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RNS
Shires Income PLC  -  SHRS   

Half-year Report

Released 07:00 17-Nov-2017

RNS Number : 7629W
Shires Income PLC
17 November 2017
 

SHIRES INCOME PLC

 

HALF YEARLY FINANCIAL REPORT

FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2017

Legal Entity Identifier (LEI): 549300HVCIHNQNZAYA89

 

 

INVESTMENT OBJECTIVE

The Company's investment objective is to provide shareholders with a high level of income, together with the potential for growth of both income and capital from a diversified portfolio substantially invested in UK equities but also in preference shares, convertibles and fixed income securities.

HIGHLIGHTS


30 September 2017

31 March 2017

% change

Equity shareholders' funds (£'000)

84,805

81,477

+4.1

Net asset value per share

282.71p

271.61p

+4.1

Share price (mid-market)

267.00p

243.25p

+9.8

Discount to net asset value

5.56%

10.44%


Dividend yield

4.78%

5.20%


Net gearingA

18.4%

21.1%


Ongoing charges ratioB

0.97%

1.04%


A              Calculated in accordance with AIC guidance "Gearing Disclosures post RDR". 

B                Ongoing charges ratio calculated in accordance with guidance issued by the AIC as the total of the investment management fee and administrative expenses (annualised) divided by the average cum income net asset value throughout the year. The ratio for 30 September 2017 is based on forecast ongoing charges for the year ending 31 March 2018.

 

 

PERFORMANCE (TOTAL RETURN)


6 months ended

1 year ended

3 years ended

5 years ended


30 September

30 September

30 September

30 September


2017

2017

2017

2017

Net asset value

+6.7%

+14.6%

+33.3%

+81.1%

Share price

+12.8%

+23.5%

+29.8%

+66.9%

FTSE All-Share Index

+3.6%

+11.9%

+27.8%

+61.2%

All figures are for total return and assume re-investment of net dividends excluding transaction costs.

 

 

 

 

INTERIM  BOARD REPORT - CHAIRMAN'S STATEMENT

 

Background

 

Investment Performance

 

Portfolio Profile

Investment Income

Dividends

Gearing

 

Investment Objective

Manager

Outlook

Robert Talbut



INTERIM BOARD REPORT - OTHER MATTERS

Directors' Responsibility Statement

-       the condensed set of financial statements within the Half Yearly Financial Report has been prepared in accordance with IAS 34 'Interim Financial Reporting'; and

-       the Interim Board Report (constituting the Interim Management Report) includes a fair review of the information required by rules 4.2.7R of the Disclosure Guidance and Transparency Rules (being 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 and a description of the principal risks and uncertainties for the remaining six months of the financial year) and 4.2.8R (being related party transactions that have taken place during the first six months of the financial year and that have materially affected the financial position of the Company during that period; and any changes in the related party transactions described in the last Annual Report that could so do).

Principal Risks and Uncertainties

-       Investment performance

-       Failure to maintain and grow the dividend over the longer term

-       Widening of discount

-       Financial and economic

-       Gearing

-       Regulatory

-       Operational

Going Concern

Robert Talbut

 



DISTRIBUTION OF ASSETS AND LIABILITIES


Valuation at

Movement during the period

Valuation at


31 March 2017

Purchases

Sales

Other

Gains

30 September 2017


£'000

%

£'000

£'000

£'000

£'000

£'000

%

Listed investments









Equities

72,118

88.5

4,158

(6,295)

-

1,742

71,723

84.6

Convertibles

575

0.7

-

-

(20)

(2)

553

0.7

Other Fixed Interest

25,133

30.9

-

-

(28)

2,563

27,668

32.6


______

______

______

______

______

______

______

______

Total investments

97,826

120.1

4,158

(6,295)

(48)

4,303

99,944

117.9

Current assets

2,881

3.5





4,236

5.0

Current liabilities

(19,230)

(23.6)





(19,375)

(22.9)


______

______





______

______

Net assets

81,477

100.0





84,805

100.0


______

______





______

______

Net asset value per Ordinary share

271.61p






282.71p



______






______


 



CONDENSED STATEMENT OF COMPREHENSIVE INCOME

 



 30 September 2017



 (unaudited)



 Revenue

 Capital

 Total


Note

 £'000

 £'000

 £'000

Gains on investments at fair value


-

3,352

3,352

Currency losses


-

(21)

(21)






Investment income





Dividend income


2,265

-

2,265

Interest income/(expense)


284

(52)

232

Stock dividends


17

-

17

Traded option premiums


81

-

81

Other income


-

-

-

Money market interest


1

-

1

Underwriting commission


-

-

-



_______

_______

_______



2,648

3,279

5,927



_______

_______

_______

Expenses





Management fee


(108)

(108)

(216)

Administrative expenses


(203)

-

(203)

Finance costs


(79)

(79)

(158)



_______

_______

_______



(390)

(187)

(577)



_______

_______

_______

Profit before taxation


2,258

3,092

5,350






Taxation

2

_______

_______

_______






Profit attributable to equity holders

4

2,232

3,114

5,346



_______

_______

_______

Earnings per Ordinary share (pence)

4

7.44

10.38

17.82



_______

_______

_______






 

 

 

 

 



CONDENSED STATEMENT OF COMPREHENSIVE INCOME (Cont'd)

 



 30 September 2016



 (unaudited)



 Revenue

 Capital

 Total


Note

 £'000

 £'000

 £'000

Gains on investments at fair value


-

8,822

8,822

Currency gains


-

2

2






Investment income





Dividend income


1,928

-

1,928

Interest income/(expense)


287

(49)

238

Stock dividends


171

-

171

Traded option premiums


91

-

91

Other income


-

-

-

Money market interest


3

-

3

Underwriting commission


-

-

-



_______

_______

_______



2,480

8,775

11,255



_______

_______

_______

Expenses





Management fee


(97)

(97)

(194)

Administrative expenses


(189)

-

(189)

Finance costs


(84)

(84)

(168)



_______

_______

_______



(370)

(181)

(551)



_______

_______

_______

Profit before taxation


2,110

8,594

10,704






Taxation

2

(3)

3

-



_______

_______

_______

Profit attributable to equity holders

4

2,107

8,597

10,704



_______

_______

_______

Earnings per Ordinary share (pence)

4

7.02

28.66

35.68



_______

_______

_______








CONDENSED STATEMENT OF COMPREHENSIVE INCOME (Cont'd)

 



    31 March 2017



 (audited)



 Revenue

 Capital

 Total


Note

 £'000

 £'000

 £'000

Gains on investments at fair value


-

12,856

12,856

Currency gains


-

7

7






Investment income





Dividend income


3,603

-

3,603

Interest income/(expense)


569

(101)

468

Stock dividends


259

-

259

Traded option premiums


204

-

204

Other income


55

-

55

Money market interest


4

-

4

Underwriting commission


1

-

1



_______

_______

_______



4,695

12,762

17,457



_______

_______

_______

Expenses





Management fee


(198)

(198)

(396)

Administrative expenses


(386)

-

(386)

Finance costs


(164)

(164)

(328)



_______

_______

_______



(748)

(362)

(1,110)



_______

_______

_______

Profit before taxation


3,947

12,400

16,347






Taxation

2

(22)

20

(2)



_______

_______

_______

Profit attributable to equity holders

4

3,925

12,420

16,345



_______

_______

_______

Earnings per Ordinary share (pence)

4

13.08

41.41

54.49



_______

_______

_______



CONDENSED BALANCE SHEET

 



As at

As at

As at



30 September

30 September

31 March



2017

2016

2017



(unaudited)

(unaudited)

(audited)


Note

£'000

£'000

£'000

Non-current assets





Equities


71,723

68,298

72,118

Convertibles


553

560

575

Other fixed interest


27,668

25,396

25,133



_______

_______

_______

Securities at fair value


99,944

94,254

97,826



_______

_______

_______

Current assets





Trade and other receivables


30

20

126

Accrued income and prepayments


844

765

982

Cash and cash equivalents


3,362

1,821

1,773



_______

_______

_______



4,236

2,606

2,881



_______

_______

_______

Total assets


104,180

96,860

100,707






Creditors: amounts falling due within one year





Trade and other payables


(375)

(223)

(230)

Short-term borrowings


(19,000)

(9,000)

(19,000)



_______

_______

_______



(19,375)

(9,223)

(19,230)



_______

_______

_______

Net current liabilities


(15,139)

(6,617)

(16,349)



_______

_______

_______

Total assets less current liabilities


84,805

87,637

81,477






Non-current liabilities





Long-term borrowings


-

(10,000)

-



_______

_______

_______

Net assets


84,805

77,637

81,477



_______

_______

_______

Share capital and reserves





Called-up share capital


15,049

15,049

15,049

Share premium account


19,308

19,308

19,308

Capital reserve

6

43,726

36,789

40,612

Revenue reserve


6,722

6,491

6,508



_______

_______

_______

Equity shareholders' funds


84,805

77,637

81,477



_______

_______

_______






Net asset value per Ordinary share (pence)

5

282.71

258.81

271.61



_______

_______

_______






The accompanying notes are an integral part of the financial statements.

 

 



CONDENSED STATEMENT OF CHANGES IN EQUITY

 

Six months ended 30 September 2017 (unaudited)








Share


Retained



Share

premium

Capital

revenue



capital

account

reserve

reserve

Total


£'000

£'000

£'000

£'000

£'000

As at 31 March 2017

15,049

19,308

40,612

6,508

81,477

Revenue profit for the period

-

-

-

2,232

2,232

Capital profit for the period

-

-

3,114

-

3,114

Equity dividends

-

-

-

(2,018)

(2,018)


_______

_______

_______

_______

_______

As at 30 September 2017

15,049

19,308

43,726

6,722

84,805


_______

_______

_______

_______

_______







Six months ended 30 September 2016 (unaudited)








Share


Retained



Share

premium

Capital

revenue



capital

account

reserve

reserve

Total


£'000

£'000

£'000

£'000

£'000

As at 31 March 2016

15,049

19,308

28,192

6,253

68,802

Revenue profit for the period

-

-

-

2,107

2,107

Capital profit for the period

-

-

8,597

-

8,597

Equity dividends

-

-

-

(1,869)

(1,869)


_______

_______

_______

_______

_______

As at 30 September 2016

15,049

19,308

36,789

6,491

77,637


_______

_______

_______

_______

_______







Year ended 31 March 2017 (audited)








Share


Retained



Share

premium

Capital

revenue



capital

account

reserve

reserve

Total


£'000

£'000

£'000

£'000

£'000

As at 31 March 2016

15,049

19,308

28,192

6,253

68,802

Revenue profit for the year

-

-

-

3,925

3,925

Capital profit for the year

-

-

12,420

-

12,420

Equity dividends

-

-

-

(3,670)

(3,670)


_______

_______

_______

_______

_______

As at 31 March 2017

15,049

19,308

40,612

6,508

81,477


_______

_______

_______

_______

_______

 

 



CONDENSED CASH FLOW STATEMENT

 


Six months ended

Six months ended

Year
ended


30 September 2017

30 September 2016

31 March
2017


(unaudited)

(unaudited)

(audited)


£'000

£'000

£'000

Net cash inflow from operating activities




Dividend income received

2,409

2,098

3,423

Interest income received

283

295

721

Options premium received

76

80

204

Other income

-

-

55

Money market interest received

1

3

4

Management fee paid

(211)

(185)

(385)

Other cash expenses

(222)

(153)

(349)


__________

__________

__________

Cash generated from operations

2,336

2,138

3,673





Interest paid

(158)

(168)

(327)

Overseas taxation

(8)

-

(4)


__________

__________

__________

Net cash inflows from operating activities

2,170

1,970

3,342


__________

__________

__________

Cash flows from investing activities




Purchases of investments

(4,011)

(5,468)

(9,092)

Sales of investments

5,469

5,313

9,313


__________

__________

__________

Net cash inflow/(outflow) from investing activities

1,458

(155)

221


__________

__________

__________

Cash flows from financing activities




Equity dividends paid

(2,018)

(1,869)

(3,670)


__________

__________

__________

Net cash outflow from financing activities

(2,018)

(1,869)

(3,670)


__________

__________

__________

Net increase/(decrease) in cash and cash equivalents

1,610

(54)

(107)


__________

__________

__________

Reconciliation of net cash flow to movements in cash and cash equivalents




Increase/(decrease) in cash and cash equivalents as above

1,610

(54)

(107)

Net cash and cash equivalents at start of period

1,773

1,873

1,873

Effect of foreign exchange rate changes

(21)

2

7


__________

__________

__________

Cash and cash equivalents at end of period

3,362

1,821

1,773


__________

__________

__________

 

 

Notes to the Financial Statements

For the six months ended 30 September 2017

 

1.

Accounting policies


Basis of accounting




 

2.

Taxation








Six months ended
30 September 2017

Six months ended
30 September 2016

Year ended
 31 March 2017

 



Revenue

Capital

Total

Revenue

Capital

Total

Revenue

Capital

Total

 


Taxation

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

 


UK Corporation tax

22

(22)

-

3

(3)

-

20

(20)

-

 


Overseas tax suffered

4

-

4

-

-

-

2

-

2

 



______

______

_____

______

______

_____

______

______

______

 


Total tax charge

26

(22)

4

3

(3)

-

22

(20)

2

 



______

______

_____

______

______

_____

______

______

______

 

 

3.

Dividends









Six months ended

Six months ended

Year ended



30 September 2017

30 September 2016

31 March 2017



£'000

£'000

£'000


Revenue

2,232

2,107

3,925


Dividends declared

(1,800)A

(1,800)B

(3,825)C



__________

__________

__________



432

307

100



__________

__________

__________







A               Dividends declared relate to first two interim dividends (both 3.00p each) in respect of the financial year 2017/18.


B               Dividends declared relate to first two interim dividends (both 3.00p each) in respect of the financial year 2016/17.


C                       First three interim dividends (each 3.00p) and the final dividend (3.75p) declared in respect of the financial year 2016/17.

 



Six months ended

Six months ended

Year ended



30 September 2017

30 September 2016

31 March 2017

4.

Return per share

£'000

£'000

£'000


Returns are based on the following figures:





Revenue return

2,232

2,107

3,925


Capital return

3,114

8,597

12,420



__________

__________

__________


Total return

5,346

10,704

16,345



__________

__________

__________


Weighted average number of Ordinary shares in issue

29,997,580

29,997,580

29,997,580



__________

__________

__________

 

5.

Net asset value per share


The net asset value per Ordinary share and the net asset values attributable to Ordinary shareholders at the period end were as follows:








As at

As at

As at



30 September 2017

30 September 2016

31 March 2017



(unaudited)

(unaudited)

(audited)


Attributable net assets (£'000) per Balance Sheet

84,805

77,637

81,477


Number of Ordinary shares in issue

29,997,580

29,997,580

29,997,580


Net asset value per Ordinary share (p)

282.71

258.81

271.61

 

6.

Capital reserve


 

7.

Transaction costs









Six months ended

Six months ended

Year ended



30 September 2017

30 September 2016

31 March 2017



£'000

£'000

£'000


Purchases

16

29

41


Sales

2

3

5



__________

__________

__________



18

32

46



__________

__________

__________






 



Six months ended

Six months ended

Year ended



30 September 2017

30 September 2016

31 March 2017

8.

Movement in net debt

£'000

£'000

£'000


Increase/(decrease) in cash and cash equivalents

1,610

(54)

(107)


Effect of foreign exchange rate changes

(21)

2

7



__________

__________

__________


Change in net debt in the year

1,589

(52)

(100)


Opening net debt

(17,227)

(17,127)

(17,127)



__________

__________

__________


Closing net debt

(15,638)

(17,179)

(17,227)



__________

__________

__________

 

9.

Transactions with the Manager






 

10.

Segmental information


 

11.

Fair value hierarchy


















Level 1

Level 2

Level 3

Total


At 30 September 2017

Note

£'000

£'000

£'000

£'000


Financial assets at fair value through profit or loss







Quoted investments

a)

99,944

-

-

99,944









Financial liabilities at fair value through profit or loss







Derivatives

b)

-

(39)

-

(39)




______

______

______

______


Net fair value


99,944

(39)

-

99,905




______

______

______

______











Level 1

Level 2

Level 3

Total


At 30 September 2016

Note

£'000

£'000

£'000

£'000


Financial assets at fair value through profit or loss







Quoted investments

a)

94,254

-

-

94,254









Financial liabilities at fair value through profit or loss







Derivatives

b)

-

(22)

-

(22)




______

______

______

______


Net fair value


94,254

(22)

-

94,232




______

______

______

______











Level 1

Level 2

Level 3

Total


As at 31 March 2017

Note

£'000

£'000

£'000

£'000


Financial assets at fair value through profit or loss







Quoted investments

a)

97,826

-

-

97,826









Financial liabilities at fair value through profit or loss







Derivatives

b)

-

(30)

-

(30)




______

______

______

______


Net fair value


97,826

(30)

-

97,796




______

______

______

______










a)

Quoted investments











b)

Derivatives







 

12.

 

13.

This Half Yearly Financial Report was approved by the Board on 17 November 2017.



14.

The Half Yearly Financial Report will shortly be available on the Company's website, www.shiresincome.co.uk* and will be posted to shareholders in November 2017.

 

Please note that past performance is not necessarily a guide to the future and that the value of investments and the income from them may fall as well as rise.  Investors may not get back the amount they originally invested

 

By order of the Board

Aberdeen Asset Management PLC

Company Secretary

17 November 2017

 

* Neither the Company's website nor the content of any website accessible from hyperlinks on the Company's website (or any other website) is (or is deemed to be) incorporated into, or forms (or is deemed to form) part of this announcement.

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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Half-year Report - RNS