TIDMARCL
RNS Number : 6612T
Altus Resource Capital Limited
07 October 2014
Altus Resource Capital Limited
Annual Report
and
Consolidated Financial Statements
for the year ended 30 June 2014
SUMMARY INFORMATION
Company Overview
Overview
Altus Resource Capital Limited ("ARCL" or the "Company") is a
Guernsey authorised, closed-ended investment company incorporated
on 30 April 2009, the ordinary shares of which were admitted to
trading on the Specialist Fund Market (the "SFM") of the London
Stock Exchange on 30 June 2009 and the Channel Islands Stock
Exchange (the "CISX") on 22 December 2009.
On 20 December 2013 the Royal Court of Guernsey approved the
scheme of arrangement (the "Scheme") between the CISX and The
Channel Islands Securities Exchange (the "CISE"). In accordance
with the Scheme, the business of the CISX has been acquired by
CISE. All securities that were listed on the Official List of the
CISX have been transferred and are now listed on the Official List
of CISE.
The Company's objective is to realise capital growth from a
concentrated portfolio of Junior Resource Equities and to generate
a significant capital return to shareholders.
The Company's investment activities are managed by Altus Capital
Limited (the "Investment Manager") who report to the Board. The
Investment Manager is a Financial Conduct Authority ("FCA")
authorised and regulated wholly-owned subsidiary of Altus
Strategies Limited.
The Company issued 26,000,000 Ordinary Shares at GBP1.00 per
share on 30 June 2009 and a further 10,997,233 Ordinary Shares at
GBP1.33 on 22 December 2009. On 2 August 2010 a further 2,722,336
Ordinary Shares were issued at GBP1.40 per share.
The group comprises the Company and its subsidiary Altus Global
Gold Limited (together the "Group") as detailed in Note 7 to the
Consolidated Financial Statements.
Altus Global Gold Limited is an authorised open-ended investment
company incorporated under the laws of Guernsey on 10 October 2011
with registered number 54069. It was listed on the CISE on 1
November 2011.
Altus Global Gold Limited was established to realise capital
growth from a portfolio of gold and precious metals equities, with
the aim of generating a significant capital return to shareholders.
It invests in mid-tier and major gold and precious metals companies
with a focus on mid-tier producers.
The Company invested GBP5,000,000 in its subsidiary company
Altus Global Gold Limited in October 2011.
The financial year end of Altus Global Gold Limited is 30 June,
which is co-terminus with the financial year end of the
Company.
Investment Objectives and Policy
The Company's objective is to realise capital growth from a
concentrated portfolio of Junior Resource Equities and to generate
a significant capital return to shareholders.
The Company invests in companies engaged in the exploration,
development and/or mining of metals and minerals with a focus on
companies that operate in the gold sector. Portfolio companies will
be predominantly, but not exclusively, listed or quoted on either
UK markets or other recognised stock exchanges including the
Canadian and Australian markets. They will typically be capitalised
at less than GBP500 million at the time of investment by the
Company.
Discount Management
The Directors have general shareholder authority to purchase,
from time to time, up to 14.99% of the Company's Ordinary Shares in
issue with a view to addressing any imbalance between the supply
and demand for Ordinary Shares. The Directors intend to seek annual
renewal of this authority from Shareholders at each future general
meeting held under section 199 of The Companies (Guernsey) Law,
2008, as amended (the "Law").
In accordance with the Law any Ordinary Share buy backs will be
effected by the purchase of Ordinary Shares in the market for cash
at a price below the estimated prevailing net asset value per
Ordinary Share where the Directors believe such a purchase will
enhance shareholder value. Ordinary Shares which are purchased may
be cancelled or held in treasury.
FINANCIAL HIGHLIGHTS
ARCL Month End NAV / Share & Share Price
Performance Statistics
Note: The tables above set out the performance of the gold price
and a number of mining market indices. These metrics illustrate the
performance of the mining sector in general and are not direct
benchmarks for the Company given the composition of its
portfolio.
Source: Altus Capital Limited
CHAIRMAN'S STATEMENT
I have pleasure in presenting the Annual Report and Consolidated
Financial Statements of the Company for the year ended 30 June 2014
(the "Year"). The Company's Net Asset Value ("NAV") as announced on
30 June 2014 was GBP31.7 million or GBP0.80* per Ordinary Share, a
gain of 10.5%* over the Year.
Political and economic uncertainty, highlighted in the last two
annual reports, has continued throughout the Year. In the Middle
East, civil war continues to ravage Syria, hostilities between
Israel and Palestine escalated alarmingly and ISIS appears to have
secured a stronghold within Iraq. On the edge of Europe, tensions
in Ukraine continue to rise following Russia's annexation of Crimea
and the apparent shooting down of a civilian Malaysian Airlines
jet. However, global equity markets are pricing in a sustained
economic recovery in the West and growth from China and other BRIC
economies. The S&P 500 and Dow Jones Industrial Average indices
rising steadily over the Year and breaking new highs. After a
lacklustre start to 2014 following speculation of a Chinese
economic slowdown, copper and iron ore prices have begun to
recover. The gold price has oscillated around the US$1,300 per
ounce level throughout the Year although stabilised over the period
to end up 7.5% to US$1,327 per ounce. The flow of gold from West to
East has continued with steady declines in ETF holdings being more
than matched by strong physical demand from China. Further, while
the US Federal Reserve has begun tapering the quantitative easing
programme, interest rates remain at record lows with central
bankers continuing to push out the timeline for rate hikes.
Mining equities enjoyed a better year for the most part with the
FTSE 350 Mining Index gaining 14.4%. Gold equities began to
outperform the gold price after three years of underperformance
with the FTSE Gold Mines and S&P/ TSX Gold indices climbing
10.2% and 20.0% respectively. However, with little new capital
flowing into the sector, junior equities continued to languish with
the FTSE AIM Basic Resources Index falling 13.9% over the Year.
Corporate activity has increased as majors and mid-tiers take
advantage of depressed junior equity valuations by selectively
acquiring quality assets. This M&A activity is expected to
continue as larger companies seek to replenish depleted resources
or enhance the quality of their existing resource base.
*Consolidated figures: NAV per share GBP0.79, gain of 10.3% over
the Year
The Company has maintained a concentrated portfolio focusing on
the junior resource equities with proven management teams, robust
assets and strong balance sheets. This strategy has enabled the
Company to outperform the junior index over the Year and, in the
Investment Manager's opinion, is expected to deliver superior
performance over the coming years.
The Company's Articles incorporate a provision that requires a
continuation vote to be proposed at a meeting of the Company's
Shareholders (by way of an ordinary resolution). In accordance with
Article 154A, a continuation vote will be put to Shareholders at
the next Annual General Meeting of the Company on 4 December
2014.
I thank you for your on-going support of the Company.
Nick Falla
Chairman
6 October 2014
INVESTMENT MANAGER'S REPORT
Financial Highlights and Investment Review by Altus Capital
Limited
The last twelve months has seen a general improvement in mining
equity markets with greater certainty on the recovery of Western
economies and sustained growth of China and other BRIC economies.
The gold price has stabilised and gold equities have begun to
outperform the gold price after a number of years of
underperformance although they remain at historically low relative
valuations as illustrated in Chart 1 below.
Chart 1: Philadelphia Gold & Silver Index relative to the
gold price
Source: Bloomberg
Not only are gold equities rising from a historically low base,
but there has been a significant shift in the approach and
discipline of management teams to capital allocation and cost
control. All In Sustaining Costs, "AISC" for the senior gold miners
have fallen on average by approximately 15% in the 12 months to 30
June 2014. Gold equities continue to trade at historically low
valuations on a number of other metrics including price to cash
flow multiples as illustrated in Chart 2 below.
Chart 2: Philadelphia Gold & Silver Index Price to Cash Flow
multiple
Source: Bloomberg
Junior resource equities remain starved of new capital and, on
the whole, have not performed as strongly although select companies
are raising capital and being recognised by the market. This is
highlighted by the lack of AIM mining initial public offerings in
the three year period prior to July 2014 and the limited further
issues completed in recent years as highlighted in Chart 3
below.
Chart 3: AIM mining primary and further issues (2014 data is
annualised from half yearly)
Source: London Stock Exchange
The Investment Manager remains confident that the flow of gold
from more speculative ETF holdings in the West to physical holdings
in China and other emerging economies will support the price going
forward. The China Gold Association recently stated that they
anticipate demand from the East and particularly China to remain
strong and indeed grow as incomes rise over the next twenty years.
A further bolster to Chinese demand is the Shanghai Gold Exchange's
plan to start international bullion trading that is priced and
settled in Yuan during 2014.
Other commodities have suffered price volatility over the Year
on the back of speculation over the strength of the Chinese
economy. Continued volatility is anticipated although China's
economic growth still remains above 7.0% per year and demand for
raw materials will continue. Chart 4 below illustrates historic and
anticipated mined copper production, declining grade and the
importance of Chinese demand. Should the growth of Chinese demand
continue at the current rate and demand from the rest of the world
remain stable, demand will outstrip supply.
Chart 4: Mined copper supply and grade and Chinese demand
Source: Bloomberg
The importance of China is further demonstrated by the strength
of the nickel price which has risen 37.1% in the first six months
of 2014 following Indonesia's ban at the beginning of the year on
the export of unprocessed nickel ore, a primary feedstock for
China's steel industry. Platinum and palladium have also performed
strongly rising 11.9% and 28% respectively over the Year following
industrial action in South Africa (source of over to 70% of global
platinum and close to 40% of global palladium supply) and the
potential sanctions against Russia over its handling of the
Ukrainian crisis (with Russia accounting for approximately 40% of
palladium production). Aluminium and zinc prices have also been
strong during 2014 on the back of anticipated supply shortages and
robust demand.
Against this backdrop, the Company's strategy of investing in a
concentrated portfolio of quality juniors delivered published NAV
growth of 10.5% over the Year.
The Investment Manager has retained the focus on companies with
high quality and high grade assets that are or will be highly cash
generative producers, or are developers and explorers that are
either fully funded or have the quality assets that will enable
them to raise capital.
Examples of these holdings include:
-- Nevsun Resources which successfully built and operated the
high grade gold portion of the Bisha deposit in Eritrea generating
significant cash flow. The company has subsequently built and paid
for its copper plant and retains approximately US$350 million of
cash. With a reserve grade of 1.75% copper, Bisha is three times
the copper grade of current global mined production (see Chart 4).
Following ramp-up, the company should produce 120 million pounds of
attributable copper at a cash cost of less than US$1.00 per pound
and therefore generate more than US$240 million of cash flow at the
current copper price putting the company on an enterprise value to
cash flow multiple of less than two times.
-- Guyana Goldfields has a market capitalisation of C$380
million and has fully financed and is developing the Aurora gold
project which has a net present value of US$735 million assuming a
gold price of US$1,300 per ounce and a 5% discount rate. The
company's key asset is the Aurora project which has a resource
grade of 3.2 g/t, three times the global average for producing
mines. The company forecasts producing an average of 231,000 ounces
per year for the initial ten years at a cash costs of US$527 per
ounce (royalty included) putting it in the lowest quartile. The
Aurora project has the scale, grade and robust economics that would
make the company a compelling acquisition target for a major or
mid-tier.
-- Beadell Resources is mining approximately 200,000 ounces of
gold at its Tucano project in Brazil at an All-In Sustaining Cost
of US$868 per ounce placing it in the lower quartile on the cost
curve. It can further enhance its earnings through the sale of
by-product iron ore.
-- Fission Uranium is a Canadian-listed uranium exploration
company with a world class discovery in the Athabasca Basin,
Canada. The Athabasca hosts the majority of the world's high grade
uranium deposits and Fission's Patterson Lake South discovery is
shaping up to be the most significant high grade discovery of
recent years.
-- In addition to junior resource equities, the exposure to
platinum and palladium ETFs was increased over the Year as the
industrial action in South Africa and political tension in Ukraine
intensified. Given the lengthy duration of the stoppages resulting
from the South African strikes, there is expected to be a deficit
in platinum and palladium and prices are expected to remain strong
for the balance of 2014.
Outlook
The Investment Manager anticipates a generally positive
environment for precious and industrial metals into 2015. The
market is expected to remain cautious over the continued strength
of the Chinese economy and the recovery of Western economies and
therefore short-term volatility is expected. Larger capitalised
resource equities, including gold miners, have begun to strengthen
as generalist investors begin to return to the sector. As further
M&A deals are struck and investors seek strong returns, select
junior resource equities are expected to return to favour and
outperform. The Investment Manager therefore intends to maintain
the focus of the portfolio on those companies that it believes will
attract the attention of either other corporates or the market due
to the strength of the management team and quality of the
underlying assets.
Investment Allocation
At 30 June 2014, the Group's assets were allocated in the
following proportions:
Asset Allocation by Commodity**
Gold 47.5%
Silver 2.3%
Bulk Minerals 11.1%
Base Metals 17.5%
Energy Minerals 4.4%
Platinum Group Metals 6.5%
Diamonds 6.7%
Net cash 3.9%
100.0%
----------
Asset Allocation by Development Stage**
Production 29.0%
Development 38.9%
Exploration 16.7%
Commodity Exposure 11.5%
Net cash 3.9%
----------
100.0%
----------
Asset Allocation by Geography**
Africa 34.7%
North America 16.8%
South America 18.8%
Asia - Other 6.0%
Australasia 0.7%
Other (including commodity exposure) 19.1%
Net cash 3.9%
-------
100.0%
-------
**Note totals may not equal 100% due to rounding.
STATEMENT OF DIRECTORS' RESPONSIBILITIES IN RESPECT OF THE
CONSOLIDATED FINANCIAL STATEMENTS
Responsibility Statement
The Directors confirm to the best of their knowledge and
belief:
(a) This Annual Report includes or incorporates by reference a
fair review of the development and performance of the business and
the position of the Group together with a description of the
principal risks and uncertainties that it faces;
(b) the Consolidated Financial Statements, prepared in
accordance with International Financial Reporting Standards, as
adopted by the European Union, give a true and fair view of the
assets, liabilities, financial position and profits of the Group
and performance of the Group over the Year; and
(c) this report taken as a whole is fair, balanced,
understandable and provides the information necessary for
Shareholders to assess the Company's performance, business model
and strategy.
A description of important events which have occurred during the
Year, their impact on the performance of the Group as shown in the
Consolidated Financial Statements and a description of the
principal risks and uncertainties facing the Group is given in the
Chairman's Statement, Investment Manager's Report, Directors Report
and the notes to the Consolidated Financial Statements and is
incorporated here by reference.
There were no other material related party transactions which
took place in the Year other than those disclosed in note 15 to the
Consolidated Financial Statements.
Signed on behalf of the Board of Directors on 6 October
2014.
Nick Falla Robert Milroy
Chairman Director
DIRECTORS
Nicholas J Falla: Chairman (non-executive) (Age 57)
Nicholas Falla has had over thirty years of experience in the
finance industry including sixteen years of experience in the
commodity markets. He is currently the Managing Director of Xocoatl
Limited, a private investment company taking strategic proprietary
positions in the commodities markets and Finance Director of Pharma
E Limited, a private pharmaceutical supplier. Nick was senior
non-executive director of MW Tops Limited, a closed-ended
investment company listed on the London Stock Exchange which
entered into voluntary liquidation in September 2010, whilst
transferring its assets into another investment vehicle. From
1993-2000 Nick worked as the financial controller for Bank of
Bermuda (Guernsey) Limited and from 2000 to 2002 he was their
regional controller for Europe. In addition he has acted as an
interim Financial Director for the Guernsey banking operation of
Credit Suisse Guernsey Limited and has worked on various finance
and accounting based projects with companies such as KPMG (Channel
Islands) and the Blenheim Group. Nick trained as an accountant with
Turquands Barton Mayhew & Co in Guernsey.
David Gelber: Director (non-executive) (Age 66)
David Gelber began his career in trading in 1976 when he joined
Citibank in London. David has since held a variety of senior
trading positions, in derivatives in particular, working for
Citibank, Chemical Bank and HSBC, where he was Chief Operating
Officer of HSBC Global Markets. In 1994 David joined ICAP, an
inter-dealer broker, as COO and assisted in implementing two
mergers, first with Exco plc and then with Garban. David currently
serves as a non-executive director on the board of Walker Crips
Group plc, a full service stock broker and wealth management
company where he is Chairman. David is also currently a non
executive director of DDCAP Limited, a leading arranger of Islamic
banking transactions and of Exotix Limited, an investment banking
boutique specialising in frontier markets. David is also currently
a non-executive director of Intercapital Private Group Limited, a
holding company invested in ICAP plc and CityIndex Limited, a
spread-betting and contracts for
difference provider. David has a B.Sc in statistics and law from
the University of Jerusalem and an M.Sc in computer science from
the University of London.
Robert Milroy: Director (non-executive) (Age 68)
Robert Milroy is Chairman of Milroy Capital Limited, a company
which invests in various Mining and Energy related projects. He was
a Founding Director and CIO of the Corazon Group and Milroy &
Associates, Guernsey regulated investment management and
stock-broking companies which were acquired by Collins Stewart (CI)
Limited. He has over 40 years experience in the investment, mining
and petroleum industries having participated and worked in various
mining, oil exploration projects and financings in Chile, Peru,
Argentina, Ghana, Canada, USA, Mexico, Australia and Greenland. In
addition, he was the Managing Director of Eagle Drilling Inc. for
13 years, a firm that specialised in hard rock diamond core
drilling in Central and Western Africa.
Robert is also a noted speaker and financial author of various
publications including the Standard & Poor's Guide to Offshore
Investment Funds. Robert graduated with a Bachelor of Commerce
(Honours) from the University of Manitoba and is a director on a
number of Mining and Energy related companies. Robert is also a
director of Altus Global Gold Limited.
David Netherway: (non-independent non-executive) (Age 61)
David Netherway is a mining engineer with over 35 years of
experience in the mining industry and, until the takeover by
Gryphon Minerals Limited, was the CEO of Shield Mining Limited, an
Australian listed exploration company. David was involved in the
construction and development of the Iduapriem, Siguiri and Kiniero
gold mines in West Africa and has mining experience in Africa,
Australia, China, Canada, India and the Former Soviet Union. David
served as the CEO of Toronto listed Afcan Mining Corporation, a
China focused gold mining company that was sold to Eldorado Gold in
2005. David has also held senior management positions in a number
of gold mining companies including Golden Shamrock Mines, Ashanti
Goldfields and Semafo Inc. David is currently the chairman of
Aureus Mining Inc, Kilo Goldmines Limited and a non-executive
director of Crusader Resources Limited, Canyon Resources Limited
and Altus Global Gold Limited. He is the ex-Chairman of Afferro
Mining Inc and was a non-executive director of Gryphon Minerals
Ltd, KazakhGold Group and GMA Resources Ltd. David is the current
non-executive chairman of Altus Strategies Limited and is thus not
considered an Independent Director of the Company.
INVESTMENT MANAGER, ADMINISTRATOR AND SECRETARY
Investment Management Agreement
The Board is responsible for the determination of the Company's
investment policy and has overall responsibility for the Company's
day-to-day activities. The Company has, however, entered into an
Investment Management Agreement dated 22 June 2009, as amended by a
Deed of Amendment and Novation dated 30 June 2010, and as amended
by a Deed of Amendment dated 23 May 2014, with the Investment
Manager, a wholly-owned, FCA regulated subsidiary of Altus
Strategies Limited. Under the Investment Management Agreement the
Investment Manager has overall responsibility for the discretionary
management of the Company's assets (including uninvested cash) in
accordance with the Company's investment objective and policy,
subject to the overall supervision of the Board.
The Investment Manager receives a management fee of 0.85% per
annum of the Company's NAV, calculated on the relevant quarterly
accounting date, subject to a minimum fee of GBP150,000 per annum.
In accordance with the Investment Management Agreement the
Investment Manager is also entitled to a performance fee which was
first payable on the second anniversary of the date of Admission
and is payable annually thereafter. During the Year no performance
fee was accrued as the performance hurdle was not met. Further
details of the performance fee can be found in Note 15 of the
Consolidated Financial Statements. Under the terms of the
Investment Management Agreement, the agreement may be terminated by
either party on eighteen months' written notice.
Administration Agreement
The Company entered into an Administration and Secretarial
Agreement dated 22 June 2009 with JTC (Guernsey) Limited (formerly
Anson Fund Managers Limited) (the "Administrator" or the
"Secretary"). Under the terms of the Administration and Secretarial
Agreement, the Administrator is responsible for providing
administration and secretarial services to the Company.
The Administrator carries out the general secretarial functions
required by the Law and ensures that the Company complies with its
continuing obligations as a company
with shares admitted to trading on the SFM and the CISE.
The Administrator also carries out the Company's general
administrative functions such as the calculation of net asset
value, calculating the performance of the Company's investments and
the maintenance of accounting records. The Administration and
Secretarial Agreement is terminable by either party on giving not
less than three months' written notice.
Review
The Board keeps under review the performance of the Investment
Manager and the Administrator and the powers delegated to them
both. In the opinion of the Board the continuing appointment of the
Investment Manager and the Administrator on the terms agreed is in
the interest of shareholders as a whole.
DIRECTORS' REPORT
The Directors present their report and Consolidated Financial
Statements of the Company for the Year.
Principal Activities and Business Review
The principal activity of the Company is to carry on business as
an investment company. The Directors do not envisage any change in
these activities for the foreseeable future. A description of the
activities of the Company in the Year under review is outlined in
the Investment Manager's Report.
Status
The Company is a closed-ended investment company and was
incorporated with limited liability in Guernsey on 30 April 2009
with registered number 50318. The Company operates under the Law
and the Protection of Investors (Bailiwick of Guernsey) Law, 1987
as amended.
The Company's Ordinary Shares are admitted to trading on the SFM
and to the Official List of the CISE.
The Company's management and administration takes place in
Guernsey and the Company had been granted exemption from income tax
in Guernsey by the Administrator of Income Tax under the Income Tax
(Exempt Bodies) (Guernsey) Ordinance 1989. It is the intention of
the Directors to continue to operate the Company so that each year
this tax-exempt status is maintained.
Results and Dividends
During the Year the ownership interest of the Company in its
subsidiary, Altus Global Gold Limited, increased from 53.28% to
90.22% due to shareholder redemptions in Altus Global Gold
Limited.
The results of the Group for the Year are set out on page
43.
The Group aims to provide shareholders with an attractive total
return, which is expected to comprise primarily capital growth,
although there is also potential for distributions. The Company's
investment objective and strategy means that the timing and amount
of investment income cannot be predicted.
The Company did not declare any interim dividends during the
Year and the Directors do not propose the declaration of a final
dividend for the Year under review.
Directors
Further details of the Directors in office are shown on pages 13
and 14. Details of the Board's responsibilities are given on pages
12 and 22.
The interests of the Directors in the Ordinary Shares of the
Company as at 30 June 2014 were as follows:
Number of Ordinary Shares
Nick Falla 30,000
David Gelber 53,000
Robert Milroy 30,000
No changes took place in the interests of the Directors in the
Ordinary Shares of the Company between 1 July 2014 and 6 October
2014.
Other than the above Ordinary Share transactions, none of the
Directors nor any persons connected with them had a material
interest in any of the Company's transactions, arrangements or
agreements during the Year and none of the Directors has or has had
any interest in any transaction which is or was unusual in its
nature or conditions or significant to the business of the Company,
and which was effected by the Company during the Year except for
the following:
-- David Netherway is the non-executive chairman of Altus
Strategies Limited, the ultimate parent of the Investment Manager,
who owns 504,755 Ordinary Shares in the Company; and
-- David Netherway is a non-executive chairman of Kilo Goldmines
Limited and Aureus Mining Limited and, until 31 July 2013, was a
non-executive director of Gryphon Minerals Limited, companies in
which the Company has exposure.
At the date of this report, there are no outstanding loans or
guarantees between the Company and any Director.
Substantial Shareholdings
On 6 October 2014 the following Shareholders of the Company held
more than 5% of the total Share Capital of the Company:
Registered Holder % of Total Share Number of Ordinary
Capital Shares
Nortrust Nominees Limited 15.67% 6,222,542
BNY (OCS) Nominees Limited 10.75% 4,270,657
HSBC Global Custody Nominee
(UK) Limited a/c 803321 6.87% 2,727,860
Chase Nominees Limited a/c LENDNON 5.54% 2,200,000
State Street Nominees Limited
a/c OM04 5.04% 2,000,000
Net Asset Value ("NAV")
The consolidated NAV of the Company's Ordinary Shares as at 30
June 2014 was GBP0.79 per Ordinary Share.
Principal Risks and Uncertainties
The Board has drawn up a risk matrix which identifies the key
risks to the Company and these fall into the following broad
categories:
-- Investment Risks: The Company is focused on investing in
junior resources companies and is therefore subject to the risks
associated with concentrating its investments in this asset class.
The performance of the Company will be affected by the performance
of the securities of investee companies and is thus subject to the
sharp price volatility of shares of companies principally engaged
in activities related to metals and minerals. Historically the
prices of the commodities have fluctuated significantly and are
affected by numerous factors which the Company cannot predict or
control. The Board reviews reports from the Investment Manager on a
monthly basis and at each quarterly Board meeting, paying
particular attention to the diversification of the portfolio and to
the performance and volatility of underlying investments.
-- Control environment at Service Providers: The Company is
exposed to risks arising from failures of systems and controls in
the operations of its Service Providers. The Remuneration and
Management Engagement Committee perform an annual review of each of
the Company's Service providers.
-- Regulatory Risk: The Company is required to comply with the
regulations of the FCA, the Guernsey Financial Services Commission
(the "GFSC") and the CISE. The Investment Manager and Secretary
monitor the Company's compliance with regulatory bodies and will
notify the Board immediately if it receives notice from the FCA,
GFSC or CISE.
-- Discount: The Board reviews the discount level regularly. The
Directors had authority to buyback up to 14.99% of the Company's
shares in issue immediately following Admission and seek annual
renewal of this authority from shareholders. Any buyback of shares
is made subject to Guernsey Law and within guidelines established
from time to time by the Board, the making and timing of any
buybacks is at the absolute discretion of the Board.
Further details of risk can be found in Note 14 of the
Consolidated Financial Statements.
Anti-Bribery and Corruption
The Company adheres to the requirements of the Prevention of
Corruption (Bailiwick of Guernsey) Law, 2003. In consideration of
the UK Bribery Act 2010 which came into force on 1 July 2011, the
Board abhors bribery and corruption of any form and expects all the
Company's business activities to be undertaken, whether directly by
the Directors themselves or on the Company's behalf by third
parties to be transparent, ethical and beyond reproach.
On discovery of any activity or transaction that breaches the
requirements of the Prevention of Corruption (Bailiwick of
Guernsey) Law, 2003 or the UK Bribery Act 2010, such discovery will
be reported to the relevant authorities in accordance with
prescribed procedures. The Company is committed to regularly
reviewing its policy and procedures to uphold good business
practice.
Going Concern
The Company's principal activities are set out on pages 1, 2 and
17. The financial position of the Group is set out on page 44. In
addition, Note 14 to the Consolidated Financial Statements includes
the Company's objectives, policies and processes for managing its
capital; its financial risk management objectives and its exposures
to credit risk and liquidity risk.
The Company's Articles incorporate a provision that requires a
continuation vote to be proposed at a meeting of the Company's
Shareholders (by way of ordinary resolution).
In accordance with Article 154A, a continuation vote will be put
to the Shareholders at the next Annual General Meeting on 4
December 2014. The Directors further note that if this ordinary
resolution is not passed by a simple majority, it may result in a
winding up of the Company. This would have a material impact on the
Company's ability to continue as a going concern. The Directors are
not aware of any other material uncertainties that may cast
significant doubt as to the Company's ability to continue as a
going concern. While the Directors cannot be certain what the
results of this vote will be, the Consolidated Financial Statements
are prepared on a going concern basis supported by the Directors'
current assessment of:
-- the Company's ability to continue in existence for the foreseeable future;
-- the continued viability of the Company at a lower level of net assets;
-- on-going Shareholder interest in the continuation of the Company.
The Consolidated Financial Statements have been prepared in
accordance with 'Going Concern and Liquidity Risk: Guidance for
Directors of UK Companies 2009', published by the Financial
Reporting Council.
Statement of Directors' Responsibilities
The Directors are responsible for preparing the Directors'
Report and the Consolidated Financial Statements in accordance with
applicable law and regulations.
The Law requires the Directors to prepare financial statements
for each financial year. Under that Law the Directors are required
to prepare the financial statements in accordance with
International Financial Reporting Standards ("IFRS") as adopted by
the European Union. Under the Law the Directors must not approve
the accounts unless they are satisfied that they give a true and
fair view of the state of affairs of the Company and of the profit
or loss of the Company for that period. In preparing these
Consolidated Financial Statements, International Accounting
Standard 1 requires that the Directors:
-- properly select and apply accounting policies;
-- present information, including accounting policies, in a
manner that provides relevant, reliable, comparable and
understandable information;
-- provide additional disclosures when compliance with the
specific requirements in IFRS are insufficient to enable users to
understand the impact of particular transactions, other events and
conditions on the entity's financial position and financial
performance; and
-- make an assessment of the Company's ability to continue as a going concern.
The Directors are responsible for keeping adequate accounting
records that are sufficient to show and explain the Company's
transactions and disclose with reasonable accuracy at any time the
financial position of the Company and enable them to ensure that
the Consolidated Financial Statements comply with the Law. They are
also responsible for safeguarding the assets of the Company and
hence for taking reasonable steps for the prevention and detection
of fraud and other irregularities.
The Directors are responsible for the maintenance and integrity
of the corporate and financial information included on the
Company's website. Legislation in Guernsey and the United Kingdom
governing the preparation and dissemination of financial statements
may differ from legislation in other jurisdictions.
Disclosure of Information to Auditor
The Directors who held office at the date of approval of this
Directors' Report confirm in accordance with the provisions of
Section 249 of the Law that, so far as they are each aware, there
is no relevant audit information of which the Company's Auditor is
unaware; and each Director has taken all the steps that he ought to
have taken as a Director to make himself aware of any relevant
audit information and to establish that the Company's Auditor is
aware of that information.
Auditor
Deloitte LLP has expressed its willingness to continue in office
as Auditor. A resolution proposing their reappointment will be
submitted at the forthcoming General Meeting to be held pursuant to
section 199 of the Law.
Signed on behalf of the Board on 6 October 2014.
Nick Falla Robert Milroy
Chairman Director
CORPORTATE GOVERNANCE
The Company is committed to complying with the corporate
governance obligations which apply to Guernsey registered
companies. As a Guernsey incorporated company and under SFM rules,
the Company is not required to comply with The UK Corporate
Governance Code issued in 2012 (the "Code") by the Financial
Reporting Council. However, the Board places a high degree of
importance on ensuring that high standards of corporate governance
are maintained and have therefore chosen voluntarily to comply with
the provisions of the Code to the extent that they are considered
relevant to the Company.
The UK Corporate Governance Code is available on the following
website: www.frc.org.uk.
With effect from 1 January 2012 the Company was also required to
comply with the GFSC Financial Sector Code of Corporate Governance
(the "Guernsey Code"). As the Company complies with the Code it is
deemed to meet the Guernsey Code. The Board has undertaken to
evaluate its corporate governance compliance on an on-going
basis.
Statement of Compliance with The UK Corporate Governance
Code
Throughout the Year, the Company has been in compliance with the
provisions set out in the Code, except for the following
matters:-
-- As the Board is composed exclusively of non-executive
Directors, provisions relating to executive directors or the
position of chief executive are not applicable to the Company.
-- There is no Senior Independent Director which is not in
accordance with provision A.4.1 of the Code. Taking into account
for the size and nature of the Company and the fact there are three
Independent non-executive Directors on the Board this position is
not seen as necessary.
-- There is no internal audit function in the Company and the
requirement for this function is reconsidered on an annual basis.
The Board considers that as all of the Company's administration
functions have been delegated to independent third parties there
would not be sufficient benefit for the Company to have its own
internal audit facility.
Evaluation
The Board carried out a performance evaluation of itself, its
Committees and each of the Directors as required by provision B.6.1
of the Code and is committed to this process being carried out
every year.
For the Year this process was led by the Remuneration and
Management Engagement Committee and the evaluation process
consisted of Directors completing a questionnaire to assess the
Board as a whole and the Chairman completing a questionnaire to
assess each Director individually. All questionnaires were designed
by an external facilitator.
The full Board discussed the results of the evaluation of the
Board and its Committees and concluded that there were no
significant points to raise and that each Director continues to
demonstrate their effectiveness and commitment to the Company.
Board Responsibilities
The Board comprises of four non-executive Directors, of whom
Nick Falla, David Gelber and Robert Milroy are determined to be
independent as they are independent of the Investment Manager.
Biographies of the Directors appear on pages 13 and 14,
demonstrating the wide range of skills and experience they bring to
the Board. The Board meets at least four times per year to consider
the business and affairs of the Company, at which meetings the
Directors review the Company's investments and all other important
issues to ensure control is maintained over the Company's affairs.
The Board also receives full management accounts for review at each
full Board meeting.
During the Year the number of full Board meetings and committee
meetings attended by the Directors were as follows:
Full Board Meetings Audit Committee Remuneration
and Management
Engagement Committee
---------------- -------------------- ---------------- ----------------------
Nick Falla 5 out of 5 3 out of 3 1 out of 1
---------------- -------------------- ---------------- ----------------------
David Gelber 5 out of 5 2 out of 3 0 out of 1
---------------- -------------------- ---------------- ----------------------
Robert Milroy 5 out of 5 3 out of 3 1 out of 1
---------------- -------------------- ---------------- ----------------------
David Netherway 4 out of 5 N/A N/A
---------------- -------------------- ---------------- ----------------------
No Director has a service contract with the Company, nor are any
such contracts proposed. Whilst there is no requirement under the
Company's Articles of Incorporation to retire by rotation the Board
has decided to adopt such practice as recommended by the Code. As
such at each general meeting of the Company all the Directors who
held office at the two preceding annual general meetings and did
not retire shall retire from office and shall be available for
re-election at the same meeting.
The Chairman's other significant commitments include his
appointments as Finance Director of Pharma E Limited, a private
pharmaceutical supplier and Managing Director of Xocoatl Limited, a
private investment company.
The Directors, in the furtherance of their duties, may take
independent professional advice at the Company's expense. The
Directors also have access to the advice and services of the
Corporate and Shareholder Advisory Agent and the Secretary through
their respective appointed representatives who are responsible to
the Board for ensuring that Board procedures are followed and that
applicable rules and regulations are complied with. To enable the
Board to function effectively and allow Directors to discharge
their responsibilities, full and timely access is given to all
relevant information.
Board Committees
Audit Committee
Throughout the Year an Audit Committee has been in operation.
The Audit Committee is chaired by Robert Milroy and each of the
other Board members, with the exception of David Netherway, are
members. The Audit Committee operates within clearly defined Terms
of Reference, which are available from the Company's website or the
Secretary upon request, and provides a forum through which the
Company's external auditors report to the Board.
The Audit Committee meets at least twice a year and reviews,
inter alia, the financial reporting process and the system of
internal control and management of financial risks including
understanding the current areas of greatest financial risk and how
these are managed by the Investment Manager, reviewing half-yearly
and annual financial statements, assessing the fairness of
preliminary and interim statements and disclosures and reviewing
the external audit process. The Audit Committee is responsible for
reviewing the effectiveness of the external audit including
overseeing the Company's relationship with the external auditors,
including making recommendations to the Board on the appointment of
the external auditors and their remuneration. The Audit Committee
considers the nature, scope and results of the auditors' work and
reviews, and develops and implements policy on the supply of any
non-audit services that are to be provided by the external
auditors. It receives and reviews reports from the Investment
Manager and the Company's external auditors relating to the
Company's annual report and consolidated financial statements.
The Audit Committee focuses particularly on compliance with
legal requirements, accounting standards and the Listing Rules and
ensures that an effective system of internal financial and
non-financial controls is maintained. The Audit Committee also
consider the significant financial reporting judgements and risks
impacting the financial statements. The ultimate responsibility for
reviewing and approving the annual report and financial statements
remains with the Board of Directors. Further details can be found
in the Audit Committee Report on pages 31 to 35.
During the Year the Audit Committee met to consider the interim
management statements, the Half-yearly Financial Report to 31
December 2013 and the Annual Report and Financial Statements to 30
June 2014.
Remuneration and Management Engagement Committee
The Remuneration and Management Engagement Committee is chaired
by Robert Milroy and each of the other Board members are members
except David Netherway. The Remuneration and Management Engagement
Committee operates within clearly defined Terms of Reference, which
are available from the Company's website or the Secretary upon
request.
The Remuneration and Management Engagement Committee meets at
least once a year and reviews, inter alia, the appointment and
remuneration of the Investment Manager and of other suppliers of
services to the Company as well as the fees of the Directors.
Nomination Committee
The Nomination Committee, chaired by Nick Falla, comprises each
of the Directors. The Nomination Committee operates within clearly
defined Terms of Reference, which are available from the Company's
website or the Secretary upon request.
The Nomination Committee meets as and when it is deemed
appropriate to review, inter alia, the structure, size and
composition of the Board and to identify, nominate and recommend
for approval of the Board, candidates to fill Board vacancies as
and when they arise. During the Year there were no changes to the
composition of the Board and therefore it had not been deemed
appropriate for the Nomination Committee to formally meet.
Internal Control and Financial Reporting
The Board is responsible for establishing and maintaining the
Company's system of internal controls which are reviewed for
effectiveness on an annual basis. The Board reviews not just
internal financial controls but all controls including operations,
compliance and risk management. Internal control systems are
designed to meet the particular needs of the Company and manage the
risks to which it is exposed, and by their very nature provide
reasonable, but not absolute, assurance against material
misstatement or loss. The key procedures which have been
established to provide effective internal control are as
follows:
-- Investment management is provided by Altus Capital Limited
under the Investment Management Agreement. The Board is responsible
for setting the overall investment policy and monitors the actions
of the Investment Manager at regular Board meetings.
-- Administration and company secretarial duties for the Company
are performed by JTC (Guernsey) Limited (formerly Anson Fund
Managers Limited).
-- Custody of assets is undertaken by the Royal Bank of Canada (Channel Islands) Limited.
-- The duties of investment management, accounting and the
custody of assets are segregated. The procedures of the individual
parties are designed to complement one another.
-- The Directors of the Company clearly define the duties and
responsibilities of their agents and advisers. The appointment of
agents and advisers is conducted by the Board after consideration
of the quality of the parties involved; the Board monitors their
on-going performance and contractual arrangements.
-- The Directors of the Company regularly review the performance
and contractual arrangements with the Investment Manager, other
agents and advisers.
-- Mandates for authorisation of investment transactions and
expense payments are set out by the Board.
-- The Board reviews detailed financial information produced by
the Investment Manager and the Administrator on a regular
basis.
Dialogue with Shareholders
All holders of Ordinary Shares in the Company have the right to
receive notice of, and attend, the general meetings of the Company,
during which the Board and the Investment Manager are available to
discuss issues affecting the Company.
The primary responsibility for shareholder relations lies with
the Investment Manager and Nimrod Capital LLP, the Corporate and
Shareholder Advisory Agent. However, the Directors are always
available to enter into dialogue with shareholders and the Chairman
is always willing to meet major shareholders as the Company
believes such communication to be important. The Company's
Directors can be contacted at the Company's registered office.
AUDIT COMMITTEE REPORT
The Company has established an Audit Committee with formally
delegated duties and responsibilities within written terms of
reference (a copy of which is available from the Company' Secretary
on request). The membership of the Audit Committee and its terms of
reference are kept under regular review.
Composition
For the Year under review the members of the Audit Committee
were:
Robert Milroy - Audit Committee Chairman and independent
non-executive director of the Company;
Nick Falla - independent non-executive director of the Company;
and
David Gelber - independent non-executive director of the
Company.
Biographies for these members of the Audit Committee appear on
pages 13 and 14 demonstrating the wide range of skills and
experience they bring to the Audit Committee and Board.
Role and Responsibilities of the Audit Committee
The Audit Committee acknowledges and embraces its role of
protecting the interests of the Company's shareholders as regards
the integrity of published financial information by the Company and
the effectiveness of the audit of the Company.
Audit Committee responsibilities include:
- overseeing the Company's financial reporting process;
- reviewing and maintaining the integrity of the Company's
financial statements, including its annual and half-yearly reports,
interim management statements, and any other formal announcement
relating to its financial performance and monitoring compliance
with statutory, regulatory and other financial reporting
requirements;
- reviewing and reporting to the board on significant financial reporting judgements;
- advising the Board on whether it believes the annual report
and accounts, taken as a whole, is fair, balanced and
understandable and provides the information necessary for
shareholders to assess the Company's performance, business model
and strategy;
- reporting to the Board on the appropriateness of the Company's
accounting policies and practices including critical accounting
policies and practices;
- reviewing the effectiveness of the external audit process;
- overseeing the relationship and maintaining active dialogue
with the external auditor of the Company; and
- monitoring the systems of internal controls operated by the
Company and by the Company's principal service providers,
including, in particular the Investment Manager.
Summary of Audit Committee meetings held during the Year
The Audit Committee met three times during the Year. Also in
attendance for all meetings was the Company's Secretary. The
Company's auditor was also in attendance for two meetings.
At its three meetings during the Year, the Audit Committee
focused on:
Financial reporting and Significant Issues
The Audit Committee reviewed the appropriateness of the
half-year and annual financial statements concentrating on, amongst
other matters the valuations of the Company's assets and compliance
with applicable rules and regulations. To aid its review the Audit
Committee considered reports prepared by external service providers
and also reports from the external auditor on the outcome of their
annual audit. The significant issues considered by the Audit
Committee in relation to the annual financial statements and how
these were addressed are detailed below:
Significant Issues for the How the Audit Committee addressed
Year these significant issues.
---------------------------------------- -------------------------------------------------------------
Valuation of Investments and The Audit Committee noted the
Liquidity. monthly investment portfolio
Investments should be recorded and liquidity reports produced
at fair value. The risk exists by the Investment Manager for
that the investments are not the Board of Directors. The
accurately valued based on Audit Committee would have
relevant information that is discussed any unusual variances
representative of their fair contained within these reports.
value. The use of inappropriate
valuation information or errors
in the calculation of fair
values could results in material
misstatement.
---------------------------------------- -------------------------------------------------------------
Going Concern.
The Company's Articles incorporate Whilst the Audit Committee
a provision that requires a cannot be certain what the
continuation vote to be proposed results of this vote will be
at a meeting of the Company's the Consolidated Financial
Shareholders (by way of ordinary Statements are prepared on
resolution). In accordance a going concern basis supported
with Article 154A, a continuation by the Audit Committee's current
vote will be put to the Shareholders assessment of:
at the next Annual General * the Company's ability to continue in existence for
Meeting on 4 December 2014. the foreseeable future;
The Audit Committee have therefore
considered whether the going
concern basis of preparation * the continued viability of the Company at a lower
of financial statement is appropriate. level of net assets;
* on-going Shareholder interest in the continuation of
the Company.
---------------------------------------- -------------------------------------------------------------
Internal Control
The Audit Committee is required to review the Company's internal
financial controls and risk management systems.
The Audit Committee has considered the Risk Assessment prepared
by the Company's Investment Manager and ensured that the controls
exercised by the Investment Manager and Administrator in
controlling the Company's affairs were adequate and were properly
implemented.
The Audit Committee also reported to the Board as part of a
separate agenda item, on its activity and matters of particular
relevance to the Board in the conduct of its work.
In November 2013 the Company's appointed Administrator, Anson
Fund Managers Limited, was acquired by JTC (Guernsey) Limited and
the Administrator changed its name accordingly. The Audit Committee
has made due enquiry of the purchaser about the implications of
this acquisition on the systems and controls affecting the
administration of the Company. The Audit Committee was informed
that, for the foreseeable future, there will be no changes to the
existing processes used in the administration of the Company's
affairs.
Following the publication of the revised version of The UK
Corporate Governance Code, which applies to financial years
commencing on or after 1 October 2012, the Board requested that the
Audit Committee advise it on whether it believes the Company's
annual report and accounts, taken as a whole, is fair, balanced and
understandable and provides the information necessary for
shareholders to assess the Company's performance, business model
and strategy. The Audit Committee's terms of reference have been
amended to reflect this.
Internal audit
The Company has no employees and operates no systems of its own,
relying instead on the employees and systems of its external
service providers. The Board has therefore taken the decision that
it would be of insufficient benefit for the Company to engage an
internal auditor. However, the Audit Committee will reconsider this
annually and make appropriate recommendations to the Board.
External audit
The current external auditor of the Company is Deloitte LLP and
they were reappointed as auditor to the Company at the General
Meeting of the Company held on 5 December 2013. This is Deloitte
LLP's fifth year of appointment as auditor of the Company. The
current lead audit partner, John Clacy of Deloitte LLP, is due to
rotate as audit partner to the Company after the current year
audit.
The effectiveness of the external audit process is dependent on
appropriate audit risk identification at the start of the audit
cycle. The Audit Committee receive from Deloitte LLP a detailed
audit approach memorandum, identifying their assessment of the
significant risk areas of the audit. For the year under review the
primary significant risks identified were in relation to valuation
of investments, fee calculations performed, investment
transactions, management override of controls and compliance with
applicable law and regulations. These risks are tracked through the
year and the Audit Committee challenged the work done by Deloitte
LLP in these significant risk areas.
Using our collective skills the Audit Committee assess the
effectiveness of the audit process in addressing these matters
through the reporting it receives from Deloitte LLP on the
completion of the audit process. In addition the Audit Committee
also seeks feedback from the Company's administrator on the
effectiveness of the audit process. For the year under review, the
Audit Committee had been in contact with both the Company's
Administrator and External Auditor and had received regular
progress reports on the status of the annual financial report. The
Audit Committee also had several opportunities to review and
comment on the content of the drafts of the annual financial
report. The Audit Committee is satisfied that an effective audit
has been completed, that the scope of the audit was appropriate and
that significant judgements have been challenged robustly.
Appointment and Independence
Having considered the position for the current year, the Audit
Committee has provided the Board with its recommendation that
Deloitte LLP be reappointed as external auditor to the Company for
the year ending 30 June 2015. Accordingly a resolution proposing
the reappointment of Deloitte LLP as auditor of the Company will be
put to the Company's shareholders at the General Meeting of the
Company in to be held in December 2014.
There are no contractual obligations restricting the Audit
Committee's choice of external auditor.
Non-Audit Services
Any non-audit services provided by Deloitte LLP would be
pre-approved by the Audit Committee after they are satisfied that
relevant safeguards are in place to protect the Auditors
objectivity and independence.
Robert Milroy
Chairman of the Audit Committee
on behalf of the Audit Committee.
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF ALTUS RESOURCE
CAPITAL LIMITED
Opinion on financial In our opinion the financial statements:
statements of
Altus Resource -- give a true and fair view of the state of
Capital Limited the group's affairs as at 30 June 2014 and of
its profit for the year then ended;
-- have been properly prepared in accordance
with International Financial Reporting Standards
(IFRSs) as adopted by the European Union; and
-- have been prepared in accordance with the
requirements of the Companies (Guernsey Law),
2008.
The financial statements comprise the Consolidated
Statement of Comprehensive Income, Consolidated
Statement of Financial Position, Consolidated
Statement of Changes in Equity, Consolidated
Statement of Cash Flows and the related notes
1 to 15. The financial reporting framework that
has been applied in their preparation is applicable
law and IFRSs as adopted by the European Union.
Emphasis of matter We have reviewed the directors' statement on
- going concern page 21 in respect of the group's ability to
continue as a going concern.
As described in note 2 to the financial statements,
in accordance with article 154A of the company's
Articles of Incorporation, a continuation vote
will be put to the shareholders at the next
annual general meeting on 4 December 2014, as
the company has passed the fifth anniversary
of admission to the London Stock Exchange. Whilst
the directors cannot be certain what the results
of this vote will be, the financial statements
are prepared on a going concern basis supported
by the directors' assessment of the company's
ability to continue in existence for the foreseeable
future, the continued viability of the company
at a lower level of net assets and ongoing shareholder
interest in the continuation of the company.
Whilst we have concluded that the directors'
use of the going concern basis of accounting
in the preparation of the financial statements
is appropriate, these conditions indicate the
existence of a material uncertainty which may
give rise to significant doubt over the group's
ability to continue as a going concern. We describe
below how the scope of our audit has responded
to this risk. Our opinion is not modified in
respect of this matter.
Our assessment The assessed risks of material misstatement
of risks of material described below are those that had the greatest
misstatement effect on our audit strategy, the allocation
of resources in the audit and directing the
efforts of the engagement team:
Going concern
Given the uncertainty over the We have reviewed the board minutes
outcome of the company's continuation which outline the Board's discussions
vote at the next Annual General surrounding the forthcoming continuation
Meeting, which is explained above vote. We have also reviewed the
in the Emphasis of matter - Going draft shareholder circular which
concern paragraph, we considered outlines the views of the Board
going concern to be a key risk. and the Investment Manager as
to the arguments for continuing
to operate the company. In addition,
we have considered the views
gathered on the likely shareholder
opinion by the Investment Manager
and Nimrod Capital LLP from their
formal meetings held with the
shareholders.
======================================= ===========================================
Investment valuation
The risk arises that the investments For the Level 1 quoted investments
are not recorded at fair value. we agreed all the year end prices
There is a risk that a market to independent pricing sources.
based exit price is not used To assess whether the Level 1
in the year end valuation, that investments were correctly classified
inappropriate exchange rates and met the Level 1 criteria
are used to convert foreign currency of being actively traded and
valuations to the company's reporting sufficiently liquid, we obtained
currency or that suspended or the trading volume data supporting
illiquid shares are not adequately this assessment. We sample tested
reflected in the valuations in this data to independent sources
accordance with IFRS. and challenged the Investment
Manager's conclusions to verify
their assessment of trading and
correct classification.
For the Level 2 investments we
agreed all of the fair values
to the valuations prepared by
the Investment Manager. We engaged
our Financial Instrument Specialists
to review the methodology used
to prepare the valuation calculations,
to recalculate on a sample basis
the fair values and to agree
the inputs used to supporting
information provided by the Investment
Manager. We verified the inputs
to independent sources.
The exchange rates used to convert
the year end investment portfolio
were agreed to independent published
exchange rates ruling at the
balance sheet date.
======================================= ===========================================
The Audit Committee's consideration of these
risks is set out on page 32 to 33.
Our audit procedures relating to these matters
were designed in the context of our audit of
the financial statements as a whole, and not
to express an opinion on individual accounts
or disclosures. Our opinion on the financial
statements is not modified with respect to any
of the risks described above, and we do not
express an opinion on these individual matters.
Our application We define materiality as the magnitude of
of materiality misstatement in the financial statements
that makes it probable that the economic
decisions of a reasonably knowledgeable person
would be changed or influenced. We use materiality
both in planning the scope of our audit work
and in evaluating the results of our work.
We determined materiality for the group to
be GBP638,000, which is approximately 2%
of shareholders' equity.
We agreed with the Audit Committee that we
would report them all audit differences in
excess of GBP12,750, as well as differences
below that threshold that, in our view, warranted
reporting on qualitative grounds. We also
report to the Audit Committee on disclosure
matters that we identified when assessing
the overall presentation of the financial
statements.
An overview Our audit was scoped by obtaining an understanding
of the scope of the group and its environment, including
of our audit group wide controls, and assessing the risks
of material misstatement at the group level.
The Company has one subsidiary incorporated
and administered in Guernsey which was subject
to a statutory audit by Deloitte LLP. The
audit work for the subsidiary was executed
at a level of materiality applicable to the
entity, which was lower than group materiality.
The parent and subsidiary companies are both
administered by third party Guernsey regulated
fund service providers. As part of our group
audit we assessed the adequacy of the control
environment of both the service providers
for the purposes of our audit. At the parent
entity level we also audited the consolidation
process to support our conclusion that there
were no material misstatements of the consolidated
financial information.
Matters on which
we are required
to report by
exception
Adequacy of Under the Companies (Guernsey) Law, 2008
explanations we are required to report to you if, in our
received and opinion:
accounting records -- we have not received all the information
and explanations we require for our audit;
or
-- proper accounting records have not been
kept by the parent company; or
-- the financial statements are not in agreement
with the accounting records.
We have nothing to report in respect of these
matters.
Our duty to Under International Standards on Auditing
read other information (UK and Ireland), we are required to report
in the Annual to you if, in our opinion, information in
Report the annual report is:
* materially inconsistent with the information in the
audited financial statements; or
* apparently materially incorrect based on, or
materially inconsistent with, our knowledge of the
group acquired in the course of performing our audit;
or
* otherwise misleading.
In particular, we are required to consider
whether we have identified any inconsistencies
between our knowledge acquired during the
audit and the directors' statement that they
consider the annual report is fair, balanced
and understandable and whether the annual
report appropriately discloses those matters
that we communicated to the audit committee
which we consider should have been disclosed.
We confirm that we have not identified any
such inconsistencies or misleading statements.
Respective responsibilities As explained more fully in the Statement of
of directors Directors' Responsibilities in the Director's
and auditor Report, the directors are responsible for the
preparation of the financial statements and
for being satisfied that they give a true and
fair view. Our responsibility is to audit and
express an opinion on the financial statements
in accordance with applicable law and International
Standards on Auditing (UK and Ireland). Those
standards require us to comply with the Auditing
Practices Board's Ethical Standards for Auditors.
We also comply with International Standard on
Quality Control 1 (UK and Ireland). Our audit
methodology and tools aim to ensure that our
quality control procedures are effective, understood
and applied. Our quality controls and systems
include our dedicated professional standards
review team and independent partner reviews.
This report is made solely to the company's
members, as a body, in accordance with Section
262 of the Companies (Guernsey) Law, 2008. Our
audit work has been undertaken so that we might
state to the company's members those matters
we are required to state to them in an auditor's
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 and the company's members as a body,
for our audit work, for this report, or for
the opinions we have formed.
Scope of the An audit involves obtaining evidence about the
audit of the amounts and disclosures in the financial statements
financial statements sufficient to give reasonable assurance that
the financial statements are free from material
misstatement, whether caused by fraud or error.
This includes an assessment of: whether the
accounting policies are appropriate to the group's
circumstances and have been consistently applied
and adequately disclosed; the reasonableness
of significant accounting estimates made by
the directors; and the overall presentation
of the financial statements. In addition, we
read all the financial and non-financial information
in the annual report to identify material inconsistencies
with the audited financial statements and to
identify any information that is apparently
materially incorrect based on, or materially
inconsistent with, the knowledge acquired by
us in the course of performing the audit. If
we become aware of any apparent material misstatements
or inconsistencies we consider the implications
for our report.
John G Clacy FCA
for and on behalf of Deloitte LLP
Chartered Accountants and Recognised Auditor
St Peter Port, Guernsey
6 October 2014
Neither an audit nor a review provides assurance on the
maintenance and integrity of the website, including controls listed
to achieve this and in particular whether any changes have occurred
to the financial information since first published. These matters
are the responsibility of the directors but no control procedures
can provide absolute assurance in this area.
Legislation in Guernsey governing the preparation and
dissemination of financial information differs from legislation in
other jurisdictions.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
for the year ended 30 June 2014
Year ended Year ended
30 Jun 2014 30 Jun 2013
Notes GBP GBP
Net movement in unrealised
(depreciation)/ appreciation
on investments 8 23,761,179 (20,472,832)
Realised (loss) / gains
on investments 8 (19,638,577) (12,397,227)
Operating income 3 109,989 243,942
Operating expenses 4 (860,908) (1,191,413)
------------- ----------------
Net gain / (loss) for
the year before foreign
exchange losses 3,371,683 (33,817,530)
------------- ----------------
Unrealised foreign exchange
loss (438,624) (125,332)
Net gain / (loss) for
the year 2,933,059 (33,942,862)
------------- ----------------
Other Comprehensive Income - -
------------- ----------------
Total Comprehensive Income
/ (Loss) 2,933,059 (33,942,862)
------------- ----------------
Attributable to:
Owners of the Company 2,932,371 (32,196,202)
Non-controlling interest 13 688 (1,746,660)
------------- ----------------
2,933,059 (33,942,862)
------------- ----------------
Pence Pence
Earnings per share for
the year - Basic and
Diluted 6 7.38 (81.06)
------------- ----------------
There are no recognised gains or losses for the year other
than those disclosed above.
In arriving at the results for the financial year, all
amounts above relate to continuing operations.
The notes on pages 47 to 72 form an integral part of these
financial statements
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
as at 30 June 2014
30 Jun 30 Jun
2014 2013
Notes GBP GBP
NON-CURRENT ASSETS
Financial assets designated
as at fair value through profit
and loss 8 30,536,125 28,065,169
CURRENT ASSETS
Cash and cash equivalents 3,491,801 1,868,097
Trade and other receivables 9 182,034 936,053
------------------------- --------------------------
3,673,835 2,804,150
TOTAL ASSETS 34,209,960 30,869,319
------------------------- --------------------------
CURRENT LIABILITIES
Trade and other payables 10 2,281,792 209,731
------------------------- --------------------------
2,281,792 209,731
NET ASSETS 31,928,168 30,659,588
------------------------- --------------------------
EQUITY
Share premium 12 42,602,254 42,602,254
Revenue reserve (11,201,361) (14,133,732)
------------------------- --------------------------
Equity attributable to owners
of the Company 31,400,893 28,468,522
Non-controlling interest 13 527,275 2,191,066
TOTAL EQUITY 31,928,168 30,659,588
------------------------- --------------------------
Pence Pence
Net asset value per Ordinary
Share based on 39,719,569 (2013:
39,719,569) shares in issue 79.05 71.67
------ ------
The consolidated financial statements
were approved and authorised
for issue by the Board on 6
October 2014.
Chairman Director
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the year ended 30 June 2014
Share Share Premium Revenue Non-controlling Total
Capital Reserves interest
Notes GBP GBP GBP GBP GBP
Balance as
at 1 July
2013 - 42,602,254 (14,133,732) 2,191,066 30,659,588
Net gain for
the year - - 2,932,371 688 2,933,059
Issue of shares
to non-controlling
interests - - - 5,000 5,000
Redemption
of shares
from non-controlling
interests - - - (1,669,479) (1,669,479)
Balance as
at 30 June
2014 - 42,602,254 (11,201,361) 527,275 31,928,168
---------------------- ------------------------ -------------------------- ------------------ -------------------
Share Share Premium Revenue Non-controlling Total
Capital Reserves interest
GBP GBP GBP GBP GBP
Balance as
at 1 July
2012 - 42,602,254 18,062,470 437,726 61,102,450
Net loss for
the year - - (32,196,202) (1,746,660) (33,942,862)
Issue of shares
to non-controlling
interests - - - 3,500,000 3,500,000
Balance as
at 30 June
2013 - 42,602,254 (14,133,732) 2,191,066 30,659,588
---------------------- ------------------------ -------------------------- ------------------ -------------------
CONSOLIDATED STATEMENT OF CASH FLOWS
for the year ended 30 June 2014
Year ended Year ended
30 Jun 2014 30 Jun 2013
Notes GBP GBP
OPERATING ACTIVITIES
Net gain /(loss) for
the year 2,933,059 (33,942,862)
Net movement in unrealised
(appreciation) / depreciation
on investments 8 (23,761,179) 20,472,832
Interest received (10,867) (33,283)
Increase/ (decrease)
in payables 11,125 (73,377)
Decrease in receivables 4,183 109,584
Realised losses on
investments 8 19,638,577 12,397,227
Foreign exchange movements 4 438,624 125,332
NET CASH FLOW FROM
OPERATING ACTIVITIES (746,478) (944,547)
---------------------------- ----------------------------------
INVESTING ACTIVITIES
Interest received 10,867 33,283
Purchase of investments (27,574,793) (71,331,970)
Sale of investments 32,037,210 56,843,097
NET CASH FLOW FROM
INVESTING ACTIVITIES 4,473,285 (14,455,590)
---------------------------- ----------------------------------
FINANCING ACTIVITIES
Proceeds from issue
of shares in Subsidiary 13 5,000 3,500,000
Redemption of shares
in Subsidiary 13 (1,669,479) -
NET CASH FLOW FROM
FINANCING ACTIVITIES (1,664,479) 3,500,000
---------------------------- ----------------------------------
CASH AND CASH EQUIVALENTS
AT BEGINNING OF YEAR 1,868,097 13,893,566
Increase / (decrease)
in cash and cash equivalents 2,062,328 (11,900,137)
Effect of foreign exchange
rates (438,624) (125,332)
CASH AND CASH EQUIVALENTS
AT END OF YEAR 3,491,801 1,868,097
---------------------------- ----------------------------------
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
for the year ended 30 June 2014
1 GENERAL INFORMATION
The consolidated financial statements incorporate
the financial statements of Altus Resource Capital
Limited (the "Company") and Altus Global Gold Limited
(the "Subsidiary") together known as (the "Group").
The Company is a closed-ended investment company incorporated
in Guernsey on 30 April 2009, which listed on the
Specialist Fund Market of the London Stock Exchange
on 30 June 2009 and on the Channel Islands Securities
Exchange ("CISE") on 22 December 2009.
On 20 December 2013 the Royal Court of Guernsey approved
the scheme of arrangement (the "Scheme") between the
CISX and The Channel Islands Securities Exchange (the
"CISE"). In accordance with the Scheme, the business
of the CISX has been acquired by CISE. All securities
that were listed on the Official List of the CISX
have been transferred and are now listed on the Official
List of CISE.
The principal activity of the Group is to realise
capital growth from a concentrated portfolio of resource
equities and to generate a significant capital return
to shareholders.
2 ACCOUNTING POLICIES
The following significant accounting policies have
been applied consistently in dealing with the items
which are considered material to the Group's Consolidated
Financial Statements:
(a) Basis of Preparation
The consolidated financial statements have been prepared
in conformity with International Financial Reporting
Standards ("IFRS") as adopted in the European Union
which comprise standards and interpretations approved
by the International Accounting Standards Board ("IASB")
and International Financial Reporting Interpretations
Committee ("IFRIC"), together with applicable Guernsey
law. The financial statements have been prepared on
a historical cost basis except for the measurement
at fair value of certain financial instruments.
The following Standards which became effective and
have been adopted by the group in the current period,
are relevant to the Group's operations.
IFRS 7 Financial Instruments - Disclosures - Amendments
related to the offsetting of assets and liabilities
effective for annual periods beginning on or after
1 January 2013.
IFRS 13 Fair value measurement - Original issue effective
for annual periods beginning on or after 1 January
2013.
IFRS 13 Fair Value Measurement- Amendments resulting
from Annual Improvements Cycle effective for annual
periods beginning on or after 1 July 2014 (adopted
early).
IAS 32 Financial Instruments: Presentation - Annual
improvements effective for annual periods beginning
on or after 1 January 2013.
The Group has applied IFRS 13 for the first time in
the current year. IFRS 13 establishes a single source
of guidance for fair value measurements and disclosures
about fair value measurements. The scope of IFRS 13
is broad; the fair value measurement requirements
of IFRS 13 apply to both financial instrument items
and non-financial instrument items for which other
IFRSs require or permit fair value measurements and
disclosures about fair value measurements.
IFRS 13 defines fair value as the price that would
be received to sell an asset or paid to transfer a
liability in an orderly transaction in the principal
(or most advantageous) market at the measurement date
under current market conditions. Fair value under
IFRS 13 is an exit price regardless of whether that
price is directly observable or estimated using another
valuation technique. Also, IFRS 13 includes extensive
disclosure requirements.
IFRS 13 requires prospective application from 1 January
2013. In addition, specific transitional provisions
were given to entities such that they need not apply
the disclosure requirements set out in the Standard
in comparative information provided for periods before
the initial application of the Standard.
In accordance with these transitional provisions,
the Group has not made any new disclosures required
by IFRS 13 for the 2013 comparative period (please
see Note 8 for the 2014 disclosures). Other than the
additional disclosures, the application of IFRS 13
has not had any material impact on the amounts recognised
in the consolidated financial statements.
The adoption of the revisions to IFRS 7 and IAS 32
have not had a material impact on the accounts.
The following Standards which are expected to affect
the Group have been issued but not yet adopted by the
Group as shown below. Other Standards issued by the
IASB and the IFRIC are not expected to affect the Group.
IFRS 7 Financial Instruments - Disclosures - Deferral
of mandatory effective date of IFRS 9 and amendments
relating to additional hedge accounting disclosures
(and consequential amendments). Applies only when IFRS
9 is adopted, which is effective for annual periods
beginning on or after 1 January 2018.
IFRS 9 Financial Instruments - Classification and Measurement
effective for annual periods beginning on or after 1
January 2018, subject to EU endorsement.
IFRS 9 Financial Instruments - accounting for financial
liabilities and derecognition effective for annual periods
beginning on or after 1 January 2018, subject to EU
endorsement.
IFRS 10 Consolidated Financial Statements - For annual
periods beginning on or after 1 January 2014.
IFRS 12 Disclosure of Interests in Other Entities -
For annual periods beginning on or after 1 January 2014.
IAS 27 (2011) Separate Financial Statements - For annual
periods beginning on or after 1 January 2014.
IAS 32 Financial Instruments: Presentation - Amendments
relating to the offsetting of assets and liabilities
effective for annual periods beginning on or after 1
January 2014.
IAS 39 Financial Instruments: Recognition and Measurement
- Amendments for novations of derivatives effective
for annual periods beginning on or after 1 January 2014.
IAS 39 Financial Instruments: Recognition and Measurement
- Amendments to permit an entity to elect to continue
to apply the hedge accounting requirements in IAS 39
for a fair value hedge of the interest rate exposure
of a portion of a portfolio effective for annual periods
beginning on or after 1 January 2018.
The Directors have considered the above and are of the
opinion that the above Standards are not expected to
have a material impact on the Group's financial statements
with the following exceptions.
The adoption of IFRS 9 will impact both the measurement
and disclosure of the Group's Financial Instruments.
As the Standard has not yet been adopted by the EU, it
is not practicable to provide a reasonable estimate of
the effect of the Standard.
IFRS 10 replaces the parts of IAS 27 Consolidated and
Separate Financial Statements that deal with consolidated
financial statements and SIC-12 Consolidation - Special
Purpose Entities. IFRS 10 changes the definition of control
such that an investor has control over an investee when
a) it has power over the investee, b) it is exposed,
or has rights, to variable returns from its involvement
with the investee and c) has the ability to use its power
to affect its returns. All three of these criteria must
be met for an investor to have control over an investee.
Previously, control was defined as the power to govern
the financial and operating policies of an entity so
as to obtain benefits from its activities.
The Directors expect the Company to meet the criteria
to be deemed an investment entity under IFRS10 and this
would require accounting for the Subsidiary at fair value.
The results of the Subsidiary would not be consolidated
in these financial statements as currently required by
IAS 27. As the fair value of the investment entity will
be based on the latest available NAV, which is equivalent
to the value to the results currently being consolidated
into the Group accounts, it is not anticipated there
will be a material impact on the overall NAV.
IFRS 12 is a new disclosure standard and is applicable
to entities that have interests in subsidiaries, joint
arrangements, associates and/or unconsolidated structured
entities. It will be adopted at the same time as IFRS
10 and in general, the application of IFRS 12 will result
in more extensive disclosures in the financial statements.
These items will be applied in the first financial period
for which they are required.
(b) Basis of consolidation
The consolidated financial statements incorporate the
financial statements of the Company and its Subsidiary.
The Company owns 90.22% (2013: 53.28%) of the shares
in the Subsidiary and has the power to govern the financial
and operating policies of the Subsidiary so as to obtain
benefits from its activities.
Intra-group balances and transactions, and any unrealised
income and expenses arising from intra-group transactions
are eliminated in preparing the consolidated financial
statements.
Non-controlling interests in the Subsidiary are identified
separately from the Group's equity therein. The interests
of non-controlling shareholders are initially measured
at the non-controlling interest's proportionate share
of the fair value of the acquiree's identifiable net
assets. Subsequent to acquisition, the carrying amount
of non-controlling interest is the amount of the interest
at initial recognition plus the non-controlling interest's
share of subsequent changes in equity. Total comprehensive
income is attributed to non-controlling interest even
if this results in the non-controlling interest having
a deficit balance.
(c) Judgements and estimates
The preparation of financial statements in accordance
with IFRS requires management to make judgements, estimates
and assumptions that affect the reported amounts of assets
and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during
the reporting period. The estimates and associated assumptions
are based on historical experience and other factors
that are considered to be relevant. Actual results could
differ from such estimates.
The estimates and underlying assumptions are reviewed
on an on-going basis. Revisions to accounting estimates
are recognised in the period in which the estimate was
revised, if the revision affects only that period, or
in the period of the revision and future periods if the
revision affects both current and future periods.
The most critical judgements, apart from those involving
estimates, that management has made in the process of
applying the Company's accounting policies and that have
the most significant effect on the amounts recognised
in the financial statements are the functional currency
of the Company (see note 2(d)(i)), the fair value of
investments designated to be at fair value through profit
or loss (see note 2(e)(i)) and the ability of the entity
to continue as a going concern (see note 2(f)).
In estimating the fair value of an asset or liability,
the Company uses market observable data to the extent
it is available. Where direct market data is not available,
the Company's Investment Manager performs the valuation.
The Board works closely with the Investment Manager
to establish the appropriate valuation techniques and
inputs to the model. The Investment Manager reports
quarterly to the board to explain the cause of fluctuations
in the fair value of assets and liabilities. Information
about the valuation techniques and inputs used in determining
the fair value of various assets and liabilities are
discussed in Note 8.
(d) Foreign currency
(i) Functional and Presentation
Currency
The Company's investors are mainly from the UK. The
primary activity of the Company is to realise capital
growth from a portfolio of gold and precious metals
equities with the aim of generating a significant capital
return to Shareholders.
The performance of the Company is measured and reported
to investors in Sterling. The Directors consider Sterling
as the currency that most faithfully represents the
economic effects of the underlying transactions, events
and conditions. The financial statements are presented
in Sterling, which is the Company's functional and presentation
currency.
(ii) Transactions and Balances
Foreign currency transactions are translated into the
functional currency using the exchange rates prevailing
at the dates of the transactions. Foreign exchange gains
and losses resulting from the settlement of such transactions
and from the translation at period-end exchange rates
of monetary assets and liabilities denominated in foreign
currencies are recognised in the Consolidated Statement
of Total Comprehensive Income. Translation differences
on non-monetary financial assets and liabilities such
as equities at fair value through profit or loss are
recognised in the Consolidated Statement of Total Comprehensive
Income. The Company holds investments denominated in
Australian, Canadian and US Dollars at the reporting
date, and may enter into forward foreign currency contracts
to hedge the exchange rate risk arising from future
cash flows on these investments. As at 30 June 2014
no forward foreign currency contracts were taken out.
(e) Financial Instruments
Financial assets and financial liabilities are recognised
in the Consolidated Statement of Financial Position when
the Company becomes a party to the contractual provisions
of the instrument. The Group's main financial instruments
comprise:
* Cash and cash equivalents that arise directly from
the Group's operations; and
* Quoted and unquoted investment securities.
(i) Financial Assets
The classification of financial assets at initial recognition
depends on the purpose for which the financial asset was
acquired and its characteristics.
All investments and derivative financial instruments have
been designated as financial assets "at fair value through
profit and loss". Investments are initially recognised on
the date of purchase at cost, being the fair value of the
consideration given, excluding transaction costs associated
with the investment. After initial recognition, investments
are measured at fair value, with unrealised gains and losses
on investments and impairment of investments recognised
in the Consolidated Statement of Comprehensive Income. Commissions
paid on the sale or purchase of investments are recognised
in the Consolidated Statement of Comprehensive Income as
incurred.
A financial asset (in whole or in part) is derecognised
either:
* when the Company has transferred substantially all
the risk and rewards of ownership;
* when it has not retained substantially all the risk
and rewards and when it no longer has control over
the asset or a portion of the asset; or
* when the contractual right to receive cash flow has
expired.
(ii) Financial Liabilities
The classification of financial liabilities at initial recognition
depends on the purpose for which the financial liability
was issued and its characteristics.
All financial liabilities are initially recognised at fair
value net of transaction costs incurred. All purchases of
financial liabilities are recorded on trade date, being
the date on which the Company becomes party to the contractual
requirements of the financial liability. Unless otherwise
indicated the carrying amounts of the Company's financial
liabilities approximate to their fair values.
Financial liabilities measured at amortised cost include
other short-term monetary liabilities, which are initially
recognised at fair value and subsequently carried at amortised
cost using the effective interest rate method.
A financial liability (in whole or in part) is derecognised
when the Company has extinguished its contractual obligations,
it expires or is cancelled. Any gain or loss on derecognition
is taken to the Consolidated Statement of Comprehensive
Income.
(f) Going concern
The Company's Articles incorporate a provision that
requires a continuation vote to be proposed at a meeting
of the Company's Shareholders (by way of ordinary resolution).
In accordance with Article 154A, a continuation vote
will be put to the Shareholders at the next Annual General
Meeting on 4 December 2014. While the Directors cannot
be certain what the results of this vote will be, the
Consolidated Financial Statements are prepared on a
going concern basis supported by the Directors current
assessment of:
* the Company's ability to continue in existence for
the foreseeable future;
* the continued viability of the Company at a lower
level of net assets;
* on-going Shareholder interest in the continuation of
the Company.
(g) Taxation
The Company and its Subsidiary have been granted exemption
under the Income Tax (Exempt Bodies) (Guernsey) Ordinance,
1989 from Guernsey Income Tax, and each entity is charged
an annual fee of GBP600.
(h) Expenses
All expenses are accounted for on an accruals basis.
(i) Interest, Dividend and Bond
Income
Interest, dividend and bond income is accounted for
on an accruals basis.
(j) Cash and cash equivalents
Cash at bank and short term deposits which are held
to maturity are carried at cost. Cash and cash equivalents
are defined as call deposits, short term deposits and
highly liquid investments readily convertible to known
amounts of cash and subject to insignificant risk of
changes in value. For the purposes of the Consolidated
Statement of Cash Flows, cash and cash equivalents consist
of cash and deposits at bank.
(k) Share issue costs
The Share issue costs borne by the Company are recognised
in the Consolidated Statement of Changes in Equity,
as the Company's Ordinary Shares have no fixed redemption
date.
(l) Trade Date Accounting
All "regular way" purchases and sales of financial assets
are recognised on the "trade date", i.e. the date that
the entity commits to purchase or sell the asset. Regular
way purchases or sales are purchases or sales of financial
assets that require delivery of the asset within the
time frame generally established by regulations or convention
in the market place.
(m) Segmental Reporting
The Directors are of the opinion that the Group is engaged
in a single segment of business, being investment business
and operates solely from Guernsey, therefore no segmental
reporting is provided.
3 OPERATING INCOME
Year ended Year ended
30 Jun 2014 30 Jun 2013
GBP GBP
Bank interest 10,867 33,283
Dividend income 99,122 118,818
Bond income - 91,841
109,989 243,942
--------------------------------- ----------------------------------
4 OPERATING EXPENSES
Year ended Year ended
30 Jun 2014 30 Jun 2013
GBP GBP
Investment Manager's
fees 297,381 466,671
Accountancy fees 7,558 8,975
Administrator's fee 83,276 76,246
Registrar's fee 7,283 6,727
Directors' fees 144,813 150,585
Custody fees 6,277 39,380
Audit fee 33,986 32,954
Directors' and Officers'
insurance 4,771 4,732
Annual fees 37,553 13,087
Printing and stationery 5,219 3,490
Bank interest and charges 9,109 10,852
Commissions paid 98,434 216,258
Corporate and Shareholder
Adviser fees 46,909 76,349
Sponsor fees 10,055 9,125
Legal and professional 3,073 -
fees
Travel expenses 42,986 50,000
Sundry costs 22,225 25,982
860,908 1,191,413
--------------------------------- ----------------------------------
5 DIRECTORS' REMUNERATION
The Directors of the Company are paid GBP20,000 per annum.
In addition to GBP20,000 per annum, Nicholas Falla receives
an additional fee of GBP5,000 as Chairman and Robert Milroy
receives an additional fee of GBP3,000 as Chairman of the
audit committee.
The Directors remuneration of the subsidiary is determined
by reference to NAV of the subsidiary with effect from
1 April 2014. In the year to 30 June 2014 the directors
were paid GBP14,250 (2013: GBP15,000) based on fees of
GBP15,000 per annum to 31 March 2014 and GBP12,000 annum
for the quarter to 30 June 2014. The chairman also received
an additional fee of GBP3,000 per annum.
6 EARNINGS PER SHARE
Earnings per Ordinary Share is calculated by dividing the
net gain for the year attributable to holders of Ordinary
Shares of the Company ('Shareholders') of GBP2,932,371
(2013: loss GBP32,196,202) by the weighted average number
of Ordinary Shares in issue during the year (39,719,569
(2013: 39,719,569)). There are no dilutive instruments
and therefore basic and diluted earnings per Ordinary Share
are identical.
7 SUBSIDIARIES
On 27 October 2011 the Company acquired 90.41% of the voting
equity of Altus Global Gold Limited (the "Subsidiary")
for a consideration of GBP5,000,000. The Subsidiary is
an authorised open-ended investment company with registered
number 54069. The Subsidiary was incorporated on 10 October
2011 and listed on the official list of the CISX on 1 November
2011. The Administrator of the Subsidiary is Praxis Group
and the Custodian is the Royal Bank of Canada. At the time
of the acquisition, the Subsidiary had no assets or liabilities
and had not commenced trading. The Company's holding in
the Subsidiary subsequently decreased to 53.28% of the
voting equity as at 30 June 2013, then increased to 90.22%
following redemption of shares held by third parties in
the subsidiary at 30 June 2014. Included in the Total Comprehensive
Income for the year attributable to the owners of the Company
is a gain of GBP6,343 (2013: loss GBP1,991,912) representing
the Company's share of the Subsidiary's profit for the
year.
The Subsidiary was established to realise capital growth
from a portfolio of gold and precious metals equities,
with the aim of generating a significant capital return
to shareholders. The Subsidiary invests in mid-tier and
major gold and precious metals companies with a focus on
mid-tier products.
The financial year end of the Subsidiary is 30 June, which
is co-terminus with the financial year end of the Company.
8 FAIR VALUE THROUGH PROFIT OR LOSS
INVESTMENTS
Total Total
30 Jun 2014 30 Jun 2013
GBP GBP
Opening portfolio
cost 59,605,503 58,593,473
Additions - cost 29,635,729 70,999,401
Sales (31,287,374) (57,590,144)
Realised losses on
investments (19,638,578) (12,397,227)
Unrealised depreciation
on valuation brought forward (31,540,334) (11,067,502)
Movement in unrealised appreciation
/(depreciation) on valuation
for the year 23,761,179 (20,472,832)
-------------------------- ------------------------
Closing valuation 30,536,125 28,065,169
-------------------------- ------------------------
Unrealised depreciation
on valuation carried forward (7,779,155) (31,540,334)
-------------------------- ------------------------
IFRS 13 requires disclosure of fair value measurements
of financial assets and liabilities, using a three level
hierarchy as detailed below:
* Level 1 fair value measurements are those derived
from quoted prices (unadjusted) in active markets for
identical assets or liabilities;
* Level 2 fair value measurements are those derived
from inputs other than quoted prices included in
Level 1 that are observable for the asset or
liability, either directly (as prices) or indirectly
(derived from prices);
* Level 3 fair value measurements are those derived
from valuation techniques that include inputs for the
asset or liability that are not based on observable
market data (unobservable inputs).
Valuation Techniques
Fair value is the amount for which the financial instruments
could be exchanged, or a liability settled, between knowledgeable
willing parties in an arms length transaction. Fair value
also reflects the credit quality of the issuers of the
financial instruments. The methods used for determining
the Fair Value of each of the financial assets and liabilities
held by the Group are as follows:
Investments in listed or publically quoted securities
Listed or publicly quoted securities and options where
there is an active market in those securities or options
are valued according to their quoted bid price. These
investments are included within Level 1 of the fair value
hierarchy.
Listed or publicly quoted securities where there is
not an active market and trading occurs infrequently
are valued according to their quoted bid prices but are
included within Level 2 of the fair value hierarchy due
to infrequency of trading.
Warrants
The Group invests in unlisted warrants which relate to
listed or publically quoted equities. These warrants
are valued by the Investment Manager using standard binomial
and Black-Scholes modelling techniques. The valuation
inputs include:
* The bid price of the underlying equity;
* The volatility of the underlying equity based on the
minimum of 260 day averages of daily volatility over
the last 2 years;
* The term and exercise price of the warrant or option;
and
* Risk free rates based on generic composite rates for
relevant government bonds.
To the extent that the significant inputs are observable
or derived from market data relating to the underlying
securities, the Group categorises these investments as
Level 2.
Private Investments
Private investments are valued in accordance with the
International Private Equity and Venture Capital Guidelines
using a combination of methods including the initial
purchase price, comparable company, comparable transaction,
market multiple, discounted cash flow and liquidation
analysis approaches, after taking account of foreign
exchange movements. As these inputs were not observable
they were categorised as Level 3 of the fair value hierarchy.
The Group held a private investment in the prior year
but no such investments were held as at 30 June 2014.
Details of the value of each classification are listed
in the table below. Values are based on the market value
of the investments as at the reporting date:
Market Market
Value Value
30 Jun 30 Jun
2014 2013
% of % of
GBP Total GBP Total
Level 1 30,111,496 98.6% 26,675,726 95.0%
Level 2 424,629 1.4% 1,016,078 3.6%
Level 3 - 0.0% 373,365 1.4%
Total 30,536,125 28,065,169
-------------------- ---------------
The following table shows a reconciliation of all movements
in the fair value of financial instruments categorised
within Level 3 between the beginning and the end of
the reporting year:
30 Jun 2014 30 Jun 2013
GBP GBP
Opening portfolio cost 3,391,077 3,391,077
Sales (157,103) -
Realised loss on investments (3,233,974) -
Unrealised depreciation on valuation
brought forward (3,017,712) (737,003)
Movement in unrealised depreciation
on valuation for the year 3,017,712 (2,280,709)
Closing valuation - 373,365
-------------------------------- ----------------------------------
There have been no transfers between Level 1 and Level
2 of the fair value hierarchy during the year under
review.
9 TRADE AND OTHER RECEIVABLES
30 Jun 2014 30 Jun 2013
GBP GBP
Accrued income 19,666 28,706
Prepayments 20,068 15,211
Broker debtors 142,300 892,136
182,034 936,053
--------------------------- ----------------------------------
The above carrying value of receivables is equivalent to
its fair value.
10 TRADE AND OTHER PAYABLES
(amounts falling due within 30 Jun 2014 30 Jun 2013
one year)
GBP GBP
Trade creditors 76,420 70,671
Accrued expenses 58,065 52,509
Broker creditors 2,147,487 86,551
2,281,792 209,731
--------------------------- ----------------------------------
The above carrying value of payables is equivalent to its
fair value.
11 SHARE CAPITAL
Authorised Shares GBP
Unlimited number of Ordinary Unlimited -
Shares of no par value
=========================== ==================================
Issued
Date of issue Shares GBP
29 June 2009 26,000,000 -
21 December 2009 10,997,233 -
3 August 2010 2,722,336 -
Ordinary Shares in issue as -
at 30 June 2014 and 30 June
2013 39,719,569
--------------------------- ----------------------------------
Holders of Ordinary Shares are entitled to receive, and
participate in, any dividends out of income; other distributions
of the Company available for such purposes and resolved
to be distributed in respect of any accounting period;
or other income or right to participate therein.
On a winding up, Shareholders are entitled to the surplus
assets remaining after payment of all the creditors of
the Company.
Shareholders also have the right to receive notice of
and to attend, speak and vote at general meetings of
the Company and each Member being present in person or
by proxy or by a duly authorised representative at a
meeting shall upon a show of hands have one vote and
upon a poll each such holder present in person or by
proxy or by a duly authorised representative shall have
one vote in respect of every Ordinary Share held by him.
12 SHARE PREMIUM
GBP
Premium on shares issued 29 June 2009 26,000,000
Premium on shares issued 21 December 2009 14,667,020
Premium on shares issued 3 August 2010 3,818,894
Issue costs (1,883,660)
Share premium as at 30 June 2014 and 30
June 2013 42,602,254
----------------------------------
Under IAS 32 'Financial Instruments: Presentation', transaction
costs of an equity transaction are accounted for as a
deduction from equity to the extent they are incremental
costs directly attributable to the equity transaction
that otherwise would have been avoided.
13 NON-CONTROLLING
INTEREST
The Subsidiary has a 9.78% non-controlling interest.
30 Jun 2014 30 Jun 2013
GBP GBP
Balance as at 1 July
2013 2,191,066 437,726
Share of profit /
(loss)
for the period 688 (1,746,660)
Issue of shares to
non-controlling
interests 5,000 3,500,000
Redemption of shares -
to non-controlling
interests (1,669,479)
Balance as at 30 June
2014 527,275 2,191,066
--------------------------------- ----------------------------------
14 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The main risks arising from the Group's financial instruments
are market price risk, credit risk, liquidity risk, interest
rate risk, foreign exchange risk and capital management
risk. The Board regularly reviews and agrees policies for
managing each of these risks and these are summarised below:
(a) Market Price Risk
Market price risk arises mainly from uncertainty about
future prices of financial instruments held. It represents
the potential loss the Group might suffer through holding
market positions in the face of price movements. The Investment
Manager actively monitors market prices and reports to
the Board as to the appropriateness of the prices used
for valuation purposes. A list of the top 10 investments
held by the Group is shown in the Schedule of Top 10 Investments
on page 73.
If the value of the Group's investment portfolio were to
increase by 30%, it would represent a gain of GBP9,160,838
(2013: GBP8,419,551). This would cause the net asset value
of the Group to rise by 28.69% (2013: 27.46%).
If the value of the Group's investment portfolio were to
decrease by 30%, it would represent a decrease of GBP9,160,838
(2013: GBP8,419,551). This would cause the net asset value
of the Group to fall by 28.69% (2013: 27.46%).
Some of the market price is mitigated by the use of various
put and call options and Exchange-traded funds ("ETFs").
It is Group policy not to invest more than 20% of the gross
assets of the Group in the securities of any one company
or group at the time the investment is made.
The Group has no significant concentration of market risk,
with exposure spread over a large number of investments.
At 30 June 2014 the Group's largest exposure to a single
investment was GBP2,685,697 (2013: GBP3,195,273), which
represents 8.8% (2013: 11.39%) of the total market value
of the Group's investments.
Investors should be aware that the prospective returns
to Shareholders mirror the returns under the investments
held or entered into by the investments held or entered
into by the Group and that any default by an issuer of
any such investment held by the Group would have a consequential
adverse effect on the ability of the Group to pay some
or all of the entitlement to Shareholders. Such a default
might, for example, arise on the insolvency of an issuer
of an investment.
(b) Credit Risk
Credit risk is the risk that an issuer or counterparty
will be unable or unwilling to meet a commitment that it
has entered into with the Group. The Directors receive
financial information on a regular basis which is used
to identify and monitor risk.
The Group is exposed to credit risk in respect of its cash
and cash equivalents, arising from possible default of
the relevant counterparty, with a maximum exposure equal
to the carrying value of those assets.
The Group's financial assets exposed to credit risk are
as follows:
30 Jun 2014 30 Jun 2013
GBP GBP
Cash and cash equivalents 3,491,801 1,868,097
Trade and other receivables 182,034 936,053
3,673,835 2,804,150
----------------------------- ----------------------------
The credit risk on liquid funds is limited because the
counterparties are banks with high credit ratings assigned
by international credit-rating agencies. The Group monitors
the placement of cash balances on an ongoing basis. The
Group invests its cash and cash equivalents with Royal
Bank of Canada (Channel Islands) Limited and Barclays Private
Clients International which had a Standard and Poor's rating
of AA- and A respectively as at the date of signing.
The investments of the Group are held in custody by Royal
Bank of Canada (Channel Islands) Limited ("RBCCI"). Bankruptcy
or insolvency of the Custodians may cause the Group's rights
with respect to investments held by the Custodians to be
delayed.
RBCCI mitigate risk by using a subcustodian network comprising
top-rated and well respected counterparties. The custodian
network is monitored on an ongoing basis to ensure that
each one continues to meet RBCCI's stringent criteria.
(c) Liquidity Risk
Liquidity risk is the risk that the Group will encounter
difficulty in realising assets or otherwise raising funds
to meet financial commitments. The Group's main financial
commitment is its ongoing operating expenses.
The Investment Manager ensures that the Group has sufficient
liquid resources available to fulfil its operational plans
and to meet its financial obligations as they fall due.
The table below details the residual contractual maturities
of financial liabilities:
As at 30 June 2014:
Less than 1 to 3 3 months Greater Total
1 month months to 1 than
year 1 year
GBP GBP GBP GBP GBP
Trade creditors 76,240 - - - 76,240
Accrued
expenses 20,190 34,650 3,225 - 58,065
Broker
creditors 2,147,487 - - - 2,147,487
Total
Liabilities 2,243,917 34,650 3,225 - 2,281,792
----------------- -------------------------- ------------------------ -------------------- -------------------
As at 30 June 2013:
Trade creditors 70,671 - - - 70,671
Accrued
expenses 17,458 33,164 1,887 - 52,509
Broker
creditors 86,551 - - - 86,551
Total
Liabilities 174,680 33,164 1,887 - 209,731
----------------- -------------------------- ------------------------ -------------------- -------------------
Note that all amounts included within the 1 -12 months column
above have a contractual maturity within 3 months.
(d) Interest Rate Risk
The Group holds cash in several bank accounts, the return
on which is subject to fluctuations in market interest rates.
Other than cash and cash equivalents, none of the assets
or liabilities of the Group, attract or incur interest.
The following table details the Group's exposure
to interest rate risks:
As at 30 June 2014:
Floating Non-interest
less than bearing
1 month Fixed Total
GBP GBP GBP GBP
Assets
Designated
as at fair
value through
profit or
loss on initial
recognition:
Investments - 30,536,125 - 30,536,125
Loans and receivables:
Accrued income - 19,666 - 19,666
Prepayments - 20,068 - 20,068
Broker debtors - 142,300 - 142,300
Cash and
cash equivalents 3,491,801 - - 3,491,801
----------------------- -------------------------- -------------------- -----------------
Total Assets 3,491,801 30,718,159 - 34,209,960
----------------------- -------------------------- -------------------- -----------------
Liabilities
Financial
liabilities
measured
at amortised
cost:
Trade creditors - 76,240 - 76,240
Accrued expenses - 58,065 - 58,065
Broker creditors - 2,147,487 - 2,147,487
Total Liabilities - 2,281,792 - 2,281,792
----------------------- -------------------------- -------------------- -----------------
Total interest
sensitivity
gap 3,491,801
-----------------------
As at 30 June 2013:
Floating Non-interest Fixed Total
less than bearing
1 month
GBP GBP GBP GBP
Assets
Designated
as at fair
value through
profit or
loss on initial
recognition:
Investments - 27,736,503 328,666 28,065,169
Loans and receivables: -
Accrued income - 28,706 - 28,706
Prepayments - 15,211 - 15,211
Broker debtors - 892,136 - 892,136
Cash and
cash equivalents 1,868,097 - - 1,868,097
----------------------- -------------------------- -------------------- -----------------
Total Assets 1,868,097 28,672,556 328,666 30,869,319
----------------------- -------------------------- -------------------- -----------------
Liabilities
Financial
liabilities
measured
at amortised
cost:
Trade creditors - 70,671 - 70,671
Accrued expenses - 52,509 - 52,509
Broker creditors - 86,551 - 86,551
Total Liabilities - 209,731 - 209,731
----------------------- -------------------------- -------------------- -----------------
Total interest
sensitivity
gap 1,868,097
-----------------------
Interest rate sensitivity
If interest rates had been 25 basis points higher and
all other variables were held constant, the Group's net
gain attributable to Shareholders for the year ended 30
June 2014 would have increased by approximately GBP8,730
(2013: GBP4,670) or 0.03% (2013: 0.02%) of Net Assets
due to an increase in the amount of interest receivable
on the bank balances.
If interest rates had been 25 basis points lower and all
other variables were held constant, the Group's net gain
attributable to Shareholders for the year ended 30 June
2014 would have decreased by approximately GBP8,730 (2013:
GBP4,670) or 0.03% (2013: 0.02%) of Net Assets due to
a decrease in the amount of interest receivable on the
bank balances.
(e) Foreign Exchange Risk
A substantial proportion of the Group's portfolio is invested
in overseas securities and movements in exchange rates
can significantly affect their Sterling value. The Group
does not normally hedge against foreign currency movements
affecting the value of the investment portfolio, but takes
account of this risk when making investment decisions.
The Group undertakes certain transactions denominated
in foreign currencies. Hence, exposures to exchange rate
fluctuations arise. Exchange rate exposures are managed
by minimising the amount of foreign currency held at any
one time.
The carrying amounts of the Group's foreign currency denominated
monetary assets at the reporting date are as follows:
30 Jun 2014 30 Jun 2013
GBP GBP
Australian Dollar 6,192,797 6,579,996
Canadian Dollar 17,107,481 14,437,911
US Dollar 5,548,768 7,037,398
28,849,045 28,055,305
------------------------ -------------------------
The following table details the Group's sensitivity
to a 15% appreciation or depreciation in Sterling against
the relevant foreign currencies. 15 per cent represents
the Directors' assessment of the reasonably possible
change in foreign exchange rates. The sensitivity analysis
includes only outstanding foreign currency denominated
monetary items and adjusts their translation at the
period end for a 15 per cent change in foreign currency
rates. A positive number below indicates an increase
in profit and other equity where Sterling strengthens
15 per cent against the relevant currency. For a 15
per cent weakening of the Sterling against the relevant
currency, there would be a comparable but opposite impact
on the profit and other equity:
Currency Impact 30 Jun 2014 30 Jun 2013
GBP GBP
Australian Dollar
Profit or loss (807,756) (858,260)
Other equity (807,756) (858,260)
========================== ===========================
Canadian Dollar
Profit or loss (2,231,411) (1,883,206)
Other equity (2,231,411) (1,883,206)
========================== ===========================
US Dollar
Profit or loss (723,752) (917,921)
Other equity (723,752) (917,921)
========================== ===========================
(f) Concentration Risk
The majority of the Group's investments are in companies
and related securities associated with the gold and precious
metals sector and so it is subject to the risk of concentrating
its investments in this asset class. The Group's performance
will depend largely on the overall condition of the precious
metals and mining industry.
(g) Capital Management
The investment objective of the Group is to provide
Shareholders with attractive long term returns, expected
to be in the form of capital, through a diversified
portfolio.
As the Company's Ordinary Shares are traded on the SFM,
the Ordinary Shares may trade at a discount to their
Net Asset Value per Share on occasion. However, in structuring
the Group, the Directors have given detailed consideration
to the discount risk and how this may be managed.
15 RELATED PARTY TRANSACTIONS AND DIRECTORS BENEFICIAL INTERESTS
The Group is managed by the Investment Manager, a wholly-owned
FCA authorised and regulated subsidiary of Altus Strategies
Limited ('ASL'). ASL owns 504,755 Ordinary Shares (1.27%)
in the Company and 500,000 Ordinary Shares (9.02%) in
the Subsidiary.
The Director David Netherway is a non-executive chairman
of Altus Strategies Limited, which as mentioned above,
owns 504,755 shares (1.27%) in Altus Resource Capital
Limited. David Netherway is also non-executive Chairman
of Kilo Goldmines Limited, whose equities and warrants
are invested in by the Group. The total investment in
Kilo Goldmines Limited represents 0.98% of the market
value of the Group's investments.
The Director Nick Falla holds 30,000 Ordinary Shares (0.08%)
in the Company.
The Director David Gelber holds 53,000 Ordinary Shares
(0.13%) in the Company. This is held as part of a nominee
trust holding in the Company.
The Director Robert Milroy holds 30,000 Ordinary Shares
(0.08%) in the Company.
Under the Investment Management Agreement between the
Investment Manager and the Company, the Investment Manager
is entitled to receive fees of the greater of 0.85% per
annum of the Company's Net Asset Value or GBP150,000 per
annum.
Under the Investment Management Agreement between the
Investment Manager and the Subsidiary, the Investment
Manager is entitled to receive fees of 1.5% per annum
of the Subsidiary's Net Asset Value, subject to the Total
Expense Ratio not exceeding 2%. In accordance with the
agreement the fee has been waived for ARCL's holding in
the Subsidiary.
During the year the Group incurred GBP297,381 (2013:
GBP466,671) of fees, of which GBP67,089 (2013: GBP61,398)
was outstanding at the period end as shown in trade and
other payables.
During the year, the Group was charged travel expenses
totalling GBP42,986 (2013: GBP50,000) by the Investment
Manager.
The Investment Manager is also entitled to receive a
performance fee (the "Performance Fee"). The first component
of the Performance Fee was calculated for the first time
in respect of the financial accounting period first ending
following the second anniversary of the date of Admission
("the Calculation Period"). The fee is equal to 20% of
the excess of the NAV per Share as at the end of the
financial accounting period (adjusted to account for
dividends and returns of capital paid out during the
period and in respect of which the Manager has been paid
or is to be paid the second component of the Performance
Fee) over the basic performance hurdle, this being an
amount equal to the Issue Price increased by 10% of the
Issue Price per annum up to the end of the relevant performance
period. Thereafter this fee shall be paid on an annual
basis in respect of each financial period subject to
the basic performance hurdle and a high watermark having
been exceeded. The high watermark is the NAV at the end
of the financial period in respect of which the last
Performance Fee was paid. If, however, the high watermark
is not exceeded for any consecutive period of three years
it shall be re-based to a value equal to the NAV as at
the end of the third financial period. The basic performance
hurdle, as described above, must however still be exceeded
in order for this component of the performance fee to
be payable.
The first component of the Performance Fee will be paid
on a per Share basis, multiplied by the time weighted
average of the number of Shares in issue in the relevant
performance period (or since Admission in the first performance
period) (together, if applicable, with an amount equal
to the VAT thereon). In the event that there is a further
issue of Shares, a redemption of Shares or other capital
reorganisation of the Company, the calculation of the
performance fee will be adjusted appropriately.
The second component of the Performance Fee is an amount
equal to 20% of the sum of all dividends, distributions
and other returns of capital paid out to Shareholders
during the relevant performance period (but excluding
redemptions and share buy backs that are deemed distributions
under the Companies Law), subject to the performance
hurdle having been satisfied.
The performance hurdle is the requirement that the NAV
on the relevant calculation date must exceed an amount
equal to the Issue Price increased by 10% of the Issue
Price per annum up to the end of the relevant performance
period.
No Performance Fee provision has been made for the Company
for the period as the performance hurdle has not been
met. No Performance Fee provision has been made for the
Subsidiary for the period as the performance hurdle has
not been met.
Nimrod Capital LLP is the Company's Corporate and Shareholder
Adviser and is entitled to receive fees of 0.15% of the
Company's Net Asset Value per annum. During the year
the Group incurred GBP46,909 (2013: GBP76,349) of costs,
of which GBP11,839 (2013: GBP10,391) was outstanding
at the year end as shown in accrued expenses.
TOP 10 INVESTMENTS IN SECURITIES AS AT 30 JUNE 2014
30 Jun 2014
Investment * Cost Market Unrealised
Value profit / (loss)
GBP GBP GBP
Nevsun Resources Limited 2,845,485 2,685,697 (159,788)
Guyana Goldfields
Inc 2,586,992 2,005,362 (581,630)
Beadell Resources
Limited 1,986,021 1,686,431 (299,590)
Base Resources Limited 1,985,973 1,614,355 (371,618)
Amara Mining Plc 1,148,164 1,512,875 364,711
Panoro Minerals Limited 2,006,141 1,308,114 (698,027)
ETFS Palladium 1,207,823 1,244,741 36,918
Fission Uranium Corp 964,082 1,227,620 263,538
Kennady Diamonds Inc 319,158 1,114,333 795,175
Ivanhoe Mines Limited 1,253,038 1,098,017 (155,021)
16,302,877 15,497,545 (805,332)
-------------------- ------------------------ ----------------------------
* Each line represents the amalgamated holdings in an entity
if the Group has holdings in more than one share class in
the same company.
TOP 10 INVESTMENTS IN SECURITIES AS AT 30 JUNE 2013
30 Jun 2013
Investment * Cost Market Unrealised
Value profit / (loss)
GBP GBP GBP
Base Resources Limited 3,267,138 3,195,273 (71,865)
Endeavour Mining Corp 6,825,087 1,596,857 (5,228,230)
Nevsun Resources Limited 1,922,035 1,518,005 (404,030)
ETFS Palladium 1,624,643 1,490,416 (134,227)
Detour Gold Corp 4,031,861 1,436,851 (2,595,010)
Uranium Participation
Corp 1,469,266 1,410,051 (59,215)
Guyana Goldfields Inc 3,496,264 1,278,219 (2,218,044)
ETFS Platinum 1,585,539 1,384,542 (200,997)
iShares Silver Trust 1,549,997 1,126,714 (423,283)
SPDR Gold Shares 1,226,189 964,269 (261,920)
26,998,018 15,401,196 (11,596,821)
------------------- ------------------------- ----------------------------
* Each line represents the amalgamated holdings in an entity
if the Group has holdings in more than one share class in
the same company.
ADVISORS & CONTACT INFORMATION
Key Information
Exchange
Ticker
Listing Date
Fiscal Year End
Base Currency
ISIN
SEDOL
Country of Incorporation
Management and Administration
Registered Office
Altus Resource Capital Limited
P.O. Box 156, Frances House
Sir William Place
St Peter Port
Guernsey, GY1 4EU
Investment Manager
Altus Capital Limited
14 Station Road
Didcot
Oxfordshire, OX11 7LL
Placing and Corporate and Shareholder Advisory Agent
Nimrod Capital LLP
3 St Helen's Place
London, EC3A 6AB
Custodian
Royal Bank of Canada (Channel Islands) Limited
Canada Court
Upland Road
St Peter Port
Guernsey, GY1 3BQ
Specialist Fund Market of the LSE/ CISE
ARCL/ ARC
30 June 2009 / 22 December 2009
30 June
GBP
GG00B54BPN15
B54BPN1
Guernsey - Registration number 50318
Secretary and Administrator
JTC (Guernsey) Limited
P.O. Box 156, Frances House
Sir William Place
St Peter Port
Guernsey, GY1 4EU
Registrar
Anson Registrars Limited
PO Box 426, Anson House
Havilland Street
St Peter Port
Guernsey, GY1 3WX
Auditor
Deloitte LLP
Regency Court
Glategny Esplanade
St Peter Port
Guernsey, GY1 3HW
Board of Directors
Nick Falla (Chairman)
Robert Milroy
David Gelber
David Netherway
This information is provided by RNS
The company news service from the London Stock Exchange
END
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