Investment Co Plc - Annual Financial Report

SUMMARY OF RESULTS

  At 30 June 2017 At 30 June 2016 Change
Equity shareholders’ funds 17,736,777     16,991,639 +4.4%
Number of ordinary shares in issue 4,772,049 4,772,049 -%
Net asset value (“NAV”) per ordinary share
371.68p

356.07p

+4.4%
Ordinary share price (mid) 325.00p 365.50p -11.1%
Premium/(discount) to NAV (12.56)% 2.65%  
       
    At 30 June 2017 At 30 June 2016  
Total return per ordinary share* 36.31p (11.21)p  
Return after taxation per ordinary share
24.64p

(4.03)p
 
Dividends paid/declared per ordinary share
20.70p

20.70p

 

 

Investment Co PLC (INV)

Add to Alerts list

 
  Print      Mail a friend

Friday 27 October, 2017

 

Investment Co PLC

Annual Financial Report

THE INVESTMENT COMPANY PLC

ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2017

The full Annual Report and Accounts for the year ended 30 June 2017 can be found on the Company’s website: http://www.mitongroup.com/tic.

DIRECTORS (all non-executive)

Sir David Thomson Bt. (Chairman)
S. J. Cockburn
P. S. Allen
M. H. W. Perrin (Audit Committee Chairman and Senior Independent Director)
 

STRATEGIC REPORT

SUMMARY OF RESULTS

  At 30 June 2017 At 30 June 2016 Change
Equity shareholders’ funds 17,736,777     16,991,639 +4.4%
Number of ordinary shares in issue 4,772,049 4,772,049 -%
Net asset value (“NAV”) per ordinary share
371.68p

356.07p

+4.4%
Ordinary share price (mid) 325.00p 365.50p -11.1%
Premium/(discount) to NAV (12.56)% 2.65%  
       
    At 30 June 2017 At 30 June 2016  
Total return per ordinary share* 36.31p (11.21)p  
Return after taxation per ordinary share
24.64p

(4.03)p
 
Dividends paid/declared per ordinary share
20.70p

20.70p
 
       
* The total return per ordinary share is based on total comprehensive income after taxation as detailed in the Consolidated Statement of Comprehensive Income and in note 6 and is shown to enable comparison with other investment trust companies.
         


FINANCIAL CALENDAR

November Payment of first interim dividend for the year ending 30 June 2018.
December Annual General Meeting.
February Payment of second interim dividend for the year ending 30 June 2018.
February/March Announcement of Half-Yearly Financial Report.
May Payment of third interim dividend for the year ending 30 June 2018.
August Payment of fourth interim dividend for the year ending 30 June 2018.
September/October Announcement of Annual Results.


CHAIRMAN’S STATEMENT

This statement covers the year ending 30 June 2017.

Following the initial market setback on the UK’s decision to leave the EU, the subsequent period was marked with a strong equity recovery. The FTSE All Share Index rose 13.9% over the year.  In contrast, the FTSE Actuaries UK Conventional Gilts All Stocks Index fell 3.6% over the year, as the decades of bond yield reductions came to an end.  The net asset value (“NAV”) of the Company, which has a portfolio invested in both fixed income and equities, rose 4.4% over the twelve-month period. In addition, three interim dividends of 5p and a fourth interim of 5.7p were declared over the year.  Dividends for the year 2017 totalled 20.7p (2015/16: 20.7p). Following the Company’s reorganisation in June 2013, its aim was to pay a premium, and in time grow the dividend to shareholders. It had sought to do this through investing in high-yielding loan stocks issued by quoted companies, which frequently carry a degree of participation in the issuer’s share price growth if they perform strongly. A second aspect of this strategy was that the Company’s return was not expected to be closely correlated with the movements of mainstream markets.

The Company has continued to hold a number of fixed interest stocks, which the Company has held for many years and the Board is well satisfied with the total return on these holdings. However, since June 2013, there have been few convertible loan notes issued that offer attractive risk/reward ratios, therefore the market opportunity for the strategy has not developed as had been expected. Those funds have been invested in smaller company equities where the returns have proved somewhat disappointing.

Overall, the increase in our NAV in the year was only 4.4% compared with gains of 24.8% and 36.5% respectively in the FTSE Smaller Companies and FTSE AIM Indices.

The Board is exploring initiatives to improve the total return to shareholders. The Board is also reviewing the administrative arrangements and has identified changes that can lower the cost of overheads, which includes the change of Secretary, Administrator and Registrar. Further details are included in the Director’s Report. In addition, pursuant to discussion with significant shareholders, the Board will review its composition.

Whilst markets may continue to appreciate from here for some time, the absence of global productivity growth could become a constraint. It may therefore become all the more important to invest across a wider range of opportunities in the coming period. In the meantime, our fixed interest portfolio is expected to generate a steady flow of relatively high income.

At the forthcoming Annual General Meeting there shall be, as with last year, a continuation resolution put to shareholders. The Directors believe the Company is well placed to deliver on its objectives in relation to returns to shareholders. Certain significant shareholders have expressed a strong preference to continue. Accordingly, your Directors recommend that members vote in favour of the continuation resolution.

Sir David Thomson
Chairman