Final Results
December 10 2008 - 2:00AM
UK Regulatory
RNS Number : 8282J
AIM Realisation Fund Limited
10 December 2008
AIM Realisation Fund Limited
Results for the Year Ended 30 September 2008
Chairman's Statement
I am pleased to present the results of AIM Realisation Fund Limited (the
"Company") for the year ended 30 September 2008.
The Company's capital structure consists of Ordinary Shares and Redeemable
Preference Shares and is designed to facilitate the progressive return of
capital as investments are realised. In March and September each year, the
Board intends to apply all available funds after provision for working
capital to effect a pro rata redemption at 100 pence per share of outstanding
Redeemable Preference Shares. If the Redeemable Preference Shares trade at a
sufficient discount to their redemption price, the Board intends to apply, on
a rolling basis, up to 50% of the net cash proceeds of realisations since the
last redemption to purchase the Redeemable Preference Shares in the market.
Once all Redeemable Preference Shares have been redeemed or purchased, the
Company intends to purchase the Ordinary Shares for cancellation.
Investments
Your Company acquired 98 AIM securities in the Placing in August 2006. Your
Investment Adviser has since reduced the number of holdings to 24 as at 30
September 2008 (including CardioMag Imaging, Cartucho Group, Premier Direct
Group and Vimio, which are either delisted or suspended from trading on AIM
and have been deemed to have a nil value). During the year under review,
�5.20 million was realised from the sale of investments (period ended 30
September 2007: �15.67 million) and the proceeds returned to Shareholders via
the redemption of 4,559,729 Redeemable Preference Shares (2,509,940 on 31
March 2008 and 2,049,789 on 26 September 2008) at 100 pence per Redeemable
Preference Share (period ended 30 September 2007: 13,086,056). Since launch
on 10 August 2006, �17.65 million has been returned to Shareholders through
the redemption of 17,645,785 Redeemable Preference Shares at 100 pence each,
representing 59.69% of the net proceeds received from the Placing. It is the
Board's policy to retain a prudent amount of working capital to meet expenses
and to return all surplus cash to Shareholders.
Results
A loss of �6.24 million was recorded in the year under review (period ended
30 September 2007: loss of �1.05 million), reflecting a �5.89 million
negative movement (realised and unrealised) in investments and a �0.35
million deficit on income after expenses. The Board does not propose a final
dividend. As stated in the Prospectus, the Board intends to manage the
Company's affairs to achieve Shareholder return through capital growth rather
than through income returns.
Net Asset Value
During the year ended 30 September 2008, the net asset value ("NAV") of the
Ordinary Shares (with investments based on bid prices) decreased by 88.37%
from 76.79 pence to 8.93 pence per Ordinary Share. By comparison, the FTSE
AIM All-Share Index decreased by 44.35% over the equivalent period. The
published Ordinary Share NAV of 8.42 pence was stated after the write-down of
a small number of investments due to the poor underlying performance of the
businesses and a lack of liquidity in the market. This had the impact of
reducing the NAV by 0.51 pence. Performance has suffered at the junior end of
the market as liquidity has temporarily deteriorated and as a result, many
otherwise robust businesses have endured a shift in sentiment and experienced
a significant de-rating.
The Shares were placed in units of three Ordinary Shares and seven Redeemable
Preference Shares. Over the 12 month period to 30 September 2008, the total
NAV return to an investor in the units would have been a decline of 40.44%.
October and November Performance
Following the pro rata redemptions of the Redeemable Preference Shares (which
have the effect of gearing the Ordinary Shares), combined with the
significant market decline in global equities post the year end, the NAV of
the Ordinary Shares declined to nil as at 30 November 2008. Shareholders
should be aware that any further deterioration in the value of the portfolio
will be reflected in the NAV of the Redeemable Preference Shares, which stood
at 76.93p per Redeemable Preference Share as at 30 November 2008.
Outlook
With a weakening economy and credit in very short supply, we should expect
that the market for smaller companies will continue to be challenging for the
foreseeable future. Realisations are therefore unlikely to be achieved at the
rate they were in the early months of the Company's life. We remain confident
that the Company's Investment Adviser, Collins Stewart, is well placed to
optimise the balance between the speed of realisation and maximising the
value extracted for Shareholders from the remaining portfolio holdings.
Shareholders should be aware that, as realisations are made and capital
returned, the portfolio will become increasingly concentrated and therefore
the future returns will be dependent upon an ever smaller number of holdings.
William Scott
Chairman
9 December 2008
The financial information set out in this announcement does not constitute the Company's statutory financial statements for the year
ended 30 September 2008
Income Statement
for the year ended 30 September 2008
1 October 2007 10 August 2006
to 30 September to 30 September
2008 2007
�'000 �'000
Income
Dividends 100 79
Bank interest 104 293
------------ ------------
Total income 204 372
------------ ------------
Expenses
Management fees (324) (469)
Administration fee (85) (93)
Custodian fee (5) (17)
Audit fee (8) (9)
Directors' fees (65) (74)
Other expenses (63) (240)
------------ ------------
Total expenses (550) (902)
------------ ------------
Loss before investment gains (346) (530)
and losses
Investment gains and losses
Realised (loss)/gain from sale (5,962) 1,877
of investments at fair value
through profit or loss
Movement in unrealised loss on 77 (2,390)
investments at fair value
through profit or loss
------------ ------------
Total investment loss (5,885) (513)
------------ ------------
Loss before taxation (6,231) (1,043)
Withholding tax on income (8) (5)
------------ ------------
Loss for the year (6,239) (1,048)
------------ ------------
Loss per Ordinary Share: basic (67.86)p (11.40)p
and fully diluted
------------ ------------
All items in the above statement are derived from continuing operations.
Statement of Changes in Equity
for the year ended 30 September 2008
Share Distributable Non-distributable reserve Total
capital reserve
�'000 �'000 �'000 �'000
Net assets at 01 October 2007 2 17,815 (2,390) 15,427
Redemption of Redeemable (1) (4,559) - (4,560)
Preference Shares
Net profit/(loss) from - (6,316) 77 (6,239)
operating activities
------------ ------------ ------------ ------------
Net assets at 30 September 1 6,940 (2,313) 4,628
2008
------------ ------------ ------------ ------------
Statement of Changes in Equity
for the period from 10 August 2006 to 30 September 2007
Share Share premium Distributable Non-distributable Total
capital reserve reserve
�'000 �'000 �'000 �'000 �'000
Net assets at 10 August 2006 - - - - -
Issue of Ordinary Shares 1 9,193 - - 9,194
Issue of Redeemable Preference 2 21,451 - - 21,453
Shares
Formation expenses - (1,086) - - (1,086)
Cancellation of share premium - (29,558) 29,558 - -
Redemption of Redeemable (1) - (13,085) - (13,086)
Preference Shares
Net profit/(loss) from - - 1,342 (2,390) (1,048)
operating activities
------------ ------------ ------------ ------------ ------------
Net assets at 30 September 2 - 17,815 (2,390) 15,427
2007
------------ ------------ ------------ ------------ ------------
Balance Sheet
as at 30 September 2008
30 September 2008 30 September 2007
�'000 �'000
Non-current assets
Investments at fair value through 4,006 14,449
profit or loss
------------ ------------
Current assets
Receivables and prepayments 17 81
Cash and cash equivalents 730 5,572
------------ ------------
747 5,653
------------ ------------
Total assets 4,753 20,102
------------ ------------
Current liabilities
Payables and accruals (125) (4,675)
------------ ------------
Total liabilities (125) (4,675)
------------ ------------
------------ ------------
Net assets 4,628 15,427
------------ ------------
Capital and reserves
Share capital - Ordinary Shares of 1 1
0.01p each
Share capital - Redeemable Preference - 1
Shares of 0.01p each
Distributable reserve 6,940 17,815
Non-distributable reserve (2,313) (2,390)
------------ ------------
Total equity Shareholders' funds 4,628 15,427
------------ ------------
Net asset value per Ordinary Share 8.93p 76.79p
------------ ------------
Net asset value per Redeemable 100.00p 100.00p
Preference Share
------------ ------------
Statement of Cash Flows
for the year ended 30 September 2008
1 October 2007 10 August 2006
to 30 September 2008 to 30 September 2007
�'000 �'000
Operating activities
Dividends received 107 71
Bank interest received 105 290
Management fees paid (365) (342)
Administration fee paid (85) (86)
Other expenses paid (145) (318)
------------ ------------
Net cash outflow from (383) (385)
operating activities before
taxation
Withholding tax on income (8) (4)
------------ ------------
Net cash outflow from (391) (389)
operating activities
Investing activities
Purchase of investments at (647) -
fair value through profit or
loss
Sale of investments at fair 5,260 15,618
value through profit or loss
------------ ------------
Net cash inflow from investing 4,613 15,618
activities
Financing activities
Proceeds from Placing - 11
Formation expenses paid 1 (1,087)
Redemption of Redeemable (9,065) (8,581)
Preference Shares
------------ ------------
Net cash outflow from (9,064) (9,657)
financing activities
------------ ------------
(Decrease)/increase in cash (4,842) 5,572
and cash equivalents
------------ ------------
Cash and cash equivalents at 5,572 -
beginning of year/period
(Decrease)/increase in cash (4,842) 5,572
and cash equivalents
------------ ------------
Cash and cash equivalents at 730 5,572
end of year/period
------------ ------------
For further information, please contact:
Sean O'Flanagan
Collins Stewart Europe Limited
9th Floor
88 Wood Street
London
EC2V 7QR
Tel: 0207 523 4509
Company website: www.aimrealisationfund.com
This information is provided by RNS
The company news service from the London Stock Exchange
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