Final Results, Dividend and Directorate
Please click here to view the Company's Report and Accounts
http://www.rns-pdf.londonstockexchange.com/rns/5444Q_1-2016-2-29.pdf
1 March 2016
RIT Capital Partners plc
Results for the year ended 31 December 2015
RIT Capital Partners plc today published its results for the year ended 31 December 2015.
Financial Highlights:
· Growth in net assets of £187 million (before distributions)
· Total net assets stood at £2.4 billion, a new all-time high
· Share price total return over the period of 22.7%, a meaningful outperformance of global equity markets
· Net asset value (NAV) total return of 8.1% for the year
· Significant outperformance of both the absolute benchmark and the relative benchmark
· NAV per share 1,573 pence at 31 December 2015
· £151m of long-term notes issued through a private placement, locking in historically low interest rates over the weighted average 16-year life of the notes
Performance Highlights:
· Selection and consolidation of exceptional external managers contributed significantly to total return
· Profited from major moves in China, Japan and biotech
· Continued active management of currency exposure added considerable value, with a focus on the US Dollar
· Outperformance of rising equity markets, achieved with average net quoted equity exposure of 55%
· Strong contribution from private investments - funds portfolio, in particular those with an early-stage focus
Dividends:
· Dividends paid in April and October 2015 totalling 30 pence per share
· The Board intends to pay a dividend of 31 pence per share in 2016, comprising 15.5 pence per share in April and 15.5 pence per share in October. This represents an increase of 3.3% over the previous year
Summary:
· Over the last three years, net assets have grown by £729 million (before distributions)
· Over the same three-year period, share price total return was 58.4%
· Since inception, RIT has now participated in 76% of market upside but only 39% of market declines.
· Over the same period, total shareholder return has compounded at 12.8% per annum
Commenting, Lord Rothschild, Chairman of RIT Capital Partners plc, said:
"I am pleased to report that 2015 has been a satisfactory year for your Company with a share price total return of 22.7% and a net asset value per share return of 8.1%. The results in large measure reflect the investment management and operating skills of your Company's wholly-owned subsidiary, J. Rothschild Capital Management (JRCM), under the excellent leadership of Francesco Goedhuis, well supported by the management team of Ron Tabbouche (CIO), Andrew Jones (CFO) and Jonathan Kestenbaum (COO).
In my half-yearly statement I sounded a note of caution, ending up by writing that "the climate is one where the wind may well not be behind us"; indeed we became increasingly concerned about global equity markets during the last quarter of 2015, reducing our exposure to equities as the economic outlook darkened and many companies reported disappointing earnings. Meanwhile central banks' policy makers became more pessimistic in their economic forecasts for, despite unprecedented monetary stimulus, growth remained anaemic. Not surprisingly, market conditions have deteriorated further. So much so that the wind is certainly not behind us; indeed we may well be in the eye of a storm.
Our principle will therefore be to exercise caution in all things in the current year, while remaining agile where opportunities present themselves. Problems have a habit of creating opportunities and I remain confident of our ability to identify and profit from them during 2016."
ENQUIRIES:
Brunswick Group LLP:
Tom Burns / Rowan Brown 020 7404 5959
About RIT Capital Partners plc:
RIT Capital Partners plc is an investment company listed on the London Stock Exchange. Its net assets have grown from £280 million on listing to over £2.4 billion today. It is chaired by Lord Rothschild, whose family interests retain a significant holding. www.ritcap.com
FINANCIAL SUMMARY
|
|
31 December 2015 |
31 December 2014 |
Change |
|
Net assets |
£2,441m |
£2,300m |
£141m |
|
NAV per share¹ |
1,573p |
1,483p |
90p |
|
Share price |
1,681p |
1,397p |
284p |
|
Premium/(Discount) |
6.9% |
-5.8% |
12.7% |
|
Dividends paid |
30.0p |
29.4p |
0.6p |
|
Gearing |
12.1% |
15.4% |
-3.3% |
|
Ongoing Charges % |
0.74% |
0.74% |
- |
|
NAV per share total return |
|
|
8.1% |
|
Share price total return |
|
|
22.7% |
|
RPI² plus 3.0% |
|
|
4.2% |
|
MSCI All Country World Index3 |
|
|
2.3% |
|
Performance History |
1 Year |
3 Years |
5 Years |
10 Years |
|
NAV per share total return |
8.1% |
40.4% |
34.8% |
102.3% |
|
RPI plus 3.0% |
4.2% |
15.2% |
31.8% |
78.9% |
|
MSCI All Country World Index |
2.3% |
38.3% |
46.4% |
74.0% |
1 Diluted net asset value per share with debt held at fair value.
2 Retail Price Index.
3 The MSCI All Country World Index (ACWI) we have adopted is a total return index and is based on 50% of the ACWI measured in Sterling and 50% measured in local currencies.
CHAIRMAN'S STATEMENT
I am pleased to report that 2015 has been a satisfactory year for your Company with a share price total return of 22.7% and a net asset value per share return of 8.1%. The results in large measure reflect the investment management and operating skills of your Company's wholly-owned subsidiary, J. Rothschild Capital Management (JRCM), under the excellent leadership of Francesco Goedhuis, well supported by the management team of Ron Tabbouche (CIO), Andrew Jones (CFO) and Jonathan Kestenbaum (COO).
In my half-yearly statement I sounded a note of caution, ending up by writing that "the climate is one where the wind may well not be behind us"; indeed we became increasingly concerned about global equity markets during the last quarter of 2015, reducing our exposure to equities as the economic outlook darkened and many companies reported disappointing earnings. Meanwhile central banks' policy makers became more pessimistic in their economic forecasts for, despite unprecedented monetary stimulus, growth remained anaemic. Not surprisingly, market conditions have deteriorated further. So much so that the wind is certainly not behind us; indeed we may well be in the eye of a storm.
The litany of problems which confronts investors is daunting: the QE tap is in the course of being turned off and in any event its impact in stimulating asset prices is coming to an end. There's the slowing down to an unknown extent in China. The situation in the Middle East is likely to be unresolvable at least for some time ahead. Progress of the US and European economies is disappointing. The Greek situation remains fraught with the country now having to cope with the challenge of unprecedented immigration. Over the last few years we have witnessed an explosion in debt, much of it repayable in revalued dollars by emerging market countries at the time of a collapse in commodity prices. Countries like Brazil, Russia, Nigeria, Ukraine and Kazakhstan are, as a result, deeply troubled. In the UK we have an unsettled political situation as we attempt to deal with the possibility of Brexit in the coming months. The risks that confront investors are clearly considerable at a time when stock market valuations remain relatively high.
There are, however, some influential and thoughtful investment managers who remain sanguine about markets in 2016 on the grounds that the US economy is in decent shape - outside of manufacturing - while they feel that economic conditions may be improving. To them, the decline in these markets may have more to do with sentiment than substance. Others are less optimistic but feel that the odds remain against these potential difficulties materialising in a form which would undermine global equity markets. However our view is that 2016 is likely to turn out to be more difficult than the second half of 2015. Our policy will be towards a greater emphasis on seeking absolute returns. We will remain highly selective when considering public and private investment opportunities. Reflecting this policy, our quoted equity exposure has been reduced to 43% of net asset value with private investments at 26%. To take advantage of low interest rates, in June 2015, your Company borrowed an amount of £151 million through the issue of fixed rate notes for between ten and twenty years, at a weighted average interest rate of 3.5%.
On investments, as always, the two pillars on which success depends are intelligent and correct forecasting of the macroeconomic situation, combined with the analysis of specific companies and stock selection; but in today's difficult conditions we will put a greater emphasis on creating value by searching out opportunities in dislocated credit situations, currency fluctuations and merger arbitrage. In this context we also look forward to working closely with Ed Eisler of Eisler Capital, in which we are making an important investment. Ed had a distinguished career at Goldman Sachs where he was Global co-Head of the Securities Division and also a member of the firm's Management and Risk Committees. His fund, with its focus on global macro investment opportunities, has been established to target returns over the cycle, with a capital preservation focus. Ed has now joined JRCM's Investment Committee. In turbulent and volatile conditions, these skills could be of particular relevance and value.
There's an old saying that in difficult times the return of capital takes precedence over the return on capital. Our principle will therefore be to exercise caution in all things in the current year, while remaining agile where opportunities present themselves. Problems have a habit of creating opportunities and I remain confident of our ability to identify and profit from them during 2016.
Dividend
We are intending to pay a dividend of 31 pence per share in 2016, an increase above the current rate of inflation. This will be paid in two equal payments of 15.5 pence in April and October. We intend to maintain or increase this level in the years ahead, subject to unforeseen circumstances.
Your Company's Board
After serving six years, Lord Myners is not standing for re-election to your Company's Board. We're deeply grateful to him for the investment intelligence and insights he has contributed to the affairs of your Company.
Rothschild
EXTRACT FROM STRATEGIC REPORT
Strategic Aims
Our strategic aims are best illustrated by our Corporate Objective:
"to deliver long-term capital growth, while preserving shareholders' capital; to invest without the constraints of a formal benchmark, but to deliver for shareholders increases in capital value in excess of the relevant indices over time."
We believe this accurately reflects our long-term aim. However a degree of clarification may assist shareholders in understanding what we are trying to achieve for them over time - in particular because we differ from many other large trusts who always aim to be fully invested in quoted equities.
The most important objective is long-term capital growth while preserving shareholders' capital. The essence of our investing DNA is about protecting and enhancing shareholders' wealth.
There may be times when we will deliberately place protection of shareholders' funds ahead of growth - as happened during the latter stages of the dot-com era and also in the run up to the most recent financial crisis. However we recognise that such 'market timing' is unlikely to be sustainable in the long term.
We believe that our active management of equity exposure, combined with early identification of opportunities and themes across asset classes, is more likely to lead to long-term outperformance. We would hope to display healthy participation in up markets, and reasonable protection in down markets. Over time, this should allow is to compound ahead of markets throughout their cycles.
Indeed, since your Company's listing in 1988, we have participated in 76% of the market upside but only 39% of the market declines. This has resulted in our NAV per share total return compounding at 11.4% per annum; a meaningful outperformance of global equity markets. Over the same period the total return to shareholders was 12.8% per annum.
Investment Approach
The strategic aims are expressed in more practical terms in our Investment Policy:
"to invest in a widely diversified, international portfolio across a range of asset classes, both quoted and unquoted; to allocate part of the portfolio to exceptional managers in order to ensure access to the best external talent available."
It is this policy which guides us as we manage your portfolio. So, while we retain at our core an equity bias, we nonetheless have the freedom to invest your portfolio across multiple asset classes, geographies, industries and currencies. This has been the basis of our style over many years - combining thematic investing with individual securities, and private investments with public stocks. The long-term success of your Company has been drawn from a distinctive blend of individual stocks, private investments, equity funds and currency positioning, all overlaid with macro exposure management. Indeed, it is this diversified approach that led the Association of Investment Companies (AIC) to transfer RIT into its newly created 'Flexible Investment' sector at the beginning of 2016.
We believe the extent of our global reach and network of contacts allows us to maximise our ability to deploy capital effectively. We seek to capitalise on the optimal blend of an in-house investment team working closely with our core external managers, the majority of whom are closed to new investors.
Above all, our approach is long term. For example, in relation to private investments, we are not constrained by the typical industry model of a limited life partnership. This means we can hold such investments over an extended period and choose to realise at an optimum time. On quoted investments, we aim to avoid being forced sellers of stocks if we are comfortable with their underlying fundamentals, even if it means incurring short-term losses.
2015 Performance
We were pleased with our performance in 2015.
The NAV total return ended the year at 8.1%. This compared to our first KPI (RPI plus 3%) at 4.2% for the year, an outperformance of 3.9% points. We also exceeded the relative benchmark (the ACWI), which returned 2.3% over the year, an outperformance of 5.8% points.
At the same time, as a result of the significant change in our rating from a discount of 5.8% to a premium of 6.9%, the TSR over the year (our third KPI) reached 22.7%.
The contribution to the 8.1% NAV per share total return over the year is summarised below:
|
Asset Category |
31 December 2015 % NAV |
Contribution % |
|
Quoted Equity |
67.0% |
5.8% |
|
Private Investments |
23.0% |
0.7% |
|
Absolute Return & Credit |
14.2% |
0.2% |
|
Real Assets |
3.5% |
(0.5%) |
|
Government Bonds & Rates |
2.1% |
0.2% |
|
Currency¹ |
(0.6%) |
2.7% |
|
Liquidity, Borrowings & Other |
(9.2%) |
(1.0%) |
|
Total |
100.0% |
8.1% |
¹ Currency exposure is managed centrally on an overlay basis with the translation impact and the profits from the overlay activity included in the Currency category.
Net Assets by Category
|
Asset Category |
31 December 2015 % NAV |
31 December 2014 % NAV |
|
Quoted Equity |
67.0% |
68.7% |
|
Private Investments |
23.0% |
23.6% |
|
Absolute Return & Credit |
14.2% |
16.6% |
|
Real Assets |
3.5% |
3.8% |
|
Government Bonds & Rates/Currency |
1.5% |
0.1% |
|
Total Investments |
109.2% |
112.8% |
|
Liquidity, Borrowings & Other |
(9.2%) |
(12.8%) |
|
Net Assets |
100.0% |
100.0% |
|
Average Net Quoted Equity Exposure |
55% |
56% |
|
|
|
|
Note: Exposure reflects notional exposure through derivatives and adjustments for derivatives/liquidity held by managers.
Currency Exposure of Net Assets
|
|
31 December 2015 % Net Assets |
31 December 2014 % Net Assets |
|
US Dollar |
63% |
67% |
|
Sterling |
47% |
50% |
|
Japanese Yen |
3% |
-2% |
|
Indian Rupee |
0% |
4% |
|
Euro |
-5% |
-5% |
|
Chinese Renminbi |
-3% |
-7% |
|
Australian Dollar |
-3% |
-6% |
|
South Korean Won |
-3% |
-1% |
|
Canadian Dollar |
0% |
-5% |
|
Other |
1% |
5% |
|
Total |
100% |
100% |
Consolidated Income Statement
|
Year ended 31 December £ million |
Revenue |
Capital |
2015 Total |
Revenue |
Capital |
2014 Total |
|
Income |
|
|
|
|
|
|
|
Investment income |
21.1 |
- |
21.1 |
21.1 |
- |
21.1 |
|
Other income |
8.6 |
- |
8.6 |
2.2 |
- |
2.2 |
|
|
29.7 |
- |
29.7 |
23.3 |
- |
23.3 |
|
Gains/(losses) on fair value investments |
- |
202.9 |
202.9 |
- |
213.3 |
213.3 |
|
Gains/(losses) on monetary items and borrowings |
- |
(1.4) |
(1.4) |
- |
(1.0) |
(1.0) |
|
|
29.7 |
201.5 |
231.2 |
23.3 |
212.3 |
235.6 |
|
Expenses |
|
|
|
|
|
|
|
Administrative expenses |
(24.5) |
(5.8) |
(30.3) |
(17.1) |
(3.8) |
(20.9) |
|
Investment management fees |
(2.5) |
0.3 |
(2.2) |
(3.7) |
(0.7) |
(4.4) |
|
Profit/(loss) before finance costs and tax |
2.7 |
196.0 |
198.7 |
2.5 |
207.8 |
210.3 |
|
Finance costs |
(10.7) |
- |
(10.7) |
(9.4) |
- |
(9.4) |
|
Profit/(loss) before tax |
(8.0) |
196.0 |
188.0 |
(6.9) |
207.8 |
200.9 |
|
Taxation |
0.5 |
(0.2) |
0.3 |
0.2 |
0.1 |
0.3 |
|
Profit/(loss) for the year |
(7.5) |
195.8 |
188.3 |
(6.7) |
207.9 |
201.2 |
|
Earnings per ordinary share - basic |
(4.8p) |
126.7p |
121.9p |
(4.3p) |
134.3p |
130.0p |
|
Earnings per ordinary share - diluted |
(4.8p) |
126.2p |
121.4p |
(4.3p) |
134.1p |
129.8p |
The total column of this statement represents the Group's Consolidated Income Statement, prepared in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union. The supplementary revenue and capital columns are both prepared under guidance published by the Association of Investment Companies (AIC). All items in the above statement derive from continuing operations.
Consolidated Statement of Comprehensive Income
|
Year ended 31 December £ million |
Revenue |
Capital |
2015 Total |
Revenue |
Capital |
2014 Total |
|
Profit/(loss) for the year |
(7.5) |
195.8 |
188.3 |
(6.7) |
207.9 |
201.2 |
|
Other comprehensive income/(expense) that will not be subsequently reclassified to profit or loss: |
|
|
|
|
|
|
|
Revaluation gain/(loss) on property, plant and equipment |
- |
3.2 |
3.2 |
- |
2.4 |
2.4 |
|
Deferred tax (charge)/credit allocated to actuarial loss |
(0.3) |
- |
(0.3) |
0.5 |
- |
0.5 |
|
Actuarial gain/(loss) in defined benefit pension plan |
0.5 |
- |
0.5 |
(2.5) |
- |
(2.5) |
|
Total comprehensive income/(expense) for the year |
(7.3) |
199.0 |
191.7 |
(8.7) |
210.3 |
201.6 |
The amounts included above are net of tax where applicable.
Consolidated AND PARENT COMPANY BALANCE sheet
|
At 31 December £ million |
Consolidated Balance Sheet 2015 |
Consolidated Balance Sheet 2014 |
Parent Company Balance Sheet 2015 |
Parent Company Balance Sheet 2014 |
|
Non-current assets |
|
|
|
|
|
Investments held at fair value |
2,759.0 |
2,634.0 |
2,615.8 |
2,481.4 |
|
Investment property |
33.7 |
30.2 |
33.7 |
30.2 |
|
Property, plant and equipment |
29.6 |
26.8 |
29.2 |
26.4 |
|
Investments in subsidiary undertakings |
- |
- |
164.8 |
162.8 |
|
Deferred tax asset |
2.1 |
1.8 |
- |
0.4 |
|
Retirement benefit asset |
0.5 |
- |
- |
- |
|
Derivative financial instruments |
0.4 |
5.0 |
0.4 |
5.0 |
|
|
2,825.3 |
2,697.8 |
2,843.9 |
2,706.2 |
|
Current assets |
|
|
|
|
|
Derivative financial instruments |
15.0 |
29.4 |
15.0 |
29.4 |
|
Other receivables |
90.5 |
44.9 |
88.7 |
44.6 |
|
Amounts owed by group undertakings |
0.3 |
0.4 |
0.3 |
0.4 |
|
Tax receivable |
0.2 |
0.4 |
0.2 |
0.4 |
|
Cash at bank |
112.2 |
101.4 |
104.9 |
99.8 |
|
|
218.2 |
176.5 |
209.1 |
174.6 |
|
Total assets |
3,043.5 |
2,874.3 |
3,053.0 |
2,880.8 |
|
Current liabilities |
|
|
|
|
|
Borrowings |
(258.9) |
(402.9) |
(258.9) |
(402.9) |
|
Derivative financial instruments |
(32.4) |
(27.4) |
(32.4) |
(27.4) |
|
Provisions |
(0.5) |
(0.8) |
(0.5) |
(0.8) |
|
Other payables |
(36.7) |
(8.1) |
(25.6) |
(2.7) |
|
Amounts owed to group undertakings |
(128.6) |
(128.7) |
(210.4) |
(203.8) |
|
|
(457.1) |
(567.9) |
(527.8) |
(637.6) |
|
Net current assets/(liabilities) |
(238.9) |
(391.4) |
(318.7) |
(463.0) |
|
Total assets less current liabilities |
2,586.4 |
2,306.4 |
2,525.2 |
2,243.2 |
|
Non-current liabilities |
|
|
|
|
|
Borrowings |
(141.3) |
- |
(141.3) |
- |
|
Derivative financial instruments |
(0.8) |
(3.2) |
(0.8) |
(3.2) |
|
Provisions |
(2.5) |
(2.1) |
(2.5) |
(2.1) |
|
Finance lease liability |
(0.5) |
(0.5) |
(0.5) |
(0.5) |
|
Retirement benefit liability |
- |
(1.0) |
- |
- |
|
|
(145.1) |
(6.8) |
(145.1) |
(5.8) |
|
Net assets |
2,441.3 |
2,299.6 |
2,380.1 |
2,237.4 |
|
Equity attributable to owners of the Company |
|
|
|
|
|
Share capital |
155.4 |
155.4 |
155.4 |
155.4 |
|
Share premium |
17.3 |
17.3 |
17.3 |
17.3 |
|
Capital redemption reserve |
36.3 |
36.3 |
36.3 |
36.3 |
|
Own shares reserve |
(13.0) |
(9.2) |
- |
- |
|
Share-based payment reserve |
6.2 |
6.2 |
- |
- |
|
Capital reserve |
2,216.3 |
2,066.8 |
2,202.8 |
2,044.1 |
|
Revenue reserve |
5.1 |
12.4 |
(49.1) |
(29.9) |
|
Revaluation reserve |
17.4 |
14.2 |
17.4 |
14.2 |
|
Other reserves |
0.3 |
0.2 |
- |
- |
|
Total equity |
2,441.3 |
2,299.6 |
2,380.1 |
2,237.4 |
|
Net asset value per ordinary share - basic |
1,579p |
1,486p |
|
|
|
Net asset value per ordinary share - diluted |
1,573p |
1,483p |
|
|
The financial statements were approved by the Board of Directors and authorised for issue on 29 February 2016.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
|
£ million |
Share capital |
Share premium |
Capital redemption reserve |
Own shares reserve |
Share-based payment reserve |
Capital reserve |
Revenue reserve |
Revaluation reserve |
Other reserves |
Total equity |
|
Balance at 1 January 2014 |
155.4 |
17.3 |
36.3 |
(5.5) |
5.0 |
1,904.4 |
21.1 |
11.8 |
0.2 |
2,146.0 |
|
Profit/(loss) for the year |
- |
- |
- |
- |
- |
207.9 |
(6.7) |
- |
- |
201.2 |
|
Revaluation gain on property, plant and equipment |
- |
- |
- |
- |
- |
- |
- |
2.4 |
- |
2.4 |
|
Deferred tax (charge)/credit allocated to actuarial loss |
- |
- |
- |
- |
- |
- |
0.5 |
- |
- |
0.5 |
|
Actuarial gain/(loss) in defined benefit plan |
- |
- |
- |
- |
- |
- |
(2.5) |
- |
- |
(2.5) |
|
Total comprehensive income/(expense) for the year |
- |
- |
- |
- |
- |
207.9 |
(8.7) |
2.4 |
- |
201.6 |
|
Dividends paid |
- |
- |
- |
- |
- |
(45.5) |
- |
- |
- |
(45.5) |
|
Movement in Own shares reserve |
- |
- |
- |
(3.7) |
- |
- |
- |
- |
- |
(3.7) |
|
Movement in Share-based payment reserve |
- |
- |
- |
- |
1.2 |
- |
- |
- |
- |
1.2 |
|
Balance at 31 December 2014 |
155.4 |
17.3 |
36.3 |
(9.2) |
6.2 |
2,066.8 |
12.4 |
14.2 |
0.2 |
2,299.6 |
|
Balance at 1 January 2015 |
155.4 |
17.3 |
36.3 |
(9.2) |
6.2 |
2,066.8 |
12.4 |
14.2 |
0.2 |
2,299.6 |
|
Profit/(loss) for the year |
- |
- |
- |
- |
- |
195.8 |
(7.5) |
- |
- |
188.3 |
|
Revaluation gain on property, plant and equipment |
- |
- |
- |
- |
- |
- |
- |
3.2 |
- |
3.2 |
|
Deferred tax (charge)/credit allocated to actuarial loss |
- |
- |
- |
- |
- |
- |
(0.3) |
- |
- |
(0.3) |
|
Actuarial gain/(loss) in defined benefit plan |
- |
- |
- |
- |
- |
- |
0.5 |
- |
- |
0.5 |
|
Total comprehensive income/(expense) for the year |
- |
- |
- |
- |
- |
195.8 |
(7.3) |
3.2 |
- |
191.7 |
|
Dividends paid |
- |
- |
- |
- |
- |
(46.3) |
- |
- |
- |
(46.3) |
|
Movement in Own shares reserve |
- |
- |
- |
(3.8) |
- |
- |
- |
- |
- |
(3.8) |
|
Movement in Share-based payment reserve |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
|
Other reserves |
- |
- |
- |
- |
- |
- |
- |
- |
0.1 |
0.1 |
|
Balance at 31 December 2015 |
155.4 |
17.3 |
36.3 |
(13.0) |
6.2 |
2,216.3 |
5.1 |
17.4 |
0.3 |
2,441.3 |
PARENT COMPANY STATEMENT OF CHANGES IN EQUITY
|
£ million |
Share capital |
Share premium |
Capital redemption reserve |
Capital reserve |
Revenue reserve |
Revaluation reserve |
Total equity |
|
Balance at 1 January 2014 |
155.4 |
17.3 |
36.3 |
1,876.7 |
(13.7) |
11.8 |
2,083.8 |
|
Profit/(loss) for the year |
- |
- |
- |
212.9 |
(16.2) |
- |
196.7 |
|
Revaluation gain on property, plant and equipment |
- |
- |
- |
- |
- |
2.4 |
2.4 |
|
Total comprehensive income/(expense) for the year |
- |
- |
- |
212.9 |
(16.2) |
2.4 |
199.1 |
|
Dividends paid |
- |
- |
- |
(45.5) |
- |
- |
(45.5) |
|
Balance at 31 December 2014 |
155.4 |
17.3 |
36.3 |
2,044.1 |
(29.9) |
14.2 |
2,237.4 |
|
Balance at 1 January 2015 |
155.4 |
17.3 |
36.3 |
2,044.1 |
(29.9) |
14.2 |
2,237.4 |
|
Profit/(loss) for the year |
- |
- |
- |
205.0 |
(19.2) |
- |
185.8 |
|
Revaluation gain on property, plant and equipment |
- |
- |
- |
- |
- |
3.2 |
3.2 |
|
Total comprehensive income/(expense) for the year |
- |
- |
- |
205.0 |
(19.2) |
3.2 |
189.0 |
|
Dividends paid |
- |
- |
- |
(46.3) |
- |
- |
(46.3) |
|
Balance at 31 December 2015 |
155.4 |
17.3 |
36.3 |
2,202.8 |
(49.1) |
17.4 |
2,380.1 |
CONSOLIDATED AND PARENT COMPANY CASH FLOW STATEMENT
|
Year ended 31 December £ million |
Consolidated Cash Flow 2015 |
Consolidated Cash Flow 2014 |
Parent Company Cash Flow 2015 |
Parent Company Cash Flow 2014 |
|
Cash flows from operating activities: |
|
|
|
|
|
Cash inflow/(outflow) before taxation and interest |
82.6 |
(111.0) |
70.8 |
(115.4) |
|
Interest paid |
(10.7) |
(9.4) |
(10.6) |
(9.4) |
|
Net cash inflow/(outflow) from operating activities |
71.9 |
(120.4) |
60.2 |
(124.8) |
|
|
|
|
|
|
|
Cash flows from investing activities: |
|
|
|
|
|
Purchase of property, plant and equipment |
- |
(0.1) |
- |
- |
|
Net cash inflow/(outflow) from investing activities |
- |
(0.1) |
- |
- |
|
|
|
|
|
|
|
Cash flows from financing activities: |
|
|
|
|
|
Purchase of ordinary shares by Employee Benefit Trust¹ |
(6.0) |
(4.4) |
- |
- |
|
Proceeds/(repayment) of borrowings |
(158.2) |
200.0 |
(158.2) |
200.0 |
|
Proceeds from issue of loan notes |
151.0 |
- |
151.0 |
- |
|
Equity dividend paid |
(46.3) |
(45.5) |
(46.3) |
(45.5) |
|
Net cash inflow/(outflow) from financing activities |
(59.5) |
150.1 |
(53.5) |
154.5 |
|
|
|
|
|
|
|
Increase/(decrease) in cash and cash equivalents in the year |
12.4 |
29.6 |
6.7 |
29.7 |
|
Cash and cash equivalents at the start of the year |
118.5 |
86.4 |
116.9 |
84.7 |
|
Effect of foreign exchange rate changes on cash and cash equivalents |
3.9 |
2.5 |
3.9 |
2.5 |
|
Cash and cash equivalents at the year end |
134.8 |
118.5 |
127.5 |
116.9 |
|
|
|
|
|
|
|
Reconciliation: |
|
|
|
|
|
Cash at bank |
112.2 |
101.4 |
104.9 |
99.8 |
|
Money market funds (included in portfolio investments) |
22.6 |
17.1 |
22.6 |
17.1 |
|
Cash and cash equivalents at the year end |
134.8 |
118.5 |
127.5 |
116.9 |
¹ Shares are disclosed in 'Own shares reserve' on the consolidated balance sheet
DIVIDEND
|
|
2015 Pence per share |
2014 Pence per share |
2015 £ million |
2014 £ million |
|
Dividends paid in year |
30.0 |
29.4 |
46.3 |
45.5 |
The above amounts were paid as distributions to equity holders of the Company in the relevant periods from capital profits.
On 27 February 2015 the Board declared a first interim dividend of 15.0p per share in respect of the year ended 31 December 2015 that was paid on 29 April 2015. A second interim dividend of 15.0p per share was declared by the Board on 11 August 2015 and paid on 23 October 2015.
The Board declares the payment of a first interim dividend of 15.5p per share in respect of the year ended 31 December 2016. This will be paid on 27 April 2016 to shareholders on the register on 8 April 2016.
EARNINGS/ (LOSS) PER ORDINARY SHARE - BASIC AND DILUTED
The basic earnings per ordinary share for the year ended 31 December 2015 is based on the profit of £188.3 million (year ended 31 December 2014: profit of £201.2 million) and the weighted average number of ordinary shares in issue during the year of 154.5 million (year ended 31 December 2014: 154.8 million). The weighted average number of shares is adjusted for shares held in the EBT in accordance with IAS 33.
|
£ million |
2015 |
2014 |
|
Net revenue profit(loss) |
(7.5) |
(6.7) |
|
Net capital profit/(loss) |
195.8 |
207.9 |
|
Total profit/(loss) for the year |
188.3 |
201.2 |
|
|
Pence per share |
Pence per share |
|
Revenue earnings/(loss) |
|
|
|
per ordinary share - basic |
(4.8) |
(4.3) |
|
Capital earnings/(loss) |
|
|
|
per ordinary share - basic |
126.7 |
134.3 |
|
Total earnings per share - basic |
121.9 |
130.0 |
The diluted earnings per ordinary share for the year is based on the weighted average number of ordinary shares in issue during the year, adjusted for the weighted average dilutive effect of SARs awards at the average market price for the year.
|
million |
2015 |
2014 |
|
Weighted average number of |
|
|
|
shares in issue |
154.5 |
154.8 |
|
Weighted average effect of |
|
|
|
dilutive SARs |
0.7 |
0.3 |
|
Total diluted shares |
155.2 |
155.1 |
|
|
Pence per share |
Pence per share |
|
Revenue earnings/(loss) |
|
|
|
per ordinary share - diluted |
(4.8) |
(4.3) |
|
Capital earnings/(loss) |
|
|
|
per ordinary share - diluted |
126.2 |
134.1 |
|
Total earnings per share - diluted |
121.4 |
129.8 |
NET ASSET VALUE PER ORDINARY SHARE - BASIC AND DILUTED
Net asset value per ordinary share is based on the following data:
|
31 December |
2015 |
2014 |
|
Net assets (£ million) |
2,441.3 |
2,299.6 |
|
Number of shares in issue (million) |
155.4 |
155.4 |
|
Own shares (million) |
(0.8) |
(0.6) |
|
Subtotal (million) |
154.6 |
154.8 |
|
Effect of dilutive potential ordinary shares in respect of SARs (million) |
0.6 |
0.3 |
|
Diluted shares (million) |
155.2 |
155.1 |
|
|
|
|
|
31 December |
2015 pence |
2014 pence |
|
Net asset value per ordinary share - basic |
1,579 |
1,486 |
|
Net asset value per ordinary share - diluted |
1,573 |
1,483 |
STATEMENT OF DIRECTORS' RESPONSIBILITIES
The Directors are responsible for preparing the Report and Accounts, in accordance with applicable law and regulations.
Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors have prepared the Group and Parent Company financial statements in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union. Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Group and the Company and of the profit or loss of the Group for that period. In preparing these financial statements, the Directors are required to:
· select suitable accounting policies and then apply them consistently;
· make judgements and accounting estimates that are reasonable and prudent;
· state whether applicable IFRSs as adopted by the European Union have been followed, subject to any material departures disclosed and explained in the financial statements; and
· prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and the Group and enable them to ensure that the financial statements and the Directors' Remuneration Report comply with the Companies Act 2006 as amended and, as regards the Group financial statements, Article 4 of the IAS Regulation. They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The Directors are responsible for the maintenance and integrity of the Company's website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions. The Directors consider that the Report and Accounts taken as a whole, is fair, balanced and understandable and provides the information necessary for shareholders to assess the Company's position, performance, business model and strategy.
Each of the Directors, whose names and responsibilities are listed in the Corporate Governance Report confirm that, to the best of their knowledge:
· the Group financial statements, which have been prepared in accordance with IFRSs as adopted by the European Union, give a true and fair view of the assets, liabilities, financial position and profit of the Group; and
· the Directors' Report contains a fair review of the development and performance of the business and the position of the Group, together with a description of the principal risks and uncertainties that it faces.
BASIS OF PRESENTATION
The financial information for the year ended 31 December 2015 has been extracted from the statutory accounts for that year. The auditors' report on these accounts was unqualified and did not contain a statement under either Section 498(2) or (3) of the Companies Act 2006. The statutory accounts will be delivered to the Registrar of Companies following the Company's Annual General Meeting.
The financial information for the year ended 31 December 2014 has been extracted from the statutory accounts for that year which have been delivered to the Registrar of Companies. The auditors' report on these accounts was unqualified and did not contain a statement under either Section 498(2) or (3) of the Companies Act 2006.
REPORT AND ACCOUNTS
The full statutory accounts are available to be viewed or downloaded from the Company's website at www.ritcap.com. Neither the contents of the Company's website nor the contents of any website accessible from the Company's website (or any other website) is incorporated into, or forms part of, this announcement.
This information is provided by RNS
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