TIDMUKT
RNS Number : 3006M
UK Select Trust Limited
22 August 2013
UK Select Trust Limited (the "Company")
22 August 2013
Announcement of Interim Results and Dividend
Interim Results
The financial information set out in this announcement is the
full unedited unaudited half-yearly financial report of the Company
for the period ended 30 June 2013, as approved by the Board of
Directors today. The half-yearly financial report will be uploaded
onto the section of the investment manager's website
(http://www.threadneedle.co.uk/en/Intermediary/Funds/Investment-Companies/UK-Select-Trust-Limited/)
and delivered to shareholders shortly.
Dividend
The Company also announces that a first interim dividend in
respect of the year ending 31 December 2013 of 1.80 pence per
Ordinary Share will be paid on Tuesday, 5 November 2013 to
shareholders on the register as at close of business on Friday, 6
September 2013 with a corresponding ex-divided date of Wednesday, 4
September 2013 (2012: first interim dividend 0.95 pence and second
interim dividend 3.20 pence).
The Company intends to continue with the policy of paying a
second interim dividend in respect of each financial year to
shareholders in May of the following year in place of a final
dividend. The objective is to rebalance the proportion of the
dividends paid by the Company between two interim dividends, so
that shareholders will receive a greater portion of the Company's
dividend distribution earlier. Although this will obviously result
in a lower second interim dividend, the total level of dividends
for the current financial year is expected to be no less than the
last financial year. This is neither a profit forecast nor a
binding commitment to pay such level of dividend and shareholders
should not place any reliance on receipt of such second interim
dividend.
Scrip election forms are expected to be sent to all shareholders
on or around 26 September 2013 and the latest date for receipt by
the Registrar of scrip elections is 10 October 2013.
Enquiries:
Kleinwort Benson (Channel Islands) Fund Services Limited
Secretary
Tel: + 44 (0) 1481 710607
UK Select Trust Limited
Half-Yearly Report and Condensed Unaudited Financial
Statements
for the period 1 January 2013 to 30 June 2013
UK Select Trust Limited
Contents
Introductory Information 2
Financial Highlights 3
Cautionary Note and Forward Looking Statements 3
Directors and Advisors 4
Investment Objective and Policy 5
Chairman's Statement 6
Investment Manager's Report 7
Responsibility Statement 9
The Portfolio and Sector Distribution 10
Condensed Statement of Comprehensive Income 12
Condensed Statement of Financial Position 14
Condensed Statement of Net Assets Attributable to Shareholders
15
Condensed Statement of Cash Flows 16
Notes to the Condensed Financial Statements 17
Introductory information
UK Select Trust Limited's (the "Company") ordinary shares are
traded on the Main Market of the London Stock Exchange.
The Company's share price is published daily under Investment
Companies in the Share Information Service in the Financial Times.
In addition it is published every Monday on the business pages of
The Guernsey Press and Star and Jersey Evening Post.
Financial Highlights
Six months Six months
ended ended Year ended
30 June 30 June 31 December
2013 2012 2012
Net asset value per
share 162.21p 137.30p 147.36p
Equity Shareholders'
interest (1) GBP35.52m GBP28.47m GBP30.44m
Revenue return on ordinary activities
for the financial period/year
after taxation GBP0.43m GBP0.12m GBP0.35m
Capital return / (deficit)on
ordinary activities for the financial
period/ year after taxation GBP3.19m (GBP0.47m) GBP1.57m
Revenue return per ordinary
share 2.06p 0.57p 1.72p
Capital return / (deficit)per
ordinary share 15.27p (2.31p) 7.59p
Dividend per ordinary
share (2) 1.80p 0.95p 4.15p
Share Price 163.00p 122.50p 146.25p
Net asset value total
return (3) 13.70% 1.14% 8.01%
FTSE All-Share total
return 8.50% 3.32% 12.30%
((1) During the period the Company purchased 25,000 ordinary
shares of 10p from the market to be held in Treasury. 179,947
ordinary shares of 10p each from the shares held in Treasury were
reissued during the period. 16,085 shares were held in Treasury at
30 June 2013. These are held for reissue and the Company does not
intend to cancel these. During the period 1,083,569 ordinary shares
of 10p each were issued to shareholders. After the period end a
further 90,000 ordinary shares were purchased to be held in
treasury.
(2) The dividend figures include the proposed dividend for the
relevant financial period.
(3) Source: Datastream/Threadneedle. Basis: Gross income
reinvested.
Dividends
In the Company's annual report for the year ended 31 December
2012 the Chairman advised that the Board was intending to increase
the proportion of income paid out in the first interim dividend in
November each year. Earnings per share for the half year amounted
to 2.06p (2012: 0.57p) and in line with the Board's intention the
Board has declared an interim dividend of 1.80p per share (Six
months ended 30 June 2012:0.95p), which will be paid on 5 November
2013 to shareholders on the register at 6 September 2013. The
Company intends to continue with the policy of paying a second
interim dividend each year to shareholders in May of the following
year in place of a final dividend. The objective is to rebalance
the proportion of the dividends paid by the Company between two
interim dividends, so that shareholders will receive a greater
portion of the Company's dividend distribution earlier. Although
this will obviously result in a lower second interim dividend, the
total level of dividends for the current financial year is expected
to be no less than last year.
Cautionary Note and Forward Looking Statements
The Investment Management Report (IMR) has been prepared solely
to provide additional information to shareholders to assess the
Company's strategies and the potential for those strategies to
succeed. The IMR should not be relied on by any other party or for
any other purpose.
The IMR contains certain forward-looking statements. These
statements are made by the Investment Manager in good faith based
on the information available to them up to the time of their
approval of this report and such statements should be treated with
caution due to the inherent uncertainties, including both economic
and business risk factors, underlying any such forward looking
information.
Directors and Advisors
J M Le Pelley (Chairman), (Born 1949) resident in
Guernsey,Non-executive Chairman. He has retired from private
practice as an Advocate of the Royal Court of Guernsey and joined
the board in 1983. Other directorships include AcenciA Debt
Strategies Limited.
D R Maltwood, (Born 1938) resident in Jersey,Non-executive
Director. He joined the board in 1997 after a career in stock
broking in Jersey. He has held a number of positions including the
Chairman and Director of a number of quoted companies.
G Ross Russell, (Born 1933) resident in the UK,Non-executive
Director. He joined the board in 1995. He is the Chairman of
Foresight 3 VCT Plc and former Chairman of the Chartered Institute
of Securities and Investment and Deputy Chairman of the London
Stock Exchange.
J G West FCA, (Born 1947) resident in the UK, Non-executive
Director. He joined the board in 1997. He was the Chairman of
Henderson Fledgling Trust Plc (formerly Gartmore Fledgling Trust
Plc) he retired from the Board at the end of 2011. He was also the
Chairman of Canaccord Genuity Limited, he became Deputy Chairman of
Canaccord Genuity Limited in March 2012. He is the Chairman of New
City High Yield Fund Limited, and a Director of a number of public
and private companies including British Assets Trust Plc and JP
Morgan Income and Capital Trust Plc. He is a former chief executive
of Lazard Asset Management Limited.
D Warr, (Born 1953) resident in Guernsey, Senior independent,
Non-executive Director and Audit Committee Chairman. He is a fellow
of the Institute of Chartered Accountants in England and Wales and
joined the Board in 2006. He is also a Non-executive Director of
Breedon Aggregates Limited, Schroder Real Estate Investment Trust
Limited, Acorn Income Fund Limited, Crystal Amber Fund Limited and
Unigestion (Guernsey) Limited.
Advisors
Secretary, Administrator and Registered Office Registrars
Kleinwort Benson (Channel Islands) Fund Services Limited Capita Registrars (Guernsey) Limited
Dorey Court Longue Hougue Road
Admiral Park St Sampson
St Peter Port Guernsey GY2 4JN
Guernsey GY1 2HT 0870 162 3100
01481 727111 (calls cost 10p per minute plus network extras,
lines are open 8:30am to 5:30pm Monday-Friday)
Investment Manager Brokers and advisors
Threadneedle Asset Management Limited Canaccord Genuity
Limited
60 St Mary Axe 88 Wood Street
London EC3A 8JQ London
United Kingdom EC2V 7QR
0207 464 5000 0207 523 8000
Auditor Bankers and Custodian
Deloitte LLP HSBC Bank plc
Regency Court 8 Canada Square
Glategny Esplanade London E14 5HQ
St Peter Port
Guernsey GY1 3HW
01481 724011
Investment Objective and Policy
The Company's Investment policy (as published in the Annual
Financial Report for the year ended 31 December 2012) which the
Company follows regarding asset allocation, risk diversification
and gearing is set out below.
Objective
The Company's investment objective is to provide shareholders
with a total return in excess of the total return on the FTSE
All-Share Index, together with a progressive dividend policy.
Investment Policy
The Company is permitted to invest in any security listed or
quoted on any UK stock exchange provided that no less than 80 per
cent of its gross assets at the time an investment is made are
invested in constituents of the FTSE All-Share index.
There are no minimum or maximum limits on the number of
investments in the portfolio but it is expected that the portfolio
will generally comprise shares and securities in 50 to 90
companies. The Company seeks to manage risk in part through heeding
the following investment restrictions:
-- The top five holdings in the Company's portfolio may not
exceed 40 per cent of the total value of portfolio.
-- The top three sectors represented in the portfolio may not
exceed 50 per cent of the total value of the portfolio.
-- The securities of no one company may represent more than 10
per cent of the value of the Company's portfolio measured at the
time of acquisition and subsequently, when additions are made to
the holding.
-- The Company will not hold more than 5 per cent of the issued
share capital (or voting shares) in any one company.
-- While the Company may hold shares in other investment
companies (including investment trusts), the Company will not
invest more than 10 per cent., in aggregate, of the value of its
total assets in other listed closed-ended investment funds (save to
the extent that such closed-ended investment funds have published
investment policies to invest no more than 15 per cent. of their
total assets in such other listed closed-ended investment
funds).
Cash
The Company intends to be fully invested in normal market
conditions but may hold up to 20 per cent of net asset value in
cash on deposit (or in short-term money market instruments) during
periods in which the Investment Manager believes markets are
overvalued or expects them to fall.
Gearing
Gearing may be used selectively in order to leverage the
Company's portfolio to enhance returns where the Investment Manager
considers it appropriate to do so. The Board has set a gearing
limit for the Company of a maximum of 20 per cent of net assets at
the time of draw down. However, in normal market conditions,
borrowings are not expected to exceed 10 per cent.
Derivatives
Subject to the Board giving its prior approval, the Investment
Manager is permitted to invest in options and other derivatives for
the purposes of efficient portfolio management only.
Investment Process
The Investment Manager's investment approach is driven by stock
selection, with a focus on risk and reward. Reward is derived from
valuation and profit opportunity. In terms of risk, it is the level
of business risk rather than index weight that determines position
size in the portfolio, with portfolio risk minimised through
diversification. Considerable emphasis is placed on identifying
companies which are well managed, have sustainable franchises,
strong balance sheets and cash flow generation, and which trade on
attractive valuations relative to peers and history.
Chairman's Statement
Review of Performance
I am pleased to present your Company's interim report for the
six months to 30 June 2013.
In the period the net asset value rose by 13.7% on a total
return basis. This compares favourably with the 8.5% total return
from the FTSE All-Share Index. In my half-year report last year I
spoke about the change of investment manager. Threadneedle Asset
Management assumed management of the portfolio on the 1st August
2012 and the Board remain very pleased with the investment
performance over the period.
Share Price and discount
Over the period under review, the share price increased from
146.25p to 163.00p, an increase of 11.5%. On a total return basis
(including dividends) the share price return over the period was
13.6%. The shares were trading at a 0.5% premium relative to their
net asset value at the end of the period compared with 0.8%
discount relative to their net asset value at the start of the
period.
Issue of Additional Shares
During the period the Company was successful in issuing an
additional 1,083,569 ordinary shares of 10p each to shareholders,
representing approximately 5% of the shares in issue at the time.
The shares were issued at 172.00 pence per share, representing a
premium of 1.44% to the prevailing net asset value per share of
169.56 pence. This issue of additional shares was accretive to net
asset value and also marginally reduced the Company's total expense
ratio, as it spread over a larger number of shares the fixed level
fees payable by the Company to some of its service providers. The
Company has shareholder authority to issue a number of shares
equivalent to up to 10% of its issued share capital, on a
non-preemptive basis, for a period up until the earlier of 31
December 2014 or the date of the next annual general meeting. It
intends to utilise such authority when circumstances permit to
further grow the Company for the benefit of its shareholders.
Gearing
The Company remained debt free during the period with no
gearing. The Board is currently seeking to negotiate a borrowing
facility during the course of 2013.
Dividend
In my report in the annual statement I spoke about the Board's
intention to increase the proportion of income paid out in the
first interim dividend in November each year. Earnings per share
for the half year amounted to 2.06p (2012: 0.57p). In line with our
intention the Board has declared an interim dividend of 1.80p per
share (2012:0.95p). The Company intends to continue with the policy
of paying a second interim dividend each year to shareholders in
May of the following year in place of a final dividend. The
objective is to rebalance the proportion of the dividends paid by
the Company between two interim dividends, so that shareholders
will receive a greater portion of the Company's dividend
distribution earlier. Although this will obviously result in a
lower second interim dividend, the total level of dividends for the
current financial year is expected to be no less than last
year.
J M Le Pelley
Chairman
22 August 2013
Investment Manager's Report
Market Background
UK equities delivered strong gains over the first quarter, as
optimism that the improving global economic backdrop beyond Europe,
helped by extensive central bank support, should bolster the
earnings outlook for UK companies. Although the UK trading
environment remained unhelpful, with the manufacturing and
construction sectors continuing to struggle, hopes grew that the
resilience of the service sector should help the UK economy to
avoid a return to recession. Nevertheless, two members of the Bank
of England's Monetary Policy Committee voted on consecutive months
for further quantitative easing (QE).
UK equities continued to deliver positive returns in April and
May, but this was reversed in June as global markets slid on
concern over the Federal Reserve's moves towards winding down its
quantitative easing programme. Data released in April showed that
the UK economy emerged from recession during the first quarter,
with GDP growing by 0.3%. Despite the on-going malaise in the
Eurozone, signs emerged that the UK's economic backdrop was
improving further, with the service sector showing some encouraging
signs.
Activity
New holdings during the first quarter included house builder
Crest Nicholson, an IPO. We funded the purchase by taking some
profits on some of our other house building stocks. We raised our
holding in Tullow Oil, taking the view that, following share price
weakness last year on disappointment surrounding its offshore
Ghanaian operations, the valuation reflected an overly pessimistic
view of the company's earnings growth prospects. We also extended
our overweight in BT and took advantage of share price weakness in
Johnson Matthey to add to the position. Sales activity was focused
on taking profits in a number of cyclical stocks that have
performed strongly, such as house builder Bellway and clothes
retailer N Brown.
During the second quarter we continued to favour selected
industrials, introducing a new holding in DCC, a leading
distributor of goods in Europe across a variety of sectors
including energy, healthcare and IT. In consumer staples we
introduced a new stake in PZ Cussons, a consumer products maker
with interests in Europe, Africa and Asia. This FTSE 250-listed
firm recently announced a return to full-year profits and is now
delivering profitable growth across all divisions. Given the scope
for further margin expansion, we took the view that emerging market
growth concerns presented an attractive entry point in mid-June. In
terms of sales, in addition to taking profits in easyJet, we locked
in profits in several house builders following a strong run since
the March Budget, trimming our holding in Persimmon. Other sales
during the second quarter included FirstGroup (which we exited
completely before the rescue rights issue) and Weir Group, where we
maintain a modest overweight.
Performance
It is satisfying to report that the portfolio has outperformed
the FTSE All-Share index significantly over the six months to end
of June. Both stock and sector selection contributed positively
over the six months but stock selection was the key driver of
outperformance.
At the sector level, during the first quarter, the portfolio
benefited from being overweight industrials, which outperformed,
and underweight materials, which underperformed significantly. The
materials sector was affected by renewed Chinese GDP growth
concerns and fears that the outlook for global growth could be
deteriorating. In the second quarter our favouring of consumer
discretionary was the chief contributor. Although our wary stance
toward financials and telecoms did detract, the effect was largely
offset by our favouring of industrials.
As already mentioned stock selection has been particularly
strong in materials; our overweight in Johnson Matthey added value
as the firm's results reflected an improvement in the US vehicle
market. Our lack of exposure to several large cap miners, such as
BHP Billiton and Glencore Xstrata, also boosted returns as concerns
over the demand outlook in China weighed onvaluations. At a stock
level detractors included the underweights in Lloyds Banking Group
and Vodafone, and the overweight in First Quantum Minerals, which
was unsettled by broader sector weakness.
Investment Manager's Report (continued)
Investment Strategy and Outlook
The prospect of an earlier-than-expected winding down of US
quantitative easing has triggered falls in bond and equity markets.
We believe that this demonstrates how much investor sentiment has
been reliant on central bank support (i.e. abundant liquidity),
rather than global economic fundamentals.
While the UK economy has shown some signs of improvement over
recent weeks, it remains to be seen whether the economy has yet
achieved the 'escape velocity' new Bank of England Governor Mark
Carney may be seeking. It is clear that monetary policy will remain
very accommodative, given the government's on-going commitment to
austerity. At the company level, we retain our view that the
outlook for quoted UK companies is more encouraging than the
domestic macro data might suggest, and we maintain our focus on
well-managed, fundamentally-strong businesses that we believe can
deliver positive earnings surprises.
Simon Brazier
Threadneedle Asset Management
22 August 2013
Responsibility Statement
To the best of the knowledge of the Directors:
-- The financial statements have been prepared in accordance
with International Accounting Standard 34 "Interim Financial
Reporting" and give a true and fair view of the assets,
liabilities, financial position and profit or loss of the
Company.
-- The Chairman's Statement, Investment Managers' Reports and
Notes to the Financial Statements are incorporated herein by
reference and include a fair review of the development and
performance of the Company and a description of the principal risks
and uncertainties that it faces for the next six months as required
by DTR 4.1.8 of the Disclosure and Transparency Rules.
-- There were no related party transactions in the period, nor
any changes in related party transactions described in the last
annual report, that could have a material effect on the financial
position of the Company in the period, other than as disclosed in
the financial statements. Details of related parties are set out in
note 9 to the financial statements.
By order of the Board
J M Le Pelley
22 August 2013
The Portfolio as at 30 June 2013
Market
Company Value Company Market Value
GBP'000 GBP'000
1 GlaxoSmithKline 1,577 43 John Wood Group 376
2 BP 1,412 44 Centrica 373
3 BT Group 1,327 45 De La Rue 359
4 Unilever 988 46 AMEC 357
5 Royal Dutch Shell 940 47 SAB Miller 352
6 AstraZeneca 820 48 Aviva 325
7 HSBC Holdings 800 49 Rentokil 325
8 BG Group 787 50 Pearson 324
9 DMGT 728 51 Electrocomponents 318
10 Rio Tinto 716 52 Crest Nicholson 316
11 Johnson Matthey 666 53 ITE Group 316
12 Booker Group 637 54 Standard Chartered 302
13 Sage Group 632 55 IMI 302
14 Legal and General 630 56 RSA Insurance Group 301
British American
15 Tobacco 618 57 Stagecoach Group 297
16 Rolls Royce 617 58 St James's Place 296
17 SIG 611 59 AZ Electronic Materials 285
18 Melrose 604 60 JD Wetherspoon 270
19 GKN 601 61 N Brown Group 232
20 Essentra 590 62 Headlam Group 225
21 Compass Group 588 63 Ultra Electronic 223
22 Persimmon 583 64 Premier Oil 215
23 Derwent London 582 65 PZ Cussons 206
24 Breedon Aggregates 576 66 Anglo American 193
25 Reed Elsevier 574 67 Rexam 184
26 DCC 561 68 Schroders 185
27 Imperial Tobacco 552 69 Old Mutual 170
28 Bellway 549 70 Weir Group 170
29 Smiths 532 71 Hunting 155
30 Wolseley 493 72 Colt Group SA 125
31 Berendson 484 73 Berkeley Group 40
-------------
32 Tullow Oil 480 Total Valuation 35,298
=============
These holdings represent 99.37%
33 Barclays 478 of the total valuation.
34 Carnival 465
35 Tesco 464
36 Easy Jet 461
37 Smith & Nephew 436
38 First Quantum Minerals 428
39 SVG Capital 424
40 Experian Group 393
41 Diageo 390
Reckitt Benckiser
42 Group 387
Sector Distribution as at 30 June 2013
Total Total
30 June 2013 30 June 2012
Sector Classification % %
---------------------------------------- ------------- -------------
Oil and Gas
Alternative Energy - 2.2
Oil and gas producers 11.2 18.7
Oil Equipment, Services and
Distribution 2.1 -
13.3 20.9
---------------------------------------- ------------- -------------
Industrials
Construction and materials 2.7 1.7
Aerospace and defence 2.4 2.5
General industrials 3.6 -
Industrial engineering 1.3 -
Support services 8.1 8.2
Industrial transportation 0.8 -
18.9 12.4
---------------------------------------- ------------- -------------
Basic Materials
Chemicals 4.3 -
Industrial metals and mining 5.5 6.0
---------------------------------------- ------------- -------------
9.8 6.0
---------------------------------------- ------------- -------------
Consumer goods
Automobiles and parts 1.7 -
Beverages 2.1 4.0
Food Producers 4.5 -
Household goods and home construction 4.4 4.0
Tobacco 3.3 3.3
Personal goods 0.6 -
16.6 11.3
---------------------------------------- ------------- -------------
Consumer Services
General retailers 0.7 -
Travel and leisure 5.0 -
Food and drug retailers 1.3 -
Media 4.6 8.8
---------------------------------------- ------------- -------------
11.6 8.8
---------------------------------------- ------------- -------------
Health Care
Pharmaceuticals and biotechnology 6.7 11.4
Health care equipment and Services 1.2 -
7.9 11.4
---------------------------------------- ------------- -------------
Telecommunications
Fixed line telecommunications 4.1 -
4.1 -
---------------------------------------- ------------- -------------
Utilities
Gas, Water and Multi utilities 1.1 5.3
1.1 5.3
---------------------------------------- ------------- -------------
Technology
Software and computer services 1.8 4.3
---------------------------------------- ------------- -------------
1.8 4.3
---------------------------------------- ------------- -------------
Financials
Banks 4.4 2.0
Financial services 0.5 0.9
Real estate 1.6 2.1
Non-life insurance 0.9 2.8
Life assurance 4.0 6.2
Equity investment instruments 2.9
14.3 14.0
---------------------------------------- ------------- -------------
Net current assets 0.6 5.6
---------------------------------------- ------------- -------------
Net assets 100.00 100.00
======================================== ============= =============
Note: The distribution of investments is based on the valuations
at 30 June 2013 and at 30 June 2012. All of the investments
are listed or quoted on the London Stock Exchange.
Condensed Statement of Comprehensive Income
for the six months ended 30 June 2013 (unaudited)
Six months ended 30 June Six months ended 30 June
2013 2012
Notes Revenue Capital Total Revenue Capital Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Income
Dividend revenue 3 660 - 660 404 - 404
Net gains/(losses) on financial
assets
at fair value through profit
or loss 5 - 3,295 3,295 - (400) (400)
Net foreign exchange
gains/(loss) - 1 1 - (18) (18)
--------- -------- ------- ---------- --------- -------
660 3,296 3,956 404 (418) (14)
Expenses
Investment management
fees 9 21 62 83 18 54 72
Performance fee 9 15 46 61 - - -
Administration fees 9 51 - 51 51 - 51
Registrars' fees 12 - 12 13 - 13
Auditors'
fees 9 - 9 9 - 9
Directors' fees
and expenses 9 55 - 55 58 - 58
Legal and professional
fees - - - 80 - 80
Other expenses 67 - 67 56 - 56
--------- -------- ------- ---------- --------- -------
Total operating
expenses before
finance costs 230 108 338 285 54 339
--------- -------- ------- ---------- --------- -------
Operating profit/(loss)
before finance costs 430 3,188 3,618 119 (472) (353)
Finance costs
Interest payable - - - 1 2 3
--------- -------- ------- ---------- --------- -------
Profit/(loss) for the
period 430 3,188 3,618 118 (474) (356)
Basic return/(deficit)
per ordinary share 4 2.06p 15.27p 17.33p 0.57p (2.31)p (1.74)p
--------- -------- ------- ---------- --------- -------
The total column of this statement is the condensed statement of
comprehensive income of the Company, with the revenue and capital
columns representing supplementary information.
All revenue and capital items in the above statement derive from
continuing operations. All income is attributable to the ordinary
shareholders of the Company.
The Notes on Pages 17 to 21 are an integral part of these
condensed financial statements.
Condensed Statement of Comprehensive Income (continued)
for the six months ended 30 June 2013 (unaudited)
Year ended 31 December 2012
Notes Revenue Capital Total
GBP'000 GBP'000 GBP'000
Income
Dividend revenue 3 833 - 833
Other income 3 1 - 1
Net gains on financial
assets at fair value through
profit or loss 5 - 1,680 1,680
Net foreign exchange loss - (18) (18)
---------- ---------- ---------
834 1,662 2,496
Expenses
Investment management fees 9 31 92 123
Administration
fees 101 - 101
Registrar's
fees 25 - 25
Auditor's fees 18 - 18
Directors' fees and expenses 9 114 - 114
Legal and professional
fees 75 - 75
Other expenses 114 - 114
---------- ---------- ---------
Total operating expenses
before finance costs 478 92 570
---------- ---------- ---------
Operating profit before
finance costs 356 1,570 1,926
Finance costs
Interest payable 2 5 7
---------- ---------- ---------
Profit for the year 354 1,565 1,919
========== ========== =========
Basic return per ordinary
share 4 1.72p 7.59p 9.31p
---------- ---------- ---------
The total column of this statement is the condensed statement of
comprehensive income of the Company, with the revenue and capital
columns representing supplementary information.
All revenue and capital items in the above statement derive from
continuing operations. All income is attributable to the ordinary
shareholders of the Company.
The Notes on Pages 17 to 21 are an integral part of these
condensed financial statements.
Condensed Statement of Financial Position
as at 30 June 2013 (unaudited)
30 June 30 June 31 December
Notes 2013 2012 2012
GBP'000 GBP'000 GBP'000
Assets
Cash and cash
equivalents 270 1,244 205
Due from brokers - 1,466 40
Other receivables and accrued
income 133 28 84
Financial assets at fair
value through profit or
loss 5 35,298 26,896 30,255
----------- ----------- ------------
Total assets 35,701 29,634 30,584
----------- ----------- ------------
Liabilities
Due to brokers - 897 14
Other payables
and accrued expenses 180 268 127
Total liabilities 180 1,165 141
----------- ----------- ------------
Net assets attributable
to shareholders 35,521 28,469 30,443
----------- ----------- ------------
Represented by
Share capital 7 2,192 2,083 2,083
Treasury share
reserve 7 (5) (157) (261)
Reserves 33,334 26,543 28,621
----------- ----------- ------------
Net assets attributable
to shareholders 35,521 28,469 30,443
----------- ----------- ------------
Number of ordinary shares
in issue (net of Treasury
shares) 7 21,897,968 20,735,573 20,659,452
Net asset value per share 8 162.21 137.30p 147.36p
----------- ----------- ------------
These financial statements were approved by the Board of
Directors on 22 August 2013 and signed on behalf of the Board
by:
J M Le Pelley D Warr
The Notes on Pages 17 to 21 are an integral part of these
condensed financial statements.
Condensed Statement of Net Assets Attributable to
Shareholders
for the six months ended 30 June 2013 (unaudited)
Equity Treasury Capital Capital
share share Share redemption Capital reserve- Revenue
capital reserve premium reserve reserve-realised unrealised reserve Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 January
2013 2,083 (261) 5,401 4,308 14,322 1,002 3,588 30,443
2012 Scrip
dividend
reserve
transfer* - - - - (385)* - 385* -
Shares
repurchased
during the
period - (39) - - - - - (39)
Share
subscriptions 109 - 1,755 - - - - 1,864
Cash dividends:
-2012 2(nd)
interim
dividend - - - - - - (365) (365)
Scrip dividends - 295 - - (295) - - -
Net profit - - - - 459 2,729 430 3,618
--------- --------- --------- ------------ ----------------- ------------ --------- --------
At 30 June
2013 2,192 (5) 7,156 4,308 14,101 3,731 4,038 35,521
--------- --------- --------- ------------ ----------------- ------------ --------- --------
*2012 Scrip dividends amounting to GBP385,000 deducted from
revenue reserves in the financial statements for the year ended 31
December 2012 have been transferred to capital reserves realised,
which is consistent with the Board's policy of allocating scrip
dividends against capital reserves realised.
There were no other recognised income and expenses for the six
months ended 30 June 2013
For the six months ended 30 June 2012 (unaudited)
Equity Treasury Capital Capital
share share Share redemption Capital reserve- Revenue
capital reserve premium reserve reserve-realised unrealised reserve Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 January
2012 2,083 (153) 5,401 4,308 16,507 (2,748) 4,073 29,471
Shares
repurchased
during the
period - (298) - - - - (298)
Cash dividends:
-2010 second
interim
dividend - - - - - - (348) (348)
Scrip dividends - 294 - - (294) - - -
Net profit - - - - (329) (145) 118 (356)
--------- --------- --------- ------------ ----------------- ------------ --------- --------
At 30 June
2012 2,083 (157) 5,401 4,308 15,884 (2,893) 3,843 28,469
--------- --------- --------- ------------ ----------------- ------------ --------- --------
There were no other recognised income and expenses for the six
months ended 30 June 2012
The Notes on Pages 17 to 21 are an integral part of these
condensed financial statements.
Condensed Statement of Cash Flows
for the six months ended 30 June 2013 (unaudited)
Six months ended Year ended
30 June 30 June 31 December
2013 2012 2012
Notes GBP'000 GBP'000 GBP'000
Cash flows from operating activities
Payment on purchase of financial
investments (5,199) (19,742) (44,097)
Proceeds from sale of financial
investments 3,476 18,942 42,563
Dividends received from investments 611 597 978
Investment management fee paid (79) (72) (159)
Other operating expenses (202) (148) (445)
Net cash outflow from operating
activities (1,393) (423) (1,160)
-------- --------- ------------
Cash flows from financing activities
Interest paid (3) (9) (10)
Share repurchase (39) (298) (493)
Share subscriptions 1,864 - -
Equity dividends paid (365) (348) (454)
Net cash inflow/(outflow) from
financing activities 1,457 (655) (957)
-------- --------- ------------
Net increase/(decrease) in cash and
cash equivalents 64 (1,078) (2,117)
Effect of exchange rate changes
on cash and cash equivalents 1 (18) (18)
Cash and cash equivalents at
the beginning of the period/year 205 2,340 2,340
Cash and cash equivalents at
the end of the period/year 270 1,244 205
-------- --------- ------------
The Notes on Pages 17 to 21 are an integral part of these
condensed financial statements.
Notes to the Condensed Financial Statements (unaudited)
1. General information
The Company is an authorised closed-ended investment company
incorporated under The Companies (Guernsey) Law, 2008, as amended,
with its registered office situate at Dorey Court, Admiral Park, St
Peter Port, Guernsey GY1 2HT. The Company's shares have been
admitted to the Official List of the UK Listing Authority with a
premium listing and to trading on the London Stock Exchange's Main
Market for listed securities.
The Company has no employees.
The half-yearly financial report has not been audited or
reviewed by the auditors Deloitte LLP pursuant to the Auditing
Practices Board guidance on 'Review of Interim Financial
Information'.
The information presented for the year ended 31 December 2012
does not constitute the statutory financial statements of the
Company. The 31 December 2012 annual financial report was made
public on 18 April 2013. The auditors' report on those financial
statements was unqualified and did not contain a statement under
Section 263(2) of The Companies (Guernsey) Law, 2008, as
amended.
2. Accounting Policies
a. Basis of presentation
The half-yearly report for the six months ended 30 June 2013 has
been prepared in accordance with IAS 34 'Interim Financial
Reporting' as adopted by the European Union.
b. Standards and interpretations
The accounting policies applied in the half-yearly report are
consistent with those of the annual financial statements for the
year ended 31 December 2012, as described in those financial
statements.
c. Going Concern
In the opinion of the Directors, there is a reasonable
expectation that the Company has adequate resources to continue in
operational existence for the foreseeable future. For this reason
the condensed financial statements have been prepared using the
going concern basis.
The Directors have arrived at this opinion by considering,
inter-alia, the following factors:
-- the Company has sufficient liquidity to meet all on-going expenses;
-- the portfolio of investments held by the Company consists of
listed investments which are readily realisable and therefore the
Company will have sufficient resources to meet its liquidity
requirements; and
-- the Company currently has no external borrowings and
therefore is under no obligation to repay any borrowing facilities
for the foreseeable future.
Notes to the Condensed Financial Statements (unaudited)
(continued)
3. Dividend and other revenue
Six months ended Year ended
30 June 30 June 31 December
2013 2012 2012
GBP'000 GBP'000 GBP'000
Dividend revenue from
investments designated
at fair value through
profit or loss:
Dividends 660 404 833
--------- -------- ------------
Other income - - 1
--------- -------- ------------
Total income 660 404 834
--------- -------- ------------
4. Basic return/(deficit) per ordinary share
Six months ended Six months ended Year ended
30 June 2013 30 June 2012 31 December 2012
Revenue Capital Total Revenue Capital Total Revenue Capital Total
pence pence pence pence pence pence pence pence pence
Return/(deficit) 2.06 15.27 17.33 0.57 (2.31) (1.74) 1.72 7.59 9.31
======== ======== ====== ======== ======== ======= ======== ======== ======
Revenue return per ordinary share is based on the net revenue on
ordinary activities of GBP430,000 (Six months ended 30 June 2012:
GBP118,000. Year ended 31 December 2012: GBP354,000.) and on
20,876,153 ordinary shares, being the weighted average number of
ordinary shares in issue during the period (Six months ended 30
June 2012: 20,562,644. Year ended 31 December 2012:
20,630,069).
Capital return per ordinary share is based on a net capital
profit for the financial period of GBP3,188,000 (Six months ended
30 June 2012: capital deficit GBP474,000. Year ended 31 December
2012: capital profit GBP1,565,000) and on 20,876,153 ordinary
shares, being the weighted average number of ordinary shares in
issue during the period (Six months ended 30 June 2012: 20,562,644.
Year ended 31 December 2012: 20,630,069).
Notes to the Condensed Financial Statements (unaudited)
(continued)
5. Financial assets at fair value through profit or loss
Six months ended Six months Year ended
ended
30 June 2013 30 June 2012 31 December 2012
Fair % of Fair % of Fair % of net
Value net assets Value net assets Value assets
GBP'000 GBP'000 GBP'000
Financial assets at
fair value through profit
or loss
- Listed equity securities 35,298 99.37 26,896 94.47 30,255 99.38
35,298 99.37 26,896 94.47 30,255 99.38
-------- ------------ -------- ------------ ---------- -----------
Six months ended Year ended
30 June 30 June 31 December
2013 2012 2012
Net gains/(losses) on financial GBP'000 GBP'000 GBP'000
assets at fair value through
profit or loss
Realised gains/(losses) 566 (255) (2,070)
Unrealised gains/(losses) 2,729 (145) 3,750
------------ ------------ ---------------
3,295 (400) 1,680
------------ ------------ ---------------
6. Loan facility
The Company had a revolving 5 year loan facility, secured on the
assets of the Company, which expired on 23 September 2012, and was
not renewed, with an aggregate principal amount of GBP2,000,000,
for the purposes of future investment. No loan interest was paid
during 2012. Before the expiration of the facility a fee of 0.30%
per annum was payable on the undrawn amount of GBP2,000,000.
Notes to the Condensed Financial Statements (unaudited)
(continued)
7. Share capital
30 June 30 June 31 December
2013 2012 2012
GBP'000 GBP'000 GBP'000
Authorised
100,000,000 ordinary shares
of 10p each 10,000 10,000 10,000
250,000 5% cumulative preference
restrictive voting shares of
GBP1 each 250 250 250
10,250 10,250 10,250
============= ========= =====================
The holders of the five per cent cumulative preference
restrictive voting shares shall be entitled, out of profits for
dividend, to a fixed cumulative preferential dividend at the rate
of five per cent per annum and in a winding-up or on a return of
capital shall be entitled to repayment of capital in priority to
the ordinary shareholders. At 30 June 2013, no five per cent
cumulative preference restrictive voting shares had been issued (30
June 2012: none, 31 December 2012: none). The ordinary shareholders
carry the right to receive any surplus income and in winding-up any
surplus assets, after repayment of the preference capital and
dividends as above.
30 June 31 December
2013 2012
GBP'000 GBP'000
Issued, called up
and fully paid:
21,914,053 ordinary shares of 10p
each
(2012: 20,830,484) 2,192 2,083
================ ==================
30 June 2013
Treasury share
reserve Shares in issue
Shares Cost Shares Cost
Nominal GBP'000 Nominal GBP'000
Balance at 1 January
2013 171,032 261 20,830,484 2,083
Shares purchased and held in
Treasury 25,000 39 - -
Shares issued in lieu of dividends
from Treasury (179,947) (295) - -
Share capital issued during
the year - - 1,083,569 109
Balance at 30
June 2013 16,085 5 21,914,053 2,192
------------- ----------- ------------------- ---------
31 December 2012
Treasury share
reserve Shares in issue
Shares Cost Shares Cost
Nominal GBP'000 Nominal GBP'000
Balance at 1 January
2012 87,878 153 20,830,484 2,083
Shares purchased and held in
Treasury 400,000 493 - -
Shares issued in lieu of dividends
from Treasury (316,846) (385) - -
Balance at 31 December
2012 171,032 261 20,830,484 2,083
------------- ----------- ------------------- ---------
During the period no shares were purchased for cancellation
(year ended 31 December 2012: none).
Notes to the Condensed Financial Statements (unaudited)
(continued)
7. Share capital (continued)
On 1 February 2013, 25,000 shares were purchased for Treasury at
a total cost including expenses of GBP38,452.
On 9 May 2013, 179,947 shares were issued to shareholders who
elected to receive them in lieu of a second interim cash dividend
for 2012. Ordinary shares of 10p each, fully paid were issued to
shareholders from the Treasury reserves account held by the
Company.
On 30 May 2013 1,083,569 ordinary shares of 10p each were issued
to shareholders with a share capital value of GBP108,356 and a
share premium value of GBP1,755,381
8. Net asset value per share
Net asset value per ordinary share is based on net assets
attributable to the ordinary shareholders of GBP35,521,000 (Six
months ended 30 June 2012: GBP28,469,000. Year ended 31 December
2012: GBP30,433,000) and on 21,897,968 (Six months ended 30 June
2012: 20,735,573. Year ended 31 December 2012: 20,659,452) ordinary
shares, being the number of ordinary shares in issue at the end of
the period.
9. Related party transactions
The members of the Board of Directors are listed on page 4 of
the half-yearly report. Fees earned by the Directors of the Company
during the period were GBP53,750 (Six months ended 30 June 2012:
GBP56,600. Year ended 31 December 2012: GBP107,500) of which
GBP4,651 (Six months ended 30 June 2012: GBP27,000. Year ended 31
December 2012: GBPnil) was outstanding at the period end. Allowable
expenses claimed by Directors in the course of their duties
amounted to GBP1,032 for the six months ended 30 June 2013 (Six
months ended 30 June 2012: GBP1,389. Year ended 31 December 2012:
GBP6,202).
Amerprise Financial Inc., the parent of Threadneedle, controlled
the voting rights attached to 22.20% of the Company's shares as at
30 June 2013. Threadneedle exercises discretion over these shares
on behalf of its clients and earned investment management fees of
GBP82,500 (2012: GBP37,800) during the period of which GBP42,028
(2012: GBP37,800) was outstanding at the reporting date. GBP61,305
performance fees were accrued for the period (Six months ended 30
June 2012: GBPNil).
The Company has appointed Kleinwort Benson (Channel Islands)
Funds Services Limited to provide administrative and accounting
services. Administrative fees (including the accounting fee) for
the period ended 30 June 2013 totalled GBP51,300 (Six months ended
30 June 2012: GBP50,688. Year ended 31 December 2012: GBP100,562)
of which GBP50,760 (Six months ended 30 June 2012: GBP48,423. Year
ended 31 December 2012: GBP49,578) was outstanding at the period
end.
JG West, who is the Deputy Chairman of Canaccord, is also a
director of the Company.
10. Events after the reporting date
There have been no significant events after the reporting date
which in the opinion of the Board of Directors requires disclosure
in the financial statements.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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