TIDMIRIS

RNS Number : 6563P

DCG IRIS Limited

20 August 2014

DCG IRIS Limited (the "Company")

June Net Asset Values

As at 30 June 2014, the final net asset value of the Company's ordinary shares is as follows:-

Ordinary Shares

 
 Share class    Final NAV   MTD Performance      2014 YTD 
                 30 June     (Total Return)     Performance 
                                               (Total Return) 
-------------  ----------  ----------------  ---------------- 
 Sterling 
  shares         98.58p         +0.25%            +1.36% 
-------------  ----------  ----------------  ----------------

This valuation, which has been prepared in good faith by the Company's administrator, is for information purposes only and is based on the unaudited final valuation supplied by the administrators of the Company's underlying investment. Both a weekly estimate and a monthly valuation of the underlying investment may be produced as at valuation dates which do not coincide with valuation dates for the Company, may be based on a valuation provided as of a significantly earlier date, may differ materially from the actual value of the Company's portfolio and is unaudited or may be subject to little verification or other due diligence and may not comply with generally accepted accounting practices or other generally accepted valuation principles. The Company's administrator may not have sufficient information to confirm or review the completeness or accuracy of information provided by the administrators of the Company's investments.

Other risk factors which may be relevant to this valuation are set out in the Company's prospectus dated 12 November 2012.

Monthly Portfolio Review

Portfolio Commentary (provided by Credit Suisse AG, the manager of the Master Fund)(1)

Performance: The Company returned 0.25% (net of fees) in June, mainly driven by the private transactions. Mark-to-market losses on the cat bond portfolio, in line with seasonal pricing patterns, lowered performance, albeit to a lesser degree compared to last month. The first month of the US hurricane season has passed by uneventfully. After the flurry of activity in the cat bond market in the run up to the hurricane season, only one publicly placed cat bond deal closed in the primary market during the month of June. Pricing in the ILW market showed signs of improvement as cedents looked to fill gaps in their program by buying covers on an industry loss basis. We expect this trend to continue over the next few months as the US wind capacity in the market begins to dry up. Our team was busy for most of the month with the completion of the June renewal, as well as working on the preparation for the July renewal in Australia and New Zealand and for some large UK composite insurance companies.

Large Catastrophic Events: June began with an outbreak of severe weather, including thunderstorms and hail, primarily in Germany and France. In Germany, hail caused extensive residential and car damage. Extensive crop damage was also reported in France, where the authorities expect pay-outs to be around $1.25bn. The overall losses in the region are expected to be around $3.5bn. With the US tornado season in full swing, central parts of the country experienced several tornados with accompanying hail and damaging winds. Five tornados classified as EF-5, the most intense and destructive tornados on the enhanced Fujita scale, touched down in a 36 hour period. The aggregated insured losses are currently estimated around $1bn. While the full impact of these loss events is still uncertain, we do not anticipate an impact on fund performance at current industry loss estimates. We will continue to monitor the impact of these events and keep investors advised of significant changes in insured losses in future reports.

Trading: There was some trading in the cat bond market with the net holding of cat bonds decreasing. Much of the trading involved strategic rebalancing of the portfolio as we sold some US wind bonds to redeploy the capacity into US private transactions where we found better value. We added some US, Japan and European exposure to the fund that we found to be well priced on an ILW basis, in addition to private transactions with US insurance and reinsurance companies. We were also successful in getting on the program of a large US homeowners-only writer.

Outlook: The team will be busy during the month of July finalising the renewals for Australia and New Zealand. Our expectation is that the improvements in the ILW pricing will continue. For this reason we anticipate an increase in ILW trading over the next few months and plan to selectively invest in opportunities both inside and outside the US. We do not expect much activity in the primary cat bond market over the next few months.

(1)Portfolio commentary compiled at the end of the month being reported on.

Supplementary Information

Click on, or paste the following link into your web browser, to view a full review of the DCG Iris portfolio.

http://www.rns-pdf.londonstockexchange.com/rns/6563P_-2014-8-20.pdf

This information is provided by RNS

The company news service from the London Stock Exchange

END

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