TIDMARCL
RNS Number : 7813H
Altus Resource Capital Limited
26 February 2010
from date of incorporation (30 April 2009) to 31 December 2009 (Unaudited)
SUMMARY INFORMATION
Company Overview
Overview
Altus Resource Capital Limited (LSE:ARCL) (the "Company") is a Guernsey
registered, closed-ended investment company incorporated on 30 April 2009, and
listed on the Specialist Fund Market of the London Stock Exchange on 30 June
2009 and the Channel Islands Stock Exchange on 22 December 2009.
The Company is managed by Altus Asset Management Limited (the "Investment
Manager"), a subsidiary of the Company.
The Company issued 26,000,000 shares at GBP1.00 per share on 30 June 2009 and a
further 10,997,233 at GBP1.33 on 22 December 2009.
Investment Objectives and Policy
The Company's objective is to realise capital growth from a concentrated
portfolio of junior resource equities and to generate a significant capital
return to shareholders.
The Company invests in companies engaged in the exploration, development and/or
mining of metals and minerals with a focus on companies that operate in the gold
sector. Portfolio companies will be predominantly, but not exclusively, listed
or quoted on either UK markets or other recognised stock exchanges including the
Canadian and Australian markets and typically will be capitalised at less than
GBP100 million at the time of investment.
FINANCIAL HIGHLIGHTS
+------+------+--+----------+--------+-------+--------+--------+--------+--------+-----+--------+
| Monthly Performance | | |
+ +-----+--------+
| | | |
+--------------------------------------------------------------------------------+-----+--------+
| | | | | | | | | | | |
+------+---------+----------+--------+-------+--------+--------+--------+--------+-----+--------+
| Monthly change at | Jul | Aug | Sep | Oct | Nov | Dec | | 6 |
| end: | | | | | | | | months |
+---------------------------+--------+-------+--------+--------+--------+--------+-----+--------+
| ARC | | | 0.09% | 1.96% | 13.56% | 4.56% | 14.43% | -2.06% | | 35.81% |
| (NAV/Share) | | | | | | | | | | |
+-------------+--+----------+--------+-------+--------+--------+--------+--------+-----+--------+
| Gold | | | 2.30% | 0.32% | 5.55% | 3.18% | 12.87% | -6.38% | | 18.09% |
| ($/oz) | | | | | | | | | | |
+-------------+--+----------+--------+-------+--------+--------+--------+--------+-----+--------+
| FTSE Gold | | 3.60% | 1.04% | 10.00% | -4.45% | 17.41% | -8.54% | | 18.14% |
| Mines Index | | | | | | | | | |
+----------------+----------+--------+-------+--------+--------+--------+--------+-----+--------+
| S&P/TSX | | -0.61% | 2.37% | 7.38% | -6.59% | 13.94% | -7.28% | | 7.82% |
| Gold Index | | | | | | | | | |
+----------------+----------+--------+-------+--------+--------+--------+--------+-----+--------+
| | | | | | | | | | | | |
+------+------+--+----------+--------+-------+--------+--------+--------+--------+-----+--------+
| Note: The table above sets out the performance of the gold price and a |
| number of mining market indices. These metrics illustrate the performance |
| of the mining sector in general and are not direct benchmarks for the |
| Company given the composition of its portfolio. |
+------+------+--+----------+--------+-------+--------+--------+--------+--------+-----+--------+
+----------+----------+----------+----------+----------+----------+----------+
| At end | Jul-09 | Aug-09 | Sep-09 | Oct-09 | Nov-09 | Dec-09 |
+----------+----------+----------+----------+----------+----------+----------+
| NAV / | GBP0.950 | GBP0.970 | GBP1.101 | GBP1.151 | GBP1.317 | GBP1.290 |
| Share | | | | | | |
+----------+----------+----------+----------+----------+----------+----------+
| | | | | | | |
+----------+----------+----------+----------+----------+----------+----------+
Source - Altus Asset Management Limited
CHAIRMAN'S STATEMENT AND INTERIM MANAGEMENT REPORT
I have pleasure in presenting the first Half-Yearly Financial Report of Altus
Resource Capital Limited for the period ended 31 December 2009 (the "Period").
It has been an exciting start to the life of the Company, with a stellar
performance, allowing the Company to raise further equity within six months of
its initial listing. On behalf of the Board of directors, I thank all
shareholders for their support.
During the first six months following the Company's listing on 30 June 2009, the
resource sector continued to perform well and the Company, with a focus on
junior companies, was able to capitalise on this.
The Company's unaudited Net Asset Value (the "NAV") at the end of December 2009
was GBP47.7 million or 129.0 pence per share, an increase of 35.8% since launch
on 30 June 2009. The Company benefited from the strength of the gold price,
which gained 18.1% over the period to end the period at US$1,099/oz. By the end
of the Period the Company was 53.6% invested in gold equities and gold-backed
Exchange Traded Funds with these investments being the primary driver behind the
increase in the Company's NAV.
Following the initial placing of 26 million shares at 100 pence per share which
was concluded in June, the Company undertook a secondary placing in December
2009, issuing 10,997,233 shares at 133.37 pence per share to raise a total of
GBP14.7 million. At the end of December 2009 the Company held GBP14.7 million in
cash.
With the current cash position and the continued strength in gold and other
metal prices, the outlook for the Company remains positive.
A description of the important events that have occurred during the Period and
their impact on the condensed set of financial statements is included in the
Investment Manager's Report on pages 4 to 6, and includes a description of the
principal risks and uncertainties, along with Note 13 in the financial
statements. Details of all related party transactions are given in Note 14.
Other than the information set out in this report, the Board is not aware of any
events during the period to 31 December 2009, which would have had a material
impact on the financial position of the Company.
Nick Falla
Chairman
INVESTMENT MANAGER'S REPORT
Altus Resource Capital Limited has enjoyed a buoyant market in the six months
since its launch following the market meltdown of 2008. The Company benefited
from its exposure to the junior resource sector which continued to rebound well
and in particular junior gold equities which responded to the rise in the gold
price, which reached new highs during the Period.
The Company's strategy to deploy cash rapidly paid off with the market gaining
momentum during the Period. Over the Period a total of 30 investments were made
in junior resource equities and one of these positions was profitably fully
exited. Further investments were made in both gold and platinum exchange traded
funds ("ETFs"). The ETFs are highly liquid and therefore represent quasi-cash
holdings but offer direct exposure to the underlying commodity. The Company has
acquired its positions primarily through the secondary market and also through
participating in new equity issues.
Following the successful secondary placing in December, the Company's cash
position was increased to GBP14.7 million. In line with its stated investment
objectives, the Company has invested in junior resource equities with a focus on
gold production and development companies.
Outlook
The outlook for the Company remains positive with continued strength in the gold
price, which has maintained its level above the psychologically important
US$1,000/oz since early October. In addition, M&A activity is increasing both
within gold and other resource sectors. Following the mid-tier acquisitions of
Moto Goldmines by Randgold and Sino Gold by Eldorado, further consolidation of
the gold sector seems inevitable and is starting to spread to the junior market
and other commodities. Two gold equities have been the subject of take-over
speculation and a further gold holding, Allied Gold Ltd has acquired junior
developer, Australian Solomons Gold. In addition, Kiwara plc, an AIM listed
copper explorer with assets in Zambia, received and accepted a cash and share
offer for the company by First Quantum Minerals which, following the end of the
Period, realised a significant uplift in value for the Company and afforded an
exit.
This trend for strength in gold and other commodity prices is expected to
continue. Resource equities, which continue to trade at a discount to their fair
value, will perform strongly in this environment, supported by the strength of
the underlying commodity prices and increasing consolidation within the sector.
Principal Risks and Uncertainties
The Company is focused on investing in junior resources companies and is
therefore subject to the risks associated with concentrating its investments in
this asset class. The performance of the Company will be affected by the
performance of the securities of investee companies and is thus subject to the
sharp price volatility of shares of companies principally engaged in activities
related to metals and minerals. Historically the prices of the commodities have
fluctuated significantly and are affected by numerous factors which the Company
cannot predict or control. Political and economic conditions in metal and
mineral producing countries may have a direct effect on the mining and
production of these metals and minerals, and consequently, on their prices. In
addition, the Company has invested, and will continue to invest in companies
with assets or operations in emerging or developing markets and will
consequently be exposed to various increased risks associated with investing in
such markets.
Investment allocation
At 31 December 2009, the Company's assets were allocated in the following
approximate proportions:
STATEMENT OF DIRECTORS' RESPONSIBILITIES IN RESPECT OF THE FINANCIAL STATEMENTS
The Board of directors jointly and severally confirm that, to the best of their
knowledge:
(a) The financial statements, prepared in accordance with International
Financial Reporting Standards, give a true and fair view of the assets,
liabilities, financial position and profit or loss of the Company; and
(b) This Interim Management Report includes or incorporates by reference:
(i) an indication of important events that have occurred during the
first six months of the financial year and their impact on the financial
statements;
(ii) a description of the principal risks and uncertainties for the
remaining six months of the financial year;
(iii) confirmation that there were no related party transactions in the
first six months of the current financial year that have materially affected the
financial position or the performance of the Company during that period; and
(iv) changes in the related parties transactions described in the last
annual report that could have a material effect on the financial position or
performance of the Company in the first six months of the current financial
year.
Signed on behalf of the Board of Directors on 25 February 2010
Nick Falla
Robert Milroy
Chairman
Director
DIRECTORS
Nicholas J Falla: Chairman (non-executive)
Nicholas Falla has had thirty years of experience in the finance industry
including thirteen years of experience in commodity markets. He is currently the
Managing Director of Xocoatl Limited, a private investment company taking
strategic proprietary positions in the commodities markets; a senior
non-executive director of MW Tops Limited, a closed-ended investment company
listed on the London Stock Exchange; and the non-executive chairman of Close
Enhanced Commodities Fund Limited, a company which provides structured
investment in the commodities markets. From 1993-2000 Nicholas worked as the
financial controller for Bank of Bermuda (Guernsey) Limited and from 2000 to
2002 he was their regional controller for Europe. In addition he has acted as an
interim financial director for the Guernsey banking operation of Credit Suisse
Guernsey Limited and has worked on various finance and accounting based projects
with companies such as KPMG (Channel Islands) and the Health Xchange Limited.
Nicholas trained as an accountant with Turquands Barton Mayhew & Co in Guernsey.
David Gelber: Director (non-executive)
David Gelber began his career in trading in 1976 when he joined Citibank in
London. He has since held a variety of senior trading positions, in derivatives
in particular, working for Citibank, Chemical Bank and HSBC, where he was Chief
Operating Officer of HSBC Global Markets. In 1994 he joined ICAP, an
inter-dealer broker, as COO and assisted in implementing two mergers, first with
Exco Plc and then with Garban Plc. David remains a consultant to ICAP Plc.
Furthermore, David currently serves as a non-executive director on the board of
eSecLending, GlobeOp Financial Services SA and Walker Crips Group PLC. David is
also currently a non executive director of DDCAP Limited, a leading arranger of
Islamic banking transactions and of Exotix Limited, an investment banking
boutique specialising in illiquid bonds, loans, equities, structured finance,
capital raising and asset management. He is also currently a non-executive
director of Intercapital Private Group Limited, a holding company invested in
ICAP plc and CityIndex Limited, a spread-betting and contracts for difference
provider; David has a B.Sc in statistics and law from the University of
Jerusalem and an M.Sc in computer science from the University of London.
Robert Milroy: Director (non-executive)
Robert Milroy is a director of the Corazon Capital Group and for the last 12
years has been the Managing Director of Corazon Fund Management Limited, a
Guernsey regulated investment management and stock-broking company. He has over
35 years experience in the investment and mining and petroleum industries having
participated in various mining, oil exploration projects and financings in
Chile, Peru, Argentina, Ghana, Canada, USA, Mexico, Australia and Greenland. In
addition, for the last 12 years he has been the Managing Director of Eagle
Drilling Inc., a firm that specialises in hard rock core drilling in Central and
Western Africa. Robert is also a noted speaker and financial author, having
written the Standard & Poor's Guide to Offshore Investment Funds. Robert
graduated with a Bachelor of Commerce (Honours) from the University of Manitoba.
David Netherway (non-independent non-executive)
David Netherway is a mining engineer with over 30 years of experience in the
mining industry and is the CEO of Shield Mining Ltd., an Australian listed
exploration company. David was involved in the construction and development of
the Iduapriem, Siguiri and Kiniero gold mines in West Africa and has mining
experience in Africa, Australia, China, Canada, India and the Former Soviet
Union. David served as the CEO of Toronto listed Afcan Mining Corporation, a
China focused gold mining company that was sold to Eldorado Gold in 2005. David
has also held senior management positions in a number of gold mining companies,
including Golden Shamrock Mines, Ashanti Goldfields and Semafo Inc. He is
currently the Chairman of GMA Resources plc and African Aura Mining Inc and a
director of the KazakhGold Group Limited. David is also the current
non-executive chairman of Altus Strategies and is thus not considered an
independent director of the Company.
STATEMENT OF COMPREHENSIVE INCOME
for the period from 30 April 2009 (date of incorporation) to 31 December 2009
+--------------------------------------+-------+----------+-------------+
| | | | 30 Apr |
| | | | 2009 to |
| | | | 31 Dec |
| | | | 2009 |
+--------------------------------------+-------+----------+-------------+
| |Notes | | GBP |
+--------------------------------------+-------+----------+-------------+
| | | | |
+--------------------------------------+-------+----------+-------------+
| Net movement in unrealised | 5 | | 8,446,711 |
| appreciation on investments | | | |
+--------------------------------------+-------+----------+-------------+
| | | | |
+--------------------------------------+-------+----------+-------------+
| Operating income | | | 20,872 |
+--------------------------------------+-------+----------+-------------+
| | | | |
+--------------------------------------+-------+----------+-------------+
| Profit on disposal of investments | 5 | | 1,506,766 |
+--------------------------------------+-------+----------+-------------+
| | | | |
+--------------------------------------+-------+----------+-------------+
| Operating expenses | 2 | | (1,128,006) |
+--------------------------------------+-------+----------+-------------+
| | | | |
+--------------------------------------+-------+----------+-------------+
| Net gain for the period attributable | | | 8,846,343 |
| to shareholders | | | |
+--------------------------------------+-------+----------+-------------+
| | | | |
+--------------------------------------+-------+----------+-------------+
| | | | |
+--------------------------------------+-------+----------+-------------+
| Earnings per share for the period | | | |
+--------------------------------------+-------+----------+-------------+
| - Basic and Diluted | 4 | | 0.33 |
+--------------------------------------+-------+----------+-------------+
In arriving at the results for the financial period, all amounts above relate to
continuing operations.
There are no recognised gains or losses for the period other than those
disclosed above.
There is no other comprehensive income for the period.
The notes on pages 14 to 26 form an integral part of these financial statements.
STATEMENT OF FINANCIAL POSITION
as at 31 December 2009
+--------------------------------------+-------+----------+------------+
| | | | 31 Dec |
| | | | 2009 |
+--------------------------------------+-------+----------+------------+
| |Notes | | GBP |
+--------------------------------------+-------+----------+------------+
| NON-CURRENT ASSETS | | | |
+--------------------------------------+-------+----------+------------+
| Financial assets designated as at | | | |
| fair value through profit or loss | 5 | | 34,872,601 |
+--------------------------------------+-------+----------+------------+
| | | | |
+--------------------------------------+-------+----------+------------+
| CURRENT ASSETS | | | |
+--------------------------------------+-------+----------+------------+
| Cash at bank | | | 14,728,524 |
+--------------------------------------+-------+----------+------------+
| Receivables | 7 | | 8,786 |
+--------------------------------------+-------+----------+------------+
| | | | 14,737,310 |
+--------------------------------------+-------+----------+------------+
| | | | |
+--------------------------------------+-------+----------+------------+
| TOTAL ASSETS | | | 49,609,911 |
+--------------------------------------+-------+----------+------------+
| | | | |
+--------------------------------------+-------+----------+------------+
| CURRENT LIABILITIES | | | |
+--------------------------------------+-------+----------+------------+
| Payables - due within one year | 8 | | 1,117,901 |
+--------------------------------------+-------+----------+------------+
| | | | 1,117,901 |
+--------------------------------------+-------+----------+------------+
| | | | |
+--------------------------------------+-------+----------+------------+
| NON-CURRENT LIABILITIES | | | |
+--------------------------------------+-------+----------+------------+
| Payables - due after one year | 9 | | 761,004 |
+--------------------------------------+-------+----------+------------+
| | | | |
+--------------------------------------+-------+----------+------------+
| TOTAL LIABILITIES | | | 1,878,905 |
+--------------------------------------+-------+----------+------------+
| | | | |
+--------------------------------------+-------+----------+------------+
| NET ASSETS | | | 47,731,006 |
+--------------------------------------+-------+----------+------------+
| | | | |
+--------------------------------------+-------+----------+------------+
| EQUITY | | | |
+--------------------------------------+-------+----------+------------+
| Share premium | 11 | | 38,884,663 |
+--------------------------------------+-------+----------+------------+
| Revenue reserve | | | 8,846,343 |
+--------------------------------------+-------+----------+------------+
| | | | |
+--------------------------------------+-------+----------+------------+
| TOTAL EQUITY | | | 47,731,006 |
+--------------------------------------+-------+----------+------------+
| | | | |
+--------------------------------------+-------+----------+------------+
| | | | Pence |
+--------------------------------------+-------+----------+------------+
| Net asset value per Ordinary Share | | | |
| based on 36,997,233 shares in issue | | | 129.01 |
+--------------------------------------+-------+----------+------------+
The unaudited financial statements were approved by the Board of Directors on 25
February 2010 and signed on its behalf by:
Nick Falla
Robert Milroy
Chairman
Chairman of Audit Committee
he notes on pages 14 to 26 form an integral part of these financial statements.
STATEMENT OF CASH FLOWS
For the period from 30 April 2009 (date of incorporation) to 31 December 2009
+--------------------------------------+-------+----------+--------------+
| | | | 30 Apr |
| | | | 2009 to |
| | | | 31 Dec |
| | | | 2009 |
+--------------------------------------+-------+----------+--------------+
| |Notes | | GBP |
+--------------------------------------+-------+----------+--------------+
| OPERATING ACTIVITIES | | | |
+--------------------------------------+-------+----------+--------------+
| Net gain for the period attributable | | | 8,846,343 |
| to shareholders | | | |
+--------------------------------------+-------+----------+--------------+
| Less: Unrealised appreciation on | | | (8,446,711) |
| investments | | | |
+--------------------------------------+-------+----------+--------------+
| Less: Interest received | | | (20,872) |
+--------------------------------------+-------+----------+--------------+
| Add: Increase in payables | | | 1,878,905 |
+--------------------------------------+-------+----------+--------------+
| Less: Increase in receivables | | | (8,786) |
+--------------------------------------+-------+----------+--------------+
| Less: Unrealised gains on | | | (1,506,766) |
| investments | | | |
+--------------------------------------+-------+----------+--------------+
| | | | |
+--------------------------------------+-------+----------+--------------+
| NET CASH INFLOW FROM OPERATING | | | 742,113 |
| ACTIVITIES | | | |
+--------------------------------------+-------+----------+--------------+
| | | | |
+--------------------------------------+-------+----------+--------------+
| INVESTING ACTIVITIES | | | |
+--------------------------------------+-------+----------+--------------+
| Interest received | | | 20,872 |
+--------------------------------------+-------+----------+--------------+
| Purchase of investments | 5 | | (30,185,090) |
+--------------------------------------+-------+----------+--------------+
| Sale of investments | 5 | | 5,265,966 |
+--------------------------------------+-------+----------+--------------+
| | | | |
+--------------------------------------+-------+----------+--------------+
| NET CASH OUTFLOW FROM INVESTING | | | (24,898,252) |
| ACTIVITIES | | | |
+--------------------------------------+-------+----------+--------------+
| | | | |
+--------------------------------------+-------+----------+--------------+
| FINANCING ACTIVITIES | | | |
+--------------------------------------+-------+----------+--------------+
| | | | |
+--------------------------------------+-------+----------+--------------+
| Proceeds from issue of shares | | | 40,667,020 |
+--------------------------------------+-------+----------+--------------+
| Issue costs | | | (1,782,357) |
+--------------------------------------+-------+----------+--------------+
| | | | |
+--------------------------------------+-------+----------+--------------+
| NET CASH INFLOW FROM FINANCING | | | 38,884,663 |
| ACTIVITIES | | | |
+--------------------------------------+-------+----------+--------------+
| | | | |
+--------------------------------------+-------+----------+--------------+
| CASH AND CASH EQUIVALENTS AT | | | |
| BEGINNING OF PERIOD | | | - |
+--------------------------------------+-------+----------+--------------+
| | | | |
+--------------------------------------+-------+----------+--------------+
| Increase in cash and cash | | | 14,728,524 |
| equivalents | | | |
+--------------------------------------+-------+----------+--------------+
| | | | |
+--------------------------------------+-------+----------+--------------+
| CASH AND CASH EQUIVALENTS AT END OF | | | 14,728,524 |
| PERIOD | | | |
+--------------------------------------+-------+----------+--------------+
The notes on pages 14 to 26 form an integral part of these financial statements.
STATEMENT OF CHANGES IN EQUITY
For the period from 30 April 2009 (date of incorporation) to 31 December 2009
+-----------------------+---------+----------+-------------+----------+-------------+----------+-------------+
| | Share | | Share | | Accumulated | | Total |
| | Capital | | Premium | | Profits | | |
+-----------------------+---------+----------+-------------+----------+-------------+----------+-------------+
| | GBP | | GBP | | GBP | | GBP |
+-----------------------+---------+----------+-------------+----------+-------------+----------+-------------+
| | | | | | | | |
+-----------------------+---------+----------+-------------+----------+-------------+----------+-------------+
| Balance as at 30 | - | | - | | - | | - |
| April 2009 | | | | | | | |
+-----------------------+---------+----------+-------------+----------+-------------+----------+-------------+
| | | | | | | | |
+-----------------------+---------+----------+-------------+----------+-------------+----------+-------------+
| Net gain for the | - | | - | | 8,846,343 | | 8,846,343 |
| period | | | | | | | |
+-----------------------+---------+----------+-------------+----------+-------------+----------+-------------+
| | | | | | | | |
+-----------------------+---------+----------+-------------+----------+-------------+----------+-------------+
| Issue costs | - | | (1,782,357) | | - | | (1,782,357) |
+-----------------------+---------+----------+-------------+----------+-------------+----------+-------------+
| | | | | | | | |
+-----------------------+---------+----------+-------------+----------+-------------+----------+-------------+
| Share issue | - | | 40,667,020 | | - | | 40,667,020 |
+-----------------------+---------+----------+-------------+----------+-------------+----------+-------------+
| | | | | | | | |
+-----------------------+---------+----------+-------------+----------+-------------+----------+-------------+
| Balance as at 31 | - | | 38,884,663 | | 8,846,343 | | 47,731,006 |
| December 2009 | | | | | | | |
+-----------------------+---------+----------+-------------+----------+-------------+----------+-------------+
The notes on pages 14 to 26 form an integral part of these financial statements.
NOTES TO THE FINANCIAL STATEMENTS
for the period from 30 April 2009 (date of incorporation) to 31 December 2009
1 ACCOUNTING POLICIES
The significant accounting policies adopted by the Company are as follows:
(a) Basis of preparation and going concern
The financial statements have been prepared in conformity with International
Financial Reporting Standards ("IFRS") as adopted by the EU which comprise
standards and interpretations approved by the International Accounting Standards
Board and International Financial Reporting Interpretations Committee and
applicable Guernsey law. The financial statements have been prepared on a
historical cost basis except for the measurement at fair value of certain
financial instruments.
Amendment to IFRS 7 were issued by the International Standards Board in March
2009, effective for annual periods beginning on or after 1 January 2009. The
amendment to IFRS 7 requires fair value to be disclosed by the source of inputs,
using a three-level hierarchy:
Quoted prices (unadjusted) in active markets for identical assets or liabilities
(Level 1);
Inputs other than quoted prices included in Level 1 that are observable for the
asset or liability, either directly (as prices) or indirectly (derived from
prices) (Level 2);
Inputs for the assets or liability that are not based on observable market data
(unobservable inputs) (Level 3).
The following Standards or Interpretations that are expected to affect the
Company have been issued but not yet adopted by the Company as shown below.
Other Standards or Interpretations issued by the International Accounting
Standards Board and the International Financial Reporting Interpretations
Committee are not expected to affect the Company:
IFRS 2 (revised April 2009) Share-based Payment effective for annual periods
beginning on or after 1 January 2010.
IFRS 3 (revised 2008) Business Combinations effective for annual periods
beginning on or after 1 July 2009.
IAS 27 (revised 2008) Consolidated and Separate Financial Statements effective
for annual periods beginning on or after 1 July 2009.
IAS 28 (revised 2008) Investments in Associates effective for annual periods
beginning on or after 1 July 2009.
IAS 31 (revised 2008) Interests in Joint Ventures effective for annual periods
beginning on or after 1 July 2009.
IAS 39 (revised July 2008) Financial Instruments: Recognition and Measurement
for annual periods beginning on or after 1 July 2009.
The Directors have considered the above and are of the opinion that these
Standards and Interpretations are not expected to have an impact on the
Company's financial statements except for the presentation of additional
disclosures and changes to the presentation of components of the financial
statements. These items will be applied in the first financial period for which
they are required.
(b) Going concern
The Company has adequate financial resources and as a consequence, the Directors
believe the Company is well placed to manage its business risks successfully
despite the current economic climate. After making enquiries, the directors
have a reasonable expectation that the Company has adequate resources to
continue in operational existence for the foreseeable future. Accordingly, the
directors have adopted the going concern basis in preparing the financial
statements.
(c) Taxation
The Company has been granted exemption under the Income Tax (Exempt Bodies)
(Guernsey) Ordinance, 1989 from Guernsey Income Tax, and is charged an annual
fee of GBP600. The Guernsey system of corporate taxation is currently under
review.
(d) Expenses
All expenses are accounted for on an accruals basis.
(e) Interest income
Interest income is accounted for on an accruals basis.
(f) Cash and cash equivalents
Cash at bank and short term deposits which are held to maturity are carried at
cost. Cash and cash equivalents are defined as call deposits, short term
deposits and highly liquid investments readily convertible to known amounts of
cash and subject to insignificant risk of changes in value. For the purposes of
the Statement of Cash Flow, cash and cash equivalents consist of cash and
deposits at bank.
(g) Investments
All investments and derivative financial instruments have been designated as
financial assets "at fair value through profit and loss". Investments are
initially recognised on the date of purchase at cost, being the fair value of
the consideration given, excluding transaction costs associated with the
investment. After initial recognition, investments are measured at fair value,
with unrealised gains and losses on investments and impairment of investments
recognised in the Statement of Comprehensive Income.
Fair value is the amount for which the financial instruments could be exchanged,
or a liability settled, between knowledgeable willing parties in an arms length
transaction. Fair value also reflects the credit quality of the issuers of the
financial instruments.
For investments actively traded in organised financial markets, fair value is
determined by reference to Stock Exchange quoted market bid prices as at the
close of business on the statement of financial position date.
Valuations of unquoted trade investments are based on valuations provided to the
Company by Altus Asset Management Limited. These valuations are intended to be
an indication of the fair value of those investments, where applicable using the
Black-Scholes option pricing model, designed to reflect the best estimation of
the price at which they could be sold, even though there is no guarantee that a
willing buyer might be found if the Company chose to sell the relevant
investment.
The indicative fair values of the investments are based on an approximation of
the market level of the investments. As the investments are not traded in an
active market, the indicative fair value is determined by using valuation
techniques. Altus Asset Management Limited uses a variety of methods and makes
assumptions that are based on market conditions existing at the statement of
financial position date.
Different assumptions regarding these factors, combined with different valuation
techniques and models used, could lead to different valuations of the financial
instruments produced by different parties.
As detailed in note 6 the other investments relate to the Company's investment
in Altus Asset Management Limited and the put/call options thereon. As the
intention of the directors is to transfer the investment for nominal value, the
directors believe the fair value of the investment and the put/call options
thereon are negligible.
(h) Trade date accounting
All "regular way" purchases and sales of financial assets are recognised on the
"trade date", i.e. the date that the entity commits to purchase or sell the
asset. Regular way purchases or sales are purchases or sales of financial
assets that require delivery of the asset within the time frame generally
established by regulations or convention in the market place.
(i) Segmental reporting
The directors are of the opinion that the Company is engaged in a single segment
of business, being investment business.
2 OPERATING EXPENSES
+---------------------------------------+----------+------------+
| | | 30 Apr |
| | | 2009 to 31 |
| | | Dec 2009 |
+---------------------------------------+----------+------------+
| | | GBP |
+---------------------------------------+----------+------------+
| | | |
+---------------------------------------+----------+------------+
| Company formation | | 28,600 |
+---------------------------------------+----------+------------+
| Investment manager's fee | | 97,337 |
+---------------------------------------+----------+------------+
| Performance fees | | 761,004 |
+---------------------------------------+----------+------------+
| Accountancy fees | | 1,512 |
+---------------------------------------+----------+------------+
| Administrator's fee | | 21,754 |
+---------------------------------------+----------+------------+
| Registrar's fee | | 2,631 |
+---------------------------------------+----------+------------+
| Directors' fees | | 26,088 |
+---------------------------------------+----------+------------+
| Custody fees | | 1,260 |
+---------------------------------------+----------+------------+
| Audit fees | | 5,041 |
+---------------------------------------+----------+------------+
| Directors' and Officers' insurance | | 7,360 |
+---------------------------------------+----------+------------+
| Annual fees | | 3,674 |
+---------------------------------------+----------+------------+
| Printing and stationery | | 756 |
+---------------------------------------+----------+------------+
| Bank interest and charges | | 5,965 |
+---------------------------------------+----------+------------+
| Commissions paid | | 57,749 |
+---------------------------------------+----------+------------+
| Corporate and shareholder advisory | | 29,201 |
| fees | | |
+---------------------------------------+----------+------------+
| Legal and professional fees | | 554 |
+---------------------------------------+----------+------------+
| Sundry costs | | 6,093 |
+---------------------------------------+----------+------------+
| (Profit) / loss on foreign exchange | | 71,427 |
+---------------------------------------+----------+------------+
| | | |
+---------------------------------------+----------+------------+
| Net operating expenses for the period | | 1,128,006 |
+---------------------------------------+----------+------------+
3 DIRECTORS' REMUNERATION
The directors are paid GBP15,000 per annum, with the exception of David
Netherway who has waived his entitlement to remuneration. In addition to
GBP15,000 per annum, Nicholas Falla is entitled to an additional fee of GBP3,750
as Chairman and Robert Milroy is entitled to receive an additional fee of
GBP3,000 as Chairman of the audit committee.
4 EARNINGS PER SHARE
Earnings per Share is based on the net gain for the period attributable to
shareholders of GBP8,846,343 and on 26,594,445 shares, being the weighted
average number of Shares in issue during the period. These have not been
annualised. There are no dilutive instruments and therefore basic and diluted
earnings per Share are identical.
5 INVESTMENTS
+-----------------------------------------+----------+-------------+
| FINANCIAL ASSETS DESIGNATED AS AT FAIR | | TOTAL |
| VALUE THROUGH PROFIT OR LOSS | | 31 DEC |
| | | 2009 |
+-----------------------------------------+----------+-------------+
| | | GBP |
+-----------------------------------------+----------+-------------+
| | | |
+-----------------------------------------+----------+-------------+
| Opening portfolio cost | | - |
+-----------------------------------------+----------+-------------+
| Additions - cost | | 30,185,090 |
+-----------------------------------------+----------+-------------+
| Sales | | (5,265,966) |
+-----------------------------------------+----------+-------------+
| Realised gain on investments | | 1,506,766 |
+-----------------------------------------+----------+-------------+
| Unrealised appreciation on valuation | | 8,446,711 |
| for the period | | |
+-----------------------------------------+----------+-------------+
| | | |
+-----------------------------------------+----------+-------------+
| Closing valuation | | 34,872,601 |
+-----------------------------------------+----------+-------------+
Investments held by the Company have been classified as Level 1, for those
investments that are quoted and are valued using quoted market bid prices and
Level 2, for those unquoted investments that are valued using standard modelling
techniques by Altus Asset Management Limited using observable inputs. This is
in accordance with the fair value hierarchy.
Details of the value of each classification are listed in the table below.
Values are based on the market value of the investments as at the statement of
financial position date:
+-----------------------------+----------+----------+------------+
| | Market | | Market |
| | Value | | Value |
+-----------------------------+----------+----------+------------+
| | % | | GBP |
+-----------------------------+----------+----------+------------+
| | | | |
+-----------------------------+----------+----------+------------+
| Level 1 | 92.34% | | 32,201,740 |
+-----------------------------+----------+----------+------------+
| Level 2 | 7.66% | | 2,670,861 |
+-----------------------------+----------+----------+------------+
| | | | |
+-----------------------------+----------+----------+------------+
| Total | 100.00% | | 34,872,601 |
+-----------------------------+----------+----------+------------+
There have been no transfers between Level 1 and Level 2 of the fair value
hierarchy during the period under review.
6 OTHER INVESTMENTS
Altus Asset Management Limited is the Company's investment manager. The Company
has a 100% holding in Altus Asset Management Limited's Ordinary 'A' shares which
entitle the Company to all the votes on all matters except for the appointment
of the board of directors, which is controlled by the Ordinary 'B' share held by
Altus Strategies Limited. The 'A' share holding will be transferred under the
put/call options if Altus Strategies Limited (or a subsidiary thereof) receives
FSA approval to Altus Strategies Limited.
There is a put/call option between the Company and Altus Strategies Limited over
the Company's Ordinary 'A' shares. The Options are exercisable by either party
for a nominal sum of GBP1 conditional upon FSA authorisation being granted to
Altus Strategies Limited (or a subsidiary thereof) and are for, and only for,
the entirety of the Ordinary 'A' shares.
6 OTHER INVESTMENTS (CONTINUED)
The Directors expect the Options to be realised in the near future and
accordingly, believe the fair value of the Company's investment in Altus Asset
Management Limited and the options thereon are negligible.
The Company, as a holder of Altus Asset Management Limited's Ordinary 'A'
shares, are entitled to the profits of Altus Asset Management Limited as
distributed through dividend payments. During the period no distributions were
made by Altus Asset Management Limited.
7 RECEIVABLES
+--------------------------------+-------+----------+----------+
| | | | 31 Dec |
| | | | 2009 |
+--------------------------------+-------+----------+----------+
| | | | GBP |
+--------------------------------+-------+----------+----------+
| | | | |
+--------------------------------+-------+----------+----------+
| Prepayments | | | 8,786 |
+--------------------------------+-------+----------+----------+
| | | | |
+--------------------------------+-------+----------+----------+
| | | | 8,786 |
+--------------------------------+-------+----------+----------+
The above carrying value of receivables is equivalent to its fair value.
8 PAYABLES
+------------------------------+---------+----------+-----------+
| (amounts falling due within | | | 31 Dec |
| one year) | | | 2009 |
+------------------------------+---------+----------+-----------+
| | | | GBP |
+------------------------------+---------+----------+-----------+
| | | | |
+------------------------------+---------+----------+-----------+
| Accrued expenses | | | 600,639 |
+------------------------------+---------+----------+-----------+
| Broker creditors | | | 517,262 |
+------------------------------+---------+----------+-----------+
| | | | |
+------------------------------+---------+----------+-----------+
| | | | 1,117,901 |
+------------------------------+---------+----------+-----------+
The above carrying value of payables is equivalent to its fair value.
9 PAYABLES
+------------------------------+---------+----------+----------+
| (amounts falling due after | | | 31 Dec |
| one year) | | | 2009 |
+------------------------------+---------+----------+----------+
| | | | GBP |
+------------------------------+---------+----------+----------+
| | | | |
+------------------------------+---------+----------+----------+
| Accrued expenses | | | 761,004 |
+------------------------------+---------+----------+----------+
| | | | |
+------------------------------+---------+----------+----------+
| | | | 761,004 |
+------------------------------+---------+----------+----------+
The above carrying value of payables is equivalent to its fair value.
10 SHARE CAPITAL
+------------------------------+------------+----------+----------+
| Authorised | | | |
+------------------------------+------------+----------+----------+
| | SHARES | | GBP |
+------------------------------+------------+----------+----------+
| | | | |
+------------------------------+------------+----------+----------+
| Unlimited number of Shares | Unlimited | | - |
| of no par value | | | |
+------------------------------+------------+----------+----------+
| | | | |
+------------------------------+------------+----------+----------+
| | | | |
+------------------------------+------------+----------+----------+
| Issued | | | |
+------------------------------+------------+----------+----------+
| Date of issue | SHARES | | GBP |
+------------------------------+------------+----------+----------+
| | | | |
+------------------------------+------------+----------+----------+
| 29 June 2009 | 26,000,000 | | - |
+------------------------------+------------+----------+----------+
| 21 December 2009 | 10,997,233 | | |
+------------------------------+------------+----------+----------+
| | | | |
+------------------------------+------------+----------+----------+
| Shares in issue as at 31 | 36,997,233 | | - |
| December 2009 | | | |
+------------------------------+------------+----------+----------+
Holders of Ordinary Shares are entitled to receive, and participate in, any
dividends out of income, other distributions of the Company available for such
purposes and resolved to be distributed in respect of any accounting period, or
other income or right to participate therein.
On a winding up, Ordinary shareholders are entitled to the surplus assets
remaining after payment of all the creditors of the Company.
Ordinary shareholders also have the right to receive notice of and to attend,
speak and vote at general meetings of the Company and each Member being present
in person or by proxy or by a duly authorised representative at a meeting shall
upon a show of hands have one vote and upon a poll each such holder present in
person or by proxy or by a duly authorised representative shall have one vote in
respect of every Ordinary Share held by him.
11 SHARE PREMIUM
+-----------------------------------------+----------+-------------+
| | | GBP |
+-----------------------------------------+----------+-------------+
| | | |
+-----------------------------------------+----------+-------------+
| Premium on shares issued 29 June 2009 | | 26,000,000 |
+-----------------------------------------+----------+-------------+
| Premium on shares issued 21 December | | 14,667,020 |
| 2009 | | |
+-----------------------------------------+----------+-------------+
| Issue costs | | (1,782,357) |
+-----------------------------------------+----------+-------------+
| | | |
+-----------------------------------------+----------+-------------+
| Share premium as at 31 December 2009 | | 38,884,663 |
+-----------------------------------------+----------+-------------+
Under IAS 32 "Financial Instruments: Presentation", transaction costs of an
equity transaction are accounted for as a deduction from equity to the extent
they are incremental costs directly attributable to the equity transaction that
otherwise would have been avoided.
12 FINANCIAL INSTRUMENTS
The Company's main financial instruments comprise:
(a) Cash and cash equivalents that arise directly from the Company's
operations; and
(b) Quoted and unquoted investment securities.
13 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The main risks arising from the Company's financial instruments are market price
risk, credit risk, liquidity risk, interest rate risk, foreign exchange risk and
capital management risk. The Board regularly review and agrees policies for
managing each of these risks and these are summarised below:
(a) Market Price Risk
Market price risk arises mainly from uncertainty about future prices of
financial instruments held. It represents the potential loss the Company might
suffer through holding market positions in the face of price movements. The
Manager actively monitors market prices and reports to the Board as to the
appropriateness of the prices used for valuation purposes. A list of the top 10
investments held by the Company is shown in the Schedule of Top 10 Investments
on page 29.
If the value of the Company's investment portfolio were to increase by 10%, it
would represent a gain of GBP3,487,260. This would cause the net asset value of
the Company to rise by 7.31%.
If the value of the Company's investment portfolio were to decrease by 10%, it
would represent a decrease of GBP3,487,260. This would cause the net asset
value of the Company to fall by 7.31%.
(b) Credit Risk
Credit risk is the risk that an issuer or counterparty will be unable or
unwilling to meet a commitment that it has entered into with the Company. The
Directors receive financial information on a regular basis which is used to
identify and monitor risk.
It is the Company's policy not to invest more than 20% of the gross assets of
the Company in the securities of any one company or group at the time the
investment is made.
The Company has no significant concentration of credit risk, with exposure
spread over a large number of investments. As at 31 December 2009 the Company's
largest exposure to a single investment was GBP2,688,710, which represented
7.71% of the total market value of the Company's investments.
Investors should be aware that the prospective returns to Shareholders mirror
the returns under the investments held or entered into by the Company and that
any default by an issuer of any such investment held by the Company would have a
consequential adverse effect on the ability of the Company to
pay some or all of the entitlement to Shareholders. Such a default might, for
example, arise on the insolvency of an issuer of an investment.
The Company's financial assets exposed to credit risk are as follows:
+------------------------------+---------+----------+------------+
| | | | 31 Dec |
| | | | 2009 |
+------------------------------+---------+----------+------------+
| | | | GBP |
+------------------------------+---------+----------+------------+
| | | | |
+------------------------------+---------+----------+------------+
| Investments in equities / | | | 34,872,601 |
| warrants | | | |
+------------------------------+---------+----------+------------+
| Cash at bank | | | 14,728,524 |
+------------------------------+---------+----------+------------+
| Receivables | | | 8,786 |
+------------------------------+---------+----------+------------+
| | | | |
+------------------------------+---------+----------+------------+
| | | | 49,609,911 |
+------------------------------+---------+----------+------------+
The Company is exposed to credit risk in respect of its cash and cash
equivalents, arising from possible default of the relevant counterparty, with a
maximum exposure equal to the carrying value of those assets. The credit risk
on liquid funds is limited because the counterparties are banks with high credit
ratings assigned by international credit-rating agencies. The Company monitors
the placement of cash balances on an ongoing basis.
The Company invests its cash and cash equivalents with Royal Bank of Canada
(Channel Islands) Limited, HSBC Bank plc, Lloyds TSB, Barclays Bank plc and The
Royal Bank of Scotland International.
The investments of the Company are held in custody by Anson Custody Limited for
CREST eligible securities and by Royal Bank of Canada (Channel Islands) Limited
for certain non-CREST eligible securities. Bankruptcy or insolvency of the
Custodian may cause the Company's rights with respect to investments held by the
Custodian to be delayed. Investments held with the Custodian are held in a
Crest account maintained by Anson Registrars Limited in a sub-account designated
exclusively for the Company. This ensures that the investments are ring fenced
and will be protected should the Custodian become bankrupt or insolvent.
(c) Liquidity Risk
Liquidity risk is the risk that the Company will encounter difficulty in
realising assets or otherwise raising funds to meet financial commitments. The
Company's main financial commitment is its ongoing operating expenses.
The Investment Manager ensures that the Company has sufficient liquid resources
available to fulfil its operational plans and to meet its financial obligations
as they fall due.
The table below details the residual contractual maturities of financial
liabilities:
+------------------------------+-----------+----------+----------+
| As at 31 December 2009 | 1-3 | | Over 1 |
| | months | | year |
+------------------------------+-----------+----------+----------+
| | GBP | | GBP |
+------------------------------+-----------+----------+----------+
| | | | |
+------------------------------+-----------+----------+----------+
| Accrued expenses | 600,639 | | 761,004 |
+------------------------------+-----------+----------+----------+
| Broker creditors | 517,262 | | - |
+------------------------------+-----------+----------+----------+
| | | | |
+------------------------------+-----------+----------+----------+
| | 1,117,901 | | 761,004 |
+------------------------------+-----------+----------+----------+
(d) Interest Rate Risk
The Company holds cash in several bank accounts, the return on which is subject
to fluctuations in market interest rates.
Other than cash and cash equivalents, none of the assets or liabilities of the
Company, attract or incur interest.
The following table details the Company's exposure to interest rate risks:
+-----------------+------------+----------+-----------+----------+--------------+----------+------------+
| As at | Fixed | | Floating | | Non-interest | | Total |
| 31 December | Less | | Less | | bearing | | |
| 2009: | than | | than 1 | | | | |
| | 1 month | | month | | | | |
+-----------------+------------+----------+-----------+----------+--------------+----------+------------+
| | GBP | | GBP | | GBP | | GBP |
+-----------------+------------+----------+-----------+----------+--------------+----------+------------+
| | | | | | | | |
+-----------------+------------+----------+-----------+----------+--------------+----------+------------+
| Assets | | | | | | | |
+-----------------+------------+----------+-----------+----------+--------------+----------+------------+
| Designated as | | | | | | | |
| at fair value | | | | | | | |
| through profit | | | | | | | |
| or loss on | | | | | | | |
| initial | | | | | | | |
| recognition: | | | | | | | |
+-----------------+------------+----------+-----------+----------+--------------+----------+------------+
| Investments | - | | - | | 34,872,601 | | 34,872,601 |
+-----------------+------------+----------+-----------+----------+--------------+----------+------------+
| Loans and | | | | | | | |
| receivables | | | | | | | |
+-----------------+------------+----------+-----------+----------+--------------+----------+------------+
| Prepayments | - | | - | | 8,786 | | 8,786 |
+-----------------+------------+----------+-----------+----------+--------------+----------+------------+
| Cash and cash | 13,630,356 | | 1,098,166 | | - | | 14,728,522 |
| equivalents | | | | | | | |
+-----------------+------------+----------+-----------+----------+--------------+----------+------------+
| | | | | | | | |
+-----------------+------------+----------+-----------+----------+--------------+----------+------------+
| Total Assets | 13,630,356 | | 1,098,166 | | 34,881,387 | | 49,609,909 |
+-----------------+------------+----------+-----------+----------+--------------+----------+------------+
| | | | | | | | |
+-----------------+------------+----------+-----------+----------+--------------+----------+------------+
| Liabilities | | | | | | | |
+-----------------+------------+----------+-----------+----------+--------------+----------+------------+
| Financial | | | | | | | |
| liabilities | | | | | | | |
| measured at | | | | | | | |
| amortised cost: | | | | | | | |
+-----------------+------------+----------+-----------+----------+--------------+----------+------------+
| Accrued | - | | - | | 1,361,643 | | 1,361,643 |
| expenses | | | | | | | |
+-----------------+------------+----------+-----------+----------+--------------+----------+------------+
| Broker | - | | - | | 517,262 | | 517,262 |
| creditors | | | | | | | |
+-----------------+------------+----------+-----------+----------+--------------+----------+------------+
| | | | | | | | |
+-----------------+------------+----------+-----------+----------+--------------+----------+------------+
| Total | - | | - | | 1,878,905 | | 1,878,905 |
| Liabilities | | | | | | | |
+-----------------+------------+----------+-----------+----------+--------------+----------+------------+
| | | | | | | | |
+-----------------+------------+----------+-----------+----------+--------------+----------+------------+
| Total interest | 13,630,356 | | 1,098,166 | | | | |
| sensitivity gap | | | | | | | |
+-----------------+------------+----------+-----------+----------+--------------+----------+------------+
Interest rate sensitivity
If interest rates had been 25 basis points higher and all other variables were
held constant, the Company's net gain attributable to shareholders for the
period ended 31 December 2009 would have increased by approximately GBP24,548 or
0.05% of Net Assets due an increase in the amount of interest receivable on the
bank balances.
If interest rates had been 25 basis points lower and all other variables were
held constant, the Company's net gain attributable to shareholders for the
period ended 31 December 2009 would have decreased by approximately GBP24,548 or
0.05% of Net Assets due a decrease in the amount of interest receivable on the
bank balances.
(e) Foreign Exchange Risk
A substantial proportion of the Company's portfolio is invested in overseas
securities and movements in exchange rates can significantly affect their
Sterling value. The Company does not normally hedge against foreign currency
movements affecting the value of the investment portfolio, but takes account of
this risk when making investment decisions.
The Company undertakes certain transactions denominated in foreign currencies.
Hence, exposures to exchange rate fluctuations arise. Exchange rate exposures
are managed by minimising the amount of foreign currency held at any one time.
The carrying amounts of the Company's foreign currency denominated monetary
assets at the reporting date are as follows:
+------------------------------+---------+----------+----------+
| | | | GBP |
+------------------------------+---------+----------+----------+
| | | | |
+------------------------------+---------+----------+----------+
| Australian Dollar | | | 338,711 |
+------------------------------+---------+----------+----------+
| Canadian Dollar | | | 601,677 |
+------------------------------+---------+----------+----------+
| | | | |
+------------------------------+---------+----------+----------+
| | | | 940,388 |
+------------------------------+---------+----------+----------+
(f) Capital Management
The investment objective of the Company is to provide shareholders with
attractive long term returns, expected to be in the form of capital, through a
diversified portfolio.
The Company monitors capital on the basis of the carrying amount of equity as
presented on the face of the statement of financial position.
14 RELATED PARTY TRANSACTIONS AND DIRECTORS BENEFICIAL INTERESTS
As detailed in note 6, Altus Asset Management Limited is the Company's
investment manager. The Company has a 100% holding in Altus Asset Management
Limited's Ordinary 'A' shares. Altus Strategies Limited owns 150,000 shares
(0.41%) in Altus Resource Capital Limited and the Ordinary 'B' shares in Altus
Asset Management Limited.
The director David Netherway is a non-executive chairman of Altus Strategies
Limited, which as mentioned above, owns 150,000 shares (0.41%) in Altus Resource
Capital Limited. David Netherway is also a director of GMA Resources, whose
loan stock is invested in by the Company. The investment in GMA Resources
represents 1.68% of the market value of the Company's investments.
Director David Gelber holds 50,000 shares (0.14%) in the Company, and Chairman
Nicolas Falla holds 20,000 shares (0.05%). These are held as part of nominee
trust holdings in the Company.
Under the Investment Management Agreement, Altus Asset Management Limited is
entitled to receive fees of, the greater of 0.5% per annum of the Company's Net
Asset Value or GBP150,000 per annum. During the period the Company incurred
GBP97,337 of fees, of which GBP59,837 was outstanding at the period end as shown
in accrued expenses.
The Investment Manager is also entitled to receive a performance fee. The
performance fee is calculated as follows: The first component of the Performance
Fee will be calculated for the first time in respect of the financial accounting
period first ending following the second anniversary of the date of Admission.
The fee is equal to 20% of the excess of the NAV per Share as at the end of the
financial accounting period (adjusted to account for dividends and returns of
capital paid out during the period and in respect of which the Manager has been
paid or is to be paid the second component of the Performance Fee) over the
basic performance hurdle, this being an amount equal to the Issue Price
increased by 10% of the Issue Price per annum up to the end of the relevant
performance period. Thereafter this fee shall be paid on an annual basis in
respect of each financial period subject to the basic performance hurdle and a
high watermark having been exceeded. The high watermark is the NAV at the end
of the financial period in respect of which the last Performance Fee was paid.
If, however, the high watermark is not exceeded for any consecutive period of
three years it shall be re-based to a value equal to the NAV as at the end of
the third financial period. The basic performance hurdle, as described above,
must however still be exceeded in order for this component of the performance
fee to be payable.
The first component of the Performance Fee will be paid on a per Share basis,
multiplied by the time weighted average of the number of Shares in issue in the
relevant performance period (or since Admission in the first performance
period). In the event that there is a further issue of Shares, a redemption of
Shares or other capital reorganisation of the Company, the calculation of the
performance fee will be adjusted appropriately.
The second component of the Performance Fee is an amount equal to 20% of the sum
of all dividends, distributions and other returns of capital paid out to
Shareholders during the relevant performance period (but excluding redemptions
and share buy backs that are deemed distributions under the Companies Law),
subject to the performance hurdle having been satisfied. The performance hurdle
is the requirement that the NAV on the relevant calculation date must exceed an
amount equal to the Issue Price increased by 10% of the Issue Price per annum up
to the end of the relevant performance period.
The Company will pay to the Manager 80% of the Performance Fee. However, as at
31 December 2009 no performance fee has been paid. Where the performance hurdle
has been exceeded a performance fee will be accrued. A performance fee of
GBP761,004 has been accrued as at 31 December 2009.
Nimrod Capital LLP is the Company's corporate and shareholder advisory agent and
owns 10,000 shares (0.03%) in the Company. Nimrod Capital LLP is entitled to
receive fees of 0.15% of the Company's Net Asset Value per annum, and 20% of the
Performance Fee. During the period the Company incurred GBP29,201 of costs, of
which GBP18,388 was outstanding at the period end as shown in accrued expenses.
TOP 10 INVESTMENTS IN SECURITIES AS AT 31 DECEMBER 2009
+--------------------+---------+----------+------------+----------+------------+----------+------------+
| Investment | | | Cost | | Market | | 31 Dec |
| | | | | | Value | | 2009 |
| | | | | | | | Unrealised |
| | | | | | | | profit / |
| | | | | | | | (loss) |
+--------------------+---------+----------+------------+----------+------------+----------+------------+
| | | | GBP | | GBP | | GBP |
+--------------------+---------+----------+------------+----------+------------+----------+------------+
| | | | | | | | |
+--------------------+---------+----------+------------+----------+------------+----------+------------+
| Greystar Resources | | | 1,761,899 | | 2,688,710 | | 926,811 |
| Limited | | | | | | | |
+--------------------+---------+----------+------------+----------+------------+----------+------------+
| Perseus Mining | | | 1,406,943 | | 2,597,381 | | 1,190,438 |
| Limited | | | | | | | |
+--------------------+---------+----------+------------+----------+------------+----------+------------+
| European | | | 1,444,352 | | 2,475,832 | | 1,031,480 |
| Goldfields Limited | | | | | | | |
+--------------------+---------+----------+------------+----------+------------+----------+------------+
| Adamus Resources | | | 1,795,818 | | 2,407,453 | | 611,635 |
| Limited | | | | | | | |
+--------------------+---------+----------+------------+----------+------------+----------+------------+
| Kryso Resources | | | 500,000 | | 2,290,780 | | 1,790,780 |
| Plc | | | | | | | |
+--------------------+---------+----------+------------+----------+------------+----------+------------+
| Ecometals Limited | | | 511,364 | | 2,058,790 | | 1,547,426 |
+--------------------+---------+----------+------------+----------+------------+----------+------------+
| Allied Gold | | | 1,955,148 | | 1,717,495 | | (237,653) |
| Limited | | | | | | | |
+--------------------+---------+----------+------------+----------+------------+----------+------------+
| Banro Corporation | | | 1,792,421 | | 1,670,861 | | (121,560) |
| NPV | | | | | | | |
+--------------------+---------+----------+------------+----------+------------+----------+------------+
| Eastern Platinum | | | 1,581,558 | | 1,566,371 | | (15,187) |
| Limited | | | | | | | |
+--------------------+---------+----------+------------+----------+------------+----------+------------+
| Kenmare Resources | | | 1,451,365 | | 1,534,462 | | 83,097 |
| Plc | | | | | | | |
+--------------------+---------+----------+------------+----------+------------+----------+------------+
| | | | | | | | |
+--------------------+---------+----------+------------+----------+------------+----------+------------+
| | | | 14,200,868 | | 21,008,135 | | 6,807,267 |
+--------------------+---------+----------+------------+----------+------------+----------+------------+
ADVISORS & CONTACT INFORMATION
Key Information
Exchange
Ticker
Listing Date
Fiscal Year End
Base Currency
ISIN
SEDOL
Country of Incorporation
Management and Administration
Registered Office
Altus Resource Capital Limited
Anson Place
Mill Court
La Charroterie
St Peter Port,
Guernsey GY1 EJ
Investment Manager
Altus Asset Management Limited
14 Station Road
Didcot
Oxfordshire
OX11 7LL
Placing and Corporate and Shareholder Advisory Agent
Nimrod Capital LLP
4 The London Fruit and Wool Exchange
Brushfield Street
London, E1 6HB
Specialist Fund Market of the LSE/ CISX
ARCL/ ARC
30 June 2009/ 22 December 2009
30 June
GBP
GG00B54BPN15
B54BPN1
Guernsey - Registration number 50318
Company Secretary and Administrator
Anson Fund Managers Limited
P.O. Box 405, Anson Place
Mill Court
La Charroterie
St Peter Port
Guernsey, GY1 3GF
Registrar
Anson Registrars Limited
PO Box 426, Anson Place
Mill Court, La Charroterie
St Peter Port
Guernsey, GY1 3WX
Auditor
Deloitte LLP
Regency Court
Glategny Esplanade
St Peter Port
Guernsey, GY1 3HW
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR EQLFLBLFZBBX
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