Interim Results

Athelney Trust PLC 02 September 2005 Embargoed 7am Friday September 2 2005 ATHELNEY TRUST PLC: INTERIM RESULTS Athelney Trust plc, the AIM-traded investor in junior markets and small companies, announces its unaudited interim results for the six months ended June 30 2005. Highlights •Unaudited Net Asset Value ('NAV') up 19.9 per cent at 143.6p per share (2004: 119.8p). Increase is 6.4 per cent over past six months •Gross Revenue rose 26.2 per cent to £39,600 (2004: £31,391). Increase is 16.7 per cent on like-for-like basis after allowing for early and special dividends •Revenue Return per Ordinary Share 1.2p (2004: 0.7p) •Unaudited NAV at 29 July of 145.6p per share Athelney Chairman, Hugo Deschampsneufs said: 'After a whirlwind 2003 and 2004, when Athleney's NAV increased by 33.3 per cent and 21.6 per cent respectively, shareholders could be forgiven for being disappointed by the apparently pedestrian 6.4 per cent rise over the past six months. 'However, this is much more typical of the sort of return likely to be achieved over the next few years. Indeed when allowance is made for dividends received of approximately 1 per cent, the overall return compares most favourably with that from holdings of gilts, cash, residential property and index-linked investments. 'As is the Board's practice, consideration of a dividend for 2005 will be left until the final results are known. It is also worth re-stating that the Board wishes to pursue a steady and progressive strategy via regular increases in the dividend. 'What we all need to do now is to keep interest rates low and credit plentiful. In these circumstances, the outlook for equity markets is likely to be favourable over an extended period of time. Rising dividend income, however, is likely to represent a higher proportion of overall returns than in the past'. -ends- For further information: Robin Boyle, Managing Director Athelney Trust plc 020 7222 8989 Paul Quade 020 7248 8010 CityRoad Communications 07947 186694 CHAIRMAN'S STATEMENT I have pleasure in announcing the unaudited results for the six months to 30 June 2005. The salient points are as follows: •Unaudited Net Asset Value ('NAV') is 143.6p per share (31 December 2004: 134.9p, 30 June 2004: 119.8p), a rise of 6.4 per cent over six months and an increase of 19.9 per cent over the past year. •Gross Revenue rose by 26.2 per cent to £39,600 compared with the half year ended 30 June 2004 of £31,391 and the full year to 31 December 2004 of £79,822. •On a like-for-like basis (after allowing for a dividend received early and a special dividend in this half year), Gross Revenue increased by 16.7 per cent. •Revenue return per ordinary share was 1.2p, up 71.4 per cent from the previous half year (31 December 2004: 2.4p, 30 June 2004: 0.7p). •As is the Board's practice, consideration of a dividend for 2005 will be left until the final results are known. The Market After a whirlwind 2003 and 2004, when Athelney's NAV increased by 33.3 per cent and 21.6 per cent respectively, shareholders could be forgiven for being disappointed by the apparently pedestrian 6.4 per cent rise over the past six months. However, this is much more typical of the sort of return likely to be achieved over the next few years. Indeed, when allowance is made for dividends received of approximately 1 per cent the overall return compares most favourably with that resulting from holdings of gilts, cash, residential property and index-linked investments. And yet the economic background is, on the face of it, not conducive to good markets. Interest rates, although coming down, are still in my opinion far too high in a non-inflationary environment. Manufacturing industry is in technical recession having contracted in both Q1 and Q2. Oil hit $60 at the end of June, yet with political uncertainties, terrorism and a distinct shortage of refining capacity, only a cock-eyed optimist would predict a sharp fall to more sensible levels. Furthermore, the long awaited slowdown in house price inflation is well underway, although mortgage applications rose to a peak of 96,000 in May compared with only 77,000 last November. Government tax revenues will be way below those forecast by Mr. Brown since the economy is likely to grow by 2 per cent this year, rather than 3 to 3.5 per cent. Having said all that, there are a number of factors which give cause for cautious optimism. Corporate profits, for instance, are buoyant, partly due to the huge revenues being generated by the oil companies. Another important component is the trend to have everything made in China rather than manufacture it ourselves. Whilst the Renminbi remains massively undervalued and wage rates a fraction of our own, the trend will continue as will the steady increase in outsourcing which, when it works well, certainly adds to profits. Although economic growth is muted here in the UK and arguably less than that in the Eurozone, the US continues to trundle along with growth of 3.5 per cent or so, while those two new heavyweights, India and China, are racing away at 7 per cent and 9 per cent respectively. Results Gross Revenue rose by 26.2 per cent to £39,600 compared with the six months to 30 June 2004. When due allowance is made for a special dividend from Latham (James) and S & U paying its final dividend on 3 June this year, several weeks earlier than in 2004, on a like-for-like basis Gross Revenue increased by 16.7 per cent, which was still a most satisfactory result. Number Companies paying dividends 61 Companies sold (therefore no true comparison) 9 Companies purchased (therefore no true comparison) 10 Increased total dividend in the half year 36 Reduced total dividend in the half year 2 No change in dividend 4 Corporate Activity Cash takeovers were completed in respect of three holdings: Countryside Properties, Bristol & West Investments and Merrydown, the last representing a profit of 296 per cent. Vantis also took over Numerica: in this case shares were preferred to cash. At the time of writing, cash bids for James Beattie and Broadcastle seem likely to go through, Urbium is looking to do a deal, there is a long and tortuous MBO at Park Group which may or may not happen and Wyevale is under pressure from a group of aggressive shareholders. Portfolio Review The following were purchased for the first time or were existing holdings which have been increased in size: Belhaven Group , Clinton Cards , Domestic & General , Treatt , Arbuthnot Banking (formerly Secure Trust Banking Group) , City Lofts Group , Jarvis Securities, Nichols , Numerica Group , RWS Holdings , Tenon Group and Urbium . ICM Computers and Patientline have been sold and the holding of Camellia has again been top-sliced. Dividend As is the Board's practice, consideration of a dividend for 2005 will be left until the final results are known. It is also worth re-stating that the Board wishes to pursue a steady and progressive strategy via regular increases in the dividend. Update The unaudited NAV at 29 July was 145.6p per share. On that same date, Athelney shares were quoted at 119.5p so the discount to NAV was 17.9 per cent compared with 25.8 per cent at 28 February. The position continues to improve. Outlook What we all need to do now is to keep interest rates low and credit plentiful. In these circumstances, the outlook for equity markets is likely to be favourable over an extended period of time. Rising dividend income, however, is likely to represent a higher proportion of overall returns than in the past. Hugo Deschampsneufs Chairman 31 August 2005 Athelney Trust plc INTERIM STATEMENT OF TOTAL RETURN (INCORPORATING THE REVENUE ACCOUNT) FOR THE SIX MONTHS ENDED 30 JUNE 2005 Year ended Unaudited Unaudited 31 December 6 months ended 30 June 2005 6 months ended 30 June 2004 2004 Revenue Capital Total Revenue Capital Total Total £ £ £ £ £ £ £ Profits on investments - 174,698 174,698 - 184,327 184,327 535,518 Income 39,600 - 39,600 31,391 31,391 79,822 Investment management expenses (3,875) (10,375) (14,250) (3,363) (9,853) (13,216) (26,599) Other expenses (17,946) - (17,946) (18,920) - (18,920) (38,199) ------- ------- ------- -------- -------- -------- --------- Return on ordinary activities before taxation 17,779 164,323 182,102 9,108 174,474 183,582 550,542 Taxation 3,692 (28,799) (25,107) 4,104 (26,637) (22,533) (82,362) ------- ------- ------- -------- -------- -------- --------- Return on ordinary activities after taxation 21,471 135,524 156,995 13,212 147,837 161,049 468,180 Dividend - - - - - - (36,056) ------- ------- ------- -------- -------- -------- --------- Transfer to reserves 21,471 135,524 156,995 13,212 147,837 161,049 432,124 ======= ======= ======= ======== ======== ======== ========= Return per ordinary share 1.2p 7.5p 8.7p 0.7p 8.2p 8.9p 26.0p Athelney Trust plc INTERIM BALANCE SHEET AS AT 30 JUNE 2005 Unaudited Unaudited 30 June 2005 30 June 2004 31 December 2004 £ £ £ Fixed assets Investments 2,759,392 2,216,684 2,555,581 --------- --------- ---------- Current assets Debtors 90,852 107,871 116,514 Cash at bank and in hand 21,884 37,539 61,311 --------- --------- ---------- 112,736 145,410 177,825 Creditors: amounts falling due within one year (29,900) (36,536) (57,673) --------- --------- ---------- Net current assets 82,836 108,874 120,152 --------- --------- ---------- Total assets less current liabilities 2,842,228 2,325,558 2,675,733 Provisions for liabilities and charges (253,600) (165,000) (244,100) --------- --------- ---------- Net assets 2,588,628 2,160,558 2,431,633 ========= ========= ========== Capital and reserves Called up share capital 450,700 450,700 450,700 Share premium account 405,605 405,605 405,605 Other reserves - non distributable Capital reserve - realised 479,588 449,882 389,458 Capital reserve - unrealised 1,174,839 791,496 1,129,445 Revenue reserve 77,896 62,875 56,425 --------- --------- ---------- Shareholders' funds - all equity 2,588,628 2,160,558 2,431,633 ========= ========= ========== Net Asset Value per share 143.6p 119.8p 134.9p Athelney Trust plc CASH FLOW STATEMENT FOR THE SIX MONTHS ENDED 30 JUNE 2005 Unaudited Unaudited Year ended 6 months ended 6 months ended 31 December 2004 30 June 2005 30 June 2004 £ £ £ £ £ Net cash (outflow) / inflow from operating activities (3,372) (4,604) 19,170 Servicing of finance Dividends paid (36,056) (32,450) (32,450) ------- -------- --------- Net cash (outflow) from servicing of finance (36,056) (32,450) (32,450) --------- Taxation Corporation tax paid - - - Investing activities Purchases of investments (269,360) (382,084) (575,195) Sales of investments 269,361 382,084 575,193 -------- -------- Net cash inflow / (outflow) from --------- investing activities 1 - (2) --------- ------- ------- --------- (Decrease) in cash in the year (39,427) (37,054) (13,282) ======= ======= ========= Reconciliation of operating net revenue to net cash (outflow) / inflow from £ £ £ operating activities Revenue return on ordinary activities before taxation 17,779 9,108 34,813 (Increase) in debtors (3,452) (4,051) (398) (Decrease) / increase in creditors (7,324) 192 4,544 Management expenses charged to capital (10,375) (9,853) (19,789) ------- ------- --------- (3,372) (4,604) 19,170 ======= ======= ========= Athelney Trust plc NOTES TO THE INTERIM ACCOUNTS FOR THE SIX MONTHS ENDED 30 JUNE 2005 1. The financial information contained in this report is unaudited and does not constitute statutory accounts within the meaning of Section 240 of the Companies Act 1985 (as amended). The results for the year ended 31 December 2004 were reported on by the auditors and received an unqualified report and contained no statement under Section 237(2) or (3) of the Companies Act 1985 (as amended) and a copy of the audited accounts has been filed with the Registrar of Companies. 2. These unaudited results have been prepared on the basis of the accounting policies adopted in the audited accounts for the year ended 31 December 2004. 3. The calculation of earnings per share for the six months ended 30 June 2005 is based on the attributable return on ordinary activities after taxation and on the average weighted number of shares in issue during the period. 6 months ended 30 June 2005 6 months ended 30 June 2004 Revenue Capital Total Revenue Capital Total £ £ £ £ £ £ Attributable return on ordinary activities after taxation 21,471 135,524 156,995 13,212 147,837 161,049 Number of shares 1,802,802 1,802,802 Return per ordinary share 1.2p 7.5p 8.7p 0.7p 8.2p 8.9p 12 months ended 31 December 2004 Revenue Capital Total £ £ £ Attributable return on 42,818 425,362 468,180 ordinary activities after taxation Number of shares 1,802,802 Return per ordinary share 2.4p 23.6p 26.0p 4. Copies of the interim results for the six months ended 30 June 2005 will be sent to all shareholders as soon as practicable. Copies of the interim results will be available free of charge for one month from the Company's Nominated Adviser: Noble & Company Limited, 76 George Street, Edinburgh EH2 3BU This information is provided by RNS The company news service from the London Stock Exchange

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