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Friday 02 August, 2019

Rights and Issues Investment T

Half-yearly Results

Rights and Issues Investment Trust PLC (RIII)
Rights and Issues Investment Trust PLC: Half-yearly Results

02-Aug-2019 / 07:00 GMT/BST
Dissemination of a Regulatory Announcement, transmitted by EQS Group.
The issuer is solely responsible for the content of this announcement.


RIGHTS AND ISSUES INVESTMENT TRUST PLC

For the six months ended 30th June 2019

 

A copy of the Company's Half Yearly Financial Report for the six months ended 30th June 2019 will shortly be available to view and download from www.maitlandgroup.com/investments-trusts/rights-and-issues-investment-trust-plc/.  Neither the contents of this website nor the contents of any website accessible from hyperlinks on this website (or any other website) is incorporated into or forms part of this announcement.

 

Printed copies of the Report will be sent to shareholders shortly. Additional copies may be obtained from the Corporate Secretary - Maitland Administration services Limited, Hamilton Centre, Rodney Way, Chelmsford, Essex CM1 3BY.

 

INTERIM DIVIDEND

An interim dividend of 10.75p per share has been approved by the Board and is payable on 27th September 2019 to shareholders on the register as at 30th August 2019 (ex-dividend 29th August 2019).

 

The following text is copied from the Half Yearly Financial Report.

 

HALF YEARLY FINANCIAL REPORT

for the six months ended 30th June 2019

 

CHAIRMAN'S STATEMENT

Markets have recovered with a 10.4% increase in the FTSE All-Share Index in the six months to 30 June 2019.

 

The UK smaller company market underperformed with the FTSE Small Cap Index rising by 8.5% and the FTSE Fledgling Index falling by 4.3%.

 

The Trust made modest progress with the net asset value increasing by 3.3% to 2188.7p.

 

The share buy-back programme has continued in the half year with a further £3.1m of purchases and the issued equity has now been reduced by 13% since December 2016.

 

The interim dividend is being raised by 2.4% to 10.75p.

 

The change of Prime Minister now means the Brexit process is at its most uncertain and this is likely to dominate for the remaining months of 2019.

 

Dr D. M. BRAMWELL

Chairman

1st August 2019

 

You can view or download copies of the Half Yearly and the Annual Reports from our website at www.maitlandgroup.com/investment-trusts/rights-and-issues-investment-trust-plc/

 

The Half Yearly Report will be posted to shareholders and copies are 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 Company's performance over the remaining six months of the financial year and could cause actual results to differ materially from expected and historical results. The Company's results continue to be exposed to market price risk. Further information on the principal long-term risks and uncertainties of the Company is included in the latest Annual Report.

 

STATEMENT OF COMPREHENSIVE INCOME

for the six months ended 30th June 2019

 

 

 

Six months ended 30th June 2019

 

Six months ended 30th June 2018

Notes

Revenue

£'000

Capital

£'000

Total

£'000

Revenue

£'000

Capital

£'000

Total

£'000

Investment income

2

1,911

-

1,911

1,814

-

1,814

Other operating income

2

8

-

8

8

-

8

Total income

 

1,919

-

1,919

1,822

-

1,822

Gains on fair value through profit or loss assets

 

-

5,518

5,518

-

8,873

8,873

Gains on subsidiary holding

 

-

52

52

-

-

-

 

 

1,919

5,570

7,489

1,822

8,873

10,695

Expenses

 

 

 

 

 

 

 

Investment management fee

 

-

-

-

-

-

-

Other expenses

 

400

16

416

395

44

439

 

 

400

16

416

395

44

439

Profit before tax

 

1,519

5,554

7,073

1,427

8,829

10,256

Tax-

 

 

-

-

-

-

-

Profit for the period

 

1,519

5,554

7,073

1,427

8,829

10,256

Earnings per share

 

 

 

 

 

 

 

Return per Ordinary Share

 

19.1p

69.8p

88.9p

17.3p

107.3p

124.6p

 

Return per share is calculated using the weighted average number of Ordinary shares in issue during the period ended 30th June 2019 of 7,958,152 (2018: 8,228,933).

 

The total column of this statement represents the Statement of Comprehensive Income, prepared in accordance with International Financial Reporting Standards as adopted by the EU. 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 are those of the single entity and derive from continuing operations.

 

The profit for the period disclosed above represents the Company's total Comprehensive Income. The Company does not have any other Comprehensive Income.

 

An interim dividend of 10.75p (2018: 10.50p) per share and amounting to £833,213 (calculated as at 29th July 2019) (2018: £845,870) is payable on 27th September 2019 to shareholders on the register as at 30th August 2019 (ex-dividend 29th August 2019).

 

 

 

 

Year ended 31st December 2018

Notes

Revenue

£'000

Capital

£'000

Total

£'000

Investment income

2

3,599

-

3,599

Other operating income

2

20

-

20

Total income

 

3,619

-

3,619

(Losses)/gains on fair value through profit or loss assets

 

-

(21,459)

(21,459)

Gains on subsidiary holding

 

-

-

-

 

 

3,619

(21,459)

(17,840)

Expenses

 

 

 

 

Investment management fee

 

-

-

-

Other expenses

 

813

59

872

 

 

813

59

872

Loss before tax

 

2,806

(21,518)

(18,712)

Tax

 

-

-

-

Loss for the period

 

2,806

(21,518)

(18,712)

Earnings per share

 

 

 

 

 

 

 

 

 

Return per Ordinary Share

 

34.5p

(264.8)p

(230.3)p

 

Return per share is calculated using the weighted average number of Ordinary shares in issue during the year ended 31st December 2018 of 8,125,931.

 

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 2019 and 30th June 2018 has not been audited.

 

The information for the year ended 31st December 2018 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) or (4) of the Companies Act 2006.

 

The auditors have reviewed the financial information for the six months ended 30th June 2019 pursuant to the Auditing Practices Board guidance on Review of Interim Financial Information and their report is on page 12.

 

BALANCE SHEET

as at 30th June 2019

Non-current assets

30th June

2019

£'000

30th June

2018

£'000

31st December

2018

£'000

Investments - fair value through profit or loss

163,207

188,173

155,647

 

163,207

188,173

155,647

Current assets

 

 

 

Trade and other receivables

1,095

937

621

Amounts due from Group undertakings

78

78

78

Cash and cash equivalents

7,642

12,302

13,310

 

8,815

13,317

14,009

Total assets

172,022

201,490

169,656

Current liabilities

 

 

 

Trade and other payables

154

65

81

 

154

65

81

Total assets less current liabilities

171,868

201,425

169,575

Net assets

171,868

201,425

169,575

Equity

 

 

 

Called up share capital

1,963

2,025

2,002

Capital redemption reserve

292

230

253

Retained reserves:

 

 

 

Capital reserve

59,481

62,096

61,984

Revaluation reserve

107,170

134,491

102,217

Revenue reserve

2,962

2,583

3,119

Total equity

171,868

201,425

169,575

Net asset value per share

 

 

 

Ordinary shares

2,188.7p

2,487.9p

2,118.1p

 

STATEMENT OF CHANGES IN EQUITY

for the six months ended 30th June 2019

 

For the six months ended 30th June 2018

Balance at

Share capital

£'000

Capital redemption reserve

£'000

Capital
reserve

£'000

Revaluation reserve

£'000

Revenue
reserve

£'000

Total

£'000

31st December 2017

2,094

161

65,434

128,151

2,850

198,690

Profit for the period

-

-

2,489

6,340

1,427

10,256

Total recognised income and expense

2,094

161

67,923

134,491

4,277

208,946

Ordinary shares bought back and cancelled

(69)

69

(5,827)

-

-

(5,827)

Dividends (Note 3)

-

-

-

-

(1,694)

(1,694)

Balance at

30th June 2018

2,025

230

62,096

134,491

2,583

201,425

 

For the year ended 31st December 2018

Balance at

Share capital

£'000

Capital Redemption reserve

£'000

Capital
reserve

£'000

Revaluation reserve

£'000

Revenue
reserve

£'000

Total

£'000

31st December 2017

2,094

161

65,434

128,151

2,850

198,690

Changes in equity for 2018

 

 

 

 

 

 

Loss for the year

-

-

4,416

(25,934)

2,806

(18,712)

Total recognised income and expense

2,094

161

69,850

102,217

5,656

179,978

Ordinary shares bought back and cancelled

(92)

92

(7,866)

-

-

(7,866)

Dividends (Note 3)

-

-

-

-

(2,537)

(2,537)

Balance at

31st December 2018

2,002

253

61,984

102,217

3,119

169,575

 

For the six months ended 30th June 2019

Balance at

Share

capital

£'000

Capital Redemption reserve

£'000

Capital
reserve

£'000

Revaluation reserve

£'000

Revenue
reserve

£'000

Total

£'000

31st December 2018

2,002

253

61,984

102,217

3,119

169,575

Profit for the period

-

-

601

4,953

1,519

7,073

Total recognised income and expense

2,002

253

62,585

107,170

4,638

176,648

Ordinary shares bought back and cancelled

(39)

39

(3,104)

-

-

(3,104)

Dividends (Note 3)

-

-

-

-

(1,676)

(1,676)

Balance at

30th June 2019

1,963

292

59,481

107,170

2,962

171,868

 

STATEMENT OF CASH FLOWS

for the six months ended 30th June 2019

Cashflows from operating activities

30th June

2019

£'000

30th June

2018

£'000

31st December

2018

£'000

Profit/(loss) before tax

7,073

10,256

(18,712)

Adjustments for:

 

 

 

(Gains)/losses on investments

(5,518)

(8,873)

21,460

(Gains) on revaluation of subsidiary

(52)

-

-

Purchases of investments

(2,815)

(4,018)

(4,018)

Proceeds on disposal of investments

825

3,862

6,055

Operating cash flows before movements in working capital

(487)

1,227

4,785

Increase in receivables

(474)

(358)

(42)

Increase/(decrease) in payables

(35)

(33)

(17)

Net cash from operating activities

(996)

836

4,726

Cashflows from financing activities

 

 

 

Ordinary shares bought back and cancelled

(2,996)

(5,909)

(7,948)

Dividends paid

(1,676)

(1,694)

(2,537)

Net cash used in financing activities

(4,672)

(7,603)

(10,485)

Net decrease in cash and cash equivalents

(5,668)

(6,767)

(5,759)

Cash and cash equivalents at beginning of period

13,310

19,069

19,069

Cash and cash equivalents at end of period

7,642

12,302

13,310

 

NOTES TO THE HALF YEARLY FINANCIAL REPORT

for the six months ended 30th June 2019

 

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.  Income

30th June

30th June

31st December

 

2019

2018

2018

 

£'000

£'000

£'000

Total income comprises:

 

 

 

Dividends

1,911

1,814

3,599

Interest

8

8

20

Total income

1,919

1,822

3,619

 

3.  Dividends

 

30th June

2019

£'000

30th June

2018

£'000

31st December

2018

£'000

Amounts recognised as distributions to equity holders in the year:

 

 

 

Interim dividend for the year ended 31st December 2018 of 10.50p per share

-

-

843

Final dividend for the year ended 31st December 2018 of 21.00p per share (year ended 31st December 2017: 20.50p)

1,676

1,694

1,694

 

1,676

1,694

2,537

 

 

30th June

2019

£'000

 

 

Proposed interim dividend of 10.75p per share

833

 

833

 

This proposed interim dividend was approved by the Board on 1st August 2019, has been calculated based on shares in issue at 29th July 2019, and has not been included as a liability at 30th June 2019.

 

4.  Valuation of financial instruments

 

IFRS 13 requires the Company to classify fair value measurements using a fair value hierarchy that reflects the significance of inputs used in making the measurements. The valuation techniques used by the Company are explained in the accounting policies note 1 Investments, as set out in the Company's Annual Report and Financial Statements for the year ended 31st December 2018.

 

The fair value hierarchy has the following levels:

Level 1 - Unadjusted prices quoted in active markets for identical assets and liabilities.

Level 2 - Having inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (ie as prices) or indirectly (ie derived from prices).

Level 3 - Having inputs for the asset or liability that are not based on observable data.

 

30th June 2019

Financial assets at fair value through profit or loss

Level 1

£000

Level 2

£000

Level 3

£000

Total

£000

UK Equity Listed

121,300

-

-

121,300

AIM traded stocks

41,147

-

-

41,147

Delisted stock

-

2

-

2

Investment in subsidiary undertaking

-

-

758

758

Net fair value

162,447

2

758

163,207

30th June 2018

Level 1

Level 2

Level 3

Total

 

£000

£000

£000

£000

Financial assets at fair value through profit or loss

 

 

 

 

UK Equity Listed

143,791

-

-

143,791

AIM traded stocks

43,655

-

-

43,655

Delisted stock

-

21

-

21

Investment in subsidiary undertaking

-

-

706

706

Net fair value

187,446

21

706

188,173

 

31st December 2018

Financial assets at fair value through profit or loss

Level 1

£000

Level 2

£000

Level 3

£000

Total

£000

UK Equity Listed

116,544

-

-

116,544

AIM traded stocks

38,395

-

-

38,395

Delisted stock

-

2

-

2

Investment in subsidiary

-

-

706

706

Net fair value

154,939

2

706

155,647

 

There were no transfers between Level 1 and Level 2 during the period.

A reconciliation of fair value measurements in Level 3 is set out in the following table.

 

 

30th June

2019

£'000

30th June

2018

£'000

31st December

2018

£'000

Opening Balance

706

706

706

Purchases

-

-

-

Sales

-

-

-

Total gains or losses included in gains on investments in the Income Statement:

 

 

 

- on assets sold

-

-

-

- on assets held at period end

52

-

-

Closing Balance

758

706

706

 

The Level 3 investment relates to the Company's subsidiary, Discretionary Unit Fund Managers Limited, which has been valued based on the most recent estimated NAV.

 

5.  Related Party Transactions

 

Under IFRS, the Directors have been identified as related parties. Their fees and interests for the year ended 31st December 2018 have been disclosed in the Directors' Annual Remuneration Report within the 2018 Annual Report and Financial Statements.

 

During the period the Company had the following transactions with Discretionary Unit Fund Managers Limited, its subsidiary undertaking:

 

 

30th June

2019

£'000

30th June

2018

£'000

31st December

2018

£'000

Dividends received

-

-

-

 

-

-

-

Amounts owed by subsidiary undertaking

78

78

78

 

6.  Going Concern

 

The Company's assets comprise mainly realisable equity securities and cash and the value of its assets is greater than its liabilities. Additionally, after reviewing the Company's budget including the current financial resources and projected expenses for the next twelve months and its medium-term plans, the Directors believe that the Company's resources are adequate for continuing in business for the foreseeable future. Accordingly it is appropriate to continue to prepare accounts on a going concern basis.

 

DIRECTORS' STATEMENT OF RESPONSIBILITY FOR THE HALF YEARLY FINANCIAL 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 1st August 2019.

 

Dr D. M. BRAMWELL Chairman

 

PORTFOLIO STATEMENT

Details of the twenty largest investments as at 30th June 2019 are given below by market value:

 

UK Investments

 

Holdings

 

Market Value

30th June 2019

31st December 2018

30th June 2019

£'000

31st December 2018

£'000

Treatt

4,250,000

4,250,000

19,550

17,680

RPC Group

2,400,000

2,400,000

19,018

15,634

Hill & Smith Holdings

1,434,230

1,434,230

16,795

17,196

Macfarlane Group

17,250,000

17,250,000

16,526

12,248

Vp

1,800,000

1,800,000

15,480

16,920

Scapa Group

8,000,000

6,250,000

14,832

19,150

Spirax-Sarco Engineering

120,714

120,714

11,088

7,514

Colefax Group

2,100,000

2,250,000

11,025

12,375

Renold

27,000,000

27,000,000

8,775

7,560

Electrocomponents

1,300,000

1,300,000

8,226

6,586

Vitec Group

400,000

400,000

4,560

4,740

Menzies (John)

882,142

882,142

4,005

4,499

Elecosoft

4,520,781

4,520,781

3,481

3,029

Titon Holdings

1,265,000

1,265,000

1,923

2,277

Castings

400,000

400,000

1,640

1,500

Dialight

238,095

238,095

1,169

952

National Grid

137,500

137,500

1,149

1,051

GlaxoSmithKline

70,000

70,000

1,104

1,044

Discretionary Unit Fund

 

 

 

 

Managers Limited

93,600

93,600

758

706

Santander UK 10.375%

 

 

 

 

Non Cumulative Preferred

400,000

400,000

631

604

 

 

 

161,735

153,265

Balance held in other investments

 

 

1,472

2,382

 

 

 

163,207

155,647

 

Unless otherwise specified, the actual holdings are, in each case, of ordinary shares or stock units and of the nominal value for which listing has been granted.

 

INDEPENDENT REVIEW REPORT TO RIGHTS AND ISSUES INVESTMENT TRUST PLC

 

INTRODUCTION

We have been engaged by the Company to review the financial statements in the Half Yearly Financial Report for the six months ended 30th June 2019 which comprises the Statement of Comprehensive Income, the Balance Sheet, the Statement of Changes in Equity, the Statement of Cash Flows and the related explanatory notes 1 to 6. We have read the other information contained in the Half Yearly Report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.

 

The report is made solely to the Company in accordance with International Standard on Review Engagements (UK and Ireland) 2410 issued by the Auditing Practices Board. Our work has been undertaken so that we might state to the Company those matters we are required to state to them in an independent review report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company, for our review work, for this report, or for the conclusions we have formed.

 

DIRECTORS' RESPONSIBILITIES

The Half Yearly Financial Report is the responsibility of, and has been approved by, the Directors. The Directors are responsible for preparing the Half Yearly Financial Report in accordance with the Disclosure and Transparency Rules of the United Kingdom's Financial Conduct Authority.

 

As disclosed in note 1, the Annual Financial Statements of the group are prepared in accordance with IFRSs as adopted by the European Union. The financial statements included in this Half Yearly Financial Report have been prepared in accordance with International Accounting Standard 34 "Interim Financial Reporting" as adopted by the European Union.

 

OUR RESPONSIBILITY

Our responsibility is to express to the Company a conclusion on the condensed set of financial statements in the Half Yearly Financial Report based on our review.

 

SCOPE OF REVIEW

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Auditing Practices Board for use in the United Kingdom. A review of interim information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than in an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly we do not express an audit opinion.

 

CONCLUSION

Based on our review, nothing has come to our attention that causes us to believe that the financial statements in the Half Yearly Financial Report for the six months ended 30th June 2019 are not prepared, in all material respects, in accordance with International Accounting Standard 34 as adopted by the European Union and the Disclosure and Transparency Rules of the United Kingdom's Financial Conduct Authority.

 

JEREMY STAINES

For and on behalf of Begbies, 9 Bonhill Street, London EC2A 4DJ

Chartered Accountants

1st August 2019

 

DIRECTORS AND ADVISERS

 

DIRECTORS

Dr D. M. BRAMWELL (Chairman)

D. M. BEST

Dr A. J. HOSTY

S. J. B. KNOTT

J. B. ROPER

 

REGISTERED OFFICE

Hamilton Centre

Rodney Way

Chelmsford CM1 3BY

 

WEBSITE

www.maitlandgroup.com/investment-trusts/rights-and-issues-investment-trust-plc/

 

ADMINISTRATOR/SECRETARY

MAITLAND ADMINISTRATION SERVICES LTD

Hamilton Centre Rodney Way

Chelmsford CM1 3BY

 

SOLICITORS

EVERSHEDS SUTHERLAND

One Wood Street

London EC2V 7WS

 

AUDITOR

BEGBIES

9 Bonhill Street

London EC2A 4DJ

 

REGISTRARS

LINK MARKET SERVICES LTD

The Registry

34 Beckenham Road

Beckenham

Kent BR3 4TU

 

BROKERS

SHORE CAPITAL LTD

Cassini House

57-58 St James's Street

London SW1A 1LD

 

BANKERS/CUSTODIAN

NORTHERN TRUST

50 Bank Street

Canary Wharf

London E14 5NT

 

REGISTRATION DETAILS

 

Company Registration Number:

00736898 (Registered in England)

SEDOL number:

0739207

ISIN number:

GB0007392078

London Stock Exchange (EPIC) Code:

RIII

Global Intermediary Identification Number (GIIN):

I2ZVNY.99999.SL.826

Legal Entity Identifier (LEI):

2138002AWAM93Z6BP574

 

END



ISIN: GB0007392078
Category Code: IR
TIDM: RIII
LEI Code: 2138002AWAM93Z6BP574
OAM Categories: 1.2. Half yearly financial reports and audit reports/limited reviews
Sequence No.: 15451
EQS News ID: 850273

 
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