Quarterly Report • May 22, 2019
Quarterly Report
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RNS Number : 7661Z
Majedie Investments PLC
22 May 2019
Majedie Investments PLC
Half-Yearly Financial Report
31 March 2019
Financial Highlights for the half year ended 31 March 2019
| Total shareholder return (including dividends): | -2.9% |
| Net asset value (NAV) total return (debt at par including dividends): | -4.2% |
| NAV total return (debt at fair value including dividends): | -4.5% |
| NAV per share (Debt at par value): | 313.1p |
| NAV per share (Debt at fair value): | 304.4p |
| Revenue Return per share: | 8.0p |
| Interim Dividend: | 4.4p |
| Directors' valuation of investment in Majedie Asset Management Limited: | £52.3m |
| Total assets*: | £187.8m |
| * Total assets are defined as total assets less current liabilities. |
Investment Objective and Policy Statement
Investment Objective
The Company's investment objective is to maximise total shareholder return whilst increasing dividends by more than the rate of inflation over the long term.
General
The Company invests principally in securities of publicly quoted companies worldwide and in funds managed by its investment manager, though it may invest in unquoted securities up to levels set periodically by the Board, including its investment in Majedie Asset Management Limited (MAM). Investments in unquoted securities, other than those managed by its investment manager or made prior to the date of the adoption of this investment policy, (measured by reference to the Company's cost of investment) will not exceed 10% of the Company's gross assets.
Risk Diversification
Whilst the Company will at all times invest and manage its assets in a manner that is consistent with spreading investment risk, there will be no rigid industry, sector, region or country restrictions. The overall approach is based on an analysis of global economies sector trends with a focus on companies and sectors judged likely to deliver strong growth over the long term. The number of investments held, together with the geographic and sector diversity of the portfolio, enable the Company to spread its risks with regard to liquidity, market volatility, currency movements and revenue streams.
The Company will not invest in any holding that would, at the time of investment, represent more than 15% of the value of its gross assets save that the Company may invest up to 25% of its gross assets in any single fund managed by its investment manager where the Board believes that the investment policy of such funds is consistent with the Company's objective of spreading investment risk.
The Company may utilise derivative instruments including index-linked notes, contracts for difference, covered options and other equity-related derivative instruments for efficient portfolio management and investment purposes.
Any use of derivatives for investment purposes will be made on the basis of the same principles of risk spreading and diversification that apply to the Company's direct investments, as described above.
Asset Allocation
The assets of the Company will be allocated principally between investments in publicly quoted companies worldwide, in investments intended to provide an absolute return (in each case either directly or through other funds or collective investment schemes managed by the Company's investment manager) and in the Company's investment in MAM itself.
Benchmark
The Company does not have one overall benchmark, rather each distinct group of assets is viewed independently. Any investments made into funds managed by the Company's investment manager will be measured against the benchmark or benchmarks, if any, whose constituent investments appear to the Company to correspond most closely to those investments. It is important to note that in all cases investment decisions and portfolio construction are made on an independent basis. The Board however sets various specific portfolio limits for stocks and sectors in order to restrict risk levels from time to time, which remain subject to the investment restrictions set out in this section.
Gearing
The Company uses gearing currently via long term debentures. The Board has the ability to borrow up to 100% of adjusted capital and reserves. The Board also reviews the level of net gearing (borrowings less cash) on an on-going basis and sets a range at its discretion as appropriate. The Company's current debenture borrowings are limited by covenant to 66⅔%, and any additional indebtedness is not to exceed 20%, of adjusted capital and reserves.
Chief Executive's Report
In the six months ended 31 March 2019 the NAV at par and NAV at FV (net asset value with debt at par and at fair value) fell by 4.2% and 4.5% respectively on a total return basis. The share price fell by 2.9% over the period, also on a total return basis. Over the six months the FTSE All Share Index fell by 1.8% and the MSCI All Country World Index fell by 2.0% in sterling terms.
Results and Dividend
The Company had a capital loss for the six months to 31 March 2019 of £11.9m. The loss includes a reduction in the holding value of Majedie Asset Management of £2.9m. The valuation is based on a formula which has been used in prior years; however, in light of lower valuations of other fund management companies, the Board has felt it prudent to discount the formulaic valuation, which reduces the value of the holding in MAM to £52.3m. The retained valuation represents a discount to the formulaic valuation of £9.6m or 15%.
The total income received from investments was £4.8m compared to £4.7m in the six months to 31 March 2018. The dividend received from MAM of £3.5m was the same as in the six months to 31 March 2018 and the income from the MAM Funds increased by £0.1m. Total administration expenses and management fees were flat at £0.9m. Finance costs fell by £0.2m due to the redemption of the 2020 Debentures in December 2017.
The net revenue return after tax for the six months to 31 March 2019 was £4.3m compared to £4.1m in the six months to 31 March 2018.
The Board has declared an interim dividend of 4.4p (2018: 4.0p), which will be paid on 14 June 2019 to shareholders on the register on 31 May 2019.
Asset Allocation
The Company invests through a number of investment strategies managed by MAM and retains an equity holding in MAM of 17.1%. The Company has no overall benchmark; rather each fund has its own benchmark. The Company's total assets were £187.8m at 31 March 2019. In the six months to 31 March 2019 there were no significant changes to the asset allocation and no sales of MAM shares.
MAM Funds and investment Performance
The MAM UK Equity Fund launched in March 2003. Its objective is to produce a total return in excess of the FTSE All-Share Index over the long term. Since inception to 31 March 2019 it has returned 11.5% per annum net of fees, with a relative outperformance of 2.6% against its benchmark. The Company's assets are invested in a segregated mandate that is managed pari passu to the MAM UK Equity Fund. The funds are predominantly invested in UK equities with overseas equities limited to 20% and the strategy incorporates a dedicated allocation to UK smaller companies. At 31 March 2019 the Company had an allocation to it of £54.4m, which represents 29.0% of total assets. In the six months to 31 March 2019 the mandate returned -4.4% net of fees which is an underperformance of 2.6% against its benchmark. At the sector level the largest positive contributors were Telecoms, Healthcare Equipment and Mining (gold) (all overweight); detractors were Utilities, Oil Equipment (both overweight) and Beverages (not owned). The positive stock contributors to performance over the six months included Serco, Barrick Gold and Marshalls (all overweight); detractors were Centrica, Ensco (both overweight) and Diageo (not held).
The table below shows the principal overweight and underweight sector positions of the MAM UK Equity Segregated Portfolio at 31 March 2019 relative to the FTSE All-Share Index in %.
| Food & Drug Retailers | 7.5 | Overweight |
| Fixed Line Telecommunications | 5.0 | Overweight |
| General Retailers | 3.3 | Overweight |
| Oil & Gas Producers | 2.9 | Overweight |
| Support Services | 2.3 | Overweight |
| Financial Services | -2.6 | Underweight |
| Household Goods & Home Construction | -3.2 | Underweight |
| Beverages | -3.5 | Underweight |
| Tobacco | -4.3 | Underweight |
| Equity Investment Instruments | -4.9 | Underweight |
The MAM UK Income Fund launched in December 2011. Its objective is to maintain an attractive yield whilst outperforming the FTSE All-Share Index over the long term, with up to 20% invested in overseas equities. The historic yield is 5.3%. Since inception to 31 March 2019, the Fund has returned 12.3% per annum net of fees, with a relative outperformance of 3.3% per annum against its benchmark. At 31 March 2019 the Company had an allocation of £14.7m, which represents 7.8% of the Company's total assets. In the six months to 31 March 2019 the Fund returned -5.6%, which represents an underperformance of 3.8%. The largest positive contributors at a sector level were Food Producers, Life Insurers (both overweight) and General Industrials (not owned); detractors were Oil and Gas Producers, Utilities (both overweight) and Mining (underweight). Positive stock contributors were Legal and General, Pearson and Roche (all overweight) and detractors were Centrica, Aviva (both overweight) and Diageo (not held).
The table below shows the principal overweight and underweight sector positions of the MAM UK Income Fund at 31 March 2019 relative to the FTSE All-Share Index in %.
| Life Insurance | 10.4 | Overweight |
| Oil & Gas Producers | 4.2 | Overweight |
| Media | 3.8 | Overweight |
| Food Producers | 2.6 | Overweight |
| Aerospace & Defence | 2.2 | Overweight |
| Household Good & Home Construction | -3.3 | Underweight |
| Beverages | -3.7 | Underweight |
| Mining | -3.7 | Underweight |
| Tobacco | -4.3 | Underweight |
| Equity Investment Instruments | -5.1 | Underweight |
The MAM Global Equity and MAM Global Focus Funds launched in June 2014. Their objectives are to provide a total return in excess of the MSCI All Country World Index over the long term through investment in a diversified portfolio (MAM Global Equity Fund) or concentrated portfolio (MAM Global Focus Fund) of global equities incorporating emerging markets. Since inception, the Funds have returned 12.5% and 12.0% per annum net of fees for the sterling share classes which represent an outperformance of 0.6% and 0.1%, respectively against their benchmark. At 31 March 2019 the Company had allocations of £22.7m and £8.0m to the MAM Global Equity and MAM Global Focus Funds representing 12.1% and 4.3% of total assets. In the six months to 31 March 2019 the Funds returned 0.6% and 1.1% net of fees which represents an outperformance of 2.6% and 3.1% respectively. At the sector level, for the MAM Global Equity Fund, the largest positive contributors were Internet and Direct Retail, Biotechnology and Metals and Mining (all overweight); detractors were Entertainment, Interactive Media and Health Care Technology (all overweight). Positive stock contributions were Ionis Pharmaceuticals, Mercadolibre and Royal KPN (all overweight); detractors were Take-Two Interactive, Parsley Energy and Baidu (all overweight). For the MAM Global Focus Fund, the largest positive contributors to performance at a sector level were Internet and Direct Retail, Diversified Telecom Services and Biotechnology (all overweight); detractors were Entertainment, Energy Equipment and Chemicals (all overweight). Positive stock contributions were Royal KPN, Ionis Pharmaceuticals and Barrick Gold (all overweight); detractors were Take Two Interactive, Diamond Offshore Drilling and Softbank (all overweight).
The tables below shows the principal overweight and underweight sector positions of the MAM Global Equity Fund at 31 March 2019 relative to the MSCI All Country Index, in %.
| Internet & Direct Marketing Retail | 6.6 | Overweight |
| Interactive Media & Services | 4.2 | Overweight |
| Integrated Telecommunication Services | 3.3 | Overweight |
| Wireless Telecommunication Services | 3.0 | Overweight |
| Gold | 2.8 | Overweight |
| Health Care Equipment | -1.6 | Underweight |
| Packaged Food & Meats | -1.8 | Underweight |
| Technology Hardware Storage & Peripherals | -2.1 | Underweight |
| Data Processing & Outsourced Services | -2.3 | Underweight |
| Diversified Banks | -3.8 | Underweight |
The tables below shows the principal overweight and underweight sector positions of the MAM Global Focus Fund at 31 March 2019 relative to the MSCI All Country World Index, in %.
| Integrated Telecommunication Services | 7.4 | Overweight |
| Integrated Oil & Gas | 6.4 | Overweight |
| Wireless Telecommunication Services | 5.1 | Overweight |
| Internet & Direct Marketing Retail | 4.6 | Overweight |
| Personal Products | 3.7 | Overweight |
| Packaged Food & Meats | -1.8 | Underweight |
| Health Care Equipment | -2.1 | Underweight |
| Data Processing & Outsourced Services | -2.3 | Underweight |
| System Software | -2.6 | Underweight |
| Diversified Banks | -4.8 | Underweight |
The MAM US Equity Fund was launched in June 2014. Since inception the Fund has returned 14.5% per annum net of fees for the sterling share class. This represents an underperformance of 1.5% per annum against its benchmark S&P 500 Index. At 31 March 2019 the Company had an allocation of £8.8m which represents 4.7% of total assets. In the six months to 31 March 2019 the Fund returned 0.5% net of fees which is an outperformance of 2.5% against its benchmark. At the sector level the largest positive contributors to performance were Insurance (overweight), Technology Hardware (underweight) and Media (overweight); detractors were REITs, Household Products (both not held) and Airlines (overweight). Positive stock contributors were New York Times, American Electric Power (both overweight) and Apple (not owned); detractors were Parsley Energy, Lockheed Martin and Alaska Air (overweight).
The table below shows the principal overweight and underweight sector positions of the MAM US Equity Fund at 31 March 2019 relative to the S&P 500 Index, in %.
| IT Consulting & Other Services | 6.7 | Overweight |
| Interactive Media & Services | 4.5 | Overweight |
| Insurance Brokers | 4.4 | Overweight |
| Financial Exchange & Data | 4.1 | Overweight |
| Wireless Telecommunication Services | 3.4 | Overweight |
| Health Care Equipment | -2.0 | Underweight |
| Integrated Telecommunication Services | -2.0 | Underweight |
| Semiconductors | -2.7 | Underweight |
| Data Processing & Outsourced Services | -3.7 | Underweight |
| Technology Hardware Storage & Peripherals | -4.0 | Underweight |
The MAM Tortoise Fund is a global equity absolute return fund which was launched in August 2007. Its objective is to achieve positive absolute returns in all market conditions over rolling three year periods, with less volatility than a conventional long only fund. Since inception to 31 March 2019, the Fund has returned 6.4% per annum net of fees. At 31 March 2019 the Company had an allocation of £26.4m, which represents 14.0% of total assets. The Fund returned -0.4% for the six months to 31 March 2019. At a sector level the largest positive contributors to performance were Metals and Mining (Gold), Diversified Telecom Services (both long) and Trading Companies and Distributors (short); the detractors were Energy Equipment, Food Retail and Utilities (all long). Positive stock contributions were Goldfields, Sibanye Gold and Barrick Gold (all longs); detractors were Ensco, Sainsbury and Diamond Offshore Drilling (all longs).
The table below shows the principal long and short positions (on a net basis) of the MAM Tortoise Fund at 31 March 2019, in %.
| Energy | 12.8 | Overweight |
| Materials | 11.8 | Overweight |
| Communication Service | 10.0 | Overweight |
| Health Care | 3.9 | Overweight |
| Consumer Staples | 2.9 | Overweight |
| Utilities | 1.6 | Overweight |
| Financials | -0.8 | Underweight |
| Real Estate | -1.8 | Underweight |
| Information Technology | -6.6 | Underweight |
| Consumer Discretionary | -9.1 | Underweight |
| Industrials | -12.9 | Underweight |
Majedie Asset Management
The Company retains its holding in MAM and has no current intention to sell any shares in MAM other than the obligation, if required, to sell shares in proportion to other founder shareholders to the MAM Employee Benefit Trust. MAM's assets under management declined over the six months to 31 March 2019 from £14.1bn to £12.4bn which reflects stock market declines and a net outflow of funds. The value of the holding in MAM at 30 September 2018 was £58.7m which included the value of the MAM final dividend of £3.5m which the Company received in December 2018.
The Board has felt it appropriate to reduce the value of its holding in MAM to £52.3m, which represents 27.9% of total assets. The valuation is based on a formula which has been used in prior years and reflects three year historic average earnings and cash held on the balance sheet. However, in light of market conditions, the current valuations of other fund management companies, the performance of certain MAM Funds and net outflows over the period, the Board felt it appropriate to reduce the valuation. The current valuation represents a discount to the formulaic valuation of 15% or £9.6m.
Board
Sadly, Andrew Adcock who had joined the Board in 2008 and became Chairman in 2010 passed away in January 2019. Andrew's contribution to the Company had been immense; in particular he was instrumental in moving the investment management to MAM in 2014. He will be much missed by the Company and his colleagues.
David Henderson, who joined the Board in 2011, became interim Chairman in December 2018 and Chairman on the passing of Andrew. He currently retains his position as Chairman of the Audit and Nomination Committee; however, the Board is close to concluding a search for a new Non Executive Director to Chair the Audit Committee.
Jane Lewis joined the Board as a Non Executive Director in January 2019. Jane brings a deep knowledge and understanding of Investment Companies having worked in the sector for over twenty years. She was director of corporate finance and broking at Winterflood Investment Trusts until 2013 and is non-executive director of a number of Investment Companies.
Summary
The six month period to 31 March 2019 was a story of two very different quarters. In the quarter to December 2018 the FTSE All-Share Index fell by 10.3% and the MSCI All Country World Index (in sterling terms) fell by 10.7%. Markets became concerned that leading economic indicators were turning down at the same time that Central Banks were increasing interest rates and some economic forecasts suggested that the US economy could fall into recession in 2019. Stock markets, having traded at all-time highs and on historically stretched valuations, fell sharply.
The new year brought a change of policy from Central Banks and a much more dovish outlook for monetary policy particularly in the US and China. Stock markets rallied, with the FTSE All-Share Index rising by 9.4% and the MSCI All Country World Index (in sterling terms) rising by 8.5%. It is noticeable however that expectations for global economic growth were not upgraded and forecast earnings growth is muted. US, German and UK unemployment rates are low, so the risk of rising wage pressure has increased. Other global macroeconomic risks include a further escalation of the trade dispute between US and China. Of course, from a UK perspective, the Brexit chaos and political fallout weigh on the market and in recent years the UK market has performed relatively poorly and seen substantial investor outflows. Nevertheless, in the six months to 31 March 2019 the FTSE All- Share Index has performed in line with the MSCI All Country World Index, suggesting that at current ratings UK markets have discounted much of the uncertainty.
The Company's overall investment performance for the six months to 31 March 2019 was disappointing. There were two main reasons. First, the Company's investment in MAM was written down by 5%. The Board think it prudent to apply a discount to the formulaic valuation that has been used in previous years. Secondly, the UK Funds underperformed their benchmarks in the first quarter of 2019. In anticipation of more volatile markets their managers had tilted their portfolios to defensive value orientated stocks, but, as markets rallied, the more expensive momentum stocks out-performed. Whilst the defensive positioning of the Funds has been premature the Board remain confident that it should be relatively resilient should markets deteriorate.
During the period under review, the Company bought, for cancellation, 7,000 shares in response to a discount that the Board deemed unwarranted. The Board will continue to monitor closely the level of the discount.
Development of Net Asset Value (NAV)
The chart below shows the NAV development during the six months to 31 March 2019. In aggregate the NAV has decreased by £11.3m, having recorded total investment income and losses of £6.0m, having incurred net administration and finance costs of £1.6m, and having paid out dividends of £3.7m.
| NAV 30.09.18 | £178.6m |
| UKES Portfolio | -£2.4m |
| MAM | -£2.9m |
| MAM Funds | -£0.7m |
| Admin Costs and Other | -£0.8m |
| Finance Costs | -£0.8m |
| Dividend Paid | -£3.7m |
| NAV 31.03.19 | £167.3m |
Allocation of Total Assets at 31 March 2019
| Value £000s |
% of Total Assets |
|
| MAM UK Equity Segregated Portfolio | 54,409 | 29.0 |
| MAM UK Income Fund | 14,743 | 7.8 |
| MAM Global Equity Fund | 22,681 | 12.1 |
| MAM Global Focus Fund | 8,006 | 4.3 |
| MAM US Equity Fund | 8,763 | 4.7 |
| MAM Tortoise Fund | 26,372 | 14.0 |
| MAM | 52,346 | 27.9 |
| Net Cash/realisation fund* | 506 | 0.2 |
| 187,826 | 100.0 |
* Net Cash and realisation fund does not include cash held in the MAM UK Equity Segregated Portfolio or MAM funds.
MAM Fund Performance
| 6 months to 31 March 2019 | Since MI invested (per annum) | |||||
| % Fund return |
% Benchmark return |
% Relative performance |
% Fund return |
% Benchmark return |
% Relative performance |
|
| MAM UK Equity Segregated Portfolio | (4.4) | (1.8) | (2.6) | 5.1 | 5.5 | (0.4) |
| MAM UK Income Fund | (5.6) | (1.8) | (3.8) | 6.3 | 6.2 | 0.1 |
| MAM Global Equity Fund | 0.6 | (2.1) | 2.7 | 12.7 | 11.9 | 0.8 |
| MAM Global Focus Fund | 1.1 | (2.1) | 3.2 | 12.3 | 11.9 | 0.4 |
| MAM US Equity Fund | 0.5 | (2.0) | 2.5 | 14.5 | 16.0 | (1.5) |
| MAM Tortoise Fund | (0.4) | (0.8) |
Notes:
All Fund returns are quoted in Sterling, net of fees.
The initial investment in Equity Segregated Portfolio was made on 22 January 2014.
The initial investment in the MAM UK Income Fund was made on 29 January 2014.
The initial investments in MAM Global Equity Fund, MAM Global Focus Fund and MAM US Equity Fund were made on 30 June 2014 and 26 June 2014 respectively, at the inception of each fund. The Company is invested in the Sterling share classes.
The initial investment in the MAM Tortoise Fund was made on 29 January 2014.
William Barlow
Chief Executive
For and on behalf of the Board
21 May 2019
Fund Analysis
at 31 March 2019
Geographic and Sector Analysis at 31 March 2019
| % Europe |
% United Kingdom |
% Emerging Markets |
% Asia Pacific |
% North America |
% Cash |
% Total |
|
| Basic Materials | 0.0 | 3.2 | 1.4 | 0.0 | 4.3 | 8.9 | |
| Consumer Goods | (0.2) | (0.3) | 0.2 | 0.7 | 1.5 | 1.9 | |
| Consumer Services | 0.6 | 12.8 | 0.9 | 0.1 | 0.9 | 15.4 | |
| Financials | 0.0 | 10.2 | 0.5 | (0.2) | 2.0 | 12.4 | |
| Healthcare | 2.2 | 3.4 | 0.0 | 0.0 | 0.0 | 8.3 | |
| Industrials | (0.3) | 4.8 | 0.2 | 0.1 | (0.0) | 4.7 | |
| Oil & Gas | 0.0 | 10.9 | 0.0 | 0.0 | 3.0 | 13.9 | |
| Technology | (0.1) | 0.9 | 1.7 | 0.0 | 2.5 | 5.0 | |
| Telecommunications | 4.9 | 2.3 | 0.0 | 0.7 | 0.6 | 8.4 | |
| Utilities | 0.0 | 1.7 | 0.0 | 0.0 | 0.4 | 2.1 | |
| Cash | 5.7 | 5.7 | |||||
| Fixed Income | 3.5 | 3.5 | |||||
| 7.1 | 49.9 | 4.9 | 1.4 | 17.0 | 9.2 |
Notes:
The assets analysed above are the net exposure of the MAM UK Equity Segregated Portfolio, MAM UK Income Fund, MAM Global Equity Fund, MAM Global Focus Fund, the MAM US Equity Fund and MAM Tortoise Fund. The MAM Tortoise Fund, as an absolute return fund, invests through CFDs, on a net exposure basis. As the MAM Tortoise Fund is an absolute return fund, the percentages do not sum to 100%. The aggregate of the funds represents a total of 71.9% of the Company's total assets. In previous years the MAM Tortoise Fund net exposures were not disclosed.
Exposures are classified on the stock exchange on which the underlying investment is listed and by the relevant FTSE sector classification.
Twenty Largest Portfolio Holdings
at 31 March 2019
| Company | Fair Value £000 |
% of Total Assets |
| Majedie Asset Management Limited | 52,346 | 27.9% |
| Royal Dutch Shell Plc | 6,378 | 3.4% |
| BP plc | 5,828 | 3.1% |
| Tesco PLC | 5,114 | 2.7% |
| GlaxoSmithKline plc | 3,871 | 2.1% |
| Orange SA | 3,391 | 1.8% |
| Barrick Gold Corporation | 2,572 | 1.4% |
| Royal KPN NV | 2,429 | 1.3% |
| HSBC Holdings plc | 2,126 | 1.1% |
| WM Morrison Supermarkets PLC | 2,099 | 1.1% |
| Legal & General Group Plc | 2,069 | 1.1% |
| Centrica plc | 2,013 | 1.1% |
| Tullow Oil plc | 1,958 | 1.0% |
| Pearson PLC | 1,832 | 1.0% |
| Barclays PLC | 1,741 | 0.9% |
| Royal Bank of Scotland plc | 1,719 | 0.9% |
| BT Group plc | 1,538 | 0.8% |
| Vodafone Group Plc | 1,462 | 0.8% |
| Marks & Spencer Group plc | 1,451 | 0.8% |
| Exxon Mobil Corporation | 1,399 | 0.7% |
| Total | 103,338 | 55.0% |
The assets analysed above show the Company's largest twenty holdings on a look through basis across all assets.
Interim Management Report
The important events that have occurred during the period under review, the key factors influencing the financial statements and the principal uncertainties for the remaining six months of the financial year are set out in the Chief Executive's Report above. This Half-Yearly Financial Report has not been audited or reviewed by the Company's auditor.
The financial statements continue to be prepared on a going concern basis. The approach used for the Annual Report is applied, including proper consideration of financial and cashflow forecasts, and it is believed that the Company has adequate financial resources to continue to operate for the foreseeable future.
The principal risks facing the Company remain unchanged since the date of the Annual Report for the year ended 30 September 2018, as set out in the Business Review within the Strategic Report (pages 18 and 19), with no particular subsequent heightened uncertainty. Risks faced by the Company include, but are not limited to, market risk, discount volatility, regulatory risk, financial risk, risks associated with banking and hedging and non-compliance with Section 1158 of the Corporation Tax Act 2010.
In accordance with the Disclosure Guidance and Transparency Rules 4.2.7R and 4.2.8R, we confirm that to the best of our knowledge:
(a) the condensed set of financial statements has been prepared in accordance with International Accounting Standard (IAS) 34, Interim Financial Reporting, as adopted by the European Union, as required by the Disclosure Guidance and Transparency Rule 4.2.4R, and gives a true and fair view of the assets, liabilities and financial position of the Company;
(b) the Chief Executive's Report includes a fair review of the information required to be disclosed under the Disclosure Guidance and Transparency Rule 4.2.7R, interim management report. This includes (i) an indication of important events that have occurred during the first six months of the financial year, and their impact on the condensed set of financial statements presented in the Half-Yearly Financial Report and (ii) a description of the principal risks and uncertainties for the remaining six months of the financial year; and
(c) there were no changes in the transactions or arrangements with related parties as described in the Annual Report for the year ended 30 September 2018 that would have had a material effect on the financial position or performance of the Company in the first six months of the current financial year.
David Henderson
Chairman
For and on behalf of the Board
21 May 2019
Condensed Statement of Comprehensive Income
for the half year ended 31 March 2019
| Half year ended 31 March 2019 (unaudited) |
Half year ended 31 March 2018 (unaudited) |
Year ended 30 September 2018 (audited) |
||||||||
| Notes | Revenue return £'000 |
Capital return £'000 |
Total £'000 |
Revenue return £'000 |
Capital return £'000 |
Total £'000 |
Revenue return £'000 |
Capital return £'000 |
Total £'000 |
|
| Investments | ||||||||||
| (Losses)/gains on investments at fair value through profit or loss | (10,805) | (10,805) | (7,303) | (7,303) | 36 | 36 | ||||
| Net investment result | (10,805) | (10,805) | (7,303) | (7,303) | 36 | 36 | ||||
| Income | ||||||||||
| Income from investments | 2 | 4,805 | 4,805 | 4,678 | 4,678 | 7,829 | 7,829 | |||
| Other income | 2 | 33 | 4 | 37 | 29 | 29 | 47 | 7 | 54 | |
| Total income | 4,838 | 4 | 4,842 | 4,707 | 4,707 | 7,876 | 7 | 7,883 | ||
| Management fees | (46) | (138) | (184) | (55) | (165) | (220) | (108) | (323) | (431) | |
| Administration expenses | (327) | (340) | (667) | (322) | (334) | (656) | (649) | (638) | (1,287) | |
| Return/(loss) before finance costs and taxation | 4,465 | (11,279) | (6,814) | 4,330 | (7,802) | (3,472) | 7,119 | (918) | 6,201 | |
| Finance costs | (190) | (571) | (761) | (249) | (747) | (996) | (439) | (1,317) | (1,756) | |
| Premium paid on redemption of 9.50% March 2020 debenture | (2,869) | (2,869) | (2,869) | (2,869) | ||||||
| Net return/(loss) before taxation | 4,275 | (11,850) | (7,575) | 4,081 | (11,418) | (7,337) | 6,680 | (5,104) | 1,576 | |
| Taxation | 3 | (10) | (10) | (5) | (5) | (17) | (17) | |||
| Net return/(loss) after taxation for the period | 4,265 | (11,850) | (7,585) | 4,076 | (11,418) | (7,342) | 6,663 | (5,104) | 1,559 | |
| Return per ordinary share: | pence | pence | pence | pence | pence | pence | pence | pence | pence | |
| Basic | 4 | 8.0 | (22.2) | (14.2) | 7.6 | (21.4) | (13.8) | 12.5 | (9.5) | 3.0 |
The total column of this statement is the Statement of Comprehensive Income of the Company, prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union. The supplementary revenue return and capital return columns are prepared under guidance published by the Association of Investment Companies (AIC).
See notes 1 to 16.
Condensed Statement of Changes in Equity
for the half year ended 31 March 2019
| Notes | Share capital £'000 |
Share premium £'000 |
Capital redemption reserve £'000 |
Capital reserve £'000 |
Revenue reserve £'000 |
Total £'000 |
|
| Half year ended 31 March 2019 (unaudited) | |||||||
| 30 September 2018 | 5,344 | 3,054 | 56 | 144,395 | 25,777 | 178,626 | |
| Net return after taxation for the period | (11,850) | 4,265 | (7,585) | ||||
| Shares purchased for cancellation | 12 | (1) | 1 | (10) | (10) | ||
| Dividends declared and paid in period | 6 | (3,741) | (3,741) | ||||
| 31 March 2019 | 5,343 | 3,054 | 57 | 132,535 | 26,301 | 167,290 | |
| Half year ended 31 March 2018 (unaudited) | |||||||
| 30 September 2017 | 5,344 | 3,054 | 56 | 149,499 | 24,591 | 182,544 | |
| Net return after taxation for the period | (11,418) | 4,076 | (7,342) | ||||
| Dividends declared and paid in period | 6 | (3,340) | (3,340) | ||||
| 31 March 2018 | 5,344 | 3,054 | 56 | 138,081 | 25,327 | 171,862 | |
| Year ended 30 September 2018 (audited) | |||||||
| 30 September 2017 | 5,344 | 3,054 | 56 | 149,499 | 24,591 | 182,544 | |
| Net return after taxation for the period | (5,104) | 6,663 | 1,559 | ||||
| Dividends declared and paid in period | 6 | (5,477) | (5,477) | ||||
| 30 September 2018 | 5,344 | 3,054 | 56 | 144,395 | 25,777 | 178,626 |
Condensed Balance Sheet
at 31 March 2019
| Notes | 31 March 2019 (unaudited) £'000 |
31 March 2018 (unaudited) £'000 |
30 September 2018 (audited) £'000 |
|
| Non-current assets | ||||
| Property and equipment | 30 | 44 | 37 | |
| Investments at fair value through profit or loss | 7, 8 | 184,984 | 189,785 | 196,515 |
| 185,014 | 189,829 | 196,552 | ||
| Current assets | ||||
| Trade and other receivables | 475 | 334 | 213 | |
| Cash and cash equivalents | 3,441 | 3,219 | 3,483 | |
| 3,916 | 3,553 | 3,696 | ||
| Total assets | 188,930 | 193,382 | 200,248 | |
| Current liabilities | ||||
| Trade and other payables | (1,104) | (1,006) | (1,097) | |
| Total assets less current liabilities | 187,826 | 192,376 | 199,151 | |
| Non-current liabilities | ||||
| Debentures | 14 | (20,536) | (20,514) | (20,525) |
| Total liabilities | (21,640) | (21,520) | (21,622) | |
| Net assets | 167,290 | 171,862 | 178,626 | |
| Notes | 31 March 2019 (unaudited) £'000 |
31 March 2018 (unaudited) £'000 |
30 September 2018 (audited) £'000 |
|
| Represented by: | ||||
| Ordinary share capital | 12 | 5,343 | 5,344 | 5,344 |
| Share premium account | 3,054 | 3,054 | 3,054 | |
| Capital redemption reserve | 57 | 56 | 56 | |
| Capital reserve | 132,535 | 138,081 | 144,395 | |
| Revenue reserve | 26,301 | 25,327 | 25,777 | |
| Equity Shareholders' Funds | 167,290 | 171,862 | 178,626 | |
| Net asset value per share | pence | pence | pence | |
| Basic | 313.1 | 321.6 | 334.3 |
Condensed Cash Flow Statement
for the half year ended 31 March 2019
| Notes | Half year ended 31 March 2019 (unaudited) £'000 |
Half year ended 31 March 2018 (unaudited) £'000 |
Year ended 30 September 2018 (audited) £'000 |
|
| Net cash inflow from operating activities | 13 | 4,453 | 20,314 | 23,473 |
| Investing activities Purchase of tangible assets |
(4) | (7) | (16) | |
| Net cash outflow from investing activities | (4) | (7) | (16) | |
| Financing activities | ||||
| Interest paid | (750) | (987) | (1,736) | |
| Dividends paid | (3,741) | (3,340) | (5,477) | |
| Redemption of 9.50% March 2020 debenture | (16,327) | (16,327) | ||
| Net cash outflow from financing activities | (4,491) | (20,654) | (23,540) | |
| (Decrease)/increase in cash and cash equivalents for the period | (42) | (347) | (83) | |
| Cash and cash equivalents at start of period | 3,483 | 3,566 | 3,566 | |
| Cash and cash equivalents at end of period | 3,441 | 3,219 | 3,483 |
Notes to the Accounts
as at 31 March 2019
1. Accounting Policies
The Condensed Financial Statements above comprise the unaudited results of the Company for the six months to 31 March 2019 and are presented in pounds sterling, as this is the functional currency of the Company.
The Condensed Financial Statements have been prepared in accordance with IAS 34, Interim Financial Reporting. They do not include all financial information required for full financial statements. The Condensed Financial Statements have been prepared using the accounting policies adopted in the audited financial statements for the year ended 30 September 2018.
New standards, interpretations and amendments adopted by the Company
The accounting policies adopted in the preparation of the interim Condensed Financial Statements are consistent with those followed in the preparation of the Company's annual financial statements for the year ended 30 September 2018. Since 1 October 2018, IFRS 9; Financial Instruments: Classification & Measurement and IFRS 15; Revenue from Contracts with Customers have been adopted by the Company. As was anticipated in the Company's financial statements for the year ended 30 September 2018, the adoption of these IFRSs has had no impact on the Company's financial performance or position.
2. Income
| Half year ended 31 March 2019 £'000 |
Half year ended 31 March 2018 £'000 |
Year ended 30 September 2018 £'000 |
|
| Income from investments | |||
| UK investment income* | 4,571 | 4,505 | 7,319 |
| Accumulation income | 170 | 138 | 386 |
| Overseas dividends | 64 | 35 | 124 |
| 4,805 | 4,678 | 7,829 | |
| Other income | |||
| Deposit interest | 2 | 54 | |
| Sundry income | 35 | 29 | 54 |
| 37 | 29 | 7,883 | |
| Total income | 4,842 | 4,707 | 7,829 |
| Total income comprises: | |||
| Dividends | 4,805 | 4,678 | 7,829 |
| Interest | 2 | ||
| Other income | 35 | 29 | 54 |
| 4,842 | 4,707 | 7,883 | |
| Income from investments | |||
| Listed UK | 815 | 755 | 1,943 |
| Listed overseas | 64 | 35 | 124 |
| Unlisted - MAM Funds | 475 | 437 | 1,160 |
| Unlisted | 3,451 | 3,451 | 4,602 |
| 4,805 | 4,678 | 7,829 | |
* Includes MAM dividend income of £3,451,000 (half year to 31 March 2018: £3,451,000 and year ended 30 September 2018: £4,602,000) and Property income Distribution (PID) dividend income of £20,000 (half year to 31 March 2018: £nil and the year ended 30 September 2018: £7,000).
3. Taxation
The charge for the half year to 31 March 2019 is £10,000 (half year to 31 March 2018: £5,000; year ended 30 September 2018: £17,000). These amounts represent irrecoverable withholding tax paid on overseas investment income.
The Company has an effective corporation tax rate of 0%. As investment gains are exempt from tax owing to the Company's status as an approved Investment Trust, and as there is currently an excess of management expenses over taxable income there is no charge for corporation tax.
4. Calculation of returns per ordinary share
Basic returns per ordinary share in each period are based on the return on ordinary activities after taxation attributable to equity shareholders. Basic return per ordinary share for the period is based on 53,438,956 shares (half year ended 31 March 2018 and the year ended 30 September 2018: 53,439,000), being the weighted average number of shares in issue.
5. Business segments
For management purposes the Company is organised into one principal activity, being investing activities, as described below:
Investing activities
The Company's investment objective is to maximise total shareholder return whilst increasing dividends by more than the rate of inflation over the long term. The Company operates as an investment trust company and its portfolio contains investments in companies listed in a number of countries. Geographical information about the portfolio is provided above.
6. Dividends
In accordance with IAS 10: Events After the Balance Sheet Date, interim dividends are not accounted for until paid. The following table summarises the amounts recognised as distributions to equity holders in the relevant period:
| Half year ended 31 March 2019 £'000 |
Half year ended 31 March 2018 £'000 |
Year ended 30 September 2018 £'000 |
|
| 2018 Final dividend of 7.00p paid on 23 January 2019 | 3,741 | ||
| 2018 Interim dividend of 4.00p paid on 22 June 2018 | 2,137 | ||
| 2017 Final dividend of 6.25p paid on 24 January 2018 | 3,340 | 3,340 | |
| 3,741 | 3,340 | 5,477 |
Distributable reserves of the Company comprise the Capital and Revenue Reserves.
Dividends for the half year ended 31 March 2019 (and for the half year ended 31 March 2018 and the year ended 30 September 2018) have been solely made from the Revenue Reserve.
7. Investments
All investments are designated upon initial recognition as held at fair value through profit or loss, and are measured at subsequent reporting dates at fair value, which is either the bid price or the last traded price for listed securities, depending on the convention of the exchange on which the investment is quoted. Investments in unit trusts or open ended investment companies are valued at the closing price, the bid price or the single price as appropriate, released by the relevant investment manager.
Fair values for unquoted investments, or investments for which the market is inactive, are established by using various valuation techniques in accordance with the International Private Equity and Venture Capital Valuation Guidelines (IPEV). These may include recent arm's length market transactions, the current fair value of another instrument which has substantially the same earnings multiples, discounted cash flow analysis and option pricing models. Where there is a valuation technique commonly used by market participants to price the instrument and that technique has been demonstrated to provide reliable estimates of prices obtained in actual market transactions, that technique is utilised.
8. Fair Value Hierarchy
Except for the Company's 7.25% 2025 Debenture Stock, which is measured at amortised cost under the effective interest rate method, financial assets and liabilities of the Company (re investments) are carried in the Balance Sheet at their fair value. Additionally, the balance sheet amount is a reasonable approximation of fair value (re amounts in respect of sales for future settlement, dividends receivable, cash at bank, and purchases for future settlement). The fair value is the amount at which the asset could be sold or the liability transferred in a current transaction between market participants, other than a forced or liquidation sale.
The table below sets out fair value measurements of financial assets in accordance with the IFRS 13 fair value hierarchy:
| Half year ended 31 March 2019 | ||||
| Level 1 | Level 2 | Level 3 | Total | |
| Financial assets | £'000 | £'000 | £'000 | £'000 |
| Financial assets held at fair value through profit or loss | ||||
| Equities and managed funds | ||||
| Listed equity securities | 48,338 | 48,338 | ||
| Unlisted equity securities (MAM Funds) | 84,203 | 84,203 | ||
| Unlisted equity securities | 52,443 | 52,443 | ||
| 48,338 | 84,203 | 52,443 | 184,984 |
| Half year ended 31 March 2018 | ||||
| Level 1 | Level 2 | Level 3 | Total | |
| Financial assets | £'000 | £'000 | £'000 | £'000 |
| Financial assets held at fair value through profit or loss | ||||
| Equities and managed funds | ||||
| Listed equity securities | 53,335 | 53,335 | ||
| Unlisted equity securities (MAM Funds) | 76,532 | 76,532 | ||
| Unlisted equity securities | 59,918 | 59,918 | ||
| 53,335 | 76,532 | 59,918 | 189,785 |
| Year ended 30 September 2018 | ||||
| Level 1 | Level 2 | Level 3 | Total | |
| Financial assets | £'000 | £'000 | £'000 | £'000 |
| Financial assets held at fair value through profit or loss | ||||
| Equities and managed funds | ||||
| Listed equity securities | 51,287 | 51,287 | ||
| Unlisted equity securities (MAM Funds) | 86,458 | 86,458 | ||
| Unlisted equity securities | 58,770 | 58,770 | ||
| 51,287 | 86,458 | 58,770 | 196,515 |
There have been no transfers during the period between Levels 1, 2 and 3.
Investments whose values are based on quoted market prices in active markets, and are therefore classified as Level 1, include active listed equities. The Company does not adjust the quoted price for these instruments in normal market conditions (although it may invoke its fair value pricing policy in times of market disruption - this was not the case for 31 March 2019, 31 March 2018 or 30 September 2018).
Financial instruments that trade in markets that are not considered to be active but are valued based on quoted market prices, dealer quotations or alternative pricing sources supported by observable inputs are classified as Level 2. As Level 2 instruments include positions that are not traded in active markets and/or are subject to transfer restrictions, valuations may be adjusted to reflect illiquidity and/or non-transferability, which are generally based on available market information (the MAM funds are priced daily, remain highly liquid and are not subject to any such adjustments).
Instruments classified within Level 3 have significant unobservable inputs. Level 3 instruments include private equity and corporate debt securities. As observable prices are not available for these securities, the Company has used valuation techniques to derive fair value. In respect of unquoted instruments, or where the market for a financial instrument is not active, fair value is established by using recognised valuation methodologies, in accordance with IPEV Valuation Guidelines. New instruments are initially valued at cost, for a limited period, being the price of the most recent investment in the investee. This is in accordance with IPEV Guidelines as the cost of recent investments will generally provide a good indication of fair value. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.
The Company's current Level 3 classified investments comprise certain individually immaterial unlisted investments, which total in aggregate £97,000, and the investment in MAM valued at £52,346,000. The carrying value of MAM is normally assessed twice a year by the Audit Committee and is approved by the Board. The fair value of MAM is based on a price at which the Company may sell its shares back to MAM and its employees, which is currently considered to be the sole market for the Company's shares. The significant input in assessing the price is the earnings of MAM and a 5.0% increase/decrease in MAM's earnings would result in an increase/decrease of 4.2% in the carrying value of MAM.
The table below sets out the movement in Level 3 instruments for the period:
| 31 March 2019 | ||
| Total £'000 |
Equity investments £'000 |
|
| Opening balance | 58,770 | 58,770 |
| Total net loss for the period included in the Condensed Statement of Comprehensive Income | (6,327) | (6,327) |
| 52,443 | 52,443 |
The fair value of the Company's debenture stock is calculated using a standard present value methodology and by reference to the market yields of a comparable UK Treasury Bond instrument with a 2.50% risk premium being added.
| Half year ended 31 March 2019 |
Half year ended 31 March 2018 |
Year ended 30 September 2018 |
||||
| Financial liabilities | Book value £'000 |
Fair value £'000 |
Book value £'000 |
Fair value £'000 |
Book value £'000 |
Fair value £'000 |
| £20.7m (2016: £20.7m) 7.25% 2025 debenture stock | 20,536 | 25,172 | 20,514 | 25,267 | 20,525 | 24,829 |
| 20,536 | 25,172 | 20,514 | 25,267 | 20,525 | 24,829 |
The above financial liabilities would be classified as Level 2 financial investments in the IFRS 13 Fair Value Hierarchy.
9. Principal financial risks
The principal financial risks which the Company faces include exposure to:
• Market risk
• Foreign currency risk
• Interest rate risk
• Other price risk
• Credit risk
• Liquidity risk
Further details of the Company's management of these risks and the exposure to them are set out in Note 22 of the Company's Annual Report for the year ended 30 September 2018, as issued on 4 December 2018. There have been no changes to the management of these risks since that date.
10. Majedie Asset Management Limited (MAM)
As at 31 March 2019, the Company had a 17.1% equity shareholding in MAM, which provides investment management and advisory services across a range of UK and global equity strategies.
The carrying value of the investment in MAM is included in the Condensed Balance Sheet as part of investments at fair value through profit or loss:
| 31 March 2019 £'000 |
31 March 2018 £'000 |
30 September 2018 £'000 |
|
| Cost of investment | 540 | 540 | 540 |
| Holding gains | 51,806 | 59,284 | 58,133 |
| Fair value at period end | 52,346 | 59,824 | 58,673 |
The carrying value of MAM in the 31 March 2019 Condensed Financial Statements is its fair value as assessed by the Audit Committee and approved by the Board as at that date.
11. Net Asset Value
The net asset value per share has been calculated based on Equity Shareholders' Funds and on 53,435,000 (31 March 2018 and 30 September 2018: 53,439,000) ordinary shares, being the number of shares in issue at the period end.
12. Share capital
| Half year ended 31 March 2019 £'000 |
Half year ended 31 March 2018 £'000 |
Year ended 30 September 2018 £'000 |
|
| Opening balance | 53,439,000 | 53,439,000 | 53,439,000 |
| Shares purchased for cancellation | (4,000) | ||
| Closing balance | 53,435,000 | 53,439,000 | 53,439,000 |
On 29 March 2019, the Company purchased 4,000 shares for cancellation, for a total consideration of £10,000, with settlement on 2 April 2019. The buyback was deducted from the capital reserve in accordance with the Company's Articles.
13. Reconciliation of Operating Profit to Operating Cash Flow
| Half year ended 31 March 2019 £'000 |
Half year ended 31 March 2018 £'000 |
Year ended 30 September 2018 £'000 |
|
| Net (loss)/return before taxation | (7,575) | (7,337) | 1,576 |
| Adjustments for: | |||
| Losses/(gains) on investments | 10,805 | 7,303 | (36) |
| Accumulation dividends | (170) | (138) | (386) |
| Depreciation | 12 | 14 | 29 |
| Foreign exchange losses/(gains) | 1 | (1) | (1) |
| Purchases of investments | (3,975) | (5,426) | (10,426) |
| Sales of investments | 4,697 | 22,135 | 28,128 |
| 3,795 | 16,550 | 18,884 | |
| Finance costs | 761 | 996 | 1,756 |
| Premium paid on the redemption of 9.50% March 2020 debenture | 2,869 | 2,869 | |
| Operating cash flows before movements in working capital | 4,556 | 20,415 | 23,509 |
| Increase/(decrease) in trade and other payables | 19 | (42) | (15) |
| (Increase)/decrease in trade and other receivables | (102) | (58) | 5 |
| Net cash flow from operating activities before tax | 4,473 | 20,315 | 23,499 |
| Tax recovered | 4 | 4 | |
| Tax on overseas dividends | (20) | (5) | (30) |
| Net cash inflow from operating activities | 4,453 | 20,314 | 23,473 |
14. Reconciliation of changes in liabilities arising from financing activities
| Non-cash charges | |||||
| 30 September 2018 £000 |
Cash flows £000 |
Premium on redemption £000 |
Amortisation of expenses £000 |
31 March 2019 £000 |
|
| Long term borrowings | |||||
| £20.7m 7.25% 2025 debenture stock |
20,525 | 11 | 20,536 | ||
| Interest payable | (750) | 750 | |||
| Total liabilities from financing activities |
20,525 | (750) | 761 | 20,536 |
| Non-cash charges | |||||
| 30 September 2017 £000 |
Cash flows £000 |
Premium on redemption £000 |
Amortisation of expenses £000 |
31 March 2018 £000 |
|
| Long term borrowings | |||||
| £13.5m 9.50% 2020 debenture stock |
£13,459 | (16,327) | 2,869 | (1) | |
| £20.7m 7.25% 2025 debenture stock |
20,504 | 21 | 20,525 | ||
| Interest payable | (1,736) | 1,736 | |||
| Total liabilities from financing activities |
33,963 | (18,063) | 2,869 | 1,756 | 20,525 |
15. Related Party Transactions
Majedie Asset Management (MAM)
MAM is the Company's Investment Manager providing investment management services under an Investment Agreement. The agreement provides for MAM to manage the Company's investment assets on both a segregated portfolio basis and also by investments into various MAM collective investment vehicles or funds. Details of the Investment Agreement are contained in the material contracts section of the Directors' Report in the Company's Annual Report for the year ended 30 September 2018. As Investment Manager, MAM is entitled to receive investment management fees. In respect of the Segregated Portfolio these are charged directly to the Company and are shown as an expense in its accounts. Any management fees due in respect of the investments made into any MAM funds are charged in the fund and are therefore included as part of the investment value of the relevant holding. MAM is also entitled to performance fees in respect of the investment in the MAM Tortoise fund. The fees crystallise annually on 30 September and are calculated and charged against each individual investor. As such these are also shown as an expense in the Company's accounts and are charged wholly to capital. Details concerning the Company's investments in the period in the MAM funds are shown in the Chief Executive's Report above.
In addition to the above, the Company retains an investment in MAM itself. Mr JWM Barlow is a non-executive director of MAM but receives no remuneration for this role. MAM is accounted for as an investment in the Company accounts and is valued at fair value through profit or loss. Details concerning the Company's investment in MAM are included in the Chief Executive's Report above.
The table below discloses the transactions and balances between those entities:
| Half year ended | Half year ended | Year ended | |
| 31 March | 31 March | 30 September | |
| 2019 £'000 |
2018 £0'000 |
2018 £'000 |
|
| Transactions during the period: | |||
| Dividend income received from MAM | 3,451 | 3,451 | 4,602 |
| Management fee income due to MAM (Segregated Portfolio only) | 184 | 220 | 431 |
| Balances outstanding at the period end: | |||
| Between the Company and MAM (Segregated Portfolio investment management fees) | 93 | 107 | 103 |
| Value of the Company's investment in MAM | 52,346 | 59,824 | 58,673 |
Transactions between related party companies during the period were made on terms equivalent to those that occur in arm's length transactions.
16. Financial Information
The financial information contained in this Half-Yearly Financial Report does not constitute full statutory accounts as defined in section 434 of the Companies Act 2006.
The information for the year ended 30 September 2018 has been extracted from the latest published audited accounts. Those accounts have been filed with the Registrar of Companies and included the report of the auditors which was unqualified and did not contain a statement under section 498(2) or (3) of the Companies Act 2006. Those statutory accounts were prepared in accordance with IFRS, as adopted by the European Union.
Company Information
| Board of Directors | Depositary |
| R D C Henderson, Chairman | The Bank of New York Mellon (International) Limited |
| P D Gadd | 1 Canada Square |
| J M Lewis | London E14 5AL |
| J W M Barlow (Executive) | |
| All Directors are non-executive unless indicated Registered Office 1 King's Arms Yard London EC2R 7AF Telephone: 020 7382 8170 E-mail: [email protected] Registered number: 109305 England Company Secretary Link Company Matters Limited The Registry 34 Beckenham Road Beckenham Kent BR3 4TU Investment Manager Majedie Asset Management Limited 10 Old Bailey London EC4M 7NG Telephone: 020 7618 3900 E-mail: [email protected] Solicitor |
The Depositary acts as global custodian and may delegate safekeeping to one or more global sub-custodians. The Depositary has delegated safe keeping of the assets of the Company to The Bank of New York Mellon SA/NV and the Bank of New York Mellon. AIFM Majedie Investments PLC Registrars Computershare Investor Services PLC The Pavilions Bridgwater Road Bristol BS99 6ZZ Telephone: 0370 707 1159 Auditors Ernst & Young LLP 25 Churchill Place Canary Wharf London E14 5EY Stockbrokers J.P. Morgan Cazenove 25 Bank Street London E14 5JP |
| Dickson Minto W.S. 16 Charlotte Square Edinburgh EH2 4DF |
Website www.majedieinvestments.com |
| Financial Calendar Year end 30 September Annual results December Half year results May Annual General Meeting January Dividends paid January and June |
|
| 2019 Interim Dividend Timetable | |
| The interim dividend for the period ended 31 March 2019 is 4.4p per share. | |
| Ex-dividend date | 30 May |
| Record date | 31 May |
| Payment date | 14 June |
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [email protected] or visit www.rns.com.
END
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