RNS Number:7694Y
Australian Opp Inv Tst PLC
12 February 2001
Objective of the Company
The objective of the Company is to provide long term capital appreciation by
investing in a portfolio of listed Australasian securities including New
Zealand, focusing on investment companies, financial services companies and
small industrial companies. In addition, the Company may invest up to 10% of its
assets in special situations worldwide.
Financial highlights
% change
At since
30 November 31 May
2000 2000
Australian Dollar
Australian All Ordinaries Index 3222.0 5.97%
Total assets less current liabilities (A$'000) 38,773 8.14%
Fully-diluted net asset value per ordinary share (A$) 1.9168 8.14%
Basic net asset value per ordinary share (A$) 1.5919 12.24%
# Sterling / Australian $ exchange rate 2.6963 -2.91%
# Sterling
Australian All Ordinaries Index (Sterling adjusted) 1195.0 2.97%
Total assets less current liabilities (#'000) 14,381 5.08%
Fully-diluted net asset value per ordinary share (pence) 71.09 5.08%
Basic net asset value per ordinary share (pence) 59.04 9.07%
Middle market share price per ordinary share (pence) 44.5 9.88%
Chairman's Statement
During the half year to 30 November 2000 the basic net asset value per
ordinary share ("NAV") rose by 9.1% from 54.1 pence to 59.0 pence, compared to
a rise of 3.0% in the Sterling adjusted Australian All Ordinaries Index.
During the same period the Australian dollar has weakened slightly against
Sterling by 2.9% to A$2.6963. Revenue earnings per ordinary share on a
fully-diluted basis were 0.4 pence, compared to 0.2 pence in the comparable
period last year.
The Australian economy has continued to grow strongly with GDP rising 4.2% in
the year to end September. Within this trend domestic demand is slowing,
offset by strong growth in exports helped by the weak Australian dollar and
earnings derived directly and indirectly from the Olympics. This has resulted
in a sharp improvement in the balance of payments current account from a
deficit of A$7.3 billion in the June quarter to a deficit of A$4.5 billion in
the September quarter. Competition pressures have held core inflation, which
excludes the recently introduced goods and services tax, at 2.4%, well within
the Reserve Bank's guideline of 3%. Short term interest rates have remained
steady at around 6.2%, although looking ahead the Reserve Bank is expected to
lower rates in response to weakening domestic activity. In contrast New
Zealand economic growth has slackened appreciably and the balance of payments
current account deficit remains over NZ$ 7 billion a calendar quarter, an
unsustainable 7.2% of GDP. Thus, while short term interest rates have declined
slightly to 6.7%, the New Zealand dollar has been under pressure falling 4.5%
against Sterling between end May and end December.
Over the period the Stock Market, as measured by the Australian All Ordinaries
Index rose 9.0% from 2964 to 3230, but it has since weakened slightly to 3140.
The index of smaller capitalisation stocks has moved within more narrower
parameters over the period rising by 5.3% from 1710 to 1802 and it has since
settled back to 1766. Within the Company's portfolio, which is comprised
exclusively of smaller companies, the largest holding Permanent Trustee fell
by 13% over the period, but this was more than offset by the movements of the
third and fourth largest holdings namely Dairy Brands +65% and Utilico +48%.
In a concentrated portfolio comprising exclusively smaller companies price
movements tend to be more volatile and in the shorter run to have a
disproportionate effect on the NAV.
The prospect of lower interest rates should help to support the Australian
stock market. However, if economic growth slackens, particularly in the USA,
export volumes will inevitably trend lower. Further, the Australian stock
market will tend to be influenced by movements in the major world stock
markets, particularly the USA. Nevertheless, there should still be
opportunities in smaller companies in the Australian market.
Australian Opportunities Investment Trust PLC
Consolidated Statement of Total Return
Six months to Six months to
30 November 2000 30 November 1999
Unaudited Unaudited
Revenue Capital Total Revenue Capital Total
#'000 #'000 #'000 #'000 #'000 #'000
Gains / (losses) - 576 576 - (1,557) (1,557)
on investments
Exchange - 142 142 - 57 57
differences
Trading loss of (8) - (8) (81) - (81)
subsidiary
Income 346 - 346 511 - 511
Investment (32) - (32) (44) - (44)
management fee
Other expenses (120) (3) (123) (189) (4) (193)
Net return /
(deficit) before
finance costs and 186 715 901 197 (1,504) (1,307)
taxation
Interest payable
and similar
charges (195) - (195) (228) - (228)
Return /
(deficit) on
ordinary
activities before (9) 715 706 (31) (1,504) (1,535)
tax
Tax on ordinary (19) - (19) (33) - (33)
activities
Return /
(deficit) on
ordinary
activities after (28) 715 687 (64) (1,504) (1,568)
tax for the
period
Dividends in - - - - - -
respect of equity
shares
Transfer to / (28) 715 687 (64) (1,504) (1,568)
(from) reserves
Return / (loss)
per ordinary
share (pence):
Basic (0.19) 5.10 4.91 (0.46) (10.74) (11.20)
Diluted 0.35 3.54 3.89 0.17 (7.44) (7.27)
Year ended
31 May 2000
Audited
Revenue Capital Total
#'000 #'000 #'000
Gains / (losses) on investments - (6,495) (6,495)
Exchange differences - 117 117
Trading loss of subsidiary (95) - (95)
Income 1,213 - 1,213
Investment management fee (81) - (81)
Other expenses (197) (14) (211)
Net return / (deficit) before
finance costs and taxation 840 (6,392) (5,552)
Interest payable and similar
charges (477) - (477)
Return / (deficit) on ordinary
activities before tax 363 (6,392) (6,029)
Tax on ordinary activities 8 - 8
Return / (deficit) on ordinary
activities after tax for the 371 (6,392) (6,021)
period
Dividends in respect of equity (315) - (315)
shares
Transfer to / (from) reserves 56 (6,392) (6,336)
Return / (loss) per ordinary share (pence):
Basic 2.65 (45.63) (42.98)
Diluted 2.58 (31.60) (29.02)
The revenue column of this statement is the consolidated profit and loss account
of the Group.
All revenue and capital items in the above statement derive from continuing
operations.
Consolidated Balance Sheet
30 November 30 November 31 May
2000 1999 2000
Unaudited Unaudited Audited
#'000 #'000 #'000
Fixed assets
Investments 15,314 21,560 16,531
Current assets
Investments 282 303 290
Debtors 501 873 420
Cash at bank and short-term deposits 125 17 24
908 1,193 734
Creditors: amounts falling due within one year (1,841) (4,306) (3,579)
Net current liabilities (933) (3,113) (2,845)
Total assets less current liabilities 14,381 18,447 13,686
Creditors: amounts falling due after more
than one year
Convertible Loan Stock 2007 (6,108) (6,096) (6,103)
Net assets 8,273 12,351 7,583
Capital and reserves
Called up share capital 3,503 3,502 3,502
Share premium account 2,515 2,513 2,513
Capital reserve - realised 7,876 8,776 7,709
Capital reserve - unrealised (4,145) (872) (4,693)
Revenue reserve (1,476) (1,568) (1,448)
Equity shareholders' funds 8,273 12,351 7,583
Net asset value per share:
Ordinary
- Basic 59.04p 88.17p 54.13p
- Fully-diluted 71.09p 91.19p 67.65p
Consolidated Cash Flow Statement
Six months Six months Year to
to to
30 November 30 November 31 May
2000 1999 2000
Unaudited Unaudited Audited
#'000 #'000 #'000
Net cash inflow from operating activities 131 323 868
Returns on investments and servicing of (88) (120) (431)
finance
Taxation (6) (132) (158)
Financial investment 1,729 235 549
1,766 306 828
Equity dividends paid (315) (252) (252)
1,451 54 576
Financing (1,454) 104 94
Increase/(decrease) in cash (3) 158 670
Reconciliation of net cash flow to movement in net debt
Increase/(decrease) in cash in the period (3) 158 670
Cash (inflow) / outflow from movement in debt 1,454 (104) (94)
Change in net debt resulting from cash flows 1,451 54 576
Exchange movements 142 57 117
Other non-cash flow movements (5) (5) (13)
Opening net debt (9,106) (9,786) (9,786)
Closing net debt (7,518) (9,680) (9,106)
Represented by:
Cash at bank 125 17 24
Overdrafts (145) (545) (41)
Debt due within 1 year (1,390) (3,056) (2,986)
Debt due after 1 year (6,108) (6,096) (6,103)
(7,518) (9,680) (9,106)
Notes:
1. The financial information for the year ended 31 May 2000 included in this
half-year report has been taken from the Company's full accounts, which for the
year to 31 May 2000 carry an unqualified audit report and did not include
statements under section 237(2) or (3) of the Companies Act 1985 and which
have been filed with the Registrar of Companies.
2. The financial statements for the period to 30 November 2000 have been
prepared on a basis consistent with the accounting policies adopted by the
Company in its statutory accounts for the year ended 31 May 2000.
3. The Statement of Total Return for the six months to 30 November 2000, six
months to 30 November 1999 and year to 31 May 2000 have been prepared in
accordance with the Statement of Recommended Practice "Financial Statements of
Investment Trust Companies" which have been adopted by the Company.
4. The Statement of Total return includes the results of the Company and its
subsidiary, and together with the Balance Sheet and Cash Flow Statement at 30
November 2000, are unaudited and do not constitute full statutory accounts
within the meaning of Section 240 of the Companies Act 1985.
5. The basic consolidated net asset value per ordinary share is based on net
assets at 30 November 2000 of #8,273,000 (31 May 2000: #7,583,000 and 30
November 1999: #12,351,000)(adjusted to reflect the deduction
of the convertible debt at par) and on 14,010,352 ordinary shares in issue at
30 November 2000 (31 May 2000 and 30 November 1999: 14,008,790).
6. The fully-diluted consolidated net asset value per ordinary share is based
on net assets at 30 November 2000 of #14,381,000 (31 May 2000: #13,686,000 and
30 November 1999: #18,447,000) (adjusted to reflect the conversion of the
convertible debt at par) and on 20,229,506 ordinary shares in issue at 30
November 2000 (31 May 2000 and 30 November 1999: 20,229,507) calculated on the
assumption that the 2007 Loan Stock was converted at the rate of 0.90545251 of
an ordinary share of 25p for each unit of 2007 Loan Stock.
7. Basic returns:
The calculation of the basic consolidated revenue return per ordinary share of
25 pence each is based on net revenue deficit on ordinary activities after
taxation of #(28,000) for the six months ended 30 November 2000
(31 May 2000: surplus #371,000 and 30 November 1999: deficit #64,000) divided
by 14,009,038 (31 May 2000:14,008,105 and 30 November 1999: 14,007,420) being
the weighted average number of ordinary shares in issue during the period.
The calculation of the basic consolidated capital return per ordinary share of
25 pence each is based on net capital profit of #715,000 for the six months
ended 30 November 2000 (31 May 2000: deficit #6,392,000
and 30 November 1999: deficit #1,504,000) divided by 14,009,038 (31 May 2000:
14,008,105 and 30 November 1999: 14,007,420) being the weighted average number
of ordinary shares in issue during the period.
8. Diluted returns:
The diluted returns per ordinary share of 25p each for the six months ended 30
November 2000 have been calculated on the assumption that the Convertible Loan
Stock 2007 was fully converted on the first day of that financial period giving
a weighted average of 20,229,506 (31 May 2000 and 30 November 1999: 20,229,507)
shares and based on net revenue on ordinary activities after taxation of #
71,000 (31 May 2000: #523,000 and 30 November 1999: #35,000) and net capital
profit of #715,000 (31 May 2000: deficit #6,392,000 and
30 November 1999: deficit #1,504,000). The diluted revenue return of 0.35p (31
May 2000: 2.58p and
30 November 1999: 0.17p) includes the savings of finance costs on the Loan
Stock.
There was no dilution effect on basic consolidated revenue or capital returns
per ordinary share of 25p each for the six months ended 30 November 1999.
9. The Interim report will be sent to shareholders shortly.
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