Interim Management Statement
19 Juli 2007 - 7:38PM
UK Regulatory
19 July 2007
GARTMORE IRISH GROWTH FUND PLC
INTERIM MANAGEMENT STATEMENT (UNAUDITED)
This interim management statement covers the period from 1 April 2007 to 30
June 2007. It has been produced for the sole purpose of providing information
to the Company's shareholders in accordance with the requirements of the UK
Listing Authority's Disclosure and Transparency Rules. It should not be relied
upon for any other purpose.
Investment Objective
The Company seeks to provide shareholders with long-term capital growth through
investment in quoted companies which are either incorporated in the Republic of
Ireland or Northern Ireland or, if elsewhere, derive the majority of their
turnover or profits from the Republic of Ireland or Northern Ireland.
Manager's Comments
Net asset value per Ordinary share fell by 5.5% to 960.0p per share in the
quarter to 30 June. Whilst there is no formal benchmark, this compares with
falls of 1.5% for the Davy Mid-Cap Index, 1.5% for the broad-based ISEQ Index
and 1.3% for the Hoare Govett Smaller Companies (ex Investment Companies),
whilst the FTSE All-Share Index rose 3.7%.
Although the Company outperformed most of the indices in the first quarter of
calendar year 2007, with NAV growth of 24.3%, performance suffered in the
second quarter from its holding in Ryanair. Following a period of strong growth
in the first quarter of the year, the low cost airline suffered its biggest
share price decline since 2004. Increased competition and significantly higher
passenger taxes and charges are having a negative impact on sales demand,
especially in the UK. The Company also suffered from not holding Elan, whose
share price increased by 68% during the second quarter.
One of the best performers in the portfolio during the period has been CRH, the
world's second biggest building materials supplier. European construction
markets are continuing to recover and cement demand is strong across most of
CRH's markets. We continue to favour ICON as we believe that the company's
large number of compounds in pre-clinical studies set to progress to human
trials underpins a positive medium-term outlook. During April, the company
reported strong quarterly results and raised its revenue guidance for 2007 and
its shares responded very positively.
Key stock changes included reducing Allied Irish Bank. As part of our strategy
we have sold out of financials generally as loan demand is falling away, and we
increased our holding in CRH, which is now the largest holding, and exited from
Ryanair during the quarter.
We remain confident of the vigour of the Irish economy. However, we note that
Euroland interest rates have increased twice in the quarter. This move together
with rising long-bond yields could slow economic growth and reduce the
viability of venture-capital-backed bids. The portfolio is well-placed to
perform well in equity markets where volatility has risen somewhat. We
anticipate that our bottom-up stock selection will enable us to continue to
identify a significant number of promising investment opportunities and to
deliver attractive returns as and when markets bounce.
Material Events and Transactions
Over the three months to 30 June 2007 the Company repurchased and placed into
Treasury 105,000 Ordinary shares at a price of 910p per share excluding
expenses (a discount to net asset value of 6.1%). Subsequent to the period
under review, the Company repurchased and placed into Treasury 108,000 Ordinary
shares on 6 July 2007 and 75,000 Ordinary shares on 19 July 2007 at prices of
895p and 885p per share, respectively, excluding expenses (representing a
discount to net asset value of 7.5% and 6.6% respectively). The Company will
continue, as and when appropriate, to exercise its powers to buy back shares
with the objective of reducing the share price discount to NAV whilst enhancing
the NAV per share.
10 Largest Equity Holdings at 30 June 2007:
Company Market value % of net
�'000 assets
CRH 11,856 8.7
ICON 8,684 6.4
Glanbia 7,940 5.8
Aer Lingus Group 7,082 5.2
DCC 6,921 5.1
Kerry Group 6,057 4.5
Kenmare Resources 5,836 4.3
C&C Group 5,367 4.0
Paddy Power 5,123 3.8
Total Produce 5,011 3.7
Sectoral Spread of Investments at 30 June 2007:
% of net
assets
Non-Cyclical Consumer Goods 29.7
Cyclical Services 23.0
Basic Industries 9.8
Resources 8.8
Information Technology 7.6
Non-Cyclical Services 2.7
General Industrials 2.0
Cyclical Consumer Goods 1.9
Financials 0.9
Net current assets 13.6
Financial Position: As at As at
30.06.07 31.03.07
(unaudited) (audited)
�m �m
Investments 117.2 124.7
Cash and other net current assets 18.6 19.6
Net assets 135.8 144.3
Net assets attributable to Ordinary shares** 135.8 144.3
Gearing
No loans drawn down.
Performance*:
As at % increase/(decrease) over
30.06.07 3 months 1 year 3 years 5 years 10 years
Net asset value per 960.0p (5.5%) 26.5% 109.2% 259.7% 518.5%
Ordinary
share**
Share price - Ordinary 880.5p (11.6%) 23.0% 121.0% 265.4% 554.6%
shares
Discount 8%
* Source: Thomson Financial Datastream. Basis: Capital performance only, debt
at par.
** Excludes current year revenue account, which stood at -�0.02m at 30 June
2007.
Price and Performance Information:
The Company's Ordinary shares are listed on the London and Irish Stock
Exchanges and the price is published in the Financial Times and The Daily
Telegraph under `Investment Companies'. Real-time share price information is
available on 0906 843 0000 (select menu item 2 and then enter company code
5137). Calls are charged at 60p per minute at all times.
The Company's net asset value is calculated daily and can be viewed on the
London Stock Exchange website at www.londonstockexchange.com and via a link
from the Gartmore web site at www.gartmore.co.uk.
Further information can be obtained from Gartmore as follows:
Free investor helpline: 0800 289 336
Internet address: www.gartmore.co.uk
Email address: helpline@gartmore.com
The information provided in this statement should not be considered as a
financial promotion.
Interim management statements are expected to be published in July and January
each year.
By order of the Board
Capita Sinclair Henderson Limited
Corporate Company Secretary
19 July 2007
Please note: It is currently intended that future first and third quarter
Interim Management Statements will be announced via a regulatory news service
and made available for download from the Gartmore web site, but will not be
mailed to shareholders except on request.
END
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