TIDMFPEO TIDMFPER TIDMFPEZ
RNS Number : 6129E
F&C Private Equity Trust PLC
08 April 2011
To: Stock Exchange For immediate release:
8 April 2011
THE ANNUAL FINANCIAL REPORT ANNOUNCEMENT FOR F&C PRIVATE
EQUITY TRUST PLC RELEASED TODAY AT 14:21 UNDER RNS NO. 5988E HAS
BEEN RE-RELEASED TO FACILITATE ONWARD TRANSMISSION BY THIRD PARTY
VENDORS. THE ANNOUNCEMENT IS UN-CHANGED AND IS REPRODUCED IN FULL
BELOW
F&C Private Equity Zeros plc
Audited results for the period from incorporation to 31 December
2010
Chairman's Statement
I am pleased to present the Company's first results for the
period from incorporation on 9 October 2009 to 31 December
2010.
The Company is a wholly owned subsidiary of F&C Private
Equity Trust plc ('F&C PET') and was established solely for the
purpose of issuing and redeeming Zero Dividend Preference Shares
('ZDP Shares'). 30,000,000 ZDP Shares were issued on 14 December
2009 at 100 pence per share and will redeem on 15 December 2014 at
a price of 152.14 pence per ZDP Share, giving a redemption yield of
8.75 per cent per annum. The proceeds of the ZDP Shares issue were
lent to F&C PET for use in future investment opportunities.
The revenue available for dividends for the period was GBP2,920.
As at 31 December 2010 the net asset value per Ordinary Share was
105.84 pence and the net asset value per ZDP Share was 105.91
pence.
As at 31 December 2010 the ZDP Share price was 121.50 pence,
representing a premium of 14.7 per cent over the net asset value
per share.
Mr David Simpson, who was the Company's Chairman from the date
of incorporation, retired from the Board on 24 May 2010 and I was
elected Chairman of the Company on the same date. All the Directors
of the Company are also directors of F&C PET.
Mark Tennant
Chairman
F&C Private Equity Zeros plc
Audited Statement of Comprehensive Income
Period from 9 October 2009 to 31 December 2010
Period
ended
31 December
2010
GBP'000
----------------------------------- --------------
Revenue
Income 2,909
----------------------------------- --------------
Total income 2,909
Expenditure
Expenses -
----------------------------------- --------------
Total expenditure -
----------------------------------- --------------
Profit before finance costs
and taxation 2,909
Finance costs (2,906)
----------------------------------- --------------
Profit before taxation 3
Taxation -
----------------------------------- --------------
Total comprehensive income 3
----------------------------------- --------------
Earnings per Ordinary Share 5.84p
----------------------------------- --------------
F&C Private Equity Zeros plc
Audited Balance Sheet
At 31 December 2010 2010
GBP'000 GBP'000
------------------------------------------ -------- ---------
Non current assets
Investments 50
50
Current assets
Loans and other receivables 31,775
Cash at bank 2
Net current assets 31,777
Total assets less current liabilities 31,827
------------------------------------------ -------- ---------
Creditors: amounts falling due after one
year
Zero dividend preference shares (31,774)
Net assets 53
------------------------------------------ -------- ---------
Equity
Ordinary share capital 50
Revenue reserve 3
------------------------------------------ -------- ---------
Shareholders' funds 53
------------------------------------------ -------- ---------
Net asset value per Ordinary Share 105.84p
------------------------------------------ -------- ---------
Net asset value per ZDP Share 105.91p
------------------------------------------ -------- ---------
F&C Private Equity Zeros plc
Audited Statement of Changes in Equity
Period from 9 October 2009 to 31 December
2010
Share Revenue
Capital Reserve Total
GBP'000 GBP'000 GBP'000
------------------------------------------- --------- --------- --------
Net assets at start of period - - -
Share Capital proceeds 50 - 50
Profit for the period - 3 3
------------------------------------------- --------- --------- --------
Net assets at 30 June 2010 50 3 53
------------------------------------------- --------- --------- --------
F&C Private Equity Zeros plc
Audited Cash Flow Statement
Period from 9 October 2009 to 31 December
2010 2010
GBP'000
-------------------------------------------- ---------
Cash flows from operating activities
Profit before finance costs and taxation 3
Increase in other receivables (1)
-------------------------------------------- ---------
Net cash inflow from operating activities 2
-------------------------------------------- ---------
Cash flows from investing activities
Purchase of investments (50)
-------------------------------------------- ---------
Net cash outflow from investing activities (50)
-------------------------------------------- ---------
Cash flows from financing activities
Proceeds from issue of share capital 50
Proceeds from issue of ZDPs 30,000
Loan to parent company (30,000)
-------------------------------------------- ---------
Net cash inflow from financing activities 50
-------------------------------------------- ---------
Increase in cash and cash equivalents 2
-------------------------------------------- ---------
Cash and cash equivalents at beginning
of period -
-------------------------------------------- ---------
Cash and cash equivalents at end of period 2
-------------------------------------------- ---------
Principal Risks and Uncertainties and Risk Management
Final Capital Entitlement
The ZDP shares offer a pre-determined rate of growth in capital
entitlement up to the repayment date of 15 December 2014 but no
right of income.
F&C PET's debt to the Company is pursuant to the loan
agreement which ranks behind any secured creditors of F&C PET.
Therefore it is not guaranteed that the final capital entitlement
will be paid. On a return of assets, including a winding up of
F&C PET, the Company will only receive payment if there are
sufficient assets of F&C PET, having first taken account of
prior ranked liabilities and having regard to all other unsecured
liabilities of F&C PET. ZDP shares are not a secured, protected
or guaranteed investment. The final capital entitlement of the ZDP
Shares is 152.14 pence per share.
Liquid Market for ZDP Shares
The market price and realisable value of the ZDP shares, as well
as being affected by the underlying value of F&C PET's net
assets, will be affected by interest rates, supply and demand for
the ZDP shares, market conditions and general investor sentiment.
As such, the market value and realisable value (prior to
redemption) of a ZDP share can fluctuate and may not always reflect
its accrued capital entitlement. In addition, given the Company's
size and type, there is no guarantee that an active market will be
sustained for the ZDP shares. If an active trading market is not
maintained, the liquidity and trading price of the ZDP shares could
be adversely affected.
Macroeconomic and Investment Risks
The Company's obligation to pay the ZDP Shareholders the final
capital entitlement is dependent upon F&C PET's ability to
comply with its obligations to the Company. This in turn is
impacted by F&C PET's performance and its ability to manage
macroeconomic and investment risk. A material fall in the value of
assets in the investment portfolio of F&C PET may lead to a
winding up of F&C PET in the longer term.
The performance of F&C PET's underlying investment portfolio
is principally influenced by a combination of economic growth, the
availability of appropriately priced debt finance, interest rates
and the number of active trade and financial buyers. All of these
factors have an impact on F&C PET's ability to invest and on
F&C PET's ability to exit from its underlying portfolio or on
the levels of profitability achieved on exit. Financial results may
be adversely affected by movements in foreign exchange rates.
F&C PET operates in a very competitive market. Changes in
the number of market participants, the availability of funds within
the market, the pricing of assets, or in the ability of its
Manager, F&C Investment Business Limited, to access deals could
have a significant effect of F&C PET's competitive position and
on sustainability of returns.
In order to source and execute good quality of investments,
F&C PET is primarily dependent upon F&C Investment Business
Limited having the ability to attract and retain executives with
the requisite investment experience.
Once invested, the performance of the F&C PET portfolio is
dependent on a range of factors. These include but are not limited
to: (i) the quality of the initial investment decision; (ii) the
ability of the portfolio company to execute successfully its
business strategy; and (iii) actual outcomes against key
assumptions underlying the portfolio company's financial
projections. Any one of these factors could have an impact on the
valuation of a portfolio company and upon F&C PET's ability to
make a profitable exit from the investment within the desired
timeframe. Future F&C PET share issues, share buy backs or
raising new debt facilities in the longer term could dilute the
interests of the ZDP shareholders and lower the price of the ZDP
shares.
Government Policy and Regulation Risk
F&C PET carries on business as an investment trust under
section 1158 of the Corporation Tax Act 2010. Continuation and
approval by HM Revenue and Customs is subject to F&C PET
conducting its affairs in a manner which will satisfy the
conditions for continued approval as an investment trust. Any
change in F&C PET's tax status, or in taxation legislation of
practice in the UK or elsewhere, could affect the value of
investments in F&C PET's investment portfolio and F&C PET's
ability to achieve its investment objective and could also affect
the tax treatment of the ZDP Shares and the tax treatment of the
final capital entitlement.
The Company is also exposed to risks in relation to its
financial instruments. Further details of these risks and the way
they are managed are contained in note 2.
Directors' Responsibility Statement
The Directors are responsible for preparing the Annual Report
and the financial statements in accordance with applicable United
Kingdom law and those International Financial Reporting Standards
('IFRSs') as adopted by the European Union.
Under company law the Directors must not approve the financial
statements unless they are satisfied that they present fairly the
financial position, financial performance and cash flows of the
Company for that period. In preparing the financial statements the
Directors are required to:
-- select suitable accounting policies in accordance with
IAS8:Accounting Policies, Changes in Accounting Estimates and
Errors and then apply them consistently;
-- 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 IFRSs is insufficient to enable users to
understand the impact of particular transactions, other events and
conditions on the Company's financial position and financial
performance;
-- state that the Company has complied with IFRSs, subject to
any material departures disclosed and explained in the financial
statements; and
-- make judgements and estimates that are reasonable and
prudent.
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 financial statements comply with the Companies Act 2006 and
Article 4 of the IAS Regulation. 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.
Each of the Directors confirms that to the best of his or her
knowledge:
-- the financial statements, prepared in accordance with IFRS as
adopted by the European Union, give a true and fair view of the
assets, liabilities, financial position and profit or loss of the
Company;
-- the Chairman's Statement includes a fair review of the
development and performance of the business and the position of the
Company; and
-- "Principal Risks and Uncertainties and Risk Management" above
includes a description of the principal risks and uncertainties
that the Company faces.
On behalf of the Board
Mark Tennant
Director
Notes
1. The results which were approved by the Board on 8 April 2011,
have been prepared in accordance with International Financial
Reporting Standards as adopted by the EU ('IFRS').
2. Financial instruments
The Company's financial instruments comprise fixed interest
investments, cash balances and liquid resources including debtors
and creditors.
Quoted fixed assets investments held are valued at bid prices
which equate to their fair values.
The main risks arising from the Company's financial instruments
are market risk, interest rate risk, liquidity risk and credit
risk.
Market risk
Market risk embodies the potential for both losses and gains and
includes interest rate risk and price risk.
Interest rate risk
The Company's financial assets are interest bearing, some of
which are at fixed rates and some at variable. As a result the
Company is subject to exposure to fair value interest rate risk due
to fluctuations in the prevailing levels of market interest
rates.
Liquidity and funding risk
This is the risk that the Company will encounter difficulty in
meeting obligations associated with financial liabilities.
Liquidity risk is considered to be significant as the Company is
reliant upon the sale of assets within its parent undertaking,
which mainly comprises unlisted investments. Details of how this
risk is managed are contained within the financial statements of
the parent company.
Credit risk
This is the risk that a counterparty to a financial instrument
will fail to discharge an obligation or commitment that it has
entered with the Company.
3. Earnings per share are based on 50,000 Ordinary Shares in
issue during the period.
Net asset value per Ordinary Share is based on 50,000 shares in
issue at the end of the period.
Net asset value per ZDP Share is based on 30,000,000 shares in
issue at the end of the period.
4. This announcement is not the Company's statutory accounts.
The statutory accounts for the period to 31 December 2010 (on which
the audit report has been signed) will be delivered to the
Registrar of Companies.
5. A copy of the Annual Report and Financial Statements has been
submitted to the National Storage Mechanism and will shortly be
available for inspection at www.Hemscott.com/nsm.do
6. The report and accounts for the period will be sent to
shareholders and are available for inspection at the Company's
registered office, 80 George Street, Edinburgh EH2 3BU and the
parent company's website www.fcpet.co.uk
For more information, please contact:
Hamish Mair 0131 718 1184
Gordon Hay Smith 0131 718 1018
hamish.mair@fandc.com / gordon.haysmith@fandc.com
This information is provided by RNS
The company news service from the London Stock Exchange
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