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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Fidelity Special Values Plc | LSE:FSV | London | Ordinary Share | GB00BWXC7Y93 | ORD 5P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| -0.50 | -0.18% | 285.00 | 285.00 | 286.00 | 285.50 | 283.00 | 283.50 | 692,307 | 16:35:08 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Trust,ex Ed,religious,charty | 70.44M | 54.31M | 0.1676 | 17.03 | 925.3M |
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TIDMFSV
Fidelity Special Values PLC
Half-Yearly results for the six months ended 28 February 2017 (unaudited)
Financial Highlights:
* Fidelity Special Values PLC will pay an interim dividend of 1.80 pence per
share, an increase of 80% to last year's interim payment
* The Company delivered positive outperformance in the six month period to 28
February 2017, resulting in a net asset value ("NAV") total return of
+10.9%
* The discount narrowed from 10.0% to 2.1% over the period, as result of the
share price total return of +20.7%, significantly outperforming the
company's Benchmark Index by +12.1%
* Strong stock selection among financials was the biggest contributor to
returns during the period
* Portfolio manager, Alex Wright, believes 2016's cyclical rally has left
value opportunities in selected defensive stocks which have less exposure
to the performance of the economy
Contacts
For further information, please contact:
Bonita Guntrip
Senior Company Secretary
01737 837320
FIL Investments International
Portfolio Manager's Half-Yearly Review
Performance
The performance of the Company over the six-month period to 28 February 2017
was very positive, resulting in a net asset value ("NAV") total return of 10.9%
and a share price total return of 20.7%, compared to a total return of 8.6% for
the Benchmark Index (the FTSE All-Share Index). This report seeks to explain
the reasons for the performance over the review period.
Total returns (%) 1 year 3 years 5 years Since
launch*
NAV per share +25.3 +26.3 +117.6 +1,571.9
Share price +27.1 +28.4 +144.8 +1,586.4
FTSE All-Share Index +22.8 +20.2 +55.3 +425.6
======== ======== ======== ========
=== === === ===
*The Company launched on 17 November 1994
The figures in the table above are as at 28 February 2017
The attribution analysis table below shows the factors that contributed to the
Company's NAV per share total return for the six months to 28 February 2017.
Analysis of the change in NAV total return for the period (%)
Impact of:
Index +8.6
Stock selection +2.4
Gearing +0.5
Share repurchases +0.1
Operational Costs -0.7
Total return for the six months to 28 February 2017 +10.9
========
===
Stock Market and Portfolio Review
The UK stock market performed strongly over the review period with the FTSE
All-Share Index recording gains of 8.6%. Contrary to expectations, the UK
economy remained relatively resilient, which helped to ease concerns over the
economic implications of the Brexit vote. The continued weakness in sterling
also supported stock prices, though there were signs of stabilisation in the
exchange rate. The strengthening US economy, leading to an increase in interest
rates in December further supported investor sentiment, while they also reacted
positively to Donald Trump's victory in the US presidential elections.
The very strong performance of cyclical shares in the second half of 2016, and
so far this year, has left many investors arguing that their re-rating was
unjustified, citing an uncertain political and macro-economic environment as
reasons to avoid them, and thus preferring to stick to exclusively 'defensive'
investment strategies. Indeed, having seen such a significant re-rating of many
lower-quality businesses, one can see the sense in questioning the
attractiveness of these businesses today. Although this view may appear
intuitively sensible, I think it contains a faulty analysis of today's market.
The outsize returns in cyclical stocks during the review period primarily
reflect their historically unloved and under-owned status at the beginning of
2016, rather than rampant optimism at the end. In other words, it was a big
bounce off a low base. It is true that earnings expectations have recovered
but, in selected areas, they are by no means excessive. So, while the relative
performance potential of cyclical shares remains attractive, a more
discriminating approach will be required to separate the best opportunities
from those that could disappoint.
In terms of performance, the Company's NAV outperformed the Benchmark Index
over the reporting period. Strong stock selection among financials was the
biggest contributor to returns during the period, with several of our holdings
making significant contributions. At a stock level, US banking major Citigroup
was the leading contributor to returns as the increase in US interest rates and
expectations that banks could benefit from potentially lower taxes and a
friendlier regulatory environment under President Trump supported banking
shares. Litigation finance company Burford Capital was another notable
contributor; Burford is an early mover and global leader in a new and
fragmented industry. As a fully integrated company, with legal expertise and
due diligence in house as well as a good brand, Burford is in the best position
to benefit from an increase in penetration of litigation financing. Meanwhile,
the holding in Coats, a maker of threads and zips, rose after it said it will
inject GBP255 million into its pension schemes to settle a regulatory dispute.
The settlement is expected to allow the company to lift a suspension on
dividend payments. Merger and acquisition activity remained a key driver of
portfolio returns. For example, the holding in Indonesian palm oil plantation
owner M.P. Evans rose after Kuala Lumpur Kepong made a takeover offer for the
company.
On the downside, the underweight stance in the resources sectors, particularly
mining, proved a drag on overall performance. The demand improvement in the
mining sector is being driven primarily by Chinese stimulus, the economic value
of which is questionable and it is unlikely to last forever. With no meaningful
supply-side adjustment taking place in key industrial metal markets, there is a
real risk of significant disappointment if a withdrawal of Chinese stimulus
packages causes a fall in spot prices. As such, I largely continue to avoid the
sector for the time being.
Royal Dutch Shell remains the top holding in the portfolio. Even after rising
50% last year, its shares still trade on around a 6% dividend yield, suggesting
that the market does not believe the company will be able to sustainably cover
its dividend with free cash flow, and that it will ultimately be forced to cut
the dividend. However, I believe that improved capital discipline in the
company and rising cash flows following its merger with BG Group's assets will
allow the dividend to be covered, and possibly in time, grow once again.
Although Royal Dutch Shell's valuation did rise last year, it was primarily
driven by the recovery in the oil price rather than the market fundamentally
re-appraising its view of the value of the company - meaning there is
considerable potential for its share price, in addition to the gains of last
year.
One of the consequences of the 2016 rally in cyclical stocks is that more value
has begun appearing in selected defensive stocks which have less exposure to
the performance of the economy. Although in general, there is still a large gap
in valuations between cyclical and defensive stocks, the picture is more
nuanced than it was 12 months ago, and stockpicking opportunities have become
available in some classically defensive sectors, such as health care,
telecommunications and even tobacco. I welcome this opportunity to give the
Company's portfolio a more balanced exposure, and I have recently increased
positions in pharmaceuticals group Shire and telecommunications company BT
Group, which are now both top five holdings for the portfolio. Scandinavian
Tobacco is a non-UK stock which the Company bought in the second half of last
year. Its leading competitive position gives it good pricing power in the
structurally declining cigar market, which should enable it to hold sales flat
while growing cash profits over the medium term.
Outlook
The unforeseen political changes in 2016, alongside reasonable global GDP
growth, have presented the first serious challenge to the deeply embedded
'lower for longer' interest rates framework. If interest rates have finally
stopped falling, this would remove what has been a structural headwind, and
create a much more supportive environment for value investing to re-assert
itself in the mainstream market, after a long period in the wilderness. While I
do not expect value investing to outperform in a straight line from here, nor
necessarily to repeat the dramatic short term outperformance of last year, 2016
should serve as a reminder to investors that proper diversification means being
prepared for multiple macroeconomic scenarios, including inflation, growth and
rising interest rates.
As ever, I will be spending my time researching and meeting companies, looking
for those that offer some degree of downside protection but also potential for
a positive change to show them in a new light. In my experience, this is the
best way to deliver capital growth over the long term.
Alex Wright
Portfolio Manager
26 April 2017
Interim Management Report
Discount and Share Repurchases
Under the Company's discount management policy, the Board seeks to maintain the
discount in single digits in normal market conditions and will repurchase
ordinary shares with the objective of stabilising the share price discount
based on the cum-income NAV within a single digit range.
The level of discount has narrowed from 10.0% at the start of the reporting
period to 2.1% as at 28 February 2017. This narrowing of discount gave rise to
a share price total return of 20.7% for the six months, well ahead of the NAV
total return of 10.9%. The Board continues to monitor the discount closely and
will take action where it feels it to be effective.
In the six months to 28 February 2017, the Company's shares traded within a
discount range of 0.4% to 12.7% and the Company repurchased 800,000 ordinary
shares into Treasury.
Interim Dividend
The Board's dividend policy is to pay dividends twice yearly in order to smooth
the dividend payment throughout the year. As mentioned in last year's Annual
Report, the Board believe that Shareholders would prefer a more balanced
interim and final dividend payment than those paid in the last two years. The
Company's revenue return for the six months to 28 February 2017 was 1.67 pence
per share and the Board has declared an interim dividend of 1.80 pence per
share, thereby increasing last year's interim dividend by 80%. This will be
paid on 8 June 2017 to Shareholders on the register on 19 May 2017 (ex-dividend
date 18 May 2017).
A high percentage of our Shareholders reinvest their dividends for additional
shares in the Company. Until 2016, the final dividend payment has been made in
December each year and it has sometimes been difficult to find sufficient
shares in the market place to meet the required demand for the dividend
reinvestments. This is because the market is not as active in the second half
of December leading up to the Christmas period. In order to address this
problem, the Board has decided to change the payment date of the final dividend
from December to January and as a consequence change the interim payment from
May to June so that both payments are approximately six months apart.
Principal Risks and Uncertainties
The Board, with the assistance of the Manager, has developed a risk matrix
which, as part of the risk management and internal controls process, identifies
the key risks faced by the Company.
The Board believes that the principal risks and uncertainties faced by the
Company continue to fall into two broad categories. The first category is
external risks which comprises of market risk, share price risk, discount
control risk and regulatory risk. The second category is internal risks
comprising of investment management risk and governance, operational,
financial, compliance, administration etc risks. Information on each of these
risks is given in the Strategic Report section of the Annual Report for the
year ended 31 August 2016. A copy of the Annual Report can be found on the
Company's pages of the Manager's website at www.fidelityinvestmenttrusts.com.
These risks and uncertainties have not materially changed during the six months
to 28 February 2017 and are equally applicable to the remaining six months of
the Company's financial year.
Transactions with the Manager and Related Party
FIL Investment Services (UK) Limited is the Company's Alternative Investment
Fund Manager (the "Manager") and has delegated the Company's portfolio
management to FIL Investments International. The transactions with the Manager
and related party transactions with the Directors are disclosed in Note 12 to
the Financial Statements below.
Going Concern
The Directors have considered the Company's investment objective, policy,
strategy and the Company's projected income and expenditure and that the
portfolio of investments is considered to be mainly readily realisable
securities. Therefore, the Directors believe that the Company has adequate
resources to continue in operational existence for the foreseeable future. Thus
they continue to adopt the going concern basis of accounting in preparing these
Financial Statements.
Continuation votes are held every three years and the next continuation vote
will be put to Shareholders at the Annual General Meeting in 2019.
By order of the Board
FIL Investments International
26 April 2017
Directors' Responsibility Statement
The Disclosure and Transparency Rules ("DTR") of the UK Listing Authority
require the Directors to confirm their responsibilities in relation to the
preparation and publication of the Interim Management Report and Financial
Statements.
The Directors confirm to the best of their knowledge that:
1. the condensed set of Financial Statements contained within the Half-Yearly
Report has been prepared in accordance with the Financial Reporting
Council's Standard: FRS 104: Interim Financial Reporting; and
2. the Interim Management Report, together with the Portfolio Manager's
Half-Yearly Review above, includes a fair review of the information
required by DTR 4.2.7R and 4.2.8R.
The Half-Yearly Report has not been audited by the Company's Independent
Auditor.
The Half-Yearly Report was approved by the Board on 26 April 2017 and the
above responsibility statement was signed on its behalf by Andy Irvine,
Chairman.
Financial Statements
Income Statement
for the six months ended 28 February 2017
six months ended 28 year ended 31 August six months ended 29
February 2017 2016 February 2016 unaudited
unaudited audited
revenue capital total revenue capital total revenue capital total
Notes GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Gains/(losses) on - 53,513 53,513 - 43,853 43,853 - (16,831) (16,831)
investments
Gains/(losses) on long CFDs - 6,790 6,790 - 1,328 1,328 - (3,510) (3,510)
(Losses)/gains on short - (1,560) (1,560) - (3,840) (3,840) - 3,676 3,676
CFDs, futures and options
Investment and net 4 7,808 - 7,808 18,022 - 18,022 5,955 - 5,955
derivative income
Other interest 4 142 - 142 127 - 127 52 - 52
Investment management fees 5 (2,907) - (2,907) (5,186) - (5,186) (2,561) - (2,561)
Other expenses (321) - (321) (694) - (694) (367) - (367)
Foreign exchange (losses)/ - (636) (636) 28 (285) (257) 11 (94) (83)
gains
======= ======= ======= ======= ======= ======= ======= ======== ========
== == == == == == == = =
Net return/(loss) before 4,722 58,107 62,829 12,297 41,056 53,353 3,090 (16,759) (13,669)
finance costs and taxation
Finance costs (196) (196) (1,085) - (1,085) (470) - (470)
======= ======= ======= ======= ======= ======= ======= ======== ========
== == == == == == == = =
Net return/(loss) on 4,526 58,107 62,633 11,212 41,056 52,268 2,620 (16,759) (14,139)
ordinary activities before
taxation
Taxation 6 (115) - (115) (175) - (175) (90) - (90)
======= ======= ======= ======= ======= ======= ======= ======== ========
== == == == == == == = =
Net return/(loss) on
ordinary activities after
taxation for the period 4,411 58,107 62,518 11,037 41,056 52,093 2,530 (16,759) (14,229)
======= ======= ======= ======= ======= ======= ======= ======== ========
== == == == == == == = =
Return/(loss) per ordinary 7 1.67p 21.94p 23.61p 4.15p 15.42p 19.57p 0.95p (6.29p) (5.34p)
share
======= ======= ======= ======= ======= ======= ======= ======== ========
== == == == == == == = =
The Company does not have any other comprehensive income. Accordingly the net
return on ordinary activities after taxation for the period is also the total
comprehensive income for the period and no separate Statement of Comprehensive
Income has been presented.
The total column of this statement represents the Income Statement of the
Company. The revenue and capital columns are supplementary and presented for
information purposes as recommended by the Statement of Recommended Practice
issued by the AIC.
No operations were acquired or discontinued in the year and all items in the
above statement derive from continuing operations.
Statement of Changes in Equity
for the six months ended 28 February 2017
share capital other non-
share premium redemption distributable capital revenue total
capital account reserve reserve reserve reserve equity
Notes GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Six months ended 28 February 2017 (unaudited)
Total Shareholders' funds at 31 August 2016 13,532 95,896 3,256 5,152 450,196 10,259 578,291
Ordinary shares repurchased and held in - - - - (1,612) - (1,612)
Treasury
Net return on ordinary activities after - - - - 58,107 4,411 62,518
taxation for the period
Dividend paid to Shareholders 8 - - - - - (7,143) (7,143)
========== ========== ========== ========== ========== ========== ==========
Total Shareholders' funds at 28 February 2017 13,532 95,896 3,256 5,152 506,691 7,527 632,054
========== ========== ========== ========== ========== ========== ==========
Year ended 31 August 2016 (audited)
Total Shareholders' funds at 31 August 2015 13,532 95,896 3,256 5,152 411,356 8,144 537,336
Ordinary shares repurchased and held in - - - - (2,216) - (2,216)
Treasury
Net return on ordinary activities after - - - - 41,056 11,037 52,093
taxation for the year
Dividend paid to Shareholders 8 - - - - - (8,922) (8,922)
========== ========== ========== ========== ========== ========== ==========
Total Shareholders' funds at 31 August 2016 13,532 95,896 3,256 5,152 450,196 10,259 578,291
========== ========== ========== ========== ========== ========== ==========
Six months ended 29 February 2016 (unaudited) 95,896 3,256 5,152 411,356 8,144 537,336
Total Shareholders' funds at 31 August 2015 13,532 - - - (468) - (468)
Ordinary shares repurchased and held in -
Treasury
Net (loss)/return on ordinary activities after - - - - (16,759) 2,530 (14,229)
taxation for the period
Dividend paid to Shareholders 8 - - - - - (6,262) (6,262)
========== ========== ========== ========== ========== ========== ==========
Total Shareholders' funds at 29 February 2016 13,532 95,896 3,256 5,152 394,129 4,412 516,377
========== ========== ========== ========== ========== ========== ==========
Balance Sheet
at 28 February 2017
Company number 2972628
28.02.17 31.08.16 29.02.16
unaudited audited unaudited
Notes GBP'000 GBP'000 GBP'000
Fixed assets
Investments 9 596,006 539,096 489,821
Current assets ========= ======== =========
== === ==
Derivative instruments 9 14,250 16,169 16,940
Debtors 4,070 4,995 3,336
Amounts held at futures clearing houses and brokers 4,081 7,365 1,088
Fidelity Institutional Liquidity Fund 23,417 24,359 14,253
Cash at bank 2,673 2,469 1,689
========= ======== =========
== === ==
48,491 55,357 37,306
========= ======== =========
== === ==
Creditors
Derivative instruments 9 (7,020) (13,783) (8,981)
Other creditors (5,423) (2,379) (1,769)
========= ======== =========
== === ==
(12,443) (16,162) (10,750)
========= ======== =========
== === ==
Net current assets 36,048 39,195 26,556
========= ======== =========
== === ==
Net assets 632,054 578,291 516,377
========= ======== =========
== === ==
Capital and reserves
Share capital 10 13,532 13,532 13,532
Share premium account 95,896 95,896 95,896
Capital redemption reserve 3,256 3,256 3,256
Other non-distributable reserve 5,152 5,152 5,152
Capital reserve 506,691 450,196 394,129
Revenue reserve 7,527 10,259 4,412
========= ======== =========
== === ==
Total Shareholders' funds 632,054 578,291 516,377
========= ======== =========
== === ==
Net asset value per ordinary share 11 238.92p 217.94p 193.93p
========= ======== =========
== === ==
Notes to the Financial Statements
1 Principal activity
Fidelity Special Values PLC is an Investment Company incorporated in England
and Wales with a premium listing on the London Stock Exchange. The Company's
registration number is 2972628, and its registered office is Beech Gate,
Millfield Lane, Lower Kingswood, Tadworth, Surrey, KT20 6RP. The Company has
been approved by HM Revenue & Customs as an Investment Trust under Section 1158
of the Corporation Tax Act 2010 and intends to conduct its affairs so as to
continue to be approved.
2 Publication of non-statutory accounts
The Financial Statements in this Half-Yearly Financial Report have not been
audited by the Company's Independent Auditor and do not constitute statutory
accounts as defined in section 434 of the Companies Act 2006 (the "Act"). The
financial information for the year ended 31 August 2016 is extracted from the
latest published Financial Statements of the Company. Those Financial
Statements were delivered to the Registrar of Companies and included the
Independent Auditor's Report which was unqualified and did not contain a
statement under either section 498(2) or 498(3) of the Act.
3 Basis of preparation
The Company prepares its Financial Statements on a going concern basis and in
accordance with UK Generally Accepted Accounting Practice ("UK GAAP") and FRS
102: The Financial Reporting Standard applicable in the UK and Republic of
Ireland, issued by the Financial Reporting Council. The Financial Statements
are also prepared in accordance with the Statement of Recommended Practice:
Financial Statements of Investment Trust Companies and Venture Capital Trusts
("SORP") issued by the Association of Investment Companies ("AIC"), in November
2014. FRS 104: Interim Financial Reporting has also been applied in preparing
this condensed set of Financial Statements. The accounting policies followed
are consistent with those disclosed in the Company's Annual Report and
Financial Statements for the year ended 31 August 2016.
4 Income
six year six
months months
ended ended ended
28.02.17 31.08.16 29.02.16
unaudited audited unaudited
GBP'000 GBP'000 GBP'000
Investment income
UK dividends 4,107 9,327 3,442
UK scrip dividends - 95 -
Overseas dividends 1,603 3,546 1,184
Overseas scrip dividends 575 862 292
Debt security interest 269 384 131
========= ======== =========
== === ==
6,554 14,214 5,049
========= ======== =========
== === ==
Derivative income/(expenses)
Dividends received on long CFDs 1,440 4,937 1,291
Dividends and interest paid on short CFDs (186) (1,129) (385)
========= ======== =========
== === ==
1,254 3,808 906
========= ======== =========
== === ==
Investment and net derivative income 7,808 18,022 5,955
Other interest ========= ======== =========
== === ==
Interest received on short CFDs 97 56 27
Interest received on bank deposits and money market funds 45 71 25
========= ======== =========
== === ==
142 127 52
========= ======== =========
== === ==
Total investment and net derivative income and other interest 7,950 18,149 6,007
========= ======== =========
== === ==
5 Investment management fees
six year six
months months
ended ended ended
28.02.17 31.08.16 29.02.16
unaudited audited unaudited
GBP'000 GBP'000 GBP'000
Portfolio management services 2,607 4,586 2,261
Non-portfolio management services1 300 600 300
========= ======== =========
== === ==
Investment management fees 2,907 5,186 2,561
========= ======== =========
== === ==
1. Includes company secretarial, fund accounting, taxation, promotional and
corporate advisory services.
FIL Investment Services (UK) Limited is the Company's Alternative
Investment Fund Manager and has delegated portfolio management to FIL
Investments International ("FII"). Both companies are Fidelity group
companies. FII charges portfolio management services fees at an annual rate
of 0.875% of net assets. Fees are payable quarterly in arrears and are
calculated on the last business day of March, June, September and December.
6 Taxation
six year six
months months
ended ended ended
28.02.17 31.08.16 29.02.16
unaudited audited unaudited
GBP'000 GBP'000 GBP'000
Overseas taxation recovered - (18) (17)
Overseas taxation suffered 115 193 107
========= ======== =========
== === ==
Total taxation charge for the period 115 175 90
========= ======== =========
== === ==
7 Return/(loss) per ordinary share
six year six
months months
ended ended ended
28.02.17 31.08.16 29.02.16
unaudited audited unaudited
Revenue return per ordinary share 1.67p 4.15p 0.95p
Capital return/(loss) per ordinary share 21.94p 15.42p (6.29p)
========= ======== =========
== === ==
Total return/(loss) per ordinary share 23.61p 19.57p (5.34p)
========= ======== =========
== === ==
The return/(loss) per ordinary share is based on the net return/(loss) on
ordinary activities after taxation for the period divided by the weighted
average number of ordinary shares in issue held outside Treasury during the
period, as shown below:
GBP'000 GBP'000 GBP'000
Net revenue return on ordinary activities after taxation 4,411 11,037 2,530
Net capital return/(loss) on ordinary activities after 58,107 41,056 (16,759)
taxation
======== ======== ========
=== === ===
Net return/(loss) on ordinary activities after taxation 62,518 52,093 (14,229)
======== ======== ========
=== === ===
number number number
Weighted average number of ordinary shares in issue held 264,773,651 266,183,770 266,463,491
outside Treasury
=========== =========== ===========
8 Dividends paid to Shareholders
six year six
months months
ended ended ended
28.02.17 31.08.16 29.02.16
unaudited audited unaudited
GBP'000 GBP'000 GBP'000
Final dividend of 2.70 pence per ordinary share paid for the 7,143 - -
year ended 31 August 2016
Interim dividend of 1.00 pence per ordinary share paid for - 2,660 -
the year ended 31 August 2016
Final dividend of 2.35 pence per ordinary share paid for the - 6,262 6,262
year ended 31 August 2015
========= ======== =========
== === ==
Total dividends paid 7,143 8,922 6,262
========= ======== =========
== === ==
The Company has declared an interim dividend for the six month period to 28
February 2017 of 1.80 pence per ordinary share (2016: 1.00 pence). The interim
dividend will be paid on 8 June 2017 to Shareholders on the register at 19 May
2017 (ex-dividend date 18 May 2017). The total cost of this interim dividend,
which has not been included as a liability in these Financial Statements, is GBP
4,761,000 (2016: GBP2,660,000). This amount is based on the number of ordinary
shares in issue held outside Treasury at the date of this Report.
9 Fair value hierarchy
The Company is required to disclose the fair value hierarchy that classifies
its financial instruments measured at fair value at one of three levels,
according to the relative reliability of the inputs used to estimate the fair
values.
Classification Valued by reference to
Level 1 Valued using quoted prices in active markets
for identical assets
Level 2 Valued by reference to valuation techniques
using observable inputs
other than quoted prices included within
level 1
Level 3 Valued by reference to valuation techniques
using inputs that are not
based on observable market data
Categorisation within the hierarchy has been determined on the basis of the
lowest level input that is significant to the fair value measurement of the
relevant asset. The table below sets out the Company's fair value hierarchy:
28 February 2017 unaudited
level 1 level 2 level 3 total
GBP'000 GBP'000 GBP'000 GBP'000
Financial assets at fair value
Investments 589,570 117 6,319 596,006
Derivative instruments - 14,250 - 14,250
======== ======== ======== ========
=== === === ===
589,570 14,367 6,319 610,256
Financial liabilities at fair value
Derivative instruments (2,158) (4,862) - (7,020)
======== ======== ======== ========
=== === === ===
31 August 2016 audited
level 1 level 2 level 3 total
GBP'000 GBP'000 GBP'000 GBP'000
Financial assets at fair value
Investments 527,418 5,818 5,860 539,096
Derivative instruments - 16,169 - 16,169
======== ======== ======== ========
=== === === ===
527,418 21,987 5,860 555,265
======== ======== ======== ========
=== === === ===
Financial liabilities at fair value
Derivative instruments (2,342) (11,441) - (13,783)
======== ======== ======== ========
=== === === ===
29 February 2016 unaudited
level 1 level 2 level 3 total
GBP'000 GBP'000 GBP'000 GBP'000
Financial assets at fair value
Investments 489,561 - 260 489,821
Derivative instruments - 16,940 - 16,940
======== ======== ======== ========
=== === === ===
489,561 16,940 260 506,761
======== ======== ======== ========
=== === === ===
Financial liabilities at fair value
Derivative instruments - (8,981) - (8,981)
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10 Share capital
28 February 2017 31 August 2016 29 February 2016
unaudited audited unaudited
number of number of number of
shares GBP'000 shares GBP'000 shares GBP'000
Ordinary shares of
5 pence each - issued,
allotted and fully paid
Held outside Treasury
Beginning of the period 265,349,480 13,267 266,524,480 13,326 266,524,480 13,326
Ordinary shares
repurchased and
transferred into Treasury (800,000) (40) (1,175,000) (59) (250,000) (13)
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End of the period 264,549,480 13,227 265,349,480 13,267 266,274,480 13,313
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Held in Treasury
Beginning of the period 5,295,000 265 4,120,000 206 4,120,000 206
Ordinary shares
repurchased and held in
Treasury 800,000 40 1,175,000 59 250,000 13
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End of the period 6,095,000 305 5,295,000 265 4,370,000 219
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Total share capital 13,532 13,532 13,532
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Shares held in Treasury carry no rights to vote, to receive a dividend or to
participate in a winding up of the Company.
11 Net asset value per ordinary share
The net asset value per ordinary share is based on net assets of GBP632,054,000
(31 August 2016: GBP578,291,000 and 29 February 2016: GBP516,377,000) and on
264,549,480 (31 August 2016: 265,349,480 and 29 February 2016: 266,274,480)
ordinary shares, being the number of ordinary shares in issue held outside
Treasury at the period end. It is the Company's policy that shares held in
Treasury will only be reissued at a premium to net asset value per ordinary
share and, therefore, shares held in Treasury have no dilutive effect.
12 Transactions with the Manager and related parties
FIL Investment Services (UK) Limited is the Company's Alternative Investment
Fund Manager and has delegated portfolio management and the role of company
secretary to FIL Investments International ("FII"). Both companies are Fidelity
group companies. Details of the fee arrangements are given in Note 5.
During the period management fees of GBP2,607,000 (year ended 31 August 2016: GBP
4,586,000 and six months ended 29 February 2016: GBP2,261,000) and secretarial
and administration fees of GBP300,000 (year ended 31 August 2016: GBP600,000 and
six months ended 29 February 2016: GBP300,000) were payable to FII. At the
Balance Sheet date, management fees of GBP891,000 (31 August 2016: GBP810,000 and
29 February 2016: GBP738,000) and secretarial and administration fees of GBP100,000
(31 August 2016: GBP100,000 and 29 February 2016: GBP250,000) were accrued and
included in other payables. FII also provides the Company with marketing
services. The total amount payable for these services during the period was GBP
52,000 (year ended 31 August 2016: GBP155,000 and six months ended 29 February
2016: GBP80,000). At the Balance Sheet date, marketing services of GBP36,000 (31
August 2016: GBP63,000 and 29 February 2016: GBP98,000) were accrued and included
in other payables.
As at 28 February 2017, the Board consisted of five non-executive Directors,
all of whom are considered to be independent by the Board apart from Nicky
McCabe, who is employed by FIL Limited as Head of Investment Trusts. FIL
Limited has no beneficial interest in the shares of the Company. None of the
Directors have a service contract with the Company. The Chairman receives an annual fee of GBP38,750, the Audit Committee Chairman an annual fee of GBP30,000 and each other Director an annual fee of GBP25,500, apart from Nicky McCabe who waives her Director's fees. The following members of the Board hold ordinary shares in the Company: Andy Irvine 75,000 shares, Sharon Brown 15,600 shares, Dean Buckley 12,500 shares, Nigel Foster 30,000 shares and Nicky McCabe 13,183 shares. Neither the contents of the Company's website nor the contents of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated into, or forms part of, this announcement. ENDS A copy of the Half Yearly Report will shortly be submitted to the National Storage Mechanism and will be available for inspection at www.morningstar.co.uk /uk/NSM The Half Yearly Report will also be available on the Company's website at www.fidelityinvestmenttrusts.com where up to date information on the Company, including daily NAV and share prices, factsheets and other information can also be found. END
(END) Dow Jones Newswires
April 27, 2017 02:00 ET (06:00 GMT)
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