8 January 2013
CRYSTAL AMBER FUND LIMITED
("Crystal Amber Fund" or the "Fund")
Monthly Net Asset Value
Crystal Amber Fund announces that its unaudited net asset value
("NAV") per share on 31 December 2012
was 120.08p (30 November 2012:
117.18p per share).
The proportion of the Fund's NAV at 31 December 2012 represented by the ten
largest holdings, other investments and cash (including accruals), was as
follows:
Top ten holdings Pence per share Percentage of investee equity held
TT Electronics plc 14.4 3.8%
Sutton Harbour Holdings plc 12.8 27.0%
Norcros plc 10.3 8.2%
Devro plc 9.7 1.1%
API Group plc 9.2 8.8%
Northgate plc 7.7 1.1%
Tribal Group plc 7.1 4.4%
Smiths News plc 6.8 1.4%
Renishaw plc 4.4 0.2%
4imprint Group plc 4.3 2.8%
Total of ten largest holdings 86.7
Other investments 12.0
Cash and accruals 21.4
Total NAV 120.1
Investment adviser's quarterly commentary on the portfolio
Over the quarter to 31 December
2012, NAV grew by 12.3%. For the year to 31 December 2012, NAV growth was 35.3%.
Key positive contributors to the NAV performance have been N
Brown, Sutton Harbour, Northgate,
API Group and May Gurney. Smaller
negative impacts have come from Devro and TT Electronics.
TT Electronics' share price was flat over the quarter. The
Fund's holding in TT has been reduced during the period to
rebalance the portfolio, and in light of weaker trading in the
automotive industry. The Fund has remained actively engaged with
the company, its largest shareholders and other stakeholders.
Sutton Harbour's share price rose
by 31.8% over the quarter. This positive share price performance
was despite a more conservative valuation of the property
portfolio. The announcement of Sutton
Harbour's indicative master-plan for development of the
113-acre former airport site has highlighted the long term value of
its assets. The completion of lease agreements for the Millbay site
has allowed Sutton Harbour to start
the development of its new King Point
Marina which, in due course, will add scale to its
operations. Over the period, the Fund has progressed its proposals
to deliver shareholder value.
Devro's share price was down 6.2% over the quarter. Following a
site visit and additional market research, we engaged in open and
constructive dialogue with the company's board. We advised
management to demonstrate more clarity in making the investment
case for Devro and have suggested additional disclosures on the
opportunities for improved profitability through capital
investment. Believing that the outlook for the business is
favourable, our aim is to help Devro to maximise its potential and
to set appropriately stretching goals for its management. We look
forward to a continuation of this engagement process.
API's share price rose by 22.1% over the quarter. Following
previous board announcements, API initiated its sale process at the
end of September by inviting tenders. In the announcement of its
interim results, API confirmed that it is in discussions with a
number of interested parties. Trading results highlight the
on-going recovery in profitability driven by normalised input costs
and self-help measures. Following multiple site visits and research
meetings, and despite a share price gain of 100% over 2012, we
believe that API remains undervalued.
During the quarter, Northgate's share price appreciated by
26.1%. We have previously highlighted the scope to achieve benefits
in reducing the company's cost of capital in the current low
interest rate environment. Following the company's interim results
in December, we are pleased to note that such an approach is
gaining increasing credence with the analyst community and has lead
to a share price re-rating. In December, the Fund top-sliced its
holding.
During the quarter, the Fund disclosed a small position in
Thorntons, the confectioner, worth approximately £0.9m.
N Brown's share price rose by 34.6% over the quarter. The
arrival of Andrew Higginson as
non-executive chairman has been well received. The Fund was the
first institutional investor to meet him in his new capacity. It
was a positive meeting and we were pleased with the new chairman's
initial thoughts on the company. A positive trading update in
October triggered a reappraisal of N Brown's prospects, which
reflect the fact that it is now generating over half of its sales
online, and its favourable prospects in the US. However in our
view, pressure on disposable income of its core customers could
remain a headwind on sales performance in the medium term.
Following the share price strength, the Fund has significantly
reduced its holding in the company as the share price achieved the
Fund's price objective.
Further comments on the main investments in the portfolio can be
found in the Fund's 2012 Annual Report (available at
www.crystalamber.com).
Share buy-back
During December, the Fund purchased 1,000,000 of its own shares
at an average price of 104.04p per share, which are held as
treasury shares. The buy-back has had the effect of significantly
reducing the share price discount to the Fund's net asset
value.
Cash resources
Following strong share price performances in a number of our
holdings, the Fund banked some profits within the portfolio. Over
the quarter, cash and accruals increased from 9.2p per share to
21.4p per share. These cash balances will enable the Fund to take
advantage of fresh investment opportunities which have been
identified.
For further enquiries please contact:
Crystal Amber Fund Limited
William Collins (Chairman)
Tel: 01481 716 000
Merchant Securities Limited - Nominated Adviser
David Worlidge/Simon Clements
Tel: 020 7628 2200
Numis Securities Limited - Broker
Nathan Brown/Hugh Jonathan
Tel: 020 7260 1426
Crystal Amber Advisers (UK) LLP - Investment Adviser Richard
Bernstein Tel: 020 7478 9080