Final Results - NAV Up 21.6%

Majedie Investments PLC 24 November 1999 Majedie Investments plc PRELIMINARY ANNOUNCEMENT OF RESULTS for the year ended 30 September 1999 FINANCIAL HIGHLIGHTS Year ended Year ended % change 30 30 September September 1999 1998 Net asset value per 383p 315p +21.6% share Share price 367p 296p +24.0% Dividends per share 7.40p 7.20p +2.8% Earnings per share 8.09p 9.41p -14.0% PERFORMANCE * net asset value total return of +23.7% * share price total return of +26.0% * benchmark total return of +27.7% EXTRACTS FROM THE ANNUAL REPORT: The year to 30 September 1999 saw a steady recovery in the world's major economies after the market turmoil in the autumn of 1998. Over the year Majedie's net asset value increased by 21.6% and the share price increased by 24.0%. The Board is recommending a final dividend of 4.3p per share, giving a total of 7.4p for the year and representing an increase of 2.8%. This is the eleventh successive year in which the dividend has been increased and conforms with our approach of increasing the dividend above the rate of inflation. The net asset value total return of 23.7% and share price total return of 26.0% compare with the benchmark total return for the year of 27.7%. The discount to net assets started the year at 6.1% and ended it at 4.2%. One of the elements affecting performance relative to our benchmark was the combination of an underweight position in the US market coupled with the impact on performance of individual US stocks. Many funds have found it difficult to perform well in the US due to the market being highly volatile and often driven by only one or two sectors. However we are reviewing our approach in this area. During the year we have implemented the strategy outlined in last year's Chairman's Statement of re-orienting the portfolio towards a more fully-invested position in equities. At the end of the financial year, equities accounted for 94.3% of the portfolio compared to 87.6% a year earlier. Total income arising from continuing activities in the year ended 30 September 1999 amounted to £6.7m and shows a decrease of 10.7% compared with the previous year's figure of £7.5m. This is partly due to a reduction in the dividend tax credit from 20% to 10% and partly due to the re-orientation of the portfolio taking effect during the year. In the year ending 30 September 2000 there will be a probable further reduction in income. However as has been stated before, we plan to increase the dividend by more than the rate of inflation by utilising part of the Company's substantial revenue reserves if there is a shortfall between the after-tax revenue and declared dividend. With effect from 1 October 1998 75% of relevant expenses have been allocated to capital. Last year's Statement of Total Return figures have been restated to provide comparatives on the same basis. On a structural level, the Board decided during the year that the interests of Majedie's shareholders and clients of Majedie Portfolio Management would be best served by the sale of MPM's business to a larger organisation with a similar philosophy. On 29 October 1999 MPM clients transferred to Smith & Williamson. There have been a number of board appointments during the year, including Gill Leates as Investment Director following a decision by the Board that a change of approach was required with regard to the management of the portfolio. In keeping with the principles of good corporate governance, four independent non-executive directors were appointed to the Board during the year. Hubert Reid, David Ritchie and Professor Paul Marsh joined the Board in January and William Barlow was appointed in July. A further executive appointment was made yesterday when Helen Bagan joined the Board as Finance Director. The strengthening of the Board prepares the way for future changes. After the Annual General Meeting in January Sir John K Barlow will retire from the Chairmanship of the Company, an office he has held for twenty-one years. He will be succeeded by Henry Barlow, who has been a non-executive director of the Company since 1978. Hubert Reid will become non-executive Deputy Chairman. Since the end of our financial year, interest rates have risen in the UK, Europe and the US. This completes the reversal of the monetary relaxation that the US prompted a year ago following the collapse of South East Asian markets and the hedge fund LTCM. Markets around the world have risen strongly since the beginning of November based on growing confidence in the economic outlook. In the context of a reasonably benign scenario, Majedie is using its cash balance to increase exposure to the new industries that will be so important over the long term. For further information please contact either Robert Clarke or William Underwood on 0207 626 1243; E-mail: rec@majedie.co.uk Consolidated Statement of Total Return 1999 Revenue Capital Total £000 £000 £000 ------ ------- ------- Net realised gains on 9,109 9,109 sales Increase/(decrease) in unrealised appreciation 28,870 28,870 ------ ------- ------- Total capital return on 37,979 37,979 investments Dividends and interest 6,279 6,279 Rents and other income Continuing activities 460 460 Discontinued 251 251 activities ------ ------- ------- Gross revenue and 6,990 37,979 44,969 capital return Administrative expenses Continuing activities (915) (1,618) (2,533) Discontinued (394) (394) activities ------ ------- ------- Return on ordinary activities before finance costs and taxation Continuing activities 5,824 36,361 42,185 Discontinued (143) (143) activities Provision for loss on (123) (123) disposal of private client fund management business Debenture stock interest (357) (1,071) (1,428) payable ------ ------- ------- Return on ordinary activities before taxation 5,201 35,290 40,491 Taxation on ordinary (946) 340 (606) activities ------ ------- ------- Return on ordinary activities after taxation attributable to equity 4,255 35,630 39,885 shareholders Dividends Interim ordinary 3.1p (1,632) (1,632) (1998 - 3.1p) Final ordinary 4.3p (2,263) (2,263) (1998 - 4.1p) ------ ------- ------- Transfer to/(from) 360 35,630 35,990 reserves ------ ------- ------- Basic return per 8.09p 67.76p 75.85p ordinary share Diluted return per 8.09p 67.71p 75.80p ordinary share 1998 Revenue Capital Total As As As restated restated restated £000 £000 £000 ------ ------- ------- Net realised gains on 15,583 15,583 sales Increase/(decrease) in unrealised (30,421) (30,421) appreciation ------ ------- ------- Total capital return on (14,838) (14,838) investments Dividends and interest 6,969 6,969 Rents and other income Continuing activities 497 497 Discontinued 233 233 activities ------ ------- ------- Gross revenue and 7,699 (14,838) (7,139) capital return Administrative expenses Continuing activities (688) (1,307) (1,995) Discontinued (526) (526) activities ------ ------- ------- Return on ordinary activities before finance costs and taxation Continuing activities 6,778 (16,145) (9,367) Discontinued (293) (293) activities Provision for loss on disposal of private client fund management business Debenture stock interest (357) (1,071) (1,428) payable ------ ------- ------- Return on ordinary activities before taxation 6,128 (17,216) (11,088) Taxation on ordinary (1,190) 319 (871) activities ------ ------- ------- Return on ordinary activities after taxation attributable to equity 4,938 (16,897) (11,959) shareholders Dividends Interim ordinary 3.1p (1,627) (1,627) (1998 - 3.1p) Final ordinary 4.3p (2,152) (2,152) (1998 - 4.1p) ------ ------- ------- Transfer to/(from) 1,159 (16,897) (15,738) reserves ------ ------- ------- Basic return per 9.41p (32.20)p (22.79)p ordinary share Diluted return per 9.39p (32.13)p (22.74)p ordinary share The revenue column of this statement is the Consolidated Profit and Loss Account of the Group. Consolidated Balance Sheet 1999 1998 As restated £000 £000 Fixed asset investments 207,171 169,942 Cash at bank and on 10,098 11,016 deposit -------- -------- 217,269 180,958 Dividends (2,263) (2,152) Other assets and 1,513 1,492 liabilities Debenture stock (14,811) (14,808) -------- -------- Total net assets 201,708 165,490 -------- -------- Called up share capital 5,263 5,248 Share premium account 602 389 Capital redemption 37 37 reserve Capital reserve - 94,104 87,344 realised Capital reserve - 75,639 46,769 unrealised Revenue reserve 26,063 25,703 -------- -------- Shareholders' funds 201,708 165,490 -------- -------- Net asset value per share 383p 315p share Notes 1.As from 1 October 1998 the Company has charged 75% of investment management expenses and finance costs to capital, in accordance with the Board's expectation of the split of total returns over the long term between capital gains and income. This represents a change in accounting policy from prior periods in which all expenses and finance costs were charged against revenue. Consequently the comparative figures for the year ended 30 September 1998 have been restated. The effect of this change is to increase net revenue on ordinary activities after taxation for the year ended 30 September 1999 by £2,349,000 (year ended 30 September 1998: £2,059,000). The change has no effect on total shareholders' funds although the reserves at 30 September 1998 have been adjusted to reflect the transfer from realised capital reserve to revenue reserve of £2,059,000. 2.Basic and diluted revenue returns per ordinary share are based on revenue after taxation of £4,255,000 (1998 as restated: £4,938,000). Basic and diluted capital returns per ordinary share are based on capital return after taxation of £35,630,000 (1998 as restated: capital loss of £16,897,000). Basic returns per ordinary share are based on 52,584,384 shares, being the weighted average number of shares in issue (1998: 52,480,000). Diluted returns per ordinary share are based on 52,619,053 shares, the weighted average number of shares in issue adjusted for the exercise of outstanding options (1998: 52,591,592). 3.The preliminary figures for the year ended 30 September 1999 are an extract from the Company's latest accounts, prepared under the same accounting policies, consistently applied, as the audited financial statements for the year ended 30 September 1998, except as explained in Note 1 above. 4.The financial information set out above does not constitute the Company's statutory accounts for the years ended 30 September 1999 or 1998 but it is derived from those accounts. Statutory accounts for 1998 have been delivered to the Registrar of Companies, and those for 1999 will be delivered following the Company's Annual General Meeting. The auditors have reported on the accounts; their reports were unqualified and did not contain statements under section 237(2) or (3) of the Companies Act 1985. Annual Report The annual report and accounts will be sent to shareholders on 9 December 1999 from which time copies will be available to the public at the Company's registered office: 1 Minster Court, Mincing Lane, London EC3R 7ZZ. Annual General Meeting The Annual General Meeting will be held at 12.15pm on Tuesday 11 January 2000 at the London Underwriting Centre, 3 Minster Court, Mincing Lane, London EC3. Dividend The proposed final dividend of 4.3p will be paid on 4 February 2000 to shareholders on the register at the close of business on 21 January 2000. Notes for Editors Majedie Investments PLC is an investment trust with total assets under management of over £200 million. The Company's objective is to maximise total shareholder return over the long term and to outperform the benchmark, which is 70% FTSE All-Share Index and 30% FT/S&P World Ex. UK Index (sterling) on a total return basis (net income reinvested). Majedie is different from other investment trusts in that the Barlow family owns about 55% of the shares in issue and the Company itself is responsible for the investment management function. The Majedie Share Plan is a straightforward and low cost way of investing in Majedie shares with a minimum lump sum of £250, or on a regular monthly basis with £25 or more. Please contact us for more information on the Share Plan.

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