Interim Management Statement

RNS Number : 7980Z

Lowland Investment Co PLC

24 July 2008

 



LOWLAND INVESTMENT COMPANY PLC

HENDERSON GLOBAL INVESTORS

24 July 2008

LOWLAND INVESTMENT COMPANY PLC

Interim Management Statement
Review of the period from 1 April 2008 to 30 June 2008

The Directors of Lowland Investment Company plc hereby announce the following:

Portfolio Comments:

The UK stock market fell sharply in June as escalating oil prices, higher inflation and worsening prospects for the UK and global economies dampened sentiment. The UK economy has been facing rapidly increasing commodity prices, in particular oil, and a banking system that is tightening credit. This is hurting many UK corporates, especially those that are consumer-orientated or debt-laden. Investor sentiment towards medium and smaller sized companies is very poor, resulting in low valuations for some sound, robust businesses.

We are purchasing some small-cap companies when they fall to extremely low valuations.  We have also increased our exposure to banks because in our view, share price falls are overly discounting the problems that they face. Margins for UK banks will improve as they increase charges to borrowers. Bad debts will occur, but the rise is from low levels and the banks are taking steps to prepare for more difficult times. Equities in the UK are very good value. A sustained fall in the oil price would reduce inflationary worries, interest rates would fall and this could lead to substantial increases in share prices.

Gearing: During the period the company increased its credit facility by £10 million to take advantage of future opportunities. The gearing at the end of the quarter was 16.4% (at 31 March 2008: 20.5%).

Dividends: An interim dividend of 10.0p (2007: 9.0p) per ordinary share, in respect of the year ending 30 September 2008 was paid on 20 June 2008 to holders that were on the Register of Members on 23 May 2008. The ex-dividend date was 21 May 2008.

Share Capital: During the period 1 April 2008 to 30 June 2008 there was no change in the issued share capital of the Company. 

There are no other material events or transactions to report. 

- MORE -

  PERFORMANCE AND FINANCIAL HIGHLIGHTS

Financial Position (excluding current financial year revenue items)

(Source: Henderson/Fact Sheet)	at 30 June 2008	at 31 March 2008
Ordinary share price	708p	814.5p
(Discount)/Premium*	(6.9%)	(4.0%)
Gross total assets	£247m	£271m
Net asset value	760.87p	848.6p
Gearing#	16.4%	20.5%
Yield	3.46%	2.89%
Total Expense Ratio	0.72%	0.72%

* Using NAV with current year income as recommended by AIC. Using NAV excluding current year income is 4.6%.

# Investments as a percentage of equity shareholders funds minus 100 (as per the Annual Report and Accounts).

Performance at 30 June 2008 (total return % change)

(Source: Henderson)	6 months	1 year	3 years	5 years
Net asset value	-21.7	-28.0	10.5	75.5
Share price	-21.9	-32.8	5.9	65.7
Benchmark*	-11.2	-13.0	23.2	71.0
* The benchmark is the FTSE All-Share Index.

THE PORTFOLIO (Source: Henderson/Fact Sheet)

Top 10 Investments at 30 June 2008

	% of Total Assets
Royal Dutch Shell	5.2
BP	4.7
Senior	4.2
HSBC	3.0
Royal Bank of Scotland	2.9
Astrazeneca	2.5
Glaxosmithkline	2.3
Aviva	2.1
Vodafone	1.8
Hill & Smith Holdings	1.8 --------
Top 10 =	30.5
	=====

Top 10 Investments at 31 March 2008

	% of Total Assets
BP	4.5
Royal Dutch Shell	3.8
Senior	3.7
HSBC	3.5
Royal Bank of Scotland	2.5
Vodafone	2.4
Aviva	2.3
GlaxoSmithKline	1.9
Astra Zeneca	1.9
Meggitt	1.7
	----------
Top 10 =	28.2%
	======

- MORE -

Sector Breakdown	% at 30 June 2008	% at 31 March 2008
Financials	27.5	31.9
Industrials	23.9	23.5
Oil & Gas	10.5	9.2
Consumer Goods	7.3	10.5
Consumer Services	6.5	6.0
Health Care	6.4	5.6
Basic Materials	6.2	5.2
Telecommunications	4.2	4.5
Utilities	2.2	3.2
Cash & Fixed Interest	5.2	0.3
Technology	0.1	0.1
	---------	---------
Total	100.0	100.0
	=====	=====

Lowland Investment Company plc aims to give shareholders a higher than average return with growth of both capital and income over the medium to long term.

The Company's policy is to invest in a broad spread of predominantly UK companies of differing sizes with normally not more than half by value coming from the largest 100 UK companies and the balance from small and medium sized companies. 

The Manager is Henderson Global Investors Limited. Further information on the Company, including an up to date NAV and share price information, can be found on the Manager's website at www.itshenderson.com or www.lowlandinvestment.com. 

For further information, please contact:

James Henderson                                     James de Sausmarez

Portfolio Manager                                    Head of Investment Trusts

Lowland Investment Company plc            Henderson Global Investors

Telephone: [phone]                      Telephone: [phone]

- ENDS -

 

END

 

 

IMSILFVIDTISFIT