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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Brookwell B | LSE:BKWB | London | Ordinary Share | GG00B4KG7S24 | PART RED PREF SHS NPV B |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 102.50 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From Jun 2019 to Jun 2024
TIDMBKWB TIDMBKWD
RNS Number : 9639C
Brookwell Limited
15 March 2011
BROOKWELL LIMITED
Announcement of half-yearly results for the six months to 31 December 2010
Investment objective
To realise value from a portfolio of AIM Securities and Listed Securities and, in the case of the D Share class fund, from PLUS Securities and progressively return cash to shareholders.
Financial highlights
Hot Features
Premium
A Shares B Shares
------------------------------------------ --------- ---------
Amount raised in placing GBP25.5m GBP13.0m
------------------------------------------ --------- ---------
Amount returned to shareholders
in the six months ended 31 December
2010 GBP0.9m GBP3.2m
------------------------------------------ --------- ---------
Amount returned to shareholders
in the period from admission of
shares to trading on AIM ("Admission")*
to 31 December 2010 GBP11.6m GBP13.9m
------------------------------------------ --------- ---------
Number of securities acquired in
the placing* 84 62
------------------------------------------ --------- ---------
Number of securities at 31 December
2010 nil 1
------------------------------------------ --------- ---------
Net asset value per Share at Admission** 97.00p 96.60p
------------------------------------------ --------- ---------
Net asset value per Share at 31 n/a 112.37p
December 2010
------------------------------------------ --------- ---------
Weighted average net asset value/cash 45.30p 110.88p
return per Share *** at/up to 31
December 2010
------------------------------------------ --------- ---------
* The A Shares were admitted to trading on 26 June 2008 and the B Shares were admitted to trading on AIM on 19 February 2009.
** after share issue expenses
*** net assets and cash returned to shareholders
shares issued in placing
CHAIRMAN'S STATEMENT
Brookwell had a successful six months to 31 December 2010, returning a total of GBP4.1 million to shareholders. The Company realised the remaining stocks in the A Share portfolio, ahead of schedule. In addition, progress in the B Share portfolio resulted in all but one of the investments being realised. Since the period end this last remaining investment has been sold.
On 30 December 2010 the Company, having sold the remaining 4 investments in the A Share Portfolio, returned a further GBP0.9m to shareholders, in the process redeeming the entire A Shares remaining in issue. In total GBP11.6m was returned to the A fund shareholders, representing approximately 45% of the placing value of the issued A Shares. In view of the difficult profile of the original portfolio, and taking into account market conditions over the life of the class fund, I believe this to be a satisfactory performance.
On 30 December 2010, GBP3.2m was returned to B shareholders through the pro rata redemption of 2,888,862 B Shares at the price of 110.77p per B Share. This means that GBP13.9m has been returned to date representing approximately 107% of the placing value of the issued B Shares. The NAV per B Share at 31 December 2010 was 112.37p and the number of holdings had been reduced from 12 to 1.
I am pleased to announce that since the period end the remaining holding has been sold and as a result the remaining assets of GBP0.4m will be returned to the B Shareholders by the end of March, significantly ahead of the original timetable. The cash will be returned by a pro rata redemption of the remaining B Shares. The NAV per B share at 11 March 2011 was 93.66p. The aggregate cash returned to B Shareholders after the final redemption will be GBP14.3 million representing 110% of the amount raised in the B Share placing. This is a very satisfactory performance.
In the developed economies a combination of low interest rates, expansionary monetary policy and Government refinancing of those banks unable to repair their own balance sheets, has been sufficient to rescue the banking system. In Europe, in particular, central governments have acted to help support domestic banking systems, notably Ireland and Greece, which faced serious risk of failure. The indications are that economic growth is slowly returning to the West, but the developed economies are now grappling with the challenges of reducing excessive public sector deficits incurred during the crisis. This process has only just begun and will face significant challenges at a time when global growth is far from certain. In the meantime the emerging economies continue to deliver strong economic growth, with China now officially replacing Japan as the world's second largest economy. Current political upheaval in the Middle East introduces a large element of uncertainty across global stock markets and suggests that relying on the developing economies to drive global GDP growth is inherently risky. The broader impact of political instability in this region could affect markets internationally.
In October 2010 we announced that the investment manager was investigating the issue of a new class of Shares. The Company announced on 21 January 2011 a proposed placing of D shares. I am delighted to inform shareholders that your Company raised a further GBP16.1 million in the initial placing which completed in February 2011, and a further GBP0.3 million in a supplemental placing which is conditional on admission to AIM of the additional D Shares which is expected to occur on 17 March 2011. In total the D Share portfolio will comprise 76 investments of which 62 are in AIM Securities, 11 are Listed Securities and three are PLUS Securities, across a range of sectors. We thank those placees who have participated in earlier class funds and welcome others as new Shareholders in Brookwell. We are confident that your investment manager will be able to work on the realisation of this D Share portfolio with the same professionalism and success they achieved for the A and B portfolios.
CHRISTOPHER CLARK
15 March 2011
INVESTMENT MANAGER'S REPORT
Historically low interest rates and an increase in investors' risk appetite has been reflected in a further appreciation in the AIM market and provided an improvement in liquidity. Against this backdrop continued progress has been made in realising the remaining investments.
A Share portfolio
At the end of June 2010 the number of holdings in the A portfolio had been reduced from an initial 84 to just 4, all of which had been sold by the end of December 2010. As a result all of the remaining A Shares were redeemed on 30 December 2010.
B Share portfolio
At the end of June 2010 the number of holdings in the B portfolio had been reduced from an initial 62 to 12. By the end of December 2010, 11 of these holdings had been realised leaving one remaining investment, Sanderson Group.
Sanderson Group is a small UK provider of software solutions and IT services, which when Brookwell acquired its holding had debt of GBP11m and a market capitalisation of only GBP6m. Since then the management team have taken action to cut debt and improve the business. Following these improvements we have been able to realise the holding over the last three months at a price significantly above book cost.
D Share portfolio
We have carried out a review of the investments acquired in the initial D Share placing and have already arranged meetings with management teams. We have analysed the investments to establish our initial view of value and timetable for realisation. In each case we are determining the best approach to generating value and liquidity for D Shareholders from the investment. We are grateful to all those institutions who participated in the placing.
Subject to sufficient realisations of investments the first pro rata redemption of D Shares will be made at the end of June 2011. We will provide an update on progress in June with the redemption announcement.
Progressive AIM Realisation Limited
15 March 2011
STATEMENTS OF COMPREHENSIVE INCOME
For the six months to 31 December 2010
Unaudited
6 months to 31 December Unaudited
COMPANY 2010 6 months to 31 December 2009
Revenue Capital Total Revenue Capital Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Gains on
investments
designated at
fair value
through profit
or loss - 22 22 - 3,195 3,195
Investment
income 31 - 31 37 - 37
Investment
management
fees (49) (49) (98) (133) (228) (361)
Other expenses (162) - (162) (173) - (173)
----------------- -------- -------- -------- -------- -------- ----------
(Loss)/profit on
ordinary
activities
before
taxation (180) (27) (207) (269) 2,967 2,698
Taxation - - - (11) - (11)
----------------- -------- -------- -------- -------- -------- ----------
(Loss)/profit
attributable to
shareholders (180) (27) (207) (280) 2,967 2,687
----------------- -------- -------- -------- -------- -------- ----------
(Loss)/earnings
per A Share (1.35)p (8.02)p (9.37)p (0.97)p 15.02p 14.05p
----------------- -------- -------- -------- -------- -------- ----------
(Loss)/earnings
per B Share (4.50)p 4.95p 0.45p (1.47)p 10.03p 8.56p
----------------- -------- -------- -------- -------- -------- ----------
The total column of this statement represents the Company's Comprehensive Income, prepared under IFRS. The revenue and capital columns, including the revenue and capital earnings per share data, are supplementary information prepared under guidance published by the Association of Investment Companies.
All revenue and capital items in the above statement derive from continuing operations. No operations were acquired or discontinued during the year.
The Company was incorporated on 28 May 2008 and its A Shares commenced trading on AIM on 26 June 2008. The B Shares were admitted to trading on AIM on 19 February 2009.
Unaudited
6 months to 31 December Unaudited
A SHARE 2010 6 months to 31 December 2009
Revenue Capital Total Revenue Capital Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
(Losses)/gains
on investments
designated at
fair value
through profit
or loss - (187) (187) - 1,975 1,975
Investment
income 27 - 27 20 - 20
Investment
management
fees (3) (3) (6) (77) (77) (154)
Other expenses (56) - (56) (62) - (62)
----------------- -------- -------- -------- -------- -------- ----------
(Loss)/profit on
ordinary
activities
before
taxation (32) (190) (222) (119) 1,898 1,779
Taxation - - - (4) - (4)
----------------- -------- -------- -------- -------- -------- ----------
(Loss)/profit
attributable to
shareholders (32) (190) (222) (123) 1,898 1,775
----------------- -------- -------- -------- -------- -------- ----------
(Loss)/earnings
per A Share (1.35)p (8.02)p (9.37)p (0.97)p 15.02p 14.05p
----------------- -------- -------- -------- -------- -------- ----------
Unaudited Unaudited
6 months to 31 December 6 months to 31 December
B SHARE 2010 2009
Revenue Capital Total Revenue Capital Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Gains on
investments
designated at
fair value
through profit
or loss - 209 209 - 1,220 1,220
Investment
income 4 - 4 17 - 17
Investment
management
fees (46) (46) (92) (56) (151) (207)
Other expenses (106) - (106) (111) - (111)
----------------- -------- -------- -------- --------- -------- --------
(Loss)/profit on
ordinary
activities
before
taxation (148) 163 15 (150) 1,069 919
Taxation - - - (7) - (7)
----------------- -------- -------- -------- --------- -------- --------
(Loss)/profit
attributable to
shareholders (148) 163 15 (157) 1,069 912
----------------- -------- -------- -------- --------- -------- --------
(Loss)/earnings
per B Share (4.50)p 4.95p 0.45p (1.47)p 10.03p 8.56p
----------------- -------- -------- -------- --------- -------- --------
STATEMENT OF FINANCIAL POSITION
Unaudited Unaudited Audited
At 31 December At 31 December At 30 June
2010 2009 2010
Company* GBP'000 GBP'000 GBP'000
Non-current assets
------------------------------- --------------- --------------- -----------
Investments designated at fair
value through profit and
loss 108 10,621 4,112
------------------------------- --------------- --------------- -----------
Current assets
Sales for future settlement 95 - 22
Other receivables 9 2 23
Cash and cash equivalents 367 824 777
------------------------------- --------------- --------------- -----------
471 826 822
------------------------------- --------------- --------------- -----------
Total assets 579 11,447 4,934
------------------------------- --------------- --------------- -----------
Current liabilities
Other payables 108 313 193
------------------------------- --------------- --------------- -----------
108 313 193
------------------------------- --------------- --------------- -----------
Total 471 11,134 4,741
------------------------------- --------------- --------------- -----------
Capital and reserves
attributable to shareholders
Share capital and share
premium - 21,180 15,880
Capital reserve 891 (9,558) (10,443)
Revenue reserve (420) (488) (696)
------------------------------- --------------- --------------- -----------
Total shareholders' funds 471 11,134 4,741
------------------------------- --------------- --------------- -----------
Net assets per A Share* n/a 56.38p 45.57p
------------------------------- --------------- --------------- -----------
Net assets per B Share* 112.37p 114.09p 110.53p
------------------------------- --------------- --------------- -----------
* As at 31 December 2010, the Company's net assets were solely attributable to the B Shares. The final redemption of the
A Shares was completed on 30 December 2010 when all attributable assets were returned to A Shareholders and all the
outstanding A Shares were redeemed.
STATEMENTS OF CHANGES IN SHAREHOLDERS' FUNDS
Company Unaudited Unaudited Audited
6 months to 6 months to Year to
31 December 31 December
2010 2009 30 June 2010
GBP'000 GBP'000 GBP'000
Opening shareholders' funds 4,741 16,647 16,647
----------------------------- ----------- ----------- ------------
Purchases and redemption
of shares (4,063) (8,200) (13,500)
(Loss)/profit for the period (207) 2,687 1,594
----------------------------- ----------- ----------- ------------
Closing shareholders' funds 471 11,134 4,741
----------------------------- ----------- ----------- ------------
A Share Unaudited Unaudited Audited
6 months to 6 months to Year to
31 December 31 December
2010 2009 30 June 2010
GBP'000 GBP'000 GBP'000
Opening shareholders' funds 1,085 5,370 5,370
----------------------------- ----------- ----------- ------------
Purchases and redemption
of shares (863) (2,700) (5,200)
(Loss)/profit for the period (222) 1,775 915
----------------------------- ----------- ----------- ------------
Closing shareholders' funds - 4,445 1,085
----------------------------- ----------- ----------- ------------
B Share Unaudited Unaudited Audited
6 months to 6 months to Year to
31 December 31 December
2010 2009 30 June 2010
GBP'000 GBP'000 GBP'000
Opening shareholders' funds 3,656 11,277 11,277
---------------------------- ----------- ----------- ------------
Purchases and redemption
of shares (3,200) (5,500) (8,300)
Profit for the period 15 912 679
---------------------------- ----------- ----------- ------------
Closing shareholders' funds 471 6,689 3,656
---------------------------- ----------- ----------- ------------
STATEMENTS OF CASH FLOW
Unaudited Unaudited
6 months to 31 December 6 months to 31 December
2010 2009
A B A B
Shares Shares Company Shares Shares Company
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Operating activities
Cash inflow from
investment income
and interest 27 4 31 49 25 74
Cash outflow from
management and
other expenses (121) (209) (330) (214) (209) (423)
Cash inflow from
disposal of
investments 682 3,270 3,952 2,895 5,822 8,717
Net cash inflow from
operating
activities 588 3,065 3,653 2,730 5,638 8,368
--------------------- -------- -------- -------- -------- -------- --------
Financing
Payments to purchase
own shares (863) (3,200) (4,063) (2,700) (5,500) (8,200)
--------------------- -------- -------- -------- -------- --------
Net cash outflow
from financing
activities (863) (3,200) (4,063) (2,700) (5,500) (8,200)
--------------------- -------- -------- -------- -------- -------- --------
(Decrease)/increase
in cash and cash
equivalents (275) (135) (410) 30 138 168
--------------------- -------- -------- -------- -------- -------- --------
Opening balance 275 502 777 314 342 656
Cash flow (275) (135) (410) 30 138 168
Closing balance - 367 367 344 480 824
NOTES
1 Status
The Company is a closed-ended investment company incorporated and resident in Guernsey.
2 Accounting policies
The half-yearly financial statements have been prepared in accordance with IAS 34 (Interim Financial Reporting). The accounting policies used by the Company are the same as those stated in the Annual Report for the year ended 30 June 2010 which was prepared in accordance with International Financial Reporting Standards ("IFRS"). The Company has also taken the guidance of Statement of Recommended Practice issued by the Association of Investment Companies into account to the extent that it is appropriate and compatible with IFRS.
As described in note 9 shareholders approved a change in the Articles of Incorporation relating to the life of the Company on 7 February 2011. On 24 February 2011 the Company issued a new class of shares. Accordingly, the half-yearly financial statements have been prepared on the going concern basis.
3 Investments
All investments have been classified at "fair value through profit and loss". At the period end all quoted investments have been valued at market bid prices.
Classification and valuation of investments
The Company adopted IFRS 7 in the Annual Report for the year ended 30 June 2010. All investments held by the Company at that date were considered to fall within Level 1 under the IFRS 7 hierarchy, except for Hotel Corporation which was classified as Level 2 and Entelos which was valued at zero.
The classification of the Company's investments held at fair value as at 30 June 2010 is detailed in the table below:
Level Level Level
1 2 3 Total
GBP'000 GBP'000 GBP'000 GBP'000
Investments designated
as fair value through profit
and loss 3,612 500 - 4,112
-------- -------- -------- --------
Hotel Corporation was valued by an alternative valuation technique, using prices provided by market makers, which the directors believed better reflects the fair value of that investment than the market bid price. The security was reclassified from a Level 1 to a Level 2 investment during the year ended 30 June 2010 as shown below:
Level Level
1 2
GBP'000 GBP'000
Opening balance at 1 July 2009 1,150 -
Valuation adjustments (650) -
Transfer of fair value hierarchy (500) 500
Disposals during the year - -
-------- --------
Closing balance at 30 June 2010 - 500
-------- --------
As noted in the Chairman's statement the Company had disposed of all of its investments other than one holding by 31 December 2010. That holding in Sanderson Group has been classified as a level 1 investment for the purposes of the IFRS 7 hierarchy.
4 Investment management fees
31 December 2010 31 December 2009
Revenue Capital Total Revenue Capital Total
Investment
management
fees GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Basic 35 35 70 96 96 192
Capital return
fee 14 14 28 37 37 74
Equity
appreciation
fee - - - - 95 95
Total 49 49 98 133 228 361
-------- -------- -------- -------- -------- --------
One half of basic and capital return fees have been charged to capital and the entirety of the equity appreciation fee has been charged to capital.
An equity appreciation fee of GBP31,114 was invoiced in respect of the B Share redemption on 30 December 2010 and has been paid since the period end. A provision of GBP38,000 was made at 30 June 2010 for equity appreciation fees and therefore no further charge was made during the six months ended 31 December 2010.
5 Share capital and Share premium
At the period end the Company's issued share capital consists entirely of B Shares and two Founders Shares of GBP1 nominal value each. The Founders Shares have negligible rights. The B Shares are participating redeemable preference shares of no par value and are admitted to trading on AIM.
During the period, the Company also had A Shares in issue. The A Shares were participating redeemable preference shares of no par value. These shares were cancelled on 30 December 2010 following the final redemption of the A Class Fund.
Further details of the share issues and redemptions for each of the A Share and B Share class are set out below:
A Share
Issue of A Shares
Pursuant to the AIM Admission Document dated 6 June 2008 the Company:
a) On 26 June 2008, allotted 25,226,853 A Shares, all of which were issued for consideration in the form of investments received. The total consideration was GBP25,226,853.
b) On 17 July 2008, allotted a further 297,890 A Shares, all of which were issued for consideration in the form of investments received. The total consideration was GBP297,890.
Redemptions of A Shares
Pro-rata redemptions of A Shares
On 30 December 2010 2,380,891 A Shares were redeemed at a price of 36.2278p per share.
On 30 June 2010 5,502,959 A Shares were redeemed at a price of 45.43p per share.
On 30 December 2009, 4,774,523 A Shares were redeemed at a price of 56.55p per share.
On 30 June 2009 4,509,837 A Shares were redeemed at a price of 42.13p per share.
On 31 December 2008, 8,356,533 A Shares were redeemed at a price of 43.08p per share.
These redemptions were effected pro-rata to the number of A Shares held by each holder at the time of redemption.
B Share
Issue of B Shares
Pursuant to the AIM Admission Document dated 15 January 2009 the Company:-
a) On 17 February 2009, allotted 12,372,932 B Shares, all of which were issued for consideration in the form of investments received. The total consideration was GBP12,372,932.
b) On 12 March 2009 allotted a further 587,912 B Shares, all of which were issued for consideration in the form of investments received. The total consideration was GBP587,912.
Redemption of B Shares
Pro-rata redemptions of shares
On 30 December 2010, 2,888,862 B Shares were redeemed at a price of 110.77p per share
On 30 June 2010 2,554,972 B Shares were redeemed at a price of 109.59p per share.
On 30 December 2009, 4,814,839 B Shares were redeemed at a price of 114.23p per share.
On 30 June 2009 the Company redeemed 2,283,313 B Shares at a price of 105.11p per B Share.
There were 418,858 B Shares in issue at 31 December 2010.
The Company has given notice to redeem all the remaining B Shares on 31 March 2011.
6 Net assets per Share
Net assets per Share figures are based on the number of B Shares in issue at the end of the period.
7 Earnings/(loss) per Share
A Share
(Loss)/earnings per A Share is based on the loss of GBP222,000 (2009: profit of GBP1,775,000) attributable to the weighted average of 2,367,951 (2009: 12,632,425) A Shares of no par value in issue during the period.
B Share
Earnings per B Share is based on the profit of GBP15,000 (2009: profit of GBP912,000) attributable to the weighted average of 3,292,020 (2009: 10,651,363) B Shares of no par value in issue during the period.
8 Taxation
The Company is resident for tax purposes in Guernsey.
The Company applies for exempt status under the Income Tax (Exempt Bodies) (Guernsey) Ordinances 1989 and 1992 and is charged an annual exemption fee of GBP600.
The tax charge shown in the Statements of Comprehensive Income relates to overseas withholding tax on dividend income.
The Directors intend to manage the affairs of the Company so that the upfront and annual requirements relating to "reporting fund" status under the United Kingdom Offshore Reporting Rules are, and continue to be, met in relation to the D Shares.
9 Post balance sheet events
On 7 February 2011 Shareholders approved a change of the Articles of Incorporation with the effect that the life of the Company was determined by reference to the latest date set in the class fund rules for the holding of a winding up vote.
Pursuant to the AIM Admission Document dated 21 January 2011, the Company issued 16,096,091 D Shares in an initial placing and a further 328,281 D Shares are to be issued in a supplemental placing. The D Shares issued in the initial placing commenced trading on AIM on 24 February 2011 and the D Shares issued in the supplemental placing are expected to commence trading on 17 March 2011. The D Shares are participating redeemable preference shares of no par value.
10. Status of this announcement
These unaudited financial statements are not the Company's statutory accounts. The half-yearly report will be sent to shareholders and copies will be made available to the public at the registered office of the Company and at the address of the UK Administration Agent and at the Company's website: www.brookwelllimited.com. The Annual Report for the year ended 30 June 2010 received an unqualified audit report and was sent to shareholders during October 2010 and has been filed with the Guernsey Financial Services Commission.
The half-yearly report was approved by the Board of directors on 15 March 2011.
For further information please contact:
Brookwell Limited
Hannah Girard (Legis Corporate Services Limited - Company Secretary) Tel: 01481 726 034
Progressive AIM Realisation Limited (Investment manager)
Robert Legget / Ross Courtier Tel: 020 7566 5550
Deloitte LLP (Nominated adviser)
Jonathan Hinton / James Lewis Tel: 020 7936 3000
Marshall Securities Limited (Broker)
Robert Luetchford / John Webb Tel: 020 7490 3788
Website: www.brookwelllimited.com
15 March 2011
This information is provided by RNS
The company news service from the London Stock Exchange
END
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