TIDMATY
RNS Number : 1287H
Athelney Trust PLC
25 July 2023
Athelney Trust PLC
Legal Entity Identifier:
213800ON67TJC7F4DL05
26 July 2022
Half Yearly Financial Report for the Period ended 30 June
2022
Athelney Trust PLC (LSE: ATY) is a company making investments in
the equity securities of quoted United Kingdom companies including
smaller companies.
Investment Objective
The investment objective of the Trust is to provide long-term
growth in dividends and capital, with the risks inherent in small
cap investment minimised through a spread of holdings in quality
small cap companies that operate in various industries and sectors.
The Fund Manager also considers that it is important to maintain a
progressive dividend record.
Investment Policy
The assets of the Trust are allocated predominantly to companies
with either a full listing on the London Stock Exchange or a
trading facility on AIM or AQSE. The assets of the Trust have been
allocated in two main ways: first, to the shares of those companies
which have grown steadily over the years in terms of profits and
dividends but, despite this progress are undervalued by the market
when compared to future earnings and dividends; second, those
companies whose shares are undervalued by the market when compared
with the value of land, buildings, other assets or cash on their
balance sheet.
Chairman's Statement
Dear Shareholder
I am pleased to present the Interim Financial Report for the
half year to 30 June 2023.
Period Highlights
--At 30 June 2023, unaudited Net Asset Value (NAV) had declined
to 208.87p, (minus 4.8%) for the half year
--The share price fell by 7.1% to 195.0p from 210.0p at 31
December 2022
--The discount to NAV over the first six months of the year
increased to 6.6% from 4.3%
--The Trust ranked fourth out of 25 investment trusts in the
AIC's comparison of dividend yields for the UK Smaller Companies'
segment with a yield of 4.92%
--Share price total return decreased by 8.3% in this six-month
period, calculated as the change in net asset value (NAV) during
the half year, including dividend paid
--Gross revenue has increased by 19.6% for the half year to
GBP122,408 (30 Jun 2022: GBP102,311)
--Revenue return per ordinary share was 4.9p (31 Dec 2022: 6.9p,
30 Jun 2022: 3.9p)
--A final dividend of 7.5p was paid in April 2023 (April 2021:
7.5p) and an interim dividend of 2.1p was paid in September 2022
(September 2021: 2.0p) making the total dividend paid for the
financial year 9.6p (2022: 9.5p)
--The interim dividend will be 2.2p (2022: 2.1p).
Performance
The Company has produced solid investment performance over these
six months for its shareholders by comparison with the UK Smaller
Companies segment of Investment Trusts reported by the Association
of Investment Companies. The board continues to be pleased with our
Managing Director and Fund Manager's results during a period where
the world economy's growth expectations have declined and the UK
market is still recovering from serious headwinds.
Continuing headwinds include sticky and high inflation, market
uncertainties raised by weak global economic growth, the
expectation of a protracted Ukraine-Russia war and in the US a mini
banking crisis, followed by national debt default concerns.
In addition, the UK has seen considerable labour market
tightening and increasing unrest, resulting in many days lost to
public sector strikes. The new Sunak/Hunt partnership continues to
battle with the result of COVID-related poor growth figures
(compared to other advanced economies), the need to find more money
for higher wage settlements (now averaging over 6%) from
departmental budgets, and the snail-paced return to confidence for
their government after the debacle of the Truss mini-budget.
Is inflation becoming embedded in the UK in the meantime?
Interest rate rises have so far had much less effect here than in
the US where inflation in June returned to a two-year low of 3%.
There was downwards movement in the UK June figures for annual and
core inflation which dropped to 7.9% and 6.9%. both lower than
expected.
Further information on portfolio activity and the drivers behind
the portfolio's performance is contained in the Managing Director's
Report below.
Given these headwinds and the greater impact they might be
expected to have on smaller companies, I am pleased by the
Company's share price performance which declined just over 7% to
195p in the first half of our financial year. It is now trading at
a modest discount to NAV of around 7% compared to the current AIC
UK Smaller Companies investment trust sector discount average of
just below 13%. We thank shareholders for their support and
continued interest in the company.
Dividends
We are very pleased to see the continuing recovery of your
Company's income from dividends, as UK markets, alongside the rest
of the world return to more normal conditions, post-pandemic. Our
gross revenue has increased by almost 20% over the comparative
period last year to GBP122,408 (30 Jun 2022: GBP102,311).
UK smaller companies should benefit from a general return to
higher trading levels, and in some cases better margins also. The
current outlook is that FTSE Small Cap companies will deliver a
yield of 3.8% and FTSE 250 3.4% (compared to the forecast for FTSE
100 companies of 3.9% - figures from Octopus Investments).
We therefore have more confidence that companies in the UK are
currently well-placed to deliver much better yields in 2023 than in
the last two years.
Against this background I am delighted to report your board has
decided to pay an interim dividend of 2.2p per share on 22
September 2023 to all shareholders on the register of members at
close of business on 8 September 2023.
As usual, we will review the case for a final dividend in Q1
2024.
Shareholder Relations
The Board held an AGM on 16 March 2023 and was very pleased to
take questions from attendees, as well as have some further
conversations over refreshments and a light lunch. There was ample
opportunity to discuss the company's performance as well as the
future. We encourage more shareholders to take advantage of the
time and access offered by attending the AGM for this financial
year which will be held in London on 21 March 2024.
Outlook
Thankfully we have transitioned to more usual business and
market dynamics after the many COVID challenges of 2021 and 2022:
The need for immediate personal, governmental, or global action to
combat the pandemic and its impacts is now replaced with the slow,
delayed effects of interest rate rises or seeing, at long last,
increased availability of product or services as capacity rises at
production facilities or in supply chains.
We also seem to be transitioning from the expectation of deep
recession to a mild recession or possibly no recession at all in
both the US and UK. The Bank of England's forecast at the start of
2023 perhaps underestimated the likely persistence of UK inflation
at a high level, currently 8.7%. After seeing that it has stuck in
the high single digits, alongside negative core inflation, wage
growth and employment signals, the Bank has returned to 50 basis
point interest rate increases; the market is also resigned to more
'medicine' to bring inflation down to about 5% by the end of 2023
and to the Bank's target of 2% a year later.
Meanwhile companies and the public alike are still transitioning
mentally to the new environment of higher costs for everything from
basic supplies to financial services; it now seems this is going to
be a sustained period of fiscal challenge.
More normal business conditions have allowed UK company
dividends to return to more familiar patterns and amounts which is
a recent positive potential trend for the future. On the other
hand, wage and raw materials inflation threatens margins, and for
those companies who are growing, there are struggles to recruit; it
is reported there is a 1m-plus labour shortage. Similar labour
problems exist in other European countries; many took a break
during COVID and have not returned to full employment. Pre-tax
profits were under pressure in energy-intensive businesses over the
past 12 months as wholesale gas prices peaked at EUR340/MWh last
summer and as gas prices are now decreasing, should ease one of the
current constraints to business and consumer confidence.
Your board continues to actively assess opportunities and
threats, in order to provide stability and benefit for
shareholders. We remain confident the Company remains
well-positioned to meet its objectives, and to take advantage of
opportunities to capture value .
Frank Ashton
Chairman
25 July 2023
Other Matters
The important events that have occurred during the period under
review and the key factors influencing the financial statements are
set out above.
Directors' Responsibility Statement
The Directors are responsible for preparing the Half Yearly
Financial Report in accordance with applicable laws and
regulations. The Directors confirm that to the best of their
knowledge:
-- The condensed set of Financial Statements for the six months
to 30 June 2023 have been prepared in accordance with FRS 104
"Interim Financial Reporting", gives a fair view of the assets,
liabilities, financial position and profit of the Company.
-- The Half Yearly Financial Report includes a fair review of
the information required by:
a) rule 4.2.7R of the Disclosure Guidance and Transparency
Rules, being an indication of important events that have occurred
during the first six months of the financial year and their impact
on the condensed set of financial statements and a description of
the principal risks and uncertainties for the remaining six months
of the year; and
b) rule 4.2.8R of the Disclosure Guidance and Transparency
Rules, being related party transactions that have taken place in
the first six months of the financial year and that have materially
affected the financial position or performance of the Company
during that period; and any changes in the related party
transactions described in the last Annual Report that could do
so.
The Half Yearly Financial Report for the six months ended 30
June 2023 comprises an Interim Management Report, in the form of
the Chairman's Statement and Other Matters, the Managing Director's
Report, Portfolio Information and a set of Financial Statements
which have not been reviewed or audited by the Company's
Auditor.
Principal Risks and Uncertainties
The Board considers that the principal risks and uncertainties
facing the Company, other than as set out below, remain the same as
those disclosed in the Annual Report for the year ended 31 December
2022 on pages 14 and 15 and page 37. These risks include, but are
not limited to, market risk, investment and strategic risk,
regulatory risk, operational risk, financial risk and liquidity
risk.
Global Issues
The global pandemic COVID-19 declared by WHO on 11 March 2020
and the war in Ukraine have emerged as significant risks which have
impacted global commercial activities. The board have been
monitoring the development of these risks and have considered the
impact they have had to date and assessed the impact they may have
in the future. The Chairman's Statement and Managing Director's
Report cover these in more detail.
On behalf of the Board
Frank Ashton
Chairman
25 July 2023
Managing Director's Report
Portfolio Commentary
The Chairman's summary of the macro environment provides a
pretty bleak picture, not to mention the recurring news of
significant employee layoffs in some of the best-known brands and
global tech giants and this has been reflected in the stock market
with the FTSE 250 declining by 2.7% over the past six months. This
decline occurred predominantly over the last quarter, with energy
and basic materials groups being the main detractors due to weak
commodity prices and concerns about the Chinese economy.
Month NAV Pence Month on Three-month Six-month FTSE 250 Three-month Six-month
per Share Month Movement movement movement Movement movement movement
Dec 2022 219.4
----------- ---------------- ------------ ---------- ---------- ------------ ----------
Jan 2023 229.4 4.56% 5.31%
----------- ---------------- ------------ ---------- ---------- ------------ ----------
Feb 2023 226.4 -1.31% 0.25%
----------- ---------------- ------------ ---------- ---------- ------------ ----------
Mar 2023 211.7 -6.49% -3.51% -4.90% 0.40%
----------- ---------------- ------------ ---------- ---------- ------------ ----------
Apr 2023 219.0 3.45% 2.62%
----------- ---------------- ------------ ---------- ---------- ------------ ----------
May 2023 214.4 -2.10% -3.62%
----------- ---------------- ------------ ---------- ---------- ------------ ----------
Jun 2023 208.8 -2.61% -1.37% -4.83% -1.64% -2.70% -2.31%
----------- ---------------- ------------ ---------- ---------- ------------ ----------
While the portfolio has under-performed the broader market, as
the year of normalisation progresses, many of our companies are
proactively cutting unnecessary expenditures, discarding
unprofitable ventures, targeting high-value customers, establishing
efficient operations, and honing a clear value proposition to
bolster competitive strength. At the core, efficiency is pivotal to
business resilience and growth and by boosting overall efficiency
and productivity, businesses are well placed to make market share
gains and expedited growth in upcoming years once the
macro-environmental factors stabilise. Implementing Enterprise
Resource Planning (ERP) systems and addressing procurement
challenges are among the initiatives that have been used to improve
outcomes and spur margin expansion. However, it is pleasing to note
that the challenges within supply chains are gradually ameliorating
and freight rates are decreasing, though they remain higher than
2019 levels. Additionally, the prices of raw materials are starting
to normalise, sometimes even showing deflation. Our companies are
reaping the benefits of these positive shifts slowly. Adjustments
to inventory levels and operations are releasing working capital
and mitigating lingering accounting effects. In this journey,
quality businesses stay dedicated to delivering value to their
customers, strengthening resilience, and securing market positions
amidst economic uncertainties.
An example of this is FeverTree Drinks (LSE: FEVR) which is
experiencing the gradual unwinding of significant supply chain
issues. Over the coming year, as the company releases inventory,
the effects of these accounting issues, particularly energy and
glass costs, will gradually subside, driving margin expansion.
The changing landscape has triggered a power struggle among
stakeholders in the value chain (consumers, employees, suppliers,
distributors, etc.), which is squarely focused on who is delivering
value. The ongoing tug-of-war incites changes in business models,
drives industry consolidation, and other competitive measures, all
aimed at preserving margins and fostering growth.
Gamma Communications (LSE: Gamma) observed channel partner
consolidation, while Rightmove (LSE: RMV) noted agent
consolidation, which only enhances supplier power.
We are no longer seeing growth for growth's sake, with the
economic pie being redistributed between varying stakeholders. An
observable shift is that more profitable brands are moving towards
direct-to-consumer models as fragmented industries offer
opportunities to those willing and capable of focusing on bringing
alternative strategies to the market. These changing power dynamics
bring into focus the economics of consumer value - who has acted
responsibly or who has reached the limits of their pricing power.
Companies are honing their customer-centric strategies to guarantee
long-term competitive success.
By focusing on their most lucrative customers and core
demographics, they enhance customer experience and generate robust
free cash flows. A succinct and coherent value proposition is vital
in the current environment. Businesses that effectively convey
unique selling points distinguish themselves from rivals, build
brand recognition, and attract and retain customers - fuelling
growth.
Cake Box, a recent addition to the portfolio, has been
successful as a franchise retailer promoting cakes that are
completely egg free allowing the group to service a much larger
potential market which includes those customers who are unable to
eat eggs for dietary or religious reasons. The first concept store
opened in East London in 2008. The business expanded to a franchise
estate of 91 stores by June 2018 when it was listed on AIM and has
since grown to 205 stores by the end of March 2023.
We continue to focus on the group's franchisee growth, the
empowering of the franchisees utilising a data-driven approach and
their multi-channel expansion rather than press reports on issues
with the clearing of protected trees on one of the CEO's
properties.
While ensuring greater value is provided to a more specific set
of customers, companies seek to drive sustained growth and double
down on their competitive advantage in the market. The most
noticeable shift toward customer-centricity is that companies,
broadly across sectors, are now focusing on strategies to increase
product value and service quality. The previous approach of growth
for growth's sake has been replaced by a more targeted
approach.
Rightmove (LSE: RMV) prioritises product development to provide
increased value to agents and enhance the customer experience,
expecting to reap the benefits in the upcoming year.
Dividend revenue in the current financial year increased by
19.9% as compared to same period last year which is a welcome sign
of business conditions continuing to normalise. We have continued
to reduce our exposure
to the property trusts as dividend growth negates the need to
hold these high yielding low growth assets.
Consequently, the Company realised capital profits before
expenses arising from the sale of investments during the period in
the amount of GBP12,885 (30 June 2022: GBP304,722).
The continued increase in the dividend income that we receive
from our investments, as well as the current level of retained
earnings and realised capital reserves, should provide shareholders
comfort that even in the current environment when share prices are
under pressure, we are in the enviable position of being able to
continue to pay dividends to our loyal shareholders for the
foreseeable future.
As this market uncertainty continues, it is more important than
ever that one has a strict investment process. It is vital not to
get caught up in the hype and noise of the daily market movements,
and instead invest with a long-term approach. A sound investment
philosophy sets out a number of 'rules' or 'procedures' that we
fall back on when the market noise gets too loud. Companies that
have a sustainable competitive advantage will always be well-placed
to withstand short-term headwinds, regardless of market conditions,
maintain market share and ultimately find new ways to grow.
When investing it can be challenging to recognise the potential
in companies, particularly those that are in the growth stage of
their life cycle. It can also be difficult to evaluate the
'narratives' that some companies are telling about themselves. To
invest appropriately in a company in the growth stage of their life
cycle it is important to balance the company's narrative alongside
its numbers.
By drilling down into a company's financials and growth plans in
a careful, considered and committed way, it is possible to identify
the quality growth stocks that will prosper over the long-term.
Their ability to be flexible, to move quickly to take advantage of
opportunities as they arise, and to capitalise on market trends and
demand, will continue to support the ongoing success of such
businesses, and provide significant long-term opportunities for
their investors.
Sustainable Investing
Athelney Trust Plc is committed to responsible investment and we
believe that Environmental, Social and Governance (ESG) factors
have a material impact on long-term investment outcomes. The
consideration of ESG factors is an integral part of our
decision-making process and is fully integrated through asset
selection and portfolio management procedures. ESG issues are
central to understanding and framing the contextual, systematic and
idiosyncratic elements of the business and to this end we have
adopted a Quality Franchise framework comprising six distinct
pillars into our research process. This framework ensures that
companies are analysed in a systematic way to ensure they are
sustainable over the long-terms as well as able to improve
shareholder returns. Furthermore, through the application of this
six-pillar framework, our investment process aims to mitigate our
portfolio against ESG and sustainability risks through placing a
material emphasis on Sustainability and Management by being two of
the six distinct pillars:
-- The sustainability pillar focuses on areas of a business
where there may be risk to the predictability of business
operations through time. This assists our mitigation of default
risk and uncertainty of business expansion.
-- The management pillar focuses on the trustworthiness of
management. This assists our mitigation of uncertainty by reducing
the risk of managerial conduct or failure of business strategy
execution.
The other pillars are the Industry, the Business, the
Competition and the Financials.
Our investment philosophy and corporate values steer us away
from companies that have the potential to harm society, and
moreover, help us avoid companies where there is a risk to the
sustainability of their business operations. It is also important
to note that we also exclude a number of industries including
weapons, tobacco, gambling, thermal coal, petroleum, old-forest
logging, palm oil, and pesticides - a list that is reviewed
annually.
Investment Philosophy
As far as portfolio investments are concerned, our investment
philosophy is clear:
I. The economics of a business drives long-term investment returns; and
II. Investing in high quality, growth businesses' that have the
ability to generate predictable, above-average economic returns
will produce superior investment performance over the
long-term.
In essence, this means that in assessing potential investments
we:
a) Value long-term potential, not just performance
b) Choose sustainable, growing businesses; and
c) Ignore temporary market turbulence.
The key attributes that will define our investments are:
(1) Organic Sales Growth: Quality franchises organically growing
sales above GDP growth that can do so (sustainably) because they
have a large, growing market opportunity and compelling competitive
advantage which will drive ongoing market share gains are
attractive.
(2) A Proven Track Record: This encompasses both the
management's capability and the strength of the business' model.
Generally, a firm that consistently delivers a Return on Equity of
greater than 15% indicates a Quality Franchise for us. Our
investment philosophy is built on the belief that a stock's
long-term return to shareholders is driven by the return on capital
of the underlying business.
(3) Company's future profits: In essence we are backing a proven
management team and a successful business model. Management are the
key decision makers regarding the company's strategy and its
competitive position in the marketplace and it is critical that we
have confidence in the company's ability to sustainably execute its
strategy and grow their earnings, even in a tough environment.
(4) Low Leverage: We require investments to operate with low
levels of debt, which ensure that they have sufficient resources to
execute on their strategy. An Interest Coverage above 4x provides
sufficient bandwidth in times of economic trouble. As a long-term
investor, capital preservation is the highest priority. There is
nothing that changes a management team's focus toward the short
term quicker than impending debt refinancing when market conditions
suddenly change for the worse. We need to be comfortable that this
will not happen and that the company has a strong enough balance
sheet so that it will retain optionality and can quickly and
efficiently execute its strategy over the long-term.
Dr Manny Pohl AM
Managing Director
25 July 2023
Investment Portfolio at 30 June 2023
Top 20 Holdings
Holding Value %
of
GBP portfolio
AEW UK 550,000 509,300 11.3
Games Workshop 3,000 327,300 7.3
Impax Asset Management 44,000 249,920 5.6
Tritax Big Box 200,000 249,800 5.6
4Imprint 5,000 239,500 5.3
Treatt 35,000 218,400 4.9
Fevertree Drinks 17,000 207,060 4.6
Clarke T 145,000 203,725 4.5
Close Brothers 20,000 176,200 3.9
Gamma Communications 15,000 171,000 3.8
NWF Group 56,000 148,400 3.3
National Grid 14,000 145,600 3.2
Liontrust Asset Management 20,000 143,100 3.2
Londonmetric Property 84,000 138,852 3.1
S & U 6,000 135,600 3.0
Cerillion 10,000 129,500 2.9
Begbies Traynor 95,000 124,688 2.8
Rightmove 23,000 120,290 2.7
Cake Box holdings 82,000 116,440 2.6
Paypoint 24,000 115,680 2.6
Income Statement
For the Six Months Ended 30 June 2023
Audited
Year ended
Unaudited Unaudited 31 December
6 months ended 30 6 months ended 30
June 2023 June 2022 2022
Notes Revenue Capital Total Revenue Capital Total Total
GBP GBP GBP GBP GBP GBP GBP
Gains on
investments
held at
fair
value - 12,885 12,885 - 304,722 304,722 (1,787,296)
Income from
investments 122,634 - 122,634 102,311 - 102,311 183,273
Investment
Management
expenses (1,781) (16,141) (17,922) (2,211) (20,042) (22,253) (40,335)
Other
expenses (15,728) (38,500) (54,228) (15,552) (39,294) (54,846) (109,454)
Net return
on ordinary
activities
before
taxation 105,125 (41,756) 63,369 84,548 245,386 329,934 ( 1,753,812)
Taxation 2 - - - - - - -
Net return
on ordinary
activities
after
taxation 105,125 (41,756) 63,369 84,548 245,386 329,934 (1,753,812)
Dividends
Paid:
Dividend (161,841) - (161,841) (161,841) - (161,841) (207,156)
Transferred
to reserves (56,716) (41,756) (98,472) (77,293) 245,386 168,513 (1,960,968)
========== ========= ========== ============ =========== ========== =============
Return per
ordinary
share 3 4.9p (1.9)p 3.0p 3.9p 11.4p 15.3p (81.3)p
The total column of this statement is the statement of
comprehensive income of the Company prepared in accordance with
Financial Reporting Standards ("FRS"). The supplementary revenue
return and capital return columns are prepared in accordance with
the Statement of Recommended Practice issued in July 2022 by the
Association of Investment Companies ("AIC SORP").
All revenue and capital items in the above statement derive from
continuing operations.
The revenue column of the Income statement includes all income
and expenses. The capital column includes the realised and
unrealised profit or loss on investments
Statement of Changes in Equity
For the Six Months Ended 30 June 2023
For the Six Months Ended 30 June 2023(Unaudited)
Called-up Capital Capital Total
Share Share Reserve Reserve Retained Shareholders'
Capital Premium Realised Unrealised Earnings Funds
GBP GBP GBP GBP GBP GBP
Balance at 1
January 2023 539,470 881,087 2,539,394 561,784 212,827 4,734,562
Net profits on
realisation
of investments - - 12,885 - - 12,885
Decrease in unrealised
appreciation - - - (130,651) - (130,651)
Expenses allocated
to
capital - - (54,641) - - (54,641)
Profit for the
period - - - - 105,125 105,125
Dividend paid
in period - - - - (161,841) (161,841)
Shareholders'
Funds at 30 June
2023 539,470 881,087 2,497,638 431,133 156,111 4,505,439
========== ======== ========== =========== ========== ==============
For the Six Months Ended 30 June 2022
(Unaudited)
Called-up Capital Capital Total
Share Share Reserve Reserve Retained Shareholders'
Capital Premium Realised Unrealised Earnings Funds
GBP GBP GBP GBP GBP GBP
Balance at 1
January 2022 539,470 881,087 2,271,737 2,731,784 271,452 6,695,530
Net profits on
realisation - - - -
of investments 304,722 304,722
Decrease in unrealised - - - (1,821,553) - (1,821,553)
appreciation
Expenses allocated
to - - (59,336) - - (59,336)
capital
Profit for the
period - - - - 84,548 84,548
Dividend paid
in period - - - - (161,841) (161,841)
Shareholders'
Funds at 30 June
2022 539,470 881,087 2,517,123 910,231 194,159 5,042,070
========== ======== ========== ============ ========== ==============
For the Year Ended 31 December 2022 (Audited)
Called-up Capital Capital Total
Share Share Reserve Reserve Retained Shareholders'
Capital Premium Realised Unrealised Earnings Funds
GBP GBP GBP GBP GBP GBP
Balance at 1
January 2022 539,470 881,087 2,271,737 2,731,784 271,452 6,695,530
Net profits on
realisation
of investments - - 382,704 - - 382,704
Decrease in unrealised
appreciation - - - (2,170,000) - (2,170,000)
Expenses allocated
to
Capital - - (115,047) - - (115,047)
Profit for the
year - - - - 148,531 148,531
Dividend paid
in year - - - - (207,156) (207,156)
---------- -------- ---------- ------------ ---------- --------------
Shareholders'
Funds at 31 December
2022 539,470 881,087 2,539,394 561,784 212,827 4,734,562
========== ======== ========== ============ ========== ==============
Statement of Financial Position As at 30 June 2023
Audited
Notes Unaudited Unaudited 31 December
30 June 30 June
2023 2022 2022
GBP GBP GBP
Fixed assets
Investments held at
fair value through
profit and loss 4,318,342 4,350,682 4,180,985
---------- ------------------------ --------------
Current assets
Trade receivables 135,114 666,199 543,301
Cash at bank and in
hand 74,366 36,599 27,361
209,480 702,798 570,662
Creditors: amounts falling
due within one year (22,383) (11,410) (17,085)
---------- ------------------------ --------------
Net current assets 187,097 691,388 553,577
---------- ------------------------ --------------
Total assets less current
liabilities 4,505,439 5,042,070 4,734,562
Provisions for liabilities -
and charges - -
Net assets 4,505,439 5,042,070 4,734,562
========== ======================== ==============
Capital and reserves
Called up share capital 539,470 539,470 539,470
Share premium account 881,087 881,087 881,087
Other reserves (non
distributable)
Capital reserve - realised 2,497,638 2,517,123 2,539,394
Capital reserve - unrealised 431,133 910,231 561,784
Revenue reserves (distributable) 156,111 194,159 212,827
Shareholders' funds
- all equity 4,505,439 5,042,070 4,734,562
========== ======================== ==============
Net Asset Value per
share 4 208.8p 233.7P 219.4P
Number of shares in
issue 2,157,881 2,157,881 2,157,881
Approved and authorised for issue by the Board of Directors on
25 July 2023.
Dr Manny Pohl AM
Managing Director
Statement of Cash Flows
For the Six Months Ended 30 June 2023
Unaudited Unaudited Audited
6 months 6 months
ended ended Year ended
30 June 30 June 31 December
2023 2022 2022
GBP GBP GBP
Cash flows from operating
activities
Net revenue return 105,125 84,548 148,531
Adjustments for:
Expenses charged to
capital (54,641) (59,336) (115,047)
Increase/(decrease)
in creditors 5,298 (5,719) (44)
Decrease/(increase)
in debtors 408,186 (421,036) (298,138)
Cash from/(used) in
operations 463,968 (401,543) (264,698)
---------- ---------- ------------
Cash flows from investing
activities
Purchase of investments (669,737) (504,660) (1,003,583)
Proceeds from sales
of investments 414,615 1,073,967 1,472,122
Net cash from investing
activities (255,122) 569,037 468,539
---------- ---------- ------------
Equity dividends paid (161,841) (161,841) (207,156)
Net Increase/(decrease) 47,005 5,923 (3,315)
Cash at the beginning
of the period 27,361 30,676 30,676
Cash at the end of
the period 74,366 36,599 27,361
========== ========== ============
Notes to the Financial Statements
For the Six Months Ended 30 June 2023
1. Accounting Policies
a) Statement of Compliance
The Company's Financial Statements for the period ended 30 June
2023 have been prepared under UK Generally Accepted Accounting
Practice (UK GAAP) and the Statement of Recommended Practice,
'Financial Statements of Investment Trust Companies and Venture
Capital Trusts' issued in April 2022 ('the SORP') issued by the
Association of Investment Companies.
The financial statements have been prepared in accordance with
the accounting policies set out in the statutory accounts for the
year ended 31 December 2022.
b) Financial information
The financial information contained in this report does not
constitute statutory accounts as defined in Section 434 of the
Companies Act 2006. The financial information for the period ended
30 June 2023 and 30 June 2022 have not been audited or reviewed by
the Company's Auditor pursuant to the Auditing Practices Board
guidance on such reviews. The information for the year to 31
December 2022 has been extracted from the latest published Annual
Report and Financial Statements, which have been lodged with the
Registrar of Companies, contained an unqualified auditor's report
and did not contain a statement required under Section 498(2) or
(3) of the Companies Act 2006.
c) Going concern
The Company's assets consist mainly of equity shares in
companies listed on a recognised stock exchange which, in most
circumstances, are realisable within a short timescale under normal
market conditions. The Directors believe that the Company has
adequate resources to continue in operational existence for the
foreseeable future. Accordingly, they continue to adopt the going
concern basis in preparing the financial statements. In assessing
the Company's ability to continue as a going concern, the Board has
fully considered the impact of COVID-19 and the war in Ukraine.
2. Taxation
The tax charge for the six months to 30 June 2023 is nil (year
to 31 December 2022: nil; six months to 30 June 2022: nil).
The Company has an effective tax rate of 0% for the year
ending 31 December 2022. The estimated effective tax rate is 0%
as investment gains are exempt from tax owing to the Company's
status as an Investment Trust and there is expected to be an excess
of management expenses over taxable income.
3 . The calculation of earnings per share for the six months
ended 30 June 2023 is based on the attributable return on ordinary
activities after taxation and on the weighted average number of
shares in issue during the period.
6 months ended 30 June 2023
Revenue Capital Total
-------- ---------- -------
GBP GBP GBP
-------- ---------- -------
Attributable
return on
ordinary
activities
after taxation 105,125 (41,756) 63,369
-------- ---------- -------
Weighted
average
number of
shares 2,157,881
-------- ---------- -------
Return per
ordinary
share 4.9p (1.9p) 3.0p
-------- ---------- -------
6 months ended 30 June 2022
Revenue Capital Total
-------- ---------- --------
GBP GBP GBP
-------- ---------- --------
Attributable
return on
ordinary
activities
after taxation 84,548 245,386 329,934
-------- ---------- --------
Weighted
average
number of
shares 2,157,881
-------- ---------- --------
Return per
ordinary
share 3.9p 11.4p 15.3p
-------- ---------- --------
12 months ended 31 December
2022
Revenue Capital Total
-------- ------------ ------------
GBP GBP GBP
-------- ------------ ------------
Attributable
return on
ordinary
activities
after taxation 148,531 (1,902,343) (1,753,812)
-------- ------------ ------------
Weighted
average
number of
shares 2,157,881
-------- ------------ ------------
Return per
ordinary
share 6.9p (88.2p) (81.3p)
-------- ------------ ------------
4. Net Asset Value per share is calculated by dividing the net
assets by the weighted average number of shares in issue
2,157,881.
5. Financial Instruments
Fair value hierarchy
The fair value hierarchy consists of the following three
classifications:
Classification A - Quoted prices in active markets for identical
assets or liabilities. Quoted in an active market in this context
means quoted prices are readily and regularly available and those
prices represent actual and regularly occurring market transactions
on an arm's length basis.
Classification B - The price of a recent transaction for an
identical asset, where quoted prices are unavailable. The price of
a recent transaction for an identical asset provides evidence of
fair value as long as there has not been a significant change in
economic circumstances or a significant lapse of time since the
transaction took place. If it can be demonstrated that the last
transaction price is not a good estimate of fair value (e.g.
because it reflects the amount that an entity would receive or pay
in a forced transaction, involuntary liquidation or distress sale),
that price is adjusted.
Classification C - Inputs for the asset or liability that are
based on observable market data and unobservable market data, to
estimate what the transaction price would have been on the
measurement data in an arm's length exchange motivated by normal
business considerations.
The Company only holds classification A investments (2021:
classification A investments only).
6. Related Party Transactions
Dr. E. C. Pohl is the sole beneficial owner of E C Pohl & Co
Pty Limited and a Director of Astuce Group. E C Pohl & Co Pty
Limited held 86,000 (2022: 86,000) shares and Astuce Group held
550,000 (2022: 550,000) shares in the Company as at 30 June
2023.
Copies of the Half Yearly Financial Statements for the six
months ended 30 June 2023 will be available on the Company's
website www.athelneytrust.co.uk as soon as practicable.
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END
IR FLFVIDIIEFIV
(END) Dow Jones Newswires
July 25, 2023 06:37 ET (10:37 GMT)
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