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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Standard Life European Private Equity Trust | LSE:SEP | London | Ordinary Share | GB0030474687 | ORD 0.2P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 298.00 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From Apr 2019 to Apr 2024
TIDMSEP
RNS Number : 8838Q
Standard Life Euro Pri Eqty Tst PLC
05 December 2016
5 December 2016
STANDARD LIFE EUROPEAN PRIVATE EQUITY TRUST PLC
RESULTS FOR THE YEARED 30 SEPTEMBER 2016
Highlights
-- The Company's net asset value total return for the year ended 30 September 2016 was 24.8%. Following a strategic review the Board is proposing changes to the investment policy, the dividend policy and fee arrangements, details of which are provided below.
-- Net asset value per ordinary share ("NAV") at 30 September 2016 rose 23.0% to 346.4p (30 September 2015 - 281.6p). The increase in NAV during the period included 14.9% of net realised gains and income from the Company's portfolio of 49 private equity fund interests, 3.8% of unrealised losses on a constant exchange rate basis, 13.1% of positive exchange rate movements on the portfolio, and the payment of dividends during the year ended 30 September 2016.
-- Actual NAV of 346.4p compares to a previously estimated NAV at 30 September 2016 of 338.9p announced on 14 October 2016. Closing mid-market price of the Company's ordinary shares on 30 September 2016 was 267.3p, an increase of 24.9% over the year and a discount of 22.8% to NAV.
-- Recommended final dividend of 3.6p per ordinary share, which together with the interim dividend of 1.8p paid in July 2016, makes a total for the year of 5.4p (year ended 30 September 2015 - 5.25p). The Board intends to increase the annual dividend, for the year ending 30 September 2017, to 12.0p per share. The Board is committed to maintaining the real value of this new enhanced dividend and growing it at least in line with inflation, in the absence of unforeseen circumstances.
-- At the year end the Company's net assets were GBP532.6 million. In preparing the Company's year end valuation, 98.7% by value of the portfolio was valued by the relevant fund manager at 30 September 2016.
-- Distributions received by, and draw downs from, the portfolio during the year were GBP126.9 million and GBP66.2 million respectively. In addition, the Company acquired through the secondary market one private equity fund interest for GBP19.1 million.
-- During the year the Company acquired a total of 2,030,000 ordinary shares through a series of share buy-back transactions for GBP4.5 million. The ordinary shares were acquired at an average price of 221.6p and at an average discount to the prevailing NAV of 29.4%. The ordinary shares acquired have been cancelled.
-- The Company had liquid resources of GBP105.9 million at 30 September 2016. In addition, the Company has an undrawn GBP80 million syndicated revolving credit facility, provided by Citibank and Societe Generale that expires in December 2020.
-- The Company made three new fund commitments during the year, with commitments of EUR45.0 million to Advent International GPE VIII, EUR28.1 million to the Sixth Cinven Fund and EUR23.0 million to Astorg VI. In addition, the Company assumed outstanding commitments of GBP10.4 million on the secondary acquisition of TowerBrook Investors III.
-- The Company had GBP305.9 million of outstanding commitments at 30 September 2016. After undertaking a detailed review, the Manager continues to believe that up to GBP55 million of the Company's existing outstanding commitments are unlikely to be drawn.
-- During the period from 30 September 2016 to 1 December 2016 the Company received distributions of GBP14.4 million and funded GBP7.4 million of draw downs.
-- At 1 December 2016 the Company had a cash balance of GBP111.0 million and outstanding commitments of GBP325.1 million.
-- A new commitment of EUR34.0 million was made to IK VIII in October 2016.
-- Although the returns generated by the Company have been strong, its shares have persistently traded at a discount to its net asset value. As detailed in the Company's circular and the Chairman's Statement, the Board is proposing changes to the Company's investment policy to remove the current size and geographic restrictions on private equity investments. Notwithstanding, the majority of the portfolio will retain a European focus.
-- In addition, to maximise the returns on cash held pending investment in private equity funds, a product of the Company's over-commitment strategy, the Board is also proposing to broaden the investment policy in regard to cash management to incorporate listed direct private equity investments, to be utilised opportunistically in suitably liquid investment companies.
-- To reflect the proposed changes, to be voted on by shareholders at the Company's Annual General Meeting on 24 January 2017, the Board is recommending to shareholders that they approve a change in the name of the Company to Standard Life Private Equity Trust PLC.
-- The Company's Manager has been incentivised by a success-based performance fee. The performance fee had a set five-year life which expired at the end of the last financial year. The strong growth in the Company's value meant that the Manager exceeded the agreed performance hurdle and triggered a payment under the performance fee scheme of GBP6.4 million.
-- The Board is in the process of finalising new fee arrangements with the Manager and has negotiated the adoption of a single annual management fee of 0.95% of the net asset value of the Company, to replace the previous management fee and incentive fee arrangement. The Board believe the new fee structure delivers value for shareholders.
For further information please contact:-
Roger Pim and Peter McKellar of SL Capital Partners LLP (on 0131 245 0055)
CHAIRMAN'S STATEMENT
This has been a year of strong growth for the Company. Buoyant company valuations driven by strong underlying trading and a fall in the value of sterling have combined to outweigh any immediate effect of the UK referendum vote to exit the European Union ("Brexit"). Your Company's net asset value produced a total return of 24.8% during the year to the end of September and its share price delivered a total return including dividends of 27.9%. By contrast, the MSCI Europe Index delivered a total return of 20.2% over the same period.
Much of the past year has been dominated by the Brexit process. The pound has fallen by 14.8% against the euro as investors have faced up to the prospect of prolonged uncertainty about the economic, industrial and political implications of the referendum, not only in Britain but across Europe. Although equity markets have proven resilient, which has had a positive impact on the comparative valuations of the unlisted companies in the Company's portfolio, there have already been some indications that the uncertainty is affecting corporate activity.
Although political and economic uncertainty persists, making predictions as to the future prospects of the corporate sector especially hard at present, your Board continues to believe that the best private equity managers will continue to generate strong positive returns for investors over the long term and that the Company is uniquely well positioned to capture these returns for investors.
It is reassuring, in these circumstances, that the Company's portfolio has continued to benefit from strong underlying trading and a positive flow of realisations as companies it is invested in are sold by the managers of the funds that make up the portfolio. In the year to September, these realisations totalled GBP126.9 million compared to GBP106.7 million in the prior year. Against this, GBP66.2 million was drawn down from the Company's resources to fund investee companies. This compares to GBP63.1 million in the previous year.
As a result of the strong net cash flow from the portfolio, the Manager, SL Capital Partners, has worked hard to ensure that the Company's resources are deployed efficiently. The Manager has continued to make new commitments to high quality funds which will deploy cash over the coming years and build value for the future and has increased the Company's focus on acquiring fund positions in the secondary market. At times, the Manager has deployed a proportion of the Company's cash pending investment in private equity funds in equity index tracker funds. While the capability is maintained, given the current market uncertainties the Company currently holds no such investments. The net effect is that, as at the end of September, the Company had net liquid resources of GBP105.9 million, up from GBP69.4 million a year before, and total outstanding commitments to make future investments of GBP305.9 million, compared to GBP245.8 million previously.
SL Capital Partners has been incentivised by a success-based incentive fee. The incentive fee had a set five year life which expired at the end of the financial year. The strong growth in the Company's value meant that the Manager exceeded the agreed performance hurdle, and triggered a payment under the incentive fee scheme of GBP6.4 million.
The Board is in the process of finalising new fee arrangements with the Manager and has negotiated the adoption of a single management fee of 0.95% of net asset value to replace the previous management fee and incentive fee. The Board believes the new fee structure delivers value for shareholders.
Although the returns generated by the Company have been strong, its shares have persistently traded at a discount to its net asset value. As at the end of September this discount was 22.8%, and it averaged 26.7% through the year. Although this phenomenon is consistent with the Company's private equity investment trust peer group, it is a frustration to the Board and we regularly assess opportunities to address the scale of the discount. We have used the opportunity afforded by a high discount to buy back 2,030,000 of the Company's shares for cancellation during the year. The average discount on these buybacks was 29.4%.
Furthermore, the Board believes that providing a strong, stable dividend is attractive to shareholders. To that end, the decision has been taken to increase the annual dividend to 12.0 pence per share, for the year ending 30 September 2017, equating to a yield of approximately 3.5% on net asset value per ordinary share. The Board is committed to maintaining the real value of this new enhanced dividend and growing it at least in line with inflation, in the absence of unforeseen circumstances. In line with the current dividend policy, the Board has proposed a final dividend, for the year ended 30 September 2016, of 3.6 pence per share equating to an annual dividend of 5.4 pence per share.
Following an in depth strategic review, the Board has also concluded that it would be beneficial to increase the private equity opportunity set available to the Manager, by removing the current size restrictions and broadening the geographic reach on private equity investments in the Company's investment policy. In addition, to maximise the returns on cash held pending investment in private equity funds, a product of the Company's over-commitment strategy, the Board recommends broadening the investment policy in regard to cash management to incorporate listed direct private equity investments, to be utilised opportunistically in suitably liquid investment companies. The Board is proposing at the Annual General Meeting that shareholders approve the requisite amendments to the investment policy to action these changes.
The key outcome of these changes is that the Manager will be able to invest in the leading private equity buyout funds regardless of size and with additional geographic freedom, thereby enhancing the overall exposure to the private equity asset class. The intention is to increase the private equity opportunity set without diluting the strategy and focus. Shareholders should not expect a radical shift in the composition of the Company's portfolio, which will remain conviction oriented with a European focus.
The Board believes that the combination of changes outlined above should, over time, help deliver strong returns to shareholders and enhance the attractiveness of the Company to new investors. Finally, to reflect this and the broader investment universe available to the Manager, the Board is recommending a change in the Company's name to Standard Life Private Equity Trust PLC.
Details of these proposed changes will be included in the circular distributed with the Report and Financial Statements.
Edmond Warner, OBE
Chairman
2 December 2016
PRINCIPAL RISKS AND UNCERTAINTIES
The principal risks facing the Company relate to the Company's investment activities and include the following:
-- market risk; -- currency risk; -- over-commitment risk; -- liquidity risk; -- credit risk; -- interest rate risk; and -- operating and control environment risk
Information on each of these risks, and an explanation of how they are managed, is contained in the Company's Annual Report.
DIRECTORS' RESPONSIBILITY STATEMENT
The directors are responsible for preparing the Annual Report, the Directors' Remuneration Report and the financial statements 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 financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Generally Accepted Accounting Practice), including FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland. 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 Company and of the profit or loss of the Company 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 UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements respectively; 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 enable them to ensure that the financial statements and the Directors' Remuneration Report comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The directors consider that the annual 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 and performance, business model and strategy. In reaching this conclusion the directors have assumed that the reader of the annual report and accounts has a reasonable level of knowledge of the investment industry.
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.
Each of the directors confirm that, to the best of their knowledge:
-- the financial statements, which have been prepared in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Generally Accepted Accounting Practice), including FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and applicable law, give a true and fair view of the assets, liabilities, financial position and profit of the Company as at 30 September 2016;
-- the directors' report includes a fair review of the development and performance of the business and the position of the Company, together with a description of the principal risks and uncertainties that it faces; and
-- the Annual Report and Financial Statements, taken as a whole is fair, balanced and understandable and provides the information necessary to assess the Company's position and performance, business model and strategy.
For Standard Life European Private Equity Trust PLC
Edmond Warner OBE
Chairman
2 December 2016
STATEMENT OF COMPREHENSIVE INCOME (audited)
for the year ended 30 September 2016
Hot Features
Premium
Revenue Capital Total
GBP'000 GBP'000 GBP'000
Total capital gains on investments - 100,041 100,041
Currency gains - 8,727 8,727
Income 10,655 - 10,655
Investment management fee (396) (3,563) (3,959)
Incentive fee - (6,447) (6,447)
Administrative expenses (806) - (806)
_________ _________ _________
Profit on ordinary activities
before finance costs and taxation 9,453 98,758 108,211
Finance costs (130) (657) (787)
_________ _________ _________
Profit on ordinary activities
before taxation 9,323 98,101 107,424
Taxation (2,207) 1,434 (773)
_________ _________ _________
Net profit on ordinary activities
after taxation 7,116 99,535 106,651
_________ _________ _________
Net profit per ordinary share 4.59p 64.15p 68.74p
_________ _________ _________
The Total column of this statement represents the
profit and loss account of the Company.
There are no items of other comprehensive income,
therefore this statement is the single statement
of comprehensive income of the Company.
All revenue and capital items in the above statement
are derived from continuing operations.
No operations were acquired or discontinued in
the year.
The dividend which has been recommended based on
this Income Statement is 5.4p (2015 - 5.25p) per
ordinary share.
STATEMENT OF COMPREHENSIVE INCOME (audited)
for the year ended 30 September 2015
Revenue Capital Total
GBP'000 GBP'000 GBP'000
Total capital gains on investments - 40,346 40,346
Currency gains - 495 495
Income 11,917 - 11,917
Investment management fee (342) (3,082) (3,424)
Incentive fee - - -
Administrative expenses (715) - (715)
_________ _________ _________
Profit on ordinary activities
before finance costs and taxation 10,860 37,759 48,619
Finance costs (127) (1,141) (1,268)
_________ _________ _________
Profit on ordinary activities
before taxation 10,733 36,618 47,351
Taxation (1,784) 1,627 (157)
_________ _________ _________
Net profit on ordinary activities
after taxation 8,949 38,245 47,194
_________ _________ _________
Net profit per ordinary share 5.69p 24.35p 30.04p
_________ _________ _________
STATEMENT OF CHANGES IN EQUITY (audited)
For the year
ended Share Capital
30 September
2016
Share premium Special redemption Capital Revenue
capital account reserve reserve reserves reserve Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at
1 October 2015 312 86,485 56,024 89 280,380 15,450 438,740
Profit on ordinary
activities
after taxation - - - - 99,535 7,116 106,651
Buy back of
ordinary shares (5) - (4,521) 5 - - (4,521)
Dividends paid - - - - - (8,238) (8,238)
______ _______ ______ _______ ________ _______ _______
Balance at
30 September
2016 307 86,485 51,503 94 379,915 14,328 532,632
______ _______ ______ _______ ________ _______ _______
For the year
ended Share Capital
30 September
2015
Share premium Special redemption Capital Revenue
capital account reserve reserve reserves reserve Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at
1 October 2014 318 86,485 62,947 83 242,135 17,134 409,102
Profit on ordinary
activities
after taxation - - - - 38,245 8,949 47,194
Buy back of
ordinary shares (6) - (6,923) 6 - - (6,923)
Dividends paid - - - - - (10,633) (10,633)
______ _______ ______ _______ ________ _______ _______
Balance at
30 September
2015 312 86,485 56,024 89 280,380 15,450 438,740
______ _______ ______ _______ ________ _______ _______
STATEMENT OF FINANCIAL POSITION (audited)
As at As at
30 September 30 September
2016 2015
GBP'000 GBP'000 GBP'000 GBP'000
Non-current assets
Investments 433,392 406,332
Current assets
Receivables 774 729
Cash and cash equivalents 105,883 32,099
_________ _________
106,657 32,828
Creditors: amounts falling
due within one year
Payables (7,417) (420)
_________ _________
Net current assets 99,240 32,408
_________ _________
Total assets less current
liabilities 532,632 438,740
_________ _________
Capital and reserves
Called up share capital 307 312
Share premium 86,485 86,485
Special reserve 51,503 56,024
Capital redemption reserve 94 89
Capital reserves 379,915 280,380
Revenue reserve 14,328 15,450
_________ _________
Total shareholders' funds 532,632 438,740
_________ _________
Net asset value per equity
share 346.4p 281.6p
_________ _________
STATEMENT OF CASHFLOWS (audited)
For the year For the year
ended 30 September ended 30 September
as re-stated
2016 2015
GBP'000 GBP'000 GBP'000 GBP'000
Cash flows from operating
activities
Net profit on ordinary
activities after taxation 106,651 47,194
Adjusted for:
Finance costs 787 1,268
Taxation 773 157
Gains on disposal of
investments (57,595) (29,636)
Revaluation of investments (42,446) (10,710)
Currency gains on cash
balances and money market
funds (8,727) (495)
Loan interest receivable (9,107) (10,160)
Dividends receivable (2,155) (2,797)
Loan interest received 9,107 10,160
Dividends received 2,155 2,797
(Increase)/decrease
in debtors (15) 4
Increase in creditors 7,000 235
Tax deducted from non
- UK income (773) (157)
UK Corporation Tax paid (200) -
Interest paid (620) (822)
Loan arrangement fee
paid - (690)
_________ _________
Net cash inflow from
operating activities 4,835 6,348
_________ _________
Investing activities
Purchase of investments (85,540) (106,307)
Disposal of underlying
investments by funds 158,521 106,283
Disposal of fund investments
by way of secondary
sales - 21,661
_________ _________
Net cash inflow from
investing activities 72,981 21,637
Financing activities
Buy back of ordinary
shares (4,521) (7,323)
Ordinary dividends paid (8,238) (10,633)
_________ _________
Net cash outflow from
financing activities (12,759) (17,956)
_________ _________
Cash and cash equivalents
at the end of the year 65,057 10,029
Cash and cash equivalents
at the beginning of
the year 32,099 21,575
Currency gains on cash
and cash equivalents 8,727 495
_________ _________
Cash and cash equivalents
at the end of the year 105,883 32,099
_________ _________
Cash and cash equivalent
consists of:
Money market funds 45,934 -
Cash and short term
deposits 59,949 32,099
_________ _________
Cash and cash equivalents 105,883 32,099
_________ _________
Notes:
1. Standard Life European Private Equity Trust
PLC is an investment company managed by SL Capital
Partners LLP, the ordinary shares of which are
admitted to listing by the UK Listing Authority
and to trading on the London Stock Exchange. It
seeks to conduct its affairs so as to continue
to qualify as an investment trust under section
1158-1165 of the Corporation Taxes Act 2010. The
Board is wholly independent of the Manager and
Standard Life plc.
2. Accounting Policies
(a) Basis of accounting
The financial statements have been prepared in
accordance with the Companies Act 2006, Financial
Reporting Standard 102 and with the Statement of
Recommended Practice 'Financial Statements of Investment
Trust Companies and Venture Capital Trusts'. They
have also been prepared on the assumption that
approval as an investment trust will continue to
be granted. The financial statements have been
prepared on a going concern basis.
These financial statements are the first since
FRS 102 (The Financial Reporting Standard applicable
in the UK and Republic of Ireland) came into effect
for accounting periods beginning on or after 1
January 2015. The impact of adopting FRS 102 did
not require any restatement of balances as at the
transition date, 1 October 2014, or comparative
figures in the Statement of Financial Position
or the Statement of Comprehensive Income. The Company
has chosen to early adopt the Amendments to FRS
102, paragraph 34.22 which revise the disclosure
requirements for financial institutions, specifically
in relation to the fair value hierarchy. These
amendments were approved for issue on 3 March 2016
and are effective for accounting periods beginning
on or after 1 January 2017.
(b) Revenue, expenses and finance costs
Dividends from quoted investments are included
in revenue by reference to the date on which
the price is marked ex-dividend. Income on quoted
investments and other interest receivable are
dealt with on an accruals basis. Dividends and
income from unquoted investments are included
when the right to receipt is established. Dividends
are accounted for as Income from investments
in the Statement of Comprehensive Income. All
expenses are accounted for on an accruals basis.
Incentive fees are recognised in the Statement
of Comprehensive Income as they are earned and
when the return exceeds the specified hurdle
rate.
All expenses are accounted for on an accruals
basis. Expenses are charged through the revenue
account of the Statement of Comprehensive Income
except as follows:
- transaction costs incurred on the purchase
and disposal of investments are recognised as
a capital item in the Statement of Comprehensive
Income;
- the Company charges 90% of investment management
fees and finance costs to capital, in accordance
with the Board's expected long- term split of
returns between capital gains and income from
the Company's investment portfolio. Bank interest
paid has arisen as a consequence of negative
interest rates on Euro cash balances and has
been charged wholly to revenue; and
- any incentive fees payable are allocated
wholly to capital, as they are expected to be
attributable largely, if not wholly, to capital
performance.
(c) Investments
Investments have been designated upon initial
recognition as fair value through profit or
loss. On the date of making a legal commitment
to invest in a fund, such commitment is recorded
and disclosed. When funds are drawn in respect
of such fund commitment the resulting investment
is recognised in the financial statements.
The investment is removed when it is realised
or the fund is wound up. Subsequent to initial
recognition, investments are valued at fair
value as detailed below. Gains and losses arising
from changes in fair value are included in
net profit or loss for the period as a capital
item in the Statement of Comprehensive Income
and are ultimately recognised in the capital
reserves.
Unquoted investments are stated at the directors'
estimate of fair value and follow the recommendations
of the EVCA and the BVCA. The estimate of fair
value is normally the latest valuation placed
on a fund by its manager as at the Statement
of Financial Position date. The valuation policies
used by the manager in undertaking that valuation
will generally be in line with the joint publication
from the EVCA and the BVCA, 'International
Private Equity and Venture Capital Valuation
guidelines'. Where formal valuations are not
completed as at the Statement of Financial
Position date the last available valuation
from the fund manager is adjusted for any subsequent
cash flows occurring between the valuation
date and the Statement of Financial Position
date. The Company's Manager may further adjust
such valuations to reflect any changes in circumstances
from the last manager's formal valuation date
to arrive at the estimate of fair value.
For listed investments, fair value is deemed
to be bid market prices or closing prices for
SETS stocks sourced from the London Stock Exchange.
SETS is the London Stock Exchange electronic
trading service.
(d) Dividends payable
Interim and final dividends are recognised in the
period in which they are paid. Scrip dividends
are recognised in the period in which shares are
issued.
(e) Capital reserves
Share premium - The share premium account represents
the premium above nominal value received by the
Company on issuing shares net of issue costs.
Special reserve - Court approval was given on 27
September 2001 for 50% of the initial premium arising
on the issue of the ordinary share capital to be
cancelled and transferred to a special reserve.
The reserve is a distributable reserve and may
be applied in any manner as a distribution, other
than by way of a dividend.
Capital reserves - Gains or losses on investments
realised in the year that have been recognised
in the Statement of Comprehensive Income are transferred
to the "capital reserve - gains/(losses) on disposal".
In addition, any prior unrealised gains or losses
on such investments are transferred from the "capital
reserve - revaluation" to the "capital reserve
- gains/(losses) on disposal" on the disposal of
the investment. Increases and decreases in the
fair value of investments are recognised in the
Statement of Comprehensive Income and are then
transferred to the "capital reserve - revaluation".
Revenue reserve - The revenue reserve represents
accumulated revenue profits retained by the Company
that have not currently been distributed to shareholders
as a dividend.
(f) Taxation
i) Current taxation - Provision for corporation
tax is made at the current rate on the excess
of taxable income net of any allowable deductions.
ii) Deferred taxation is recognised in respect
of all timing differences that have originated
but not reversed at the Statement of Financial
Position date, where transactions or events
that result in an obligation to pay more or
a right to pay less tax in future have occurred
at the Statement of Financial Position date,
measured on an undiscounted basis and based
on enacted tax rates. This is subject to deferred
tax assets only being recognised if it is considered
more likely than not that there will be suitable
profits from which the future reversal of the
underlying timing differences can be deducted.
Timing differences are differences arising
between the Company's taxable profits and its
results as stated in the accounts which are
capable of reversal in one or more subsequent
periods.
Due to the Company's status as an investment
trust company, and the intention to continue
meeting the conditions required to obtain approval
in the foreseeable future, the Company has
not provided deferred tax on any capital gains
and losses arising on the revaluation or disposal
of investments.
(g) Overseas currencies
Overseas assets and liabilities are translated
at the exchange rate prevailing at the Company's
Statement of Financial Position date. Gains or
losses on translation of investments held at the
year end are accounted for through the Statement
of Comprehensive Income and transferred to capital
reserves. Gains or losses on the translation of
overseas currency balances held at the year end
are also accounted for through the Statement of
Comprehensive Income and transferred to capital
reserves.
Rates of exchange to sterling as at 30 September
were:
2016 2015
Euro 1.1559 1.3570
US dollar 1.2990 1.5148
Transactions in overseas currency are translated
at the exchange rate prevailing on the date
of transaction.
(h) Judgements and key sources of estimation uncertainty
The preparation of financial statements requires
the Company to make estimates and assumptions and
exercise judgements in applying the accounting policies
that affect the reported amounts of assets and liabilities
at the date of the financial statements and the
reported amounts of revenues and expenses arising
during the year. Estimates and judgements are continually
evaluated and based on historical experience and
other factors, including expectations of future
events that are believed to be reasonable under
the circumstances. The area where estimates and
assumptions have the most significant effect on
the amounts recognised in the financial statements
is the determination of fair value of unquoted investments,
as disclosed in note 1(c).
(i) Cash and cash equivalents
Cash comprises bank balances and cash held by the
Company. Cash equivalents comprise AAA money market
funds which are used by the Company to provide additional
short-term liquidity. Cash equivalents are short
term, highly liquid investments that are readily
convertible to known amounts of cash and which are
subject to an insignificant risk of changes in value.
Year to Year to
30 September 30 September
2016 2015
3. Income GBP'000 GBP'000
Income from fund investments 10,338 11,065
Income from index tracker
funds 306 836
Income from cash balances
and money market funds 11 16
______________ ______________
Total income 10,655 11,917
______________ ______________
4. Investment management
and incentive fees
Year to 30 September Year to 30 September
2016 2015
Revenue Capital Total Revenue Capital Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Investment
management fee 396 3,563 3,959 342 3,082 3,424
Incentive fee - 6,447 6,447 - -
______ _______ ______ _______ ________ _______
396 10,010 10,406 342 3,082 3,424
______ _______ ______ _______ ________ _______
The investment management fee payable to the Manager
is 0.8% per annum of the investments and other
assets of the Company and any subsidiaries less
the aggregate of the liabilities of the Company
and any subsidiaries. The investment management
fee is allocated 90% to the realised capital reserve
and 10% to the revenue account. The management
agreement between the Company and the Manager is
terminable by either party on twelve months written
notice.
The Manager is also entitled to an incentive fee
at 30 September 2016. For an incentive fee to be
payable, the Company's net asset value total return
must grow by more than 8% compound per annum (before
any accrual for the incentive fee) over the five
year period to 30 September 2016. The Manager is
entitled to an incentive fee of 10% of the growth
in NAV (before any accrual for the incentive fee)
in excess of the hurdle rate, multiplied by the
number of ordinary shares in issue on 1 October
2011 (adjusted in certain circumstances to reflect
subsequent share issuance and/or a material reduction
in the Company's issued share capital). At 30 September
2016 the net asset value total return was 371.0p
and had exceeded the 8% per annum compound growth
hurdle at the same date of 331.9p.
5. Investments
30 September 2016 30 September 2015
Index Fund Total Index Index Total
tracker Investments GBP'000 tracker tracker GBP'000
funds GBP'000 funds funds
GBP'000 GBP'000 GBP'000
Fair value through
profit or loss:
Opening market
value 37,339 368,993 403,332 39,161 348,462 387,623
Opening investment
holding losses 1,817 32,258 37,075 395 47,390 47,785
______ _______ ______ _______ ________ _______
Opening book
cost 39,156 404,251 443,407 39,556 395,852 435,408
Movements in
the year:
Additions at
cost - 66,193 66,193 9,000 96,522 105,522
Secondary purchases - 19,099 19,099 - - -
Dividends reinvested 248 - 248 785 - 785
Disposal of
underlying investments
by funds (41,384) (117,137) (158,521) (10,500) (95,783) (106,283)
Disposal of
fund investments
by way of secondary
sales - - - - (21,661) (21,661)
______ _______ ______ _______ ________ _______
(1,980) 372,406 370,426 38,841 374,930 413,771
Gains on disposal
of underlying
investments 1,980 56,172 58,152 315 40,725 41,040
Losses on liquidation
of fund investments - (557) (557) - (11,966) (11,966)
Gains on disposal
of fund investments
by way of secondary
sales - - - - 562 562
______ _______ ______ _______ ________ _______
Closing book
cost - 428,021 428,021 39,156 404,251 443,407
Closing investment
holding gains/(losses) - 5,371 5,371 (1,817) (35,258) (37,075)
______ _______ ______ _______ ________ _______
Closing market
value - 433,392 433,392 37,339 368,993 406,332
30 September 2016 30 September 2015
Index Fund Total Index Index Total
tracker Investments GBP'000 tracker tracker GBP'000
funds GBP'000 funds funds
GBP'000 GBP'000 GBP'000
Gains on investments:
Net gains on
disposal of
investments 1,980 55,615 57,595 315 29,321 29,636
Net revaluation
of investments 1,817 40,629 42,446 (1,422) 12,132 10,710
______ _______ ______ _______ ________ _______
3,797 96,244 100,041 (1,107) 41,453 40,436
Transaction costs
During the year expenses were incurred in acquiring
or disposing of investments. These have been expensed
through capital and are included within gains on
investments in the Statement of Comprehensive Income.
The total costs were as follows:
30 September 30 September
2016 2016
GBP'000 GBP'000
Purchases in respect of unquoted
fund investments 30 147
Secondary sales - 30
________ _______
30 177
5. The return per ordinary share figure is based on the net profit for the year ended 30 September 2016 of GBP105,115,000 (year ended 30 September 2015: net profit of GBP47,194,000) and on 155,155,447 (year ended 30 September 2015: 157,081,338) ordinary shares, being the weighted average number of Ordinary shares in issue during the respective periods.
6. The number of ordinary shares in issue as at 30 September 2016 was 153,746,294 (30 September 2015 - 155,776,294).
7. An interim dividend of 1.80p (2015 - 1.75p) per ordinary share was paid on 15 July 2016. The Directors recommend that a final dividend of 3.6p (2015 - 3.5p) per ordinary share be paid on 27 January 2017 to shareholders on the Company's share register as at the close of business on 23 December 2016.
8. The financial information set out in this announcement does not constitute statutory financial statements within the meaning of Section 435 of the Companies Act 2006 in respect of the financial statements for the year ended 30 September 2016. The statutory financial statements for the year ended 30 September 2015, upon which the Company's auditors have given a report that was unqualified and did not contain a statement under either section 498(2) or section 498(3) of the Companies Act 2006, have been delivered to the Registrar of Companies.
The financial information in this announcement is consistent with that in the audited statutory financial statements for the year ended 30 September 2016. The contents of the announcement have been extracted from the audited financial statements that have been approved and signed by the directors and upon which the auditor has signed an unqualified auditor's report. The audited financial statements for the year ended 30 September 2016 will be delivered to the Registrar of Companies following the Company's Annual General Meeting, which will be held at The Balmoral Hotel, 1 Princes Street, Edinburgh EH2 2EQ on 24 January 2017 at 12.30pm.
9. The report and accounts for the year ended 30 September 2016 will be posted to shareholders in mid-December 2016 and copies will be available from the Company Secretary - Maven Capital Partners UK LLP, Kintyre House, 205 West George Street, Glasgow, G2 2LW.
for Standard Life European Private Equity Trust PLC,
Maven Capital Partners UK LLP, Company Secretary
END
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR UUSBRNOAURAA
(END) Dow Jones Newswires
December 05, 2016 02:45 ET (07:45 GMT)
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