Final Results

Henderson Smaller Cos Inv Tst PLC 19 July 2005 19 July 2005 THE HENDERSON SMALLER COMPANIES INVESTMENT TRUST PLC Unaudited Preliminary Group Results for the year ended 31 May 2005 KEY POINTS • Strong absolute and relative performance* - NAV total return 24.5% - Benchmark total return 19.0% • Dividend increased to 1.15p per share • Confidence in the outlook for UK smaller companies and in the ability of the Trust to outperform *source: Datastream Extracts from the Chairman's Statement Performance I am pleased to report that the Company has enjoyed a further year of strong investment performance. The net asset value per share increased by 24%, on a total return basis. By comparison our benchmark index increased by 19%. The gearing provided by our debenture stock has contributed to performance, as has judicious short-term use of our bank facility. Share buy-backs, at an average discount of over 19%, have added to the net asset value of the remaining shares. Nevertheless, the main contribution to our performance continues to be the disciplined and diligent approach of our fund management team at Henderson, Neil Hermon and Theresa Wat. Continuation vote The Company's first triennial continuation vote was passed at the Annual General Meeting on 24 September 2004. The clear majority for continuation - the proxy votes received were 3.7 to 1 in favour - indicated that our investors share the Board's confidence in the ability of our fund managers to achieve strong investment performance from the active management of the Company's portfolio. Revenue and dividend The revenue account has continued to strengthen. Investment income has risen and, notwithstanding the increase in the management fee and higher borrowing costs, the revenue return per share rose by 23% to 1.44p. We propose a single and final dividend for the year of 1.15p per share, an increase of 15% on that paid last year. Page 2 of 7 THE HENDERSON SMALLER COMPANIES INVESTMENT TRUST PLC Unaudited Preliminary Group Results for the year ended 31 May 2005 Extracts from the Chairman's Statement (continued) Whilst we shall continue to pay due regard to investment income, capital growth will remain our priority. Our largest variable item of expense, the management fee, is calculated by reference to the value of our investments. If in future the capital value of the portfolio grows more strongly than its income yield - not itself an unwelcome outcome - our ability to distribute earnings to shareholders could be restricted. Share buy-backs During the year we bought back thirteen million shares, equivalent to about 11% of those in issue at 31 May 2004. Whilst it is disappointing that the recent demand for investment trust company shares has been weak - particularly after a twelve month period in which we bought back no shares at all - we are pleased to welcome a number of new shareholders to our register. Since the year end we have bought back a further 125,000 shares. We shall seek to renew the Company's authority to buy back its own shares at the Annual General Meeting on 30 September 2005. Management and performance fees The fee arrangements with our Investment Manager, Henderson Global Investors Limited, are subject to formal review every three years. The Board is in the process of negotiating revised fee arrangements with Henderson and expects these to include the introduction of a performance fee, to apply with effect from 1 June 2005. Details will be announced when the negotiations have been concluded. Outlook The stockmarket has recovered strongly from its low point in March 2003 and smaller companies have experienced a significant re-rating over that period. Whilst we do not expect such returns to be repeated in the coming year, we are confident about the general outlook and we expect our fund managers' stock-picking skills to give us relative advantage. Page 3 of 7 THE HENDERSON SMALLER COMPANIES INVESTMENT TRUST PLC Unaudited Preliminary Group Results for the year ended 31 May 2005 Group Statement of Total Return (incorporating the consolidated revenue account) Year ended 31 May 2005 Year ended 31 May 2004 Revenue Revenue Revenue Revenue Capital Total £'000 £'000 £'000 £'000 £'000 £'000 Total capital gains from - 39,921 39,921 - 57,939 57,939 investments Income from fixed asset investments 5,320 - 5,320 4,732 - 4,732 Other interest receivable and 136 - 136 110 - 110 similar income ------------- ------------- ------------- ------------- ------------- ------------- Gross revenue and capital gains 5,456 39,921 45,377 4,842 57,939 62,781 Management fee (1,120) - (1,120) (893) - (893) Other administrative expenses (319) - (319) (334) - (334) ------------- ------------- ------------- ------------- ------------- ------------- Net return on ordinary activities before interest payable and 4,017 39,921 43,938 3,615 57,939 61,554 taxation Interest payable (2,454) - (2,454) (2,244) (2,244) ------------- ------------- ------------- ------------- ------------- ------------- Net return on ordinary activities before taxation 1,563 39,921 41,484 1,371 57,939 59,310 Taxation on net return on ordinary - - - - - - activities ------------- ------------- ------------- ------------- ------------- ------------- Net return on ordinary activities after taxation 1,563 39,921 41,484 1,371 57,939 59,310 ------------- ------------- ------------- ------------- ------------- ------------- Dividends - ordinary shares (note 3) Final: 1.15p (2004: 1.00p) (1,116) - (1,116) (1,148) - (1,148) ------------- ------------- ------------- ------------- ------------- ------------- Transfer to reserves 447 39,921 40,368 223 57,939 58,162 ======= ======= ======= ======= ======= ======= Return per ordinary share (note 1) 1.44p 36.71p 38.15p 1.17p 49.65p 50.82p ======= ======= ======= ======= ======= ======= The revenue columns of this statement represent the consolidated profit and loss accounts of the Group. Page 4 of 7 THE HENDERSON SMALLER COMPANIES INVESTMENT TRUST PLC Unaudited Preliminary Group Results for the year ended 31 May 2005 Balance Sheets Group Group Company Company 2005 2004 2005 2004 £'000 £'000 £'000 £'000 Fixed asset investments Listed investments at market value 216,098 209,469 216,098 209,469 AIM investments at market value 28,805 16,876 28,805 16,876 Unquoted investments at directors' valuation 324 324 324 324 Subsidiary undertaking - - 2,269 2,270 ------------- ------------- ------------- ------------- 245,227 226,669 247,496 228,939 ------------- ------------- ------------- ------------- Current assets Debtors 1,157 1,406 1,157 1,406 Cash at bank and short term deposits - 488 - 488 ------------- ------------- ------------- ------------- 1,157 1,894 1,157 1,894 Creditors: amounts falling due within one year (9,304) (11,020) (11,573) (13,290) ------------- ------------- ------------- ------------- Net current liabilities (8,147) (9,126) (10,416) (11,396) ------------- ------------- ------------- ------------- Total assets less current liabilities 237,080 217,543 237,080 217,543 Creditors: amounts falling due after more than (20,000) (20,000) (20,000) (20,000) one year ------------- ------------- ------------- ------------- Total net assets 217,080 197,543 217,080 197,543 ======== ======== ======== ======== Capital and reserves Called up share capital 25,423 28,700 25,423 28,700 Capital redemption reserve 20,002 16,725 20,002 16,725 Other capital reserves 167,494 148,404 169,763 150,674 Revenue reserve 4,161 3,714 1,892 1,444 ------------- ------------- ------------- ------------- Shareholders' funds (including non-equity interests of £9,000; 2004: £9,000) 217,080 197,543 217,080 197,543 ======== ======== ======== ======== Net asset value per ordinary share 213.5p 172.1p 213.5p 172.1p ======== ======== ======== ======== Page 5 of 7 THE HENDERSON SMALLER COMPANIES INVESTMENT TRUST PLC Unaudited Preliminary Group Results for the year ended 31 May 2005 Group Cash Flow Statement 2005 2005 2004 2004 £'000 £'000 £'000 £'000 Net cash inflow from operating activities 4,410 3,256 Servicing of finance Debenture interest paid (3,150) (2,100) Bank overdraft and loan interest paid (353) (157) ------------- ------------- Net cash outflow from servicing of finance (3,503) (2,257) Net tax recovered - - Financial investment Purchases of investments (57,714) (70,843) Sales of investments 78,181 63,807 ------------- ------------- Net cash inflow/(outflow) from financial 20,467 (7,036) investment Equity dividends paid (1,106) (585) Financing Purchase of own shares (20,831) (3,109) (Repayment)/drawdown of loans (286) 7,500 ------------- ------------- Net cash (outflow)/inflow from financing (21,117) 4,391 ------------- ------------- Decrease in cash (849) (2,231) ======== ======== Reconciliation of net cash flow to movements in net debt Decrease in cash as above (849) (2,231) Cash outflow/(inflow) from debt financing 286 (7,500) ------------- ------------- Change in net debt resulting from cash flows (563) (9,731) Net debt at 1 June (27,012) (17,281) ------------- ------------- Net debt at 31 May (27,575) (27,012) ======== ======== Page 6 of 7 THE HENDERSON SMALLER COMPANIES INVESTMENT TRUST PLC Unaudited Preliminary Group Results for the year ended 31 May 2005 Notes: 1. Return per ordinary share The revenue return per ordinary share is based on the earnings attributable to the ordinary shares of £1,563,000 (2004: £1,371,000) and on the weighted average number of ordinary shares in issue during the year of 108,747,775 (2004: 116,695,187). The capital return per ordinary share is based on the net capital gains for the year of £39,921,000 (2004: £57,939,000) and on the weighted average number of ordinary shares in issue during the year, as above. 2. Issued share capital There were 101,656,282 ordinary shares in issue at 31 May 2005 (31 May 2004: 114,761,840). 3. Dividend Subject to approval at the annual general meeting, the recommended final dividend of 1.15p per ordinary share will be paid on 7 October 2005 to shareholders on the register of members at the close of business on 2 September 2005. A sum of £1,169,000 has been provided to cover this, based on the issued share capital at 31 May 2005. The final dividend accrued in respect of the year ended 31 May 2004, at 1.0p per ordinary share, amounted to £1,148,000. The buy-backs of the Company's ordinary shares, after 31 May 2004 but before the record date of the final dividend for the year ended on that date, resulted in a write-back of £42,000 for dividends accrued in respect of the year ended 31 May 2004 but not in the event payable. In addition to this, £11,000 has been written back in respect of dividends unclaimed for more than 12 years. The figure of £1,116,000 shown is net of these amounts. 4. Basis of consolidation The Group accounts consolidate the accounts of the Company and of its wholly owned subsidiary undertaking, Henderson Smaller Companies Finance Limited. 5. 2005 accounts The preliminary figures for the year ended 31 May 2005, which do not constitute statutory accounts, are an extract from the Group's draft accounts for the year. These accounts have not yet been delivered to the Registrar of Companies, nor have the auditors yet reported on them. 6. 2004 accounts The figures and financial information for the year ended 31 May 2004 are an extract of the latest published accounts and do not constitute the statutory accounts for that year. Those accounts have been delivered to the Registrar of Companies and included the report of the auditors which was unqualified and did not contain a statement under either section 237(2) or section 237(3) of the Companies Act 1985. Page 7 of 7 THE HENDERSON SMALLER COMPANIES INVESTMENT TRUST PLC Unaudited Preliminary Group Results for the year ended 31 May 2005 7. Annual General Meeting The full annual report and accounts will be posted to shareholders in late July 2005 and copies will be available thereafter from the Secretary at the Company's Registered Office, 4 Broadgate, London EC2M 2DA. The Annual General Meeting will be held on Friday 30 September 2005 at 2.00 pm. For further information please contact : Neil Hermon Fund Manager The Henderson Smaller Companies Investment Trust plc Telephone: 020 7818 4351 Theresa Wat Deputy Fund Manager The Henderson Smaller Companies Investment Trust plc Telephone: 020 7818 4644 James de Sausmarez Head of Investment Trusts Henderson Global Investors Telephone: 020 7818 3349 Sarah Gibbons-Cook Investor Relations and PR Manager Henderson Global Investors 020 7818 3198 This information is provided by RNS The company news service from the London Stock Exchange OD

Companies

Henderson Smaller Companies Inv Trust (HSL)
UK 100
FTSE quotes by TradingView

Latest directors dealings

All directors dealings today