Final Results - Replacement

RNS Number : 2793B

Artemis Alpha Trust PLC

13 August 2008

 

The issuer advises that the following replaces the Final Results announcement released on 6th August 2008 at 17.23 under RNS Number 8084A.

Due to an administrative error, the dividend record date was erroneously stated as 

13th August 2008 (under the Dividends section of the Chairman's Statement) when it should have been stated as 15th August 2008. All other details remain the same and the fully corrected version is shown below.

13th August 2008

ARTEMIS ALPHA TRUST PLC (the 'Company')

Final Results for the year ended 30th April 2008

Chairman's Statement

Performance

In what has been a challenging period for stock markets, the year to 30th April 2008 was a successful one for your Company. The total return of the diluted net asset value was 8.3 per cent and this compared favourably to the FTSE All-Share Index, which fell by 4.3 per cent.

The Company's broad investment policy allows your Investment Manager to be selective in identifying long term investment opportunities irrespective of market conditions and the Company's performance, over the long term, is testament to this approach. Strong contributions to performance came from Food Producers and Oil & Gas at a sector level and the largest contributors at the individual company level were Artemis Asset Management and New Britain Palm Oil.

Investment in unlisted companies

Your Company continues to pursue a strategy of investing a proportion of its assets in unlisted companies which has proved to be beneficial to the Company's overall performance. At last year's Annual General Meeting shareholders approved a resolution amending the Investment Management Agreement to allow the Investment Manager to invest up to 30 per cent of the Company's net assets (based on the lower of cost or valuation) in unlisted investments. As at 30th April 2008, on this basis these investments represented 19 per cent of the Company's net assets.

Further information on the Company's portfolio is contained in the Investment Manager's Review that follows.

Dividends

Your Board has declared a second interim dividend of 1.4 pence (2007: 1.3 pence) per ordinary share bringing total dividends for the year to 30th April 2008 to 2.45 pence (2007: 2.3 pence) per ordinary share, an increase of 6.5 per cent over dividends paid in 2007. The second interim dividend will be paid on 29th August 2008 to those shareholders on the register on 15th August 2008.

Buy Back of Shares

During the year your Company bought back 565,000 of its own ordinary shares of 1p each at a cost of £1.2 million. These shares were bought at an average discount of 5.8 per cent and added 0.12 pence to the net asset value for continuing shareholders. The shares are presently held in treasury and may be re-issued by the Company at prices higher than the diluted net asset value at the time of re-issue. As set out in the Notice of Annual General Meeting included in the annual report, a resolution to re-new the Company's authority to buy back its own shares and hold them in treasury will be put to shareholders at the forthcoming Annual General Meeting.

Board of Directors

In January 2008 Andrzej Sobczak resigned as a director of the Company, having served on the Board since 2001. On behalf of the Board I would like to thank him for his valuable contribution.

VAT on Management Fees

In November 2007 HM Revenue & Customs (''HMRC'') announced that it had accepted the judgement of the European Court of Justice in the JP Morgan Claverhouse Investment Trust and AIC VAT case, thereby confirming that investment management fees should be exempt from VAT. Accordingly, your Investment Manager stopped charging VAT on these fees with effect from 1st October 2007.

This change in VAT position should enable your Company to make a recovery of at least part of the VAT incurred in previous years. Due to the continuing uncertainty over how HMRC will effect back claims, together with the added complication of a change in investment manager in 2003, it is not possible to determine an exact amount that will be recovered at this stage. In view of this the financial statements have not been adjusted to take account of the possible recovery of VAT. The amounts involved are not expected to have a material impact on the Company's net asset value. Your Board will continue to monitor developments on this matter and will inform shareholders accordingly in due course.

Annual General Meeting

Your Company's Annual General Meeting ('AGM') this year will be held at the offices of Artemis Investment Management Limited, Cassini House, 57 St James's Street, London SW1A 1LD on 11th September 2008 at 12.30 pm.

A special resolution is being proposed at the AGM to approve the adoption of a new set of Articles of Association to take account of changes in company law, following the introduction of the Companies Act 2006 (the ''Act''). The Act is being introduced in stages and is expected to be fully implemented by 1st October 2009. The new Articles of Association, together with the new Article 100 to be adopted pursuant to resolution 11, will enable the Company to comply with those parts of the Act that are in effect now and those which will come into effect on 1st October 2008. It is intended that a further review of the Articles of Association will be carried out following the implementation of the final parts of the Act. Information on the principal changes to the Articles of Association are included in the Directors' Report and the Appendix to the Notice of Annual General Meeting in the Annual Report.

Full details of all the business to be conducted at the meeting are set out in the Notice of Annual General Meeting in the annual report.

Your Board looks forward to welcoming shareholders to the AGM, which provides an opportunity to meet both the Directors and Investment Manager and to ask any questions of them. Should you have any detailed or technical questions, it would be helpful if these could be raised in advance of the meeting with the Company Secretary. If you are unable to attend the meeting, your Board would encourage you to submit your proxy votes.

Investment Plan

The Investment Plan enables investors to acquire shares in the Company in a cost effective manner, either through lump sum or regular monthly investments. Documentation can be obtained by contacting Artemis Investment Management Limited on 0800 092 2051 or from the following web address, www.artemisonline.co.uk/pdf/brochures/alphatrustinvestmentplan.pdf.

Outlook

In the current environment stock markets are likely to remain volatile. In such times, good stock selection is a fundamental driver of performance and your Board believes that your Investment Manager will continue to take advantage of the Company's wide investment policy to identify further attractive long term investment opportunities. Investment in equities is not without risk, but as an asset class it has historically produced positive returns for investors over longer time periods. Your Board remains confident that the way in which your Company is managed will continue to produce above average rates of total return over the longer term.

Simon Miller

Chairman

6th August 2008

  Investment Manager's Review

Performance and Portfolio Analysis

It has been a good year for the Company's performance with the diluted net asset value per share rising 8.3 per cent, which compares favourably to the performance of the FTSE All-Share Index, which declined by 4.3 per cent. The Company's long term performance remains good and since Artemis Investment Management was appointed as Investment Manager in June 2003, the diluted net asset value has risen by 273.0 per cent, outstripping the benchmark FTSE All-Share Index, which rose by 84.9 per cent.

Our flexible investment approach has allowed these positive returns to be generated against some very challenging stock market conditions which have been well reported. Our focus has continued to favour oil exploration and resources where there is positive momentum in pricing. We have avoided the UK banking sector and also those sectors with too much reliance on the consumer. We have hedged the portfolio through the ownership of a number of fund management holdings as any unexpected recovery in the stock market would benefit these companies.

Our stock picking style has always resulted in a portfolio biased towards non large cap companies, but during the year we have reduced our exposure to smaller companies in favour of mid cap companies. In the current environment we do expect an eventual shift towards both mid and smaller cap companies given their recent poor relative performance and also their more attractive valuations.

Portfolio

The rising crude oil price has provided a positive backdrop for our investments in the oil sector, which at the year end represented 30 per cent of the portfolio. We have seen a strong recovery in Solana Resources following a management change and a greater focus which has resulted in a major oil discovery. Salamander Energy and Revus Energy continue to expand their portfolios and are now benefiting from their exciting drilling programs.

During the year we have supported further funding of companies within our unlisted portfolio, such as Vostok Energy, which is involved in exploration and production in the Saratov region of Russia and also Hurricane Exploration, which has exploration licenses in the West of Shetland basin. Expro International has announced that it has received an offer for its business and since the year end a further party has expressed an interest and is considering a bid. Genesis Petroleum, which principally has interests in both the UK and Norwegian sectors of the North Sea, has staged a remarkable recovery in share price terms. Geopark, whose interests are in Chile, has also made excellent progress in its exploration efforts.

Also, within the unlisted portfolio we benefited from the listing of Valiant Petroleum, the North Sea based explorer and we expect to see some positive news from Buried Hill whose operations in Turkmenistan have now made good progress.

In the current environment, we do not expect any major changes to our weightings in this sector. Although it is quite clear that the oil price may correct, many of our investments continue to offer further upside given their drilling programs and production targets.

We have also continued to see a strong re-rating in REA Holdings -- the Indonesian based grower of oil palms. Our largest quoted equity contribution over the year has come from the purchase of a holding in New Britain Palm Oil, a well established producer of palm oil in Papua New Guinea. Both companies have benefited from a strong price rise in palm oil which is a major source of cooking oil and an ingredient for soaps and detergents. Given the longer term cycle of the oil palm cultivation process, these well established companies have a strong future given the demand profile for palm oil.

The largest contribution to performance has come from the increase in value of Artemis Asset Management which was reported a few months ago. Given the falls we have experienced in stock markets, our investments in ACP Capital and Polar Capital have not performed well. We sold our holding in New Star Asset Management to favour BlueBay, the leading credit asset manager which is benefiting from strong inflows at present.

Outlook

The world is a different and difficult place at the time of writing, particularly from a fund manager's viewpoint. Stock markets are adjusting to slower and eventual negative economic growth which is also being compounded by inflationary pressures. Most of this is well reported and in the short term indebted governments have very little room to manoeuvre.

We have reduced our gearing in readiness for some attractive buying opportunities and in the short term our portfolio is well placed to perform in the current environment.

John Dodd
Artemis Investment Management Limited
Investment Manager

6th August 2008

  Statement of Directors' Responsibilities in respect of the Financial Statements

Company law in the United Kingdom requires the Directors to prepare Group and Company financial statements for each financial year. The Directors are required to prepare the Group financial statements in accordance with International Financial Reporting Standards (''IFRSs'') as adopted by the EU and have elected to prepare the parent Company financial statements on the same basis.

The Group and Company financial statements are required by law and International Financial Reporting Standards as adopted by the EU to present fairly the financial position of the Group and the Company and the performance for that year; the Companies Act 1985 provides, in relation to such financial statements, that references in the relevant part of that Act to financial statements giving a true and fair view are references to their achieving a fair presentation.

In preparing each of the Group and Company financial statements, the Directors are required to:

• select suitable accounting policies and then apply them consistently;

• make judgments and estimates that are reasonable and prudent; and

• state whether they have been prepared in accordance with IFRSs as adopted by the EU.

The Directors are responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that its financial statements comply with the Companies Act 1985. They have general responsibility for taking such steps as are reasonably open to them to safeguard the assets of the Group and to prevent and detect fraud and other irregularities.

Under applicable law and regulations, the Directors are also responsible for preparing a Directors' Report, Directors' Remuneration Report and Corporate Governance Statement that comply with applicable laws and regulations.

The financial statements are published on a website, www.artemisonline.co.uk, maintained by the Company's Investment Manager, Artemis Investment Management Limited. The maintenance and integrity of the corporate and financial information relating to the Group and Company is the responsibility of the Investment Manager. Visitors to the website should note that legislation in the UK governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

The Directors confirm that, to the best of their knowledge:

• the financial statements, prepared in accordance with the applicable set of accounting standards, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Group and Company; and

• the Directors' Report includes a fair review of the development and performance of the business and the position of the issuer together with a description of the principal risks and uncertainties that they face.

For and on behalf of the Board

Simon Miller

Chairman

6th August 2008

  Consolidated Income Statement

For the year ended 30th April 2008

		Year ended 30th April 2008			Year ended 30th April 2007
		Revenue £'000	Capital £'000	Total £'000	Revenue £'000	Capital £'000	Total £'000
Investment income		1,080	--	1,080	1,268	--	1,268
Other income		308	--	308	848	--	848
Total revenue		1,388	--	1,388	2,116	--	2,116
Gains on investments		--	7,791	7,791	--	3,234	3,234
Losses on current asset investments		(282)	--	(282)	(295)	--	(295)
Currency gains/(losses)		1	(1)	--	--	5	5
Total income		1,107	7,790	8,897	1,821	3,239	5,060
Expenses
Investment management fees		(55)	(493)	(548)	(57)	(515)	(572)
Other expenses		(272)	--	(272)	(359)	--	(359)
Profit before finance costs and tax		780	7,297	8,077	1,405	2,724	4,129
Finance costs		(79)	(711)	(790)	(64)	(577)	(641)
Profit before tax		701	6,586	7,287	1,341	2,147	3,488
Tax		(7)	6	(1)	(173)	167	(6)
Profit for the year		694	6,592	7,286	1,168	2,314	3,482
Earnings per ordinary share (basic)		2.10p	19.91p	22.01p	3.51p	6.95p	10.46p
Earnings per ordinary share (diluted)		1.93p	18.28p	20.21p	3.24p	6.43p	9.67p

  The total column of this statement represents the Income Statement of the Group, prepared in accordance with International Financial Reporting Standards ('IFRS'). The supplementary revenue and capital columns are both prepared under guidance published by the Association of Investment Companies. All items in the above statement derive from continuing operations.

All income is attributable to the equity shareholders of Artemis Alpha Trust plc. There are no minority interests.

  Balance Sheets

As at 30th April 2008

		Group 2008 £'000	Company 2008 £'000	Group 2007 £'000	Company 2007 £'000
Non-current assets
Investments		102,067	110,789	95,411	104,112
Current assets
Investments held by subsidiary		629	--	1,167	--
Other receivables		385	384	506	505
Cash and cash cash equivalents		496	309	1,119	937
		1,510	693	2,792	1,442
Total assets		103,577	111,482	98,203	105,554
Current liabilities
Other payables		(452)	(8,357)	(371)	(7,722)
Bank loan		(11,500)	(11,500)	(11,500)	(11,500)
		(11,952)	(19,857)	(11,871)	(19,222)
Net assets		91,625	91,625	86,332	86,332
Equity attributable to equity holders
Share capital		334	334	334	334
Share premium		23,984	23,984	23,984	23,984
Special reserve		6,762	6,762	7,974	7,974
Warrant reserve		1,299	1,299	1,299	1,299
Capital redemption reserve		2	2	2	2
Retained earnings -- revenue		1,888	531	1,975	635
Retained earnings -- capital		57,356	58,713	50,764	52,104
Total equity		91,625	91,625	86,332	86,332
Net asset value per ordinary share (basic)		280.47p		259.77p
Net asset value per ordinary share (diluted)		253.54p		236.69p

  Statements of Changes in Equity

For the year ended 30th April 2008

Group	Share capital £'000	Share premium £'000	Special reserve £'000	Warrant reserve £'000	Capital redemption reserve £'000	Retained earnings - Revenue £'000	Retained earnings - Capital £'000	Total £'000
For the year ended 30th April 2008
At 1st May 2007	334	23,984	7,974	1,299	2	1,975	50,764	86,332
Profit for the year	--	--	--	--	--	694	6,592	7,286
Repurchase of own shares	--	--	(1,212)	--	--	--	--	(1,212)
Dividends paid	--	--	--	--	--	(781)	--	(781)
At 30th April 2008	334	23,984	6,762	1,299	2	1,888	57,356	91,625
For the year ended 30th April 2007
At 1st May 2006	334	23,984	8,208	1,299	2	1,540	48,450	83,817
Profit for the year	--	--	--	--	--	1,168	2,314	3,482
Repurchase of own shares	--	--	(234)	--	--	--	--	(234)
Dividends paid	--	--	--	--	--	(733)	--	(733)
At 30th April 2007	334	23,984	7,974	1,299	2	1,975	50,764	86,332
Company	Share capital £'000	Share premium £'000	Special reserve £'000	Warrant reserve £'000	Capital redemption reserve £'000	Retained earnings - Revenue £'000	Retained earnings - Capital £'000	Total £'000
For the year ended 30th April 2008
At 1st May 2007	334	23,984	7,974	1,299	2	635	52,104	86,332
Profit for the year	--	--	--	--	--	677	6,609	7,286
Repurchase of own shares	--	--	(1,212)	--	--	--	--	(1,212)
Dividends paid	--	--	--	--	--	(781)	--	(781)
At 30th April 2008	334	23,984	6,762	1,299	2	531	58,713	91,625
For the year ended 30th April 2007
At 1st May 2006	334	23,984	8,208	1,299	2	525	49,465	83,817
Profit for the year	--	--	--	--	--	843	2,639	3,482
Repurchase of own shares	--	--	(234)	--	--	--	--	(234)
Dividends paid	--	--	--	--	--	(733)	--	(733)
At 30th April 2007	334	23,984	7,974	1,299	2	635	52,104	86,332

  Cash Flow Statements

For the year ended 30th April 2008

		Group 2008 £'000	Company 2008 £'000	Group 2007 £'000	Company 2007 £'000
Operating activities
Profit before tax		7,287	7,286	3,488	3,479
Interest payable		790	790	641	642
Gains on investments		(7,791)	(7,812)	(3,234)	(3,690)
Loss/(gain) on foreign exchange		1	--	(5)	(5)
Net movement in current asset investments		282	--	295	--
(Increase)/decrease in other receivables		(52)	(52)	210	210
Decrease in other payables		(33)	(19)	(10)	(5)
Net cash inflow from operating activities before interest and tax		484	193	1,385	631
Interest paid		(774)	(774)	(633)	(633)
Corporation tax (paid)/refunded		(4)	--	21	--
Net cash (outflow)/inflow from operating activities		(294)	(581)	773	(2)
Investing activities
Purchases of investments		(22,113)	(21,275)	(44,811)	(43,353)
Sales of investments		23,776	22,681	38,135	37,173
Net cash inflow/(outflow) from investment activities		1,663	1,406	(6,676)	(6,180)
Financing activities
Repurchase of own shares		(1,212)	(1,212)	(234)	(234)
Dividends paid		(781)	(781)	(733)	(733)
Increase in inter-company loan		--	540	--	225
Net cash outflow from financing activities		(1,993)	(1,453)	(967)	(742)
Net decrease in cash and cash equivalents		(624)	(628)	(6,870)	(6,924)
Cash and cash equivalents at the start of the year		(10,381)	(10,563)	(3,506)	(3,634)
Effect of foreign exchange rate changes		1	--	(5)	(5)
Cash and cash equivalents at the end of the year		(11,004)	(11,191)	(10,381)	(10,563)
Bank loan		(11,500)	(11,500)	(11,500)	(11,500)
Cash		496	309	1,119	937
		(11,004)	(11,191)	(10,381)	(10,563)

Notes 

1. Accounting policies

The Group's financial statements have been prepared in accordance with International Financial Reporting Standards ('IFRS') as adopted by the European Union ('EU'). The Company's financial statements have also been prepared in accordance with IFRS as adopted by the EU and in accordance with the provisions of the Companies Act 1985 (the 'Act'). The Company has taken advantage of the exemption provided under Section 230 of the Act not to publish its income statement and related notes.

2. Earnings per ordinary share

The basic revenue return per ordinary share is based on the revenue profit for the year of £694,000 (2007: £1,168,000) and on 33,103,283 (2007: 33,294,789) ordinary shares, being the weighted average number of ordinary shares in issue during the year. The basic capital earnings per ordinary share is based on capital profits for the year of £6,592,000 (2007: £2,314,000) and on 33,103,283 (2007: 33,294,789) ordinary shares, being the weighted average number of ordinary shares in issue during the year.

For the purposes of calculating diluted revenue and capital returns per ordinary share, the number of ordinary shares is the weighted average used in the basic calculation plus the number of ordinary shares deemed to be issued for no consideration on exercise of all manager warrants by reference to the average share price of the ordinary shares during the year. The calculations indicate that the exercise of warrants would result in an increase in the weighted average number of ordinary shares of 2,956,257 (2007: 2,771,003).

3. Net asset value per ordinary share

The basic net asset value per ordinary share is based on the net assets of £91,625,000 (2007: £86,332,000) and on 32,668,488 (2007: 33,233,488) shares, being the number of ordinary shares in issue at the year end.

The diluted net asset value per ordinary share has been calculated on the assumption that the 6,671,697 manager warrants (2007: 6,671,697) in issue were exercised resulting in a total of 39,340,185 ordinary shares in issue (2007: 39,905,185).

4. 2008 accounts

The financial information set out above does not constitute the Company's statutory accounts for the years ended 30th April 2008 and 30th April 2007 but is derived from those accounts. Statutory accounts for 2007 have been delivered to the Registrar of Companies.  The statutory accounts for 2007 and 2008 both received an audit report which was unqualified and did not contain a statement under section 237(2) or (3) of the Companies Act 1985. The statutory accounts for the year ended 30th April 2008 have not yet been delivered to the Registrar of Companies and will be delivered following the Annual General Meeting.

At the Annual General Meeting, due to be held on 11th September 2008, it is proposed that the Company adopts new Articles of Association. A summary of the proposed changes is set out in the explanatory notes which accompany the Notice of the 2008 Annual General Meeting and copies of the new articles are available on the Investment Manager's website at www.artemisonline.co.uk/pdf/articles and also at the UK Listing Authority's Document Viewing Facility.

5. Dividend

The Directors declare a second interim dividend of 1.4p per ordinary share, which will be paid on 29th August 2008 to eligible shareholders on the register as at close of business on 15th August 2008. 

The Annual Report will be sent to shareholders during August 2008 and thereafter copies will be available from the registered office at Cassini House, 57 St James's Street, London SW1A 1LD. The Annual General Meeting of the Company will be held on Thursday, 11th September 2008.

Artemis Investment Management Limited

Secretary

6th August 2008

For further information, please contact:

Billy Aitken at Artemis Investment Management Limited

Telephone: [phone]

 

END

 

 

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