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RNS
Bankers Investment Trust PLC   -  BNKR   

Half-year Report

Released 16:41 01-Jul-2019

RNS Number : 0990E
Bankers Investment Trust PLC
01 July 2019
 

 LEGAL ENTITY IDENTIFIER: - 213800B9YWXL3X1VMZ69                                                                     1 July 2019

 

THE BANKERS INVESTMENT TRUST PLC

 

Unaudited results for the half-year ended 30 April 2019

 

This announcement contains regulated information

 

INVESTMENT OBJECTIVES 

The Company aims over the long term to achieve capital growth in excess of the FTSE World Index and annual dividend growth greater than inflation, as defined by the UK Retail Prices Index ('RPI'), by investing in companies listed throughout the world.

 

INVESTMENT POLICY

The following investment ranges apply:

Equities: 80% to 100%

Debt securities and cash investments: 0% to 20%

Investment trusts, collective funds and derivatives: 0% to 15%

 

To achieve an appropriate spread of investment risk the portfolio is broadly diversified by geography, sector and company. The Manager ('Janus Henderson') has the flexibility to invest in any geographic region and any sector with no set limits on individual country or sector exposures and, therefore, the make-up and weighting of the portfolio may differ materially from the FTSE World Index.

 

The Manager primarily employs a bottom-up, value-based investment process to identify suitable opportunities and pays particular regard to cash generation and dividends. The Board regularly monitors the Company's investments and the Manager's investment activity. The Company can, but normally does not, invest up to 15% of its gross assets in any other investment companies (including listed investment trusts).

 

Derivatives

The Company may use financial instruments known as derivatives for the purpose of efficient portfolio management while maintaining a level of risk consistent with the risk profile of the Company.

 

Gearing

The Company can borrow to make additional investments with the aim of achieving a return that is greater than the cost of the borrowing. The Company can borrow up to 20% of net assets at the time of draw down.

 

PERFORMANCE HIGHLIGHTS

 

 30 April 2019

30 April 2018

Net Asset Value ('NAV') per share

929.9p

868.7p

Share price

906.0p

860.0p

Revenue return per share

9.25p

8.52p

Discount

2.6%

1.0%

Dividends (1st and 2nd interims)

10.20p

9.72p

           

Total Return Performance to 30 April 2019 (including dividends reinvested and excluding transaction costs)

 

 

6 months

%

1 year

%

3 years

%

5 years

%

10 years

 %

NAV1

8.7

9.6

60.3

82.1

249.6

Index2

6.9

11.7

42.3

44.3

186.0

Share price3

9.8

7.8

65.6

83.8

264.9

 

1 Net asset value total return per share with income reinvested

2 Composite of FTSE All-Share index for the period 31 October 2017 and FTSE World Index from 1 November 2017 to 30 April 2019

3 Share price total return using mid-market closing price

 

Sources: Morningstar for the AIC and Datastream

 

 

INTERIM MANAGEMENT REPORT

 

CHAIRMAN'S STATEMENT

 

Review

Our Net Asset Value ('NAV') total return for the six month period to 30 April 2019 was 8.7%, outperforming the FTSE World Index total return of 6.9%.  Our share price total return was higher, at almost 10%, due to the narrowing of the discount to NAV at which our shares traded. 

 

The positive returns disguise that the period was quite eventful.  After the sharp fall in global equity markets in the final month of our last financial year, markets largely stabilised in November before falling again in December.  Negative investor sentiment at the end of 2018 reflected a number of possible outcomes in the coming year. There was pessimism regarding the resolution of the ongoing US-China trade dispute, as well as concerns that there would be further US interest rate rises in 2019 and fears that the next recession may be closer than many had previously anticipated. The new year brought renewed optimism, driven by the belief that trade tensions were easing and by more dovish central bank policy, in particular from the US Federal Reserve, as inflationary pressures appeared to be subsiding.  This led, in the first four months of 2019, to a strong recovery in global equity markets, which broadly rose to the highs achieved in 2018.  As, in our Fund Manager's opinion, investors were pricing in an over optimistic outlook, we used this rally to realise some profits.

 

All of our regional portfolios made positive contributions to our overall portfolio performance; their respective local benchmarks also delivered positive returns, with the exception of Japan. On a relative performance basis, only the Asia Pacific (ex-Japan and China) and Emerging Market portfolios underperformed their local benchmarks. The US portfolio was marginally reduced during the period following strong performance, with the proceeds retained as cash to reduce the Company's net gearing.

 

Our allocation to direct investments in emerging markets, other than Asia, has been, typically, around 2-3% of our overall portfolio. However, we have significant exposure to the African and South American regions through companies listed in Europe and New York.  Having regard to its relatively small size and the volatility of its performance over recent years, we concluded that our direct Emerging Markets portfolio has not contributed meaningfully to the Company's returns.  Accordingly, we will start to sell down our investments in that portfolio, initially raising cash before ultimately reallocating to other regions.

 

Revenue Returns and Dividend

The Company's net revenue for the six months was £11.3 million, equivalent to 9.25p per share (2018: 8.52p).

 

The Board paid a first interim dividend on 31 May 2019 of 5.10p (2018: 4.86p) and has declared a second interim dividend of 5.10p (2018: 4.86p) per share payable on 30 August 2019 to shareholders on the register on 26 July 2019.

 

I am pleased to be able to reiterate, on behalf of the Board, a forecast of dividend growth of approximately 6% for the current financial year, resulting in aggregate dividends for the year of 20.9p (2018: 19.72p). 

 

Borrowings

The Company has refinanced its short term borrowings by agreeing a new two year £20 million borrowing facility with Sumitomo Mitsui Banking Corporation Europe Limited in February 2019. Currently, the Company is not geared as it is considered that markets are running ahead of fundamentals.

 

Board Changes

My predecessor, Richard Killingbeck, who joined the Board in 2003 and became Chairman in 2013, retired from the Board at the conclusion of the AGM in February. I would like to take this opportunity to thank Richard for his outstanding contribution and commitment to Bankers and his wise counsel to me and other members of the Board during his long association with the Company. Over the years we have aimed to achieve a level of continuity in regard to the Board and thus we believe the efficient management and oversight of your Company will continue in the same vein as it did under Richard's tenure. 

 

We are looking to replace Richard's investment knowledge with the appointment of a new non-executive director to the Board later in the year. 

 

Outlook

Since the end of the period under review, global equity markets have continued to ebb and flow as investors react to the latest news.  Of particular note were the more dovish statements from the European Central Bank ('ECB') and US Federal Reserve in June. The ECB indicated that, if the inflation outlook fails to improve, it could launch a further expansion of its €2.6tn quantitative easing programme and the US Federal Reserve hinted at possible interest rate cuts, citing increased uncertainties about the economic outlook.

 

Whilst some recent economic data has been weaker than anticipated, there are factors that should be positive for global equity markets. In particular, inflationary pressures remain muted, global monetary policy appears to continue to be supportive and corporate earnings growth is still positive.  However, the ongoing US-China trade dispute is likely to continue to hold back both the global economy and global equity markets. Even if they resolve their trade dispute, tension between the two countries may endure and adversely impact business conditions, which could continue to constrain global economic growth.

 

In the UK, the unresolved Brexit saga continues to weigh on business prospects and investor sentiment towards UK stocks. We will not know who the next Prime Minister will be until after 21 July and, even then, when and how the Brexit saga will be resolved.

 

Overall, I remain cautious on the outlook for global equity markets.  Global economic growth in the current calendar year is expected to be lower than in 2018, particularly in the US where corporate earnings received a significant boost from one-off tax cuts in 2018.  As our Fund Manager believes that markets have run ahead of fundamentals, we feel it is prudent to raise cash within the portfolio and would expect to deploy this at more attractive prices later in the year. With the macro uncertainties, the recent higher levels of equity market volatility are likely to persist but volatility does provide more opportunities for long-term managers, such as our Fund Manager, to buy at attractive prices. 

 

Sue Inglis

Chairman

1 July 2019

 

 

PRINCIPAL RISKS AND UNCERTAINTIES

The principal risks and uncertainties associated with the Company's business are divided into the following main areas:

 

·          Investment Activity and Performance 

·          Portfolio and Market (including Brexit)

·          Tax, Legal and Regulatory

·          Financial

·          Operational and Cyber

 

Information on these risks and uncertainties and how they are managed are given in the Annual Report for the year ended 31 October 2018.  In the view of the Board these principal risks and uncertainties are as applicable to the remaining six months of the financial year as they were to the six months under review.

 

DIRECTORS' RESPONSIBILITY STATEMENT

 

The Directors confirm that, to the best of their knowledge:

 

 

(a)

the condensed set of financial statements has been prepared in accordance with IAS 34;

 

 

(b)

the interim management report includes a fair review of the information required by Disclosure Guidance and Transparency Rule 4.2.7R (indication of important events during the first six months and description of principal risks and uncertainties for the remaining six months of the year); and

 

 

(c)

the interim management report includes a fair review of the information required by Disclosure Guidance and Transparency Rule 4.2.8R (disclosure of related party transactions and changes therein).

 

 

For and on behalf of the Board

Sue Inglis  

Chairman

1 July 2019

 

 

For further information contact:                                                                     

 

Alex Crooke

Fund Manager

The Bankers Investment Trust PLC

Telephone: 020 7818 4447

 

Sue Inglis

Chairman

The Bankers Investment Trust PLC

Telephone: 020 7818 4233

James de Sausmarez

Director and Head of Investment Trusts

Janus Henderson Investors

Telephone: 020 7818 3349

Laura Thomas 

PR Manager

Janus Henderson Investors

Telephone: 020 7818 2636

 

 

 

CONDENSED STATEMENT OF COMPREHENSIVE INCOME

 

 

(Unaudited)

Half-year ended

30 April 2019

(Unaudited)

Half-year ended

30 April 2018

(Audited)

Year ended

31 October 2018

 

Revenue return £'000

Capital return £'000

 

Total £'000

Revenue return £'000

Capital return £'000

 

Total £'000

Revenue  return £'000

Capital return £'000

 

Total

£'000

Gains/(losses) from investments held at fair value through profit or loss

-

82,146

82,146

-

(8,679)

(8,679)

-

(12,611)

(12,611)

Investment income

13,649

-

13,649

12,731

-

12,731

30,321

-

30,321

Other operating income

108

-

108

98

-

98

226

-

226

 

---------

---------

---------

---------

---------

---------

-----------

---------

-----------

Gross revenue and capital gains/(losses)

13,757

82,146

95,903

12,829

(8,679)

4,150

30,547

(12,611)

17,936

 

----------

---------

---------

----------

---------

---------

---------

---------

-----------

Expenses

 

 

 

 

 

 

 

 

 

Management fees (note 2)

(691)

(1,612)

(2,303)

(636)

(1,484)

(2,120)

(1,344)

(3,136)

(4,480)

Other expenses

(539)

 

(539)

(515)

-

(515)

(990)

-

(990)

 

---------

---------

---------

---------

---------

---------

---------

----------

----------

Profit/(loss) before finance costs and taxation

12,527

80,534

93,061

11,678

(10,163)

1,515

28,213

(15,747)

12,466

 

 

 

 

 

 

 

 

 

 

Finance costs

(450)

(1,050)

(1,500)

(454)

(1,061)

(1,515)

(917)

(2,141)

(3,058)

 

---------

----------

---------

---------

----------

---------

----------

----------

----------

Profit/(loss) before taxation

12,077

79,484

91,561

11,224

(11,224)

-

27,296

(17,888)

9,408

 

 

 

 

 

 

 

 

 

 

Taxation

(734)

-

(734)

(777)

-

(777)

(1,823)

 

(1,823)

 

---------

-----------

---------

---------

-----------

---------

---------

-----------

-----------

Profit/(loss) for the period

11,343

79,484

90,827

10,447

(11,224)

(777)

25,473

(17,888)

7,585

 

=====

=======

=====

=====

=======

=====

=====

======

======

Earnings/(loss) per ordinary share (note 3)

9.25p

64.83p

74.08p

8.52p

(9.15p)

(0.63p)

20.78p

(14.59p)

6.19p

 

The total columns of this statement represent the Statement of Comprehensive Income, prepared in accordance with IFRS as adopted by the European Union.  The revenue return and capital return columns are supplementary to this and are prepared under guidance published by the Association of Investment Companies. 

 

All income is attributable to the equity shareholders of The Bankers Investment Trust PLC.

 

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

 

 

 

 

 

CONDENSED STATEMENT OF CHANGES IN EQUITY

 

 

 

 

 

Half-year ended 30 April 2019 (Unaudited)

 Called up

share capital

£'000

 Share premium

account

£'000

Capital  redemption

reserve

£'000

Other capital

reserves

£'000

 

Revenue reserve

£'000

 

 

Total

£'000

Total equity at 1 November 2018

30,986

78,541

12,489

897,318

42,249

1,061,583

Total comprehensive income:

 

 

 

 

 

 

profit for the period

-

-

-

79,484

11,343

90,827

Transactions with owners, recorded

directly to equity:

 

 

 

 

 

 

Payment of third interim dividend (5.00p) in respect of the year ended 31 October 2018

-

-

-

               -

(6,130)

(6,130)

Payment of the final dividend (5.00p) in respect of the year ended 31 October 2018

-

-

-

-

(6,130)

(6,130)

 

----------

----------

----------

----------

----------

--------------

Total equity at 30 April 2019

30,986

78,541

12,489

976,802

41,332

1,140,150

 

======

======

======

======

======

========

 

 

 

 

 

 

 

 

 

 

Half-year ended 30 April 2018 (Unaudited)

 Called up

share capital

£'000

Share premium

account £'000

Capital  redemption

reserve

£'000

Other capital

reserves £'000

 

Revenue reserve £'000

 

 

Total

£'000

Total equity at 1 November 2017

30,986

78,541

12,489

915,206

40,341

1,077,563

Total comprehensive income:

 

 

 

 

 

 

(Loss)/profit for the period

-

-

-

(11,224)

10,447

(777)

Transactions with owners, recorded

directly to equity:

 

 

 

 

 

 

Payment of third interim dividend (4.70p) in respect of the year ended 31 October 2017

-

-

-

-

(5,763)

(5,763)

Payment of the final dividend (4.80p) in respect of the year ended 31 October 2017

-

-

-

-

(5,885)

(5,885)

 

----------

----------

----------

----------

----------

--------------

Total equity at 30 April 2018

30,986

78,541

12,489

903,982

39,140

1,065,138

 

======

======

======

======

======

========

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year ended 31 October 2018 (Audited)

 Called up

share capital

£'000

 Share premium

account £'000

Capital  redemption

reserve £'000

Other capital

reserves £'000

 

Revenue reserve £'000

 

Total

£'000

Total equity at 1 November 2017

30,986

78,541

12,489

915,206

40,341

1,077,563

Total comprehensive income:

 

 

 

 

 

 

(Loss)/Profit for the year

-

-

-

(17,888)

25,473

7,585

Ordinary dividends paid

-

-

-

-

(23,565)

(23,565)

 

-----------

-----------

-----------

------------

-----------

-------------

Total equity at 31 October 2018

30,986

78,541

12,489

897,318

42,249

1,061,583

 

======

======

======

======

======

=======

 

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

 

 

 

CONDENSED STATEMENT OF FINANCIAL POSITION

 

 

(Unaudited)

As at 30 April

2019

£'000

(Unaudited)

As at 30 April

2018

£'000

(Audited)

As at 31 October

2018

£'000

 

 

 

 

Non-current assets

 

 

 

Investments held at fair value through profit or loss

1,129,419

1,098,393

1,087,033

 

-------------

-------------

-------------

 

 

 

 

Current assets

 

 

 

Investments held at fair value through profit or loss (note 4)

29,607

12,454

18,005

Other receivables

5,385

5,382

4,667

Cash and cash equivalents

42,027

18,354

20,075

 

------------

------------

-------------

 

77,019

36,190

42,747

 

-------------

-------------

--------------

Total assets

1,206,438

1,134,583

1,129,780

 

-------------

-------------

--------------

Current liabilities

 

 

 

Other payables

(1,469)

(2,621)

(3,370)

Bank loans

-

(2,002)

-

 

------------

------------

------------

 

(1,469)

(4,623)

(3,370)

 

-------------

-------------

-------------

Total assets less current liabilities

1,204,969

1,129,960

1,126,410

 

 

 

 

Non-current liabilities

 

 

 

Debenture stock

(15,000)

(15,000)

(15,000)

Unsecured loan notes

(49,819)

(49,822)

(49,827)

 

-------------

-------------

--------------

Net assets

1,140,150

1,065,138

1,061,583

 

========

========

========

 

 

 

 

Equity attributable to equity shareholders

 

 

 

Share capital (note 5)

30,986

30,986

30,986

Share premium account

78,541

78,541

78,541

Capital redemption reserve

12,489

12,489

12,489

Retained earnings:

 

 

 

  Other capital reserves

976,802

903,982

897,318

  Revenue reserve

41,332

39,140

42,249

 

------------

------------

-------------

Total equity

1,140,150

1,065,138

1,061,583

 

=======

=======

=======

Net asset value per ordinary share (note 6)

929.9p

868.7p

865.8p

 

=======

=======

======

 

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

 

 

 

 

 

 

CONDENSED CASH FLOW STATEMENT

 

 

 

 

Reconciliation of profit before taxation to net cash flow from operating activities.

(Unaudited)

Half-year ended

 30 April

2019

£'000

(Unaudited)

Half-year ended

30 April

2018

£'000 

(Audited)

Year ended

31 October

 2018

£'000

Operating activities

 

 

 

Net profit before taxation

91,561

-

9,408

Add: interest payable ('finance costs')

1,508

1,510

3,047

Adjustment to loan note value

(8)

5

11

Add/(less):(Gains)/losses on investments held at fair value through profit or loss

(82,146)

8,679

12,611

(Increase)/decrease in accrued income

(1,868)

(1,430)

113

Decrease/(increase) in other receivables

24

(5)

(12)

Increase in other payables

43

42

82

Purchase of investments

(145,370)

(175,050)

(335,454)

Sales of investments

185,118

169,796

337,755

Purchases of current asset investments

(33,452)

(22,002)

(46,003)

Sales of current asset investments

21,850

32,800

51,250

1,257

(1,138)

(1,834)

(1,931)

(6,858)

(6,163)

 

------------

------------

-----------

Net cash inflow from operating activities before interest and taxation

 

36,586

 

6,349

 

24,811

Interest paid

(1,521)

(1,522)

(3,058)

Taxation on investment income

(866)

(923)

(2,083)

 

------------

------------

------------

Net cash inflow from operating activities

34,199

3,904

19,670

 

=======

=======

=======

 

 

 

 

Financing activities

 

 

 

Equity dividends paid (net of refund of unclaimed distributions and reclaimed distributions)

(12,260)

(11,648)

(23,565)

Drawdown of loan

-

2,002

2,005

Repayment of loan

-

-

(2,005)

 

------------

------------

------------

Net cash outflow from financing activities

(12,260)

(9,646)

(23,565)

 

------------

------------

------------

 

 

 

 

Increase/(decrease) in cash

21,939

(5,742)

(3,895)

Cash and cash equivalents at start of year

20,075

24,102

24,102

Exchange movements

13

(6)

(132)

 

-----------

------------

------------

Cash and cash equivalents at end of period

42,027

18,354

20,075

 

=======

=======

=======

 

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

 

 

 

 

 

 

 

 

 

 

 

NOTES TO THE CONDENSED FINANCIAL STATEMENTS:

 

1.

Accounting Policies

 

The Bankers Investment Trust PLC ('the Company') is a company incorporated and domiciled in the United Kingdom under the Companies Act 2006.

 

These condensed financial statements comprise the unaudited results of the Company for the half-year ended 30 April 2019. They have been prepared on a going concern basis and in accordance with International Accounting Standard 34, 'Interim Financial Reporting', as adopted by the European Union and with the Statement of Recommended Practice for Investment Trusts ('SORP') issued by the Association of Investment Companies dated November 2014, and updated in February 2018 with consequential amendments, where the SORP is consistent with the requirements of IFRS.

 

For the period under review the Company adopted the following accounting policies: IFRS 9 - Financial Instruments, IFRS 15 - Revenue from Contracts with Customers the impact of which are not material and none respectively. These financial statements have not been either audited or reviewed by the Company's Auditor.

 

 

 

2.

Management Fees

 

 

(Unaudited)

(Unaudited)

(Audited)

 

 

Half-year ended

30 April 2019

Half-year ended

30 April 2018

Year ended

31 October 2018

 

 

Revenue return

£'000

Capital  return

£'000

Total

£'000

Revenue return

£'000

Capital  return

£'000

Total

£'000

Revenue return

£'000

Capital  return

£'000

Total

£'000

 

 

 

 

 

 

 

 

 

 

 

 

Investment management

691

1,612

2,303

636

1,484

2,120

1,344

3,136

4,480

 

 

=====

=====

====

=====

=====

=====

=====

=====

=====

 

 

The management fee is calculated on a quarterly basis as the aggregate of 0.45% per annum of the first £750 million and 0.40% per annum on the excess over £750 million of the value of the net assets on the last day of the quarter immediately preceding the quarter in respect of which the calculation is made. For the final quarter of 2017, the quarterly fee was subject to a cap of £843,685.

 

 

3.

Earnings per Ordinary Share

 

The earnings per ordinary share figure is based on the net profit for the half-year of £90,827,000 (30 April 2018: loss £777,000; 31 October 2018: profit £7,585,000) and on 122,606,783 (30 April 2018: 122,606,783; 31 October 2018: 122,606,783) ordinary shares, being the weighted average number of ordinary shares in issue excluding treasury shares during the period.                                                                                 

 

 

 

The return per share detailed above can be further analysed between revenue and capital, as below.

 

 

(Unaudited)

Half-year ended

30 April 2019

£'000

(Unaudited)

 Half-year ended

30 April 2018

£'000

(Audited)

Year ended

31 October 2018

£'000

 

 

 

 

 

 

Revenue profit

11,343

10,447

25,473

 

Capital profit/(loss)

79,484

(11,224)

(17,888)

 

 

------------

------------

------------

 

Total profit/(loss)

90,827

(777)

7,585

 

 

=======

=======

=======

 

Weighted average number of ordinary  shares in issue during each period excluding treasury shares

122,606,783

122,606,783

122,606,783

 

 

 

 

 

 

Revenue earnings per ordinary share

9.25p

8.52p

20.78p

 

Capital earnings/(loss) per ordinary share

64.83p

(9.15p)

(14.59p)

 

 

------------

------------

------------

 

Total earnings/(loss) per ordinary share

74.08p

(0.63p)

6.19p

 

 

=======

=======

=======

 

 

 

4.

Current Asset Investment

 

 

The Company has a holding in the Deutsche Global Liquidity Series Fund, a money market fund which is viewed as a readily disposable store of value and which is used to invest cash balances that would otherwise be placed on short-term deposit. At 30 April 2019 this holding had a value of £29,607,000 (30 April 2018: £12,454,000; 31 October 2018: £18,005,000).

 

 

5.

Share Capital

 

 

At 30 April 2019 there were 123,945,292 ordinary shares of 25p each in issue (30 April 2018: 123,945,292; 31 October 2018: 123,945,292). During the half-year ended 30 April 2019 no shares were issued or bought back (30 April 2018 and 31 October 2018: no shares were issued or bought back). 

 

At 30 April 2019 1,338,509 shares were held in treasury (30 April 2018 and 31 October 2018: 1,338,509). Shares held in treasury do not have any voting rights.

 

 

6.

Net Asset Value per Ordinary Share

 

 

The net asset value per ordinary share is based on the net assets attributable to equity shareholders of £1,140,150,000 (30 April 2018: £1,065,138,000; 31 October 2018: £1,061,583,000) and on 122,606,783 (30 April 2018: 122,606,783; 31 October 2018: 122,606,783) ordinary shares, being the number of ordinary shares in issue with voting rights at the period end.

 

 

7.

Bank loan

 

 

At 30 April 2019, the Company had drawn down: £nil (30 April 2018: £2,002,000; 31 October 2018: £nil) of its £20 million multi-currency loan facility. The facility was renewed on 28 February 2019 with Sumitomo Mitsui Banking Corporation Europe Limited, prior to that it was with RBS International Limited.

 

 

8.

Related Party Transactions

 

 

The Company's transactions with related parties during the period were with its Directors and Janus Henderson. There have been no material transactions between the Company and its Directors during the period other than the amounts paid to them in respect of Directors' remuneration for which there were no outstanding amounts payable at the period end.

 

In relation to the provision of services by Janus Henderson, other than fees payable by the Company in the ordinary course of business and the provision of sales and marketing services, there have been no transactions with Janus Henderson affecting the financial position or performance of the Company during the period under review.

 

 

9.

Financial Instruments

 

At the period end the carrying value of financial assets approximates their fair value.

 

Financial Instruments Carried at Fair Value                            

 

Fair value hierarchy

The debenture stock and unsecured loan notes are valued at par in the Statement of Financial Position. The fair value of the 8% debenture stock at 30 April 2019 was £18,731,000 (30 April 2018: £19,212,000; 31 October 2018: £18,722,000). The fair values are calculated using prices quoted on the exchange on which the instruments trade and are categorised as Level 1 as described below. In order to comply with fair value accounting disclosures only, the fair value of the loan note at 30 April 2019 has been estimated to be  £56,661,000 (30 April 2018: £55,241,000; 31 October 2018: £55,373,000) and is categorised as Level 3 in the fair value hierarchy as described below. However, for the purpose of the daily NAV announcements, the unsecured loan notes are valued at amortised cost in the fair value NAV because it is not traded and the Directors expect it to be held to maturity and, accordingly, the Directors have assessed that this is the most appropriate value to be applied for this purpose.                                  

                                               

The following table analyses recurring fair value measurements for financial assets. These fair value measurements are categorised into different levels in the fair value hierarchy based on the inputs to valuation techniques used.         

                                                                                               

 

 

 

 

 

 

 

 

 

 

 

Financial assets at fair value through profit or loss at

30 April 2019 (Unaudited)

    Level 1

£,000

Level 2

£,000

Level 3

£,000

Total

£,000

 

Investments including derivatives:

 

 

 

 

 

- Equity investments

1,129,414

-

-

1,129,414

 

- Fixed interest investments

-

-

5

5

 

  - Current asset investments

29,607

-

-

29,607

 

 

-------------

---------

---------

-------------

 

Total financial assets carried at fair value

1,159,021

-

5

1,159,026

 

 

=========

======

======

=======

 

 

 

 

 

 

 

Financial assets at fair value through profit or loss at

30 April 2018 (Unaudited)

    Level 1

£,000

Level 2

£,000

Level 3

£,000

Total

£,000

 

Investments including derivatives:

 

 

 

 

 

- Equity investments

1,098,385

-

-

1,098,385

 

- Fixed interest investments

-

-

8

8

 

  - Current asset investments

12,454

-

-

12,454

 

 

-------------

---------

---------

-------------

 

Total financial assets carried at fair value

1,110,839

-

8

1,110,847

 

 

========

======

======

=======

 

 

 

 

 

 

 

Financial assets at fair value through profit or loss at

31 October 2018 (Audited)

    Level 1

£,000

Level 2

£,000

Level 3

£,000

Total

£,000

 

Investments including derivatives:

 

 

 

 

 

- Equity investments

1,087,026

-

-

1,087,026

 

- Fixed interest investments

-

-

7

7

 

  - Current asset investments

18,005

-

-

18,005

 

 

-------------

----------

---------

-------------

 

Total financial assets carried at fair value

1,105,031

-

7

1,105,038

 

 

========

======

======

=======

 

 

 

(Unaudited) Half-year

(Unaudited) Half-year

(Audited)  Year ended

 

Level 3 investments at fair value through profit or loss

30 April

     2019

   £'000

30 April

     2018

   £'000

31 October

2018

£'000

 

Opening balance

7

445

445

 

Transferred into Level 3

-

-

-

 

Disposal proceeds

(1)

(9)

(6)

 

Total losses included in the Statement of Comprehensive Income  on assets held at year end

(1)

(428)

(432)

 

 

   -------

   -------

----------

 

Closing balance

5

8

7

 

 

====

====

=====

 

10.

Going Concern

 

 

The assets of the Company consist of securities that are readily realisable and, accordingly, the Board believes that the Company has adequate resources to continue in operational existence for at least twelve months from the date of approval of the financial statements. Having assessed these factors and the principal risks, the Board has determined that it is appropriate for the financial statements to be prepared on a going concern basis.

 

 

11.

Dividends

 

A first interim dividend of 5.10p (2018: 4.86p) per ordinary share, was paid on 31 May 2019 to shareholders registered on 26 April 2019. The shares were quoted ex-dividend on 25 April 2019. Based on the number of ordinary shares in issue excluding shares held in treasury at 25 April 2019 of 122,606,783 the cost of this dividend was £ 6,253,000. The dividend was paid from the Company's revenue account.

 

The Directors have declared a second interim dividend of 5.10p (2018: 4.86p) and is payable on 30 August 2019 to shareholders on the register on 26 July 2019. The shares will be quoted ex-dividend on 25 July 2019. Based on the number of shares in issue excluding shares held in treasury at 1 July 2019 of 122,606,783 the cost of this dividend will be £6,253,000. The dividend will be paid from the Company's revenue account.

 

12.

Comparative Information

 

The financial information contained in this half-year report does not constitute statutory accounts as defined in Section 434 of the Companies Act 2006. The financial information for the half-years ended 30 April 2019 and 2018 has not been audited or reviewed by the Auditor.

 

The figures and financial information for the year ended 31 October 2018 have been extracted from the latest published financial statements of the Company. These financial statements have been delivered to the Registrar of Companies and included the report of the Auditor which was unqualified and did not contain a statement under either section 498(2) or 498(3) of the Companies Act 2006.

 

13.

Half-Year Report

 

The half-year report will shortly be available on the Company's website (www.bankersinvestmenttrust.com) or in hard copy from the Company's registered office. An abbreviated version of this half-year report, the 'update', will be circulated to shareholders in July 2019.

 

14.

General Information

 

Company Status

The Company is a UK domiciled investment trust company.

London Stock Exchange Daily Official List (SEDOL): 0076700 / ISIN number is GB0000767003

London Stock Exchange (TIDM) Code: BNKR

Global Intermediary Identification Number (GIIN): L5YVFP.99999.SL.826

Legal Entity Identifier (LEI): 213800B9YWXL3X1VMZ69

 

Registered Office

UK: 201 Bishopsgate, London EC2M 3AE.

 

Company Registration Number

UK:  00026351

NZ:  645360

 

Directors

The Directors of the Company are Susan Inglis (Chairman), Julian Chillingworth (Senior Independent Director), Isobel Sharp (Audit Committee Chairman) and Richard Huntingford.

 

Corporate Secretary

Henderson Secretarial Services Limited, represented by Wendy King FCIS.

 

Website

Details of the Company's share price and net asset value, together with general information about the Company, monthly factsheets and data, copies of announcements, reports and details of general meetings can be found at www.bankersinvestmenttrust.com.

 

 

 

 

Largest Investments

At 30 April 2019

 

Rank

30 April  2019

Rank

31 Oct 2018

 Company

Valuation
31 Oct 2018

£,000

Purchases

£'000

Sales proceeds

£'000

Appreciation/
(Depreciation)

£'000

 Valuation  
30 April 2019

£'000

1

(1)

Microsoft

                     21,422

                            -

(1,695)

4,038

                  23,765

2

(7)

Estée Lauder

                     18,089

                            -

                      -

4,858

                  22,947

3

(3)

American Express

                     20,174

                            -

                      -

2,397

                  22,571

4

(6)

Berkshire Hathaway

                     18,089

                            -

                      -

622

                  18,711

5

(11)

American Tower

                     14,412

                            -

                      -

3,290

                  17,702

6

(9)

Visa

                     14,938

                            -

                      -

2,525

                  17,463

7

(12)

Comcast

                     14,272

                   1,292

                      -

1,859

                  17,423

8

(14)

MasterCard

                     13,742

                            -

                      -

3,577

                  17,319

9

(27)

Alphabet

                     15,886

                            -

                      -

1,287

                  17,173

10

(15)

ICON

                     13,216

                   3,172

                      -

(205)

                  16,183

11

(10)

Royal Dutch Shell

                     14,926

                            -

                      -

(585)

                  14,341

12

(18)

Diageo

                     11,987

                            -

                      -

2,323

                  14,310

13

(16)

Aptiv

                     12,901

                            -

                      -

1,215

                  14,116

14

(17)

GlaxoSmithKline

                     12,710

                      656

                      -

565

                  13,931

15

(22)

Xylem

                     11,167

                            -

                      -

2,747

                  13,914

16

(4)

Union Pacific

                     19,776

                            -

(8,337)

2,316

                  13,755

17

#

Adobe Systems

                             -  

                 11,144

                      -

2,466

                  13,610

18

(24)

The Cooper Companies

                     10,814

                            -

                      -

1,079

                  11,893

19

(21)

Intercontinental Exchange

                     11,189

                            -

                      -

385

                  11,574

20

(26)

Netflix

                     10,598

                            -

(1,757)

2,089

                  10,930

21

(35)

Electronic Arts

                       8,211

                   2,268

                      -

356

                  10,835

22

(23)

Cognizant Technology Solutions

                     10,869

                            -

(610)

369

                  10,628

23

(19)

British American Tobacco

                     11,883

                            -

                      -

(1,413)

                  10,470

24

(33)

Roper Technologies

                       8,301

                            -

                      -

2,037

                  10,338

25

(29)

Nestlé

                       9,110

                      487

(674)

1,034

                    9,957

 

 

 

Rank

30 April  2019

Rank

31 Oct 2018

 Company

Valuation
31 Oct 2018

£,000

Purchases

£'000

Sales proceeds

£'000

Appreciation/
(Depreciation)

£'000

 Valuation  
30 April 2019

£'000

26

(5)

BP

                     18,816

                            -

(8,504)

(597)

                    9,715

27

(28)

Amazon

                       9,514

                            -

(1,400)

1,580

                    9,694

28

(43)

SAP

                       6,759

                   1,667

(554)

1,413

                    9,285

29

#

Ping An Insurance

                       6,740

                            -

                      -

2,514

                    9,254

30

(34)

Reckitt Benckiser

                       8,217

                   1,152

                      -

(145)

                    9,224

31

#

ANTA Sports

                       5,461

                            -

                      -

3,744

                    9,205

32

(25)

Booking.com

                     10,709

                            -

(1,106)

(421)

                    9,182

33

(20)

Taiwan Semiconductor Manufacturing

                     11,715

                            -

(3,634)

1,030

                    9,111

34

(2)

Apple

                     21,285

                            -

(8,031)

(4,776)

                    8,478

35

(45)

DSM

                       6,658

                      419

(539)

1,784

                    8,322

36

#

PayPal

                             -  

                   6,788

                      -

1,523

                    8,311

37

(40)

RELX

                       7,118

                            -

                      -

960

                    8,078

38

#

Daiichi Sankyo

                       6,350

                            -

                      -

1,652

                    8,002

39

#

National Grid

                       4,392

                   3,324

                      -

125

                    7,841

40

(30)

Roche Holdings

                       8,838

                      561

(2,098)

528

                    7,829

41

(13)

FedEx

                     13,876

                            -

(3,599)

(2,543)

                    7,734

42

(37)

Novo-Nordisk

                       7,438

                            -

(575)

850

                    7,713

43

#

SoftBank

                       5,652

                      417

 

1,625

                    7,694

44

#

Tesco

                       5,834

                      578

                      -

1,067

                    7,479

45

(38)

Lloyds Banking

                       7,341

                            -

(577)

693

                    7,457

46

(46)

Prudential

                       6,650

                            -

                      -

695

                    7,345

47

#

Chongqing Brewery

                       5,350

                            -

                      -

1,897

                    7,247

48

#

Sands China

                             -  

                   5,525

                      -

1,614

                    7,139

49

#

Fisher (James) & Sons

                       6,093

                            -

                      -

993

                    7,086

50

#

Sage

                       4,756

                      531

                      -

1,797

                    7,084

 

 

 

-------------

-------------

-------------

----------------

-------------

 

 

 

                  524,244

                 39,981

(43,690)

60,833

581,368

 

 

 

-------------

-------------

-------------

------------------

-------------

 

# These investments total £581,368,000 which represented 51.5% of the portolio

 

All securities are equity investments

# Not in top 50 at 31 October 2018

Convertibles and all classes of equity in any one company being treated as one investment

 

 

GEOGRAPHICAL DISTRIBUTION

 

 

       Valuation of investments

 

30 April 2019

%

31 October 2018

%

UK

25.2

25.2

Europe (ex UK)

13.5

14.9

North America

32.1

31.6

Japan

11.2

11.7

Pacific (ex Japan, China)

9.7

8.7

China

5.7

5.4

Emerging Markets

2.6

2.5

 

---------

---------

 

100.0

100.0

 

=====

=====

 

Source: Janus Henderson

 

 

REVENUE GENERATED

 

      

 

30 April 2019

%

31 October 2018

%

UK

10.7

11.7

Europe (ex UK)

14.1

14.9

North America

29.3

30.5

Japan

7.8

8.3

Developed Asia Pacific (ex Japan)

3.5

3.6

Emerging Asia

18.2

17.9

Emerging Other

12.7

13.1

 

 

These figures may not add up to 100% due to cash held

 

Source: Janus Henderson

 

 

SECTOR ANALYSIS

 

30 April 2019

%

31 October 2018

%

Financials

23.1

23.6

Consumer Goods

19.8

18.1

Industrials

16.1

16.2

Technology

11.4

11.9

Consumer Services

9.8

9.9

Health Care

7.1

6.7

Basic Materials

4.4

3.5

Oil & Gas

3.6

5.1

Telecommunications

3.4

4.0

Utilities

1.3

1.0

 

---------

---------

 

100.0

100.0

 

=====

=====

 

Source: Janus Henderson

 

Neither the contents of the Company's website nor the contents of any website accessible from hyperlinks on the Company's website (or any other website) are incorporated into, or forms part of, this announcement.

 


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 rns@lseg.com or visit www.rns.com.
 
END
 
 
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Half-year Report - RNS