.8p
Discount of ordinary share price to net asset value per share valuing debt at market value (including revenue)		21.9%
Total interim dividend and proposed final dividend per share		8.30p
Total assets less current liabilities		£171.2m

THE YEAR

·      Net Asset Value total return (with debt at par value) of 21.2% over one year and 40.1% over three years

·      Share price total return of 22.7% over one year and 43.6% over three years.

·      FTSE All-Share Index total return of 16.3% over one year and 28.2% over three years

·      Dividends for the year up 3.1% - increased for 26^th consecutive year

DIVIDEND

The Directors recommend that a final dividend of 4.30 pence per share (2012 - 4.15 pence) is paid on 19 July 2013 to shareholders on the register on 21 June 2013.  The ex-dividend date is 19 June 2013. An interim dividend of 4.0 pence per share (2012 - 3.9 pence) was paid on 4 January 2013.

CONTACT

For further information, please contact the Investment Managers:-

Angela Lascelles

OLIM Limited

www.olim.co.uk

Tel: [phone]

Matthew Oakeshott

OLIM Property Limited

www.olimproperty.co.uk

Tel: [phone]

VALUE AND INCOME TRUST PLC

GROUP STATEMENT OF COMPREHENSIVE INCOME

				Year ended														Year ended
				31 March 2013														31 March 2012
				Revenue		Capital			Total			Revenue			Capital				Total
				£'000		£'000			£'000			£'000			£'000				£'000
Investment income
		Dividend income		4,669		-			4,669			4,459			-				4,459
		Rental income		3,562		-			3,562			3,398			-				3,398
		Interest income on short-term deposits		2		-			2			1			-				1
Other operating income				3,564		-			3,564			3,399			-				3,399
Other comprehensive income
		Unrealised losses on investment properties		-		(2,302)			(2,302)			-			(798)				(798)
				8,233		(2,302)			5,931			7,858			(798)				7,060
Gains and losses on investments
		Realised gains on held-at-fair-value investments		-		4,400			4,400			-			105				105
		Unrealised gains on held-at-fair-value investments		-		18,417			18,417			-			3,782				3,782
Total income				8,233		20,515			28,748			7,858			3,089				10,947
Expenses
	Investment management fees		(312)			(854)			(1,166)				(292)				(1,184)		(1,476)
	Other operating expenses		(513)			-			(513)				(421)				-		(421)
Finance costs			(3,501)			-			(3,501)				(3,505)				-		(3,505)
Total expenses			(4,326)			(854)			(5,180)				(4,218)				(1,184)		(5,402)
Profit before tax			3,907			19,661			23,568				3,640				1,905		5,545
Taxation			-			390			390				-				182		182
Profit for the period			3,907			20,051			23,958				3,640			2,087			5,727
Earnings per ordinary share (pence)			8.58			44.02			52.60				7.99			4.58			12.57

The total column of this statement represents the Statement of Comprehensive Income of the Group, 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.

The Board is proposing a final dividend of 4.30p per share, making a total dividend of 8.30p per share for the year ended 31 March 2013 (2012 - 8.05p per share) which, if approved, will be payable on 19 July 2013.

VALUE AND INCOME TRUST PLC

COMPANY STATEMENT OF COMPREHENSIVE INCOME

for the year ended 31 March 2013

		Year ended				Year ended
		31 March 2013				31 March 2012
		Revenue	Capital	Total		Revenue	Capital	Total
		£'000	£'000	£'000		£'000	£'000	£'000
Investment income
	Dividend income	4,669	-	4,669		5,609	-	5,609
	Rental income	1,348	-	1,348		1,277	-	1,277
Other operating income		1,348	-	1,348		1,277	-	1,277
Other comprehensive income
	Unrealised (losses)/gains on investment properties	-	(442)	(442)		-	70	70
		6,017	(442)	5,575		6,886	70	6,956
Gains and losses on investments
	Realised gains/(losses) on held-at-fair-value investments	-	4,555	4,555		-	(97)	(97)
	Unrealised gains on held-at-fair-value investments	-	16,865	16,865		-	2,150	2,150
Total income		6,017	20,978	26,995		6,886	2,123	9,009
Expenses
	Investment management fees	(208)	(610)	(818)		(194)	(957)	(1,151)
	Other operating expenses	(386)	-	(386)		(280)	-	(280)
Finance costs		(1,851)	-	(1,851)		(1,852)	-	(1,852)
Total expenses		(2,445)	(610)	(3,055)		(2,326)	(957)	(3,283)
Profit before tax		3,572	20,368	23,940		4,560	1,166	5,726
Taxation		18	-	18		1	-	1
Profit for the period		3,590	20,368	23,958		4,561	1,166	5,727
Earnings per ordinary share (pence)		7.88	44.72	52.60		10.01	2.56	12.57

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 2013			31 March 2012			31 March 2013			31 March 2012
			£'000	£'000		£'000	£'000		£'000	£'000		£'000	£'000
ASSETS
Non current assets
Investments held at fair value through profit or loss				123,815			101,197			136,779			115,713
Investment properties held at fair value through profit or loss				46,225			48,250			17,850			18,175
				170,040			149,447			154,629			133,888
Current assets
Cash and cash equivalents			2,140			3,726			2,038			3,320
Other receivables			689			277			673			276
				2,829			4,003			2,711			3,596
TOTAL ASSETS				172,869			153,450			157,340			137,484
Current liabilities
Other payables				(1,701)			(2,114)			(1,172)			(1,538)
TOTAL ASSETS LESS CURRENT LIABILITIES				171,168			151,336			156,168			135,946
Non-current liabilities
Debenture stock			(35,325)			(35,349)			(20,325)			(20,349)
Deferred tax			-			(390)			-			-
				(35,325)			(35,739)			(20,325)			(20,349)
NET ASSETS				135,843			115,597			135,843			115,597
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				112,842			92,596			112,842			92,596
TOTAL EQUITY				135,843			115,597			135,843			115,597
Net Asset Value per ordinary share (pence)				298.23			253.78			298.23			253.78

VALUE AND INCOME TRUST PLC

STATEMENTS OF CHANGES IN EQUITY

Group				Year ended 31 March 2013					Year ended 31 March 2012
				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 2012				4,555	18,446	92,596	115,597		4,555	18,446	90,462	113,463
Net profit for the year				-	-	23,958	23,958		-	-	5,727	5,727
Dividends paid				-	-	(3,712)	(3,712)		-	-	(3,593)	(3,593)
Net assets at 31 March 2013				4,555	18,446	112,842	135,843		4,555	18,446	92,596	115,597
Company
				Year ended 31 March 2013					Year ended 31 March 2012
				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 2012				4,555	18,446	92,596	115,597		4,555	18,446	90,462	113,463
Net profit for the year				-	-	23,958	23,958		-	-	5,727	5,727
Dividends paid				-	-	(3,712)	(3,712)		-	-	(3,593)	(3,593)
Net assets at 31 March 2013				4,555	18,446	112,842	135,843		4,555	18,446	92,596	115,597

VALUE AND INCOME TRUST PLC

GROUP STATEMENT OF CASH FLOWS

For the year ended 31 March

							2013			2012
						£'000	£'000		£'000	£'000
Cash flows from operating activities
	Dividend income received						4,346			4,413
	Rental income received						3,427			3,379
	Interest received						2			1
	Operating expenses paid						(2,037)			(1,445)
	Taxation paid						(9)			-
NET CASH FROM OPERATING ACTIVITIES							5,729			6,348
Cash flows from investing activities
	Purchase of investments					(12,315)			(10,416)
	Sale of investments					12,237			12,571
NET CASH (OUTFLOW)/INFLOW FROM
INVESTING ACTIVITIES							(78)			2,155
Cash flow from financing activities
	Interest paid					(3,525)			(3,528)
	Dividends paid					(3,712)			(3,593)
NET CASH OUTFLOW FROM FINANCING ACTIVITIES							(7,237)			(7,121)
NET (DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS							(1,586)			1,382
Cash and cash equivalents at 1 April 2012							3,726			2,344
Cash and cash equivalents at 31 March 2013							2,140			3,726

VALUE AND INCOME TRUST PLC

COMPANY STATEMENT OF CASH FLOWS

For the year ended 31 March

						2013			2012
					£'000	£'000		£'000	£'000
Cash flows from operating activities
	Dividend income received					4,346			5,563
	Rental income received					1,287			1,308
	Interest received					-			-
	Operating expenses paid					(1,557)			(1,001)
	Taxation paid					(9)			-
NET CASH FROM OPERATING ACTIVITIES						4,067			5,870
Cash flows from investing activities
	Purchase of investments				(10,501)			(9,629)
	Sale of investments				10,738			10,118
	Increase in loan to subsidiary				1			45
NET CASH INFLOW
FROM INVESTING ACTIVITIES						238			534
Cash flow from financing activities
	Interest paid				(1,875)			(1,875)
	Dividends paid				(3,712)			(3,593)
NET CASH OUTFLOW FROM FINANCING ACTIVITIES						(5,587)			(5,468)
						(1,282)			936
Cash and cash equivalents at 1 April 2012						3,320			2,384
Cash and cash equivalents at 31 March 2013						2,038			3,320

 

VALUE AND INCOME TRUST PLC

NOTES TO PRELIMINARY STATEMENT OF ANNUAL RESULTS:

Notes to the Accounts
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)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) Going concern
	The financial position of the Group as at 31 March 2013 is shown in the Statement of Financial Position. The cash flows of the Group for the year ended 31 March 2013, which are not untypical, are set out in the Group Statement of Cash Flows. The Group had fixed debt totalling £35,325,000 as at 31 March 2013. None of the borrowings is repayable before 2021. The Group had no short term borrowings. As at 31 March 2013, the Group's total assets less current liabilities exceeded its total non current liabilities by a factor of over four. The assets of the Group consist mainly of securities and investment properties that are held in accordance with the Group's investment policy. Most of these securities are readily realisable, even in volatile markets. The Directors, who have reviewed carefully the Group's forecasts for the coming year, consider that the Group has adequate financial resources to enable it to continue in operational existence for the foreseeable future. Accordingly the Directors believe that it is appropriate to continue to adopt the going concern basis in preparing the Group's accounts.
	(c)  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.
	(d) 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 Articles
	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 sections 1158-1160 of the Corporation Tax Act 2010.
	(e)  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 is recognised on a straight line basis over the period of the relevant lease. Lease incentives, where material, are
	spread evenly over the term of the lease. Other income is recognised as earned.
	(f)  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.
	(g)  Taxation
	Deferred tax is recognised in respect of all temporary differences that have originated but not reversed at the date of the
	Statement of Financial Position, 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 date of the Statement of Financial Position.
	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 retain 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 accordance with the accounting treatment of the item which gives rise to the requirement for that provision.
	(h) 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.
	(i) 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 Statement of Comprehensive Income and are ultimately recognised in the retained earnings.
	As disclosed in Note 20, the group leases out all of its properties on operating leases. A property held under
	an operating lease is classified and accounted for as an investment property where the group holds it to earn rental,
	capital appreciation or both. Any such property leased under an operating lease is carried at fair value. Fair value is
	established by half-yearly professional valuation on an open market basis by Jones Lang LaSalle, Chartered Surveyors
	and Valuers, and in accordance with the RICS Valuation Professional Standards.  The determination of fair value by Jones Lang LaSalle is supported by market evidence.  It is not more heavily based on other factors because of the nature of the properties and the availability of comparable market data.
	(j) Cash and cash equivalents
	Cash and cash equivalents comprises deposits held with banks.
	(k)  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.
	(l) Adoption of new and revised Accounting Standards
	At the date of authorisation of these financial statements, the following Standard and Interpretations were in issue but not yet effective;
	- Amendments to IFRS 7 - Disclosures: Offsetting Financial Assets and Financial Liabilities (effective for annual periods beginning on or after 1 January 2013).
	- Amendments to IFRS 10 - Definition of Investment Entity (early adoption permitted) (effective for annual periods beginning on or after 1 January 2014).
	- IFRS 9 - Financial Instruments: Classification and Measurement (effective for annual periods beginning on or after 1 January 2015).
	- IFRS 10 - Consolidated Financial Statements (early adoption permitted) (effective for annual periods beginning on or after 1 January 2013).
	- IFRS 11 - Joint Arrangements (early adoption permitted) (effective for annual periods beginning on or after 1 January 2013).
	- IFRS 12 - Disclosure of Interests in Other Entities (early adoption permitted) (effective for annual periods beginning on or after 1 January 2013).
	- IFRS 13 - Fair Value Measurement (effective for annual periods beginning on or after 1 January 2013).
	- Annual Improvements and Amendments to IFRS (2009-2011) - IFRS 1 First - time Adoption of International Financial Reporting Standards, IAS 1 Presentation of Financial Statements, IAS 16 Property, Plant and Equipment, IAS 32 Financial Instruments: Presentation, IAS 34 Interim Financial Reporting. (effective for annual periods beginning on or after 1 January 2013).
	- Consolidated Financial Statements, Joint Arrangements and Disclosure of Interests in Other Entities: Transition Guidance (Amendments to IFRS 10, IFRS 11 and IFRS 12) (effective for annual periods beginning on or after 1 January 2013).
	- Amendments to IAS 19 - Employee Benefits (effective for annual periods on or after 1 January 2013).
	- IAS 27 - Separate Financial Statements (early adoption permitted) (effective for annual periods beginning on or after 1 January 2013).
	- IAS 28 - Investments in Associates and Joint Ventures (early adoption permitted) (effective 1 January 2013).
	- Amendments to IAS 32 - Offsetting Financial Assets and Financial liabilities (effective for annual periods beginning on or after 1 January 2014).
	The Directors anticipate that adoption of these Standards and Interpretations in future periods will have no material financial impact on the financial statements of the Company.  The Company concludes however that certain additional disclosures may be necessary on their application.
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 2013 or 31 March 2012 but is derived from those financial statements.
	Statutory financial statements for the year ended 31 March 2012 have been delivered to the Registrar of Companies.  The independent auditor's report in respect of the year ended 31 March 2012 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 2013 was approved by the Board of Directors on 24 May 2013.
	The Independent Auditor has reported on the financial statements for the year ended 31 March 2013.  As in previous years, there is an emphasis of matter in relation to the treatment of finance costs.
	The Annual Report and Statutory Financial Statements for the year ended 31 March 2013 will be posted to shareholders in June 2013 and copies will thereafter be available for download from www.olim.co.uk or by contacting the Managers., OLIM Limited or OLIM Property Limited, Pollen House, 10/12 Cork Street, London, W1S 3NP, (telephone [phone]) or from the Secretaries, Maven Capital Partners UK LLP, Kintyre House, 205 West George Street, Glasgow G2 2LW. The statutory financial statements for the year ended 31 March 2013 will be delivered to the Registrar of Companies following the Company's Annual General Meeting which is to be held at the offices of Shepherd and Wedderburn LLP, 1 Exchange Crescent, Conference Square, Edinburgh, EH3 8UL on Friday 12 July 2013 at 12.30pm.
	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 well be affected by exchange rate movements.  Investors may not get back the amount they originally invested.
	For Value and Income Trust PLC
	Maven Capital Partners UK LLP
	Secretaries
	24 May 2013

 

END

 

 

FR EAXSPASLDEEF