TIDMGVP
RNS Number : 5165K
Gabelli Value Plus+ Trust PLC
05 January 2021
Gabelli Value Plus+ Trust Plc
Half-Yearly Results Announcement
Financial highlights
(Unaudited) (Unaudited) (Audited)
As at As at As at
Performance (unadjusted 30 September 30 September 31 March
for distributions) 2020 2019 2020
------------------------- ----------------------- ------------- ---------
Net asset value per share
(cum income) 124.2p 146.4p 103.0p
Net asset value per share
(ex income) 123.4p 145.7p 101.9p
Share price 116.0p 133.5p 82.5p
Discount relative to
the NAV (cum income) 6.6% 8.8% 19.9%
Exchange Rate (U.S.$/GBP) 1.29 1.23 1.24
------------------------------ ------------------ ------------- ---------
(Unaudited) (Unaudited)
Half year Half year (Audited)
ended 30 ended Year ended
September 30 September 31 March
Total returns 2020 2019 2020
-------------------------------- ---------------- ------------- -----------
Net asset value per share(#) 20.1% 6.1% (25.0%)
Russell 3000 Value Index
(GBP) 15.8% 11.0% (14.0%)
Standard & Poor's 500
Index (GBP) 25.9% 12.1% (2.5%)
Share price 40.6% 9.0% (32.7%)
-------------------------------- ---------------- ------------- -----------
Income
--------------------------- ----------------------------------- ------------
Revenue return per share 0.62p 0.68p 1.09p
-------------------------------- ---------------- ------------- -----------
Ongoing charges*
--------------------------- ----------------------------------- ------------
Annualised ongoing charges** 1.34% 1.12% 1.24%
-------------------------------- ---------------- ------------- -----------
Source: Investment Manager (Gabelli Funds, LLC), verified by the
Administrator, State Street Bank and Trust Company.
(#) The net asset value ("NAV") total return for the respective
periods reflects the movement in the NAV, after taking account of
dividends paid during the periods.
The total share price return for the respective periods reflects
the movement in the share price during these periods after taking
account of dividends paid during the periods.
* Ongoing charges are calculated as a percentage of
shareholders' funds using the average net assets over the
respective periods and calculated in line with the Association of
Investment Companies (AIC's) recommended methodology.
** The annualised ongoing charges figures are the recurring
operating and investment management costs of the Company expressed
as a percentage of the average net assets.
CHAIRMAN'S STATEMENT
Introduction
I am pleased to present the half year results for the period to
30 September 2020.
The period under review was a volatile one, with markets
recovering sharply as investors began to come to terms with the
economic effects of the COVID-19 pandemic. Alongside this issue,
investor attention became focussed on the U.S. Presidential
election, the result of which is now known, being a win for Joe
Biden and Kamala Harris.
I will now briefly comment below on certain developments
directly concerning shareholders, which are set out in detail in a
circular to shareholders published on 11 November 2020.
As shareholders are aware, the most significant event for them
during the period was the ordinary resolution contained in the
Notice of the AGM held on 30 July 2020 concerning the continuation
of the Company in its present form. This proposal was roundly
defeated. On a high voting turnout of 93.2% of shares in issue,
65.6% of votes were cast against the resolution, with 34.3% in
favour of continuation. The only significant vote in favour of
continuation was that of Associated Capital Group, Inc. ('ACG'), an
affiliate of the Investment Manager, with a holding of 27.36%.
Since the AGM, the Board has consulted with a number of the
non-ACG shareholders and also with ACG. These consultations have
confirmed that the overwhelming majority of shareholders, excepting
ACG, remain in favour of liquidation. In a letter received post the
period end, on 22 October, ACG requested that the Company call a
general meeting at which it wished to propose certain resolutions
with regard to the continuation of the Company and its present
Investment Manager. The general meeting was held on 7 December 2020
and all resolutions were defeated on a poll, with 64.4% of votes
cast against the resolutions and 35.6% cast in favour. In the
Board's view, the voting results of the general meeting demonstrate
the stark lack of support for the proposals put forward in the
resolutions by a significant majority of shareholders.
The Board continues to believe that it would be in the best
interests of the Company and shareholders as a whole to put forward
further proposals for a members' voluntary liquidation of the
Company. This is the most straightforward and cost effective means
to effect the clearly expressed desire of the majority of
shareholders for a discontinuation of the Company, inter alia, from
a tax perspective. This does, of course, require a special
resolution to be passed and ACG may again decide to block it.
The first half of the Company's year saw the NAV per share
recover sharply. On a total return basis, the NAV per share rose by
22.1% in the six months to 30 September 2020, while the share price
increased by 41.8%. Over the same period, the Russell 3000 Value
Index rose by 15.8% and the S&P 500 Index by 25.9%.
In the period since the Company's inception in February 2015 to
30 September 2020 the NAV and share price total returns were 28.4%
and 19.7% respectively, compared with 54.1% for the Russell 3000
Value and 114.5% for the S&P 500.
Since early in 2020, the COVID-19 pandemic has had a dramatic
effect on many aspects of business activities, as well as social
life. Tourism and business travel very largely came to a halt as
did many other aspects of business interaction including retail,
finance and banking to name a few. One clear development resulting
from the pandemic, however, has been a dramatic acceleration in the
use of online transactions. Many people have shifted to using
online services, including payments, for a variety of their needs.
This digital surge has risen to levels which many businesses had
not expected to see for some years. While this trend may slow, as
and when the pandemic concerns subside, it will inevitably result
in significant operational changes for many companies, including
restructurings. As a result, in the medium term, many businesses
are likely to emerge leaner and more efficient, perhaps with fewer
employees. At the same time, many technology companies, including
those noted in the Company's Annual Report (Facebook, Amazon,
Apple, Netflix and Google), have continued to thrive in the current
environment. Their extraordinary record of success has placed them
in strong advantageous competitive positions, with strong balance
sheets and large amounts of free cash reserves.
Dividend and buybacks
A dividend of 1.0p per share was paid to shareholders in August
2020 in respect of the 2020 financial year. Dividends are paid
annually, therefore no dividend will be paid for this interim
period.
No share buyback transactions took place during the period under
review.
Outlook
Since the majority of shareholders have voted in favour of the
discontinuation of the Company, and the results of the general
meeting held on 7 December 2020 strongly endorse that position for
the majority of shareholders, the Board will continue to engage
with all shareholders to seek to deliver a satisfactory outcome of
the continuation vote for a shareholders as soon as
practicable.
Peter Dicks
Chairman
4 January 2021
INVESTMENT MANAGER'S REVIEW
Gabelli Methodology
Gabelli Funds would like to thank our long term investors for
entrusting a portion of their assets to the Gabelli Value Plus+
Trust. Many of our original shareholders in the IPO are still
shareholders today, and we appreciate the confidence and trust you
have offered our organisation through an investment in GVP. As we
have for over forty years, we remain vigilant in the application of
our investment philosophy and in our search for opportunities. In
this context, let us outline our investment methodology and the
investment environment through September 30th.
We at Gabelli are active, bottom up, value investors, and seek
to achieve real capital appreciation
(relative to inflation) over the long term, regardless of market
cycles. We have been steadfast in our approach. We achieve returns
through investing in businesses utilising our proprietary Private
Market Value ("PMV") with a Catalyst(TM) methodology. PMV is the
value that we believe an informed buyer would be willing to pay to
acquire an entire company in a private transaction. Our team
arrives at a PMV valuation by a rigorous assessment of fundamentals
from publicly available information and judgment gained from our
comprehensive, accumulated knowledge of a variety of sectors. We
focus not just on earnings, but also on the balance sheet, free
cash flow, and the management of prospective companies. We are not
index benchmarked, and construct portfolios agnostic of market
capitalisation and index weightings. We have invested this way
since 1977.
Our research process identifies differentiated franchise
businesses, typically with strong organic cash flow
characteristics, balance sheet opportunities, and operational
flexibility. We seek to identify businesses whose securities trade
in the public markets at a significant discount to our estimates of
their PMV estimate, or "Margin of Safety". Having identified such
securities, we look to identify one or more "catalysts" that will
narrow or eliminate the discount associated with that "Margin of
Safety". Catalysts can come in many forms including, but not
limited to, corporate restructurings (such as demergers and asset
sales), operational improvements, regulatory or managerial changes,
special situations (such as liquidations), and mergers and
acquisitions.
It is through this process of bottom up stock selection and the
implementation of disciplined portfolio construction that we expect
to create value for our shareholders.
Observations
From the period of 1 April to the end of September 2020, the
first fiscal half of the year for Gabelli Value Plus+ Trust, the
United States and the world were battling the global pandemic of
COVID-19. At the beginning of April, the U.S. economy was virtually
shut down as many businesses were ordered to close in order to slow
the spread of the disease. The stock market fell during the month
of March but, starting in April, the market began to recover slowly
and gradually. The Federal government responded to the crisis with
a massive fiscal and monetary stimulus. On the fiscal side, a
number of programs were implemented to help prop up the economy and
assist businesses that were shut down and individuals who were
unemployed. On the monetary side, short term interest rates were
quickly lowered essentially to zero in early 2020, and the Federal
Reserve promised the markets that short term interest rates would
stay near zero for at least a couple more years. In Congress, the
Trump administration was not able to move forward with any major
legislation, other than COVID-19 related stimulus, as partisan
bickering continued ahead of the Presidential election in
November.
The Economy
The U.S. economy went into a deep but short recession in 2020.
During the first calendar quarter of the year, the economy
contracted by 5% as the pandemic began to impact the economy. Then,
in the second quarter of 2020, the U.S. economy experienced a
massive contraction of slightly over 30%, as many businesses were
shut down and travel was drastically reduced. Two consecutive
quarters of negative GDP growth are defined as a recession. During
the third calendar quarter of 2020, the U.S. economy started to
grow once again, with quarter over quarter growth of about 25%
after the big contraction in the second quarter. We expect the
economy will continue to grow in the fourth quarter, probably in
the mid-single digit range, as the health care community gets
better at treating and preventing the COVID-19 virus.
The Markets
Investors are facing an acute shortage of good income generating
opportunities. While not a realistic choice for some investors,
stocks must play a larger role overall in meeting investors' income
needs. At this writing, the dividend yield on the S&P 500 Index
is higher than the 10-year U.S. Treasury yield, which currently is
around 0.7%. Stocks offer compelling current income and growth of
income for investors who can tolerate stock market volatility.
Stocks also offer the potential for growth in capital over time. It
is hard to imagine growing capital by investing in bonds at
historically low interest rates. We are probably in the final
inning of an almost 40 year bull market in U.S. bonds.
The Election
Subsequent to 30 September 2020, the United States held its
Presidential elections on 3rd November. Although the outcome has
not been certified as of the time of this writing, it appears as
though Democratic challenger Joe Biden has beaten President Donald
Trump, and Biden has been declared the president-elect by the
Associated Press. The Democrats maintained their majority in the
House of Representatives, but it is still unclear which political
party will control the Senate. There will be two runoff elections
in the state of Georgia for the Senate and, on 5 January 2021, if
the Republicans win just one of those races, then the Republicans
will retain control of the Senate. If that happens, the U.S. will
have divided government and the Senate will be able to block most
of the major policy changes the Democrats hoped to achieve.
Investors in the United States generally like divided government as
there is more certainty as to what policy will be. If the Democrats
do take control of the Senate, however, then there could be major
policy changes in the U.S., especially in the area of taxes, energy
and trade.
Portfolio
In the six months to 30 September 2020, the five top
contributors to our returns were our holdings in the shares of
Navistar International, Herc Holdings, ViacomCBS, Freeport McMoRan,
and Republic Services. Our strongest contributor, Navistar,
headquartered in Lisle, Illinois, is a leading North American
commercial vehicle manufacturer and, for most of its history, had
been the only one of its peers without a global parent. Volkswagen,
through its TRATON Truck & Bus subsidiary, purchased 17% of
Navistar in September of 2016, and this past January bid $35 per
share in cash for the balance of the company. More recently, the
$43 per share bid was revisited before both TRATON, Navistar, and
its two largest shareholders agreed in principle on a takeover at
$44.50 per share. On 7 November 2020, the two companies came to a
definitive merger agreement, with a deal expected to close in
2021.
By contrast, our holdings in Hertz Global Holdings, Wells Fargo,
General Electric, Ryman Hospitality Properties, and Akorn detracted
from returns. Our biggest detractor, Hertz, based in Estero,
Florida, operates the Hertz, Dollar and Thrifty vehicle rental
brands. Following ten consecutive quarters of year-on-year revenue
growth, the outbreak of COVID-19 created a major business
disruption as global travel demand dropped to almost zero and the
U.S. used car market effectively shut down. Faced with uncertainty
as to when revenue would return and when the used car market would
fully re-open for sale, Hertz filed for Chapter II reorganization
in May. We began selling down our position in the first quarter as
travel conditions deteriorated and Hertz's cash flow from
operations began to show signs of strain and have exited our
holding in its entirety.
Select Portfolio Holdings as at 30 September 2020
Cutera Inc. (CUTR - $18.97 - NASDAQ), headquartered in Brisbane,
California, is a manufacturer of non-invasive laser and other
energy based systems and products for cosmetic vascular conditions,
body sculpting, hair removal, skin rejuvenation, pigmented lesions
and tattoo removal. Patient traffic remained low throughout April
and May of this year, but began to pick up again in June. Demand
from medi spas led the recovery, followed by plastic surgeons and
then dermatologists. Management continues to work on its
manufacturing efficiencies and improvement programs, which began in
late 2019 and will continues for another 15-18 months. Gross margin
improvements should be evident when revenues return to a normalized
level.
Freeport-McMoRan Inc. (FCX - $15.64 - NYSE), headquartered in
Phoenix, Arizona, is the largest pure-play copper company in the
world, producing approximately 3.5 billion pounds of copper
annually from mines in the United States, Indonesia, Peru, and
Chile. Grasberg, the company's Indonesian mine, is also the largest
gold mine in the world. Grasberg is in the process of expanding
production as a large scale underground mine is developed. The
project is 60 percent complete, and should be finished in 2022.
Freeport's free cash flow should increase substantially once
Grasberg is at full operating capacity.
PNC Financial Services Group Inc. (PNC - $109.91 - NYSE) is one
of the nation's largest diversified financial services
organizations. From its Pittsburgh, Pennsylvania, headquarters, PNC
provides retail and commercial banking services throughout the
Northeast, Southeast, Midwest, and Western U.S. via a regional
branch network of over two thousand locations, along with mortgage
and deposit businesses on a national basis. The company also
operates a large asset management franchise, with over $158 billion
in assets under management and $142 billion under administration as
of September 2020. The firm has strong corporate leadership with a
historically conservative approach to loan origination and credit
performance.
Republic Services Inc. (RSG - $93.35 - NYSE) based in Phoenix,
Arizona, is the second largest solid waste company in North
America. Republic provides nonhazardous solid waste collection
services for commercial, industrial, municipal, and residential
customers in forty-one states and Puerto Rico. Republic serves more
than 2,800 municipalities and operates 190 landfills, 213 transfer
stations, 339 collection operations, and 78 recycling facilities.
We view Republic's plan to remain steadfast in the traditional
solid waste business positively. We expect continued solid waste
growth acquisitions, earnings improvement, and incremental route
density and internalization growth in already established markets
to generate real value in the near to medium term, highlighting the
company's potential.
Teladoc (TDOC - $217.72 - NYSE), headquartered in Purchase, New
York, is the global leader
in virtual care, allowing patients to videoconference with a
doctor at any time of the day. The COVID-19 pandemic has driven
significant new interest in virtual care by both patients and
doctors. In August, Teladoc agreed to acquire Livongo for $37
billion in cash and stock. Livongo's ability to remotely manage
chronic diseases, such as diabetes, is a natural fit with Teladoc.
The deal closed at the end of October, and the companies expect
significant cost and revenue synergies over the next several
years.
Gabelli Funds, LLC
4 January 2021
PORTFOLIO SUMMARY
Portfolio distribution as at 30 September 2020 (%)*
As at 30 September 2020
----------------------- -----------------------------
Portfolio Russell
of GVP S&P 500 3000
----------------------- --------- ------- -------
Communication Services 20.0 10.8 9.8
Consumer Discretionary 4.6 11.6 12.3
Consumer Staples 7.9 7.0 6.3
Energy 0.3 2.1 1.9
Financials 12.9 9.7 9.9
Health Care 5.9 14.2 14.5
Industrials 35.1 8.2 8.9
Information Technology 1.7 28.2 27.3
Materials 9.8 2.6 2.8
Real Estate - 2.6 3.4
Utilities 1.8 3.0 2.9
----------------------- --------- ------- -------
Total 100.0 100.0 100.0
----------------------- --------- ------- -------
* Excludes cash and short term investments.
(Unaudited) (Audited)
As at 30 As at 31
September March
By asset class (%) 2020 2020
-------------------------------- ------------- ----------------
Equities 92.1 88.5
Cash and short term investments 7.9 11.5
-------------------------------- ------------- ----------------
Total 100.0 100.0
-------------------------------- ------------- ----------------
PORTFOLIO DISTRIBUTION
Largest holdings
(Unaudited)
As at 30 September
2020
--------------------------------- --------------------------
Market % of total
value portfolio
GBP000
--------------------------------- ------- -----------------
Republic Services Inc 5,343 4.8
Navistar International Corp 4,698 4.2
Herc Holdings Inc 4,473 4.0
GCP Applied Technologies
Inc 4,213 3.8
PNC Financial Services Group
Inc 3,823 3.4
--------------------------------- ------- -----------------
Bank of New York Mellon Corp 3,452 3.1
Mueller Industries Inc 3,349 3.0
Textron Inc 3,070 2.8
State Street Corp 2,891 2.6
ViacomCBS Inc 2,816 2.5
--------------------------------- ------- -----------------
Bunge Ltd 2,660 2.4
Teladoc Health Inc 2,611 2.3
EnPro Industries Inc 2,571 2.3
Freeport-McMoRan Inc 2,537 2.3
Discovery Inc 2,492 2.2
--------------------------------- ------- -----------------
Johnson Controls International
plc 2,432 2.2
CNH Industrial N.V. 2,416 2.2
Flowserve Corp 2,385 2.2
Fox Corp 2,119 1.9
Energizer Holdings Inc 2,119 1.9
--------------------------------- ------- -----------------
Sub-total - top 20 holdings 62,470 56.1
--------------------------------- ------- -----------------
Sub-total - top 21 - 40 holdings 30,402 27.3
--------------------------------- ------- -----------------
Sub-total - top 41 - 60 holdings 14,614 13.1
--------------------------------- ------- -----------------
Sub-total - remaining holdings 3,965 3.5
--------------------------------- ------- -----------------
Total holdings* - 79 positions 111,451 100.0
--------------------------------- ------- -----------------
A full list of investments is available on the Company's
website.
* Excludes cash and short term investments.
RESPONSIBILITY STATEMENT
The Chairman's Statement and the Investment Manager's Review
provide details of the important events that have occurred during
the period and their impact on the financial statements.
Principal Risks and Uncertainties
The principal risks and uncertainties faced by the Company were
explained in detail within the Annual Report for the year ended 31
March 2020. As shareholders will be aware, the continuation vote
was defeated at the AGM on 30 July 2020 and resolutions put forward
by ACG at a general meeting of the Company held on 7 December 2020
were also overwhelmingly defeated. The Board is currently
considering options, including a members' voluntary liquidation, in
order to deliver on the outcome of these votes for shareholders.
The Directors are not aware of any other new risks or
uncertainties, or any changes to those risks and uncertainties
stated within the Annual Report which are applicable to the
remaining six months of the financial year or were applicable to
the period under review.
Related Party Transactions
Details of related party transactions can be found in Note 8 of
the financial statements. Other than this, there have been no
changes to related party transactions detailed in the Company's
Annual Report for the period ended 31 March 2020, nor have there
been any related party transactions during the period under review,
which have materially affected the financial position or
performance of the Company.
Going Concern
As noted in the Annual Report for the year ended 31 March 2020,
the defeat of the continuation vote at the AGM has given rise to a
material uncertainty which casts significant doubt on the Company's
future and the likelihood of its ability to continue as a going
concern. Notwithstanding this, the financial statements have been
prepared on a going concern basis. In arriving at the decision on
the basis of preparation, the Board considered the financial
position of the Company, the nature of its portfolio, its cashflow,
financial structure and liquidity position.
Directors' Responsibility Statement
The Board of Directors confirms that, to the best of its
knowledge:
-- the condensed financial statements have been prepared in
accordance with Financial Reporting Standard (FRS 104) applicable
in the UK and Republic of Ireland, which forms part of the revised
Generally Accepted Accounting Practice (UK GAAP) issued by the
Financial Reporting Council ("FRC") in 2015; and
-- the Interim Report, together with the Chairman's Statement
and the Investment Manager's Report, includes a fair review of the
information required by section 4.2.7R and 4.2.8R of the FCA's
Disclosure Guidance and Transparency Rules.
The half-yearly financial report was approved by the Board on 4
January 2021 and the responsibility statement was signed on the
Board's behalf by Peter Dicks, Chairman of the Board.
Peter Dicks
Chairman
4 January 2021
CONDENSED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)
Half year ended 30 September
2020
------------------------------- ---- ---------------------------------------
Revenue Capital Total
Income Note GBP000 GBP000 GBP000
------------------------------- ---- --------------------- ------- -------
Dividend income 1,171 - 1,171
Interest on deposits - - -
------------------------------- ---- --------------------- ------- -------
Total dividends and
interest 1,171 - 1,171
------------------------------- ---- --------------------- ------- -------
Net realised and unrealised
gains/(losses) on investments 3
Net realised and unrealised - 21,977 21,977
currency (losses)/gains (3) (462) (465)
------------------------------- ---- --------------------- ------- -------
Investment management
fee (131) (375) (506)
Other expenses (271)(1) (8) (279)
------------------------------- ---- --------------------- ------- -------
Net return on ordinary
activities before taxation 766 21,132 21,898
------------------------------- ---- --------------------- ------- -------
Taxation on ordinary
activities 4 (160) - (160)
------------------------------- ---- --------------------- ------- -------
Net returns attributable
to shareholders 606 21,132 21,738
------------------------------- ---- --------------------- ------- -------
Net returns per ordinary
share - basic and diluted 6 0.62p 21.50p 22.12p
------------------------------- ---- --------------------- ------- -------
CONDENSED STATEMENTS OF COMPREHENSIVE INCOME CONTINUED
(Unaudited) (Audited)
Half year ended 30 Year ended 31 March
September 2019 2020
------------------------- ------------------------- ------- -------------------------- ----
Revenue Capital Total Revenue Capital Total
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
------------------------- ------- --------- --------- ----------- ------------ ----------
Dividend income 1,125 - 1,125 2,119 - 2,119
Interest on
deposits 12 - 12 19 - 19
------------------------- ------- --------- --------- ----------- ------------ ----------
Total dividends
and interest 1,137 - 1,137 2,138 - 2,138
------------------------- ------- --------- --------- ----------- ------------ ----------
Net realised
and unrealised
gains/(losses)
on investments - 8,546 8,546 - (33,893) (33,893)
Net realised
and unrealised
currency (losses)/gains 1 151 152 5 76 81
------------------------- ------- --------- --------- ----------- ------------ ----------
Investment management
fee (155) (467) (622) (310) (948) (1,258)
Other expenses (170) (2) (172) (474) (9) (483)
------------------------- ------- --------- --------- ----------- ------------ ----------
Net return on
ordinary activities
before taxation 813 8,228 9,041 1,359 (34,774) (33,415)
------------------------- ------- --------- --------- ----------- ------------ ----------
Taxation on
ordinary activities (138) - (138) (281) - (281)
------------------------- ------- --------- --------- ----------- ------------ ----------
Net returns
attributable
to shareholders 675 8,228 8,903 1,078 (34,774) (33,696)
------------------------- ------- --------- --------- ----------- ------------ ----------
Net returns
per ordinary
share - basic
and diluted 0.68p 8.31p 8.99p 1.09p (35.25)p (34.16)p
------------------------- ------- --------- --------- ----------- ------------ ----------
(1) Other expenses include Directors' remuneration (GBP73,000),
fees accrued to State Street for Accounting (GBP29,000), Company
Secretary services (GBP31,000), Broker services (GBP18,000) and
Audit services (GBP17,000).
The total columns of these statements are the profit and loss
accounts of the Company for the respective periods.
The revenue and capital items are presented in accordance with
the AIC's Statement of Recommended Practice ('SORP') 2019.
All revenue and capital items in the above statement derive from
continuing operations.
No operations were acquired or discontinued in the half year
ended 30 September 2020.
The notes form part of these financial statements.
CONDENSED STATEMENTS OF CHANGES IN EQUITY
Half year ended 30 September 2020 (Unaudited)
Called Special
up Distributable Capital Revenue
Share Capital Reserve* Reserve Reserve* Total
Note GBP000 GBP000 GBP000 GBP000 GBP000
---------------------- ---- -------------- --------------- -------- --------- -------
Net assets as at
1 April 2020 1,001 95,885 3,106 1,278 101,270
Realised losses on
investments at fair
value 3 - - (5,755) - (5,755)
Unrealised gains
on investments at
fair value 3 - - 27,732 - 27,732
Net realised and
unrealised currency
losses - - (462) - (462)
Capital expenses - - (383) - (383)
Transfer to revenue
reserve for the year - - - 606 606
Dividends paid 5 - - - (983) (983)
---------------------- ---- -------------- --------------- -------- --------- -------
Net assets as at
30 September 2020 1,001 95,885 24,238 901 122,025
---------------------- ---- -------------- --------------- -------- --------- -------
Half year ended 30 September 2019 (Unaudited)
Called Special
up Share Distributable Capital Revenue
Capital Reserve* Reserve Reserve* Total
Note GBP000 GBP000 GBP000 GBP000 GBP000
------------------------ ---- --------- -------------- -------- --------- -------
Net assets as at
1 April 2019 1,001 97,699 37,880 944 137,524
Realised gains on
investments at fair
value 3 - - 2,300 - 2,300
Unrealised gains
on investments at
fair value 3 - - 6,246 - 6,246
Net realised and
unrealised currency
gains - - 151 - 151
Capital expenses - - (469) - (469)
Ordinary shares bought
back into treasury 7 - (1,813) - - (1,813)
Transfer to revenue
reserve for the period - - - 675 675
Dividends paid 5 - - - (744) (744)
------------------------ ---- --------- -------------- -------- --------- -------
Net assets as at
30 September 2019 1,001 95,886 46,108 875 143,870
------------------------ ---- --------- -------------- -------- --------- -------
Year to 31 March 2020 (Audited)
Called Special
up Share Distributable Capital Revenue
Capital Reserve* Reserve Reserve* Total
Note GBP000 GBP000 GBP000 GBP000 GBP000
--------------------- ---- ---------- --------------- --------- ---------- ---------
Net assets as at
1 April 2019 1,001 97,699 37,880 944 137,524
Realised gains on
investments at fair
value 3 - - 4,943 - 4,943
Unrealised losses
on investments at
fair value 3 - - (38,836) - (38,836)
Net realised and
unrealised currency
gains - - 76 - 76
Capital expenses - - (957) - (957)
Ordinary shares
bought back into
treasury 7 - (1,814) - - (1,814)
Transfer to revenue
reserve for year - - - 1,078 1,078
Dividends paid 5 - - - (744) (744)
--------------------- ---- ---------- --------------- --------- ---------- ---------
Net assets as at
31 March 2020 1,001 95,885 3,106 1,278 101,270
--------------------- ---- ---------- --------------- --------- ---------- ---------
* These reserves are distributable.
The notes form part of these financial statements.
CONDENSED STATEMENTS OF FINANCIAL POSITION
(Unaudited) (Unaudited) (Audited)
As at 30 September As at 30 September As at 31 March
2020 2019 2020
---------------------- ---- --------------------- --------------------- -------------------
Note GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
---------------------- ---- --------- ---------- -------- ----------- -------- ---------
Fixed assets
Investments
held at fair
value through
profit or loss
Current assets
Cash and cash
equivalents 3 9,579 111,451 11,274 132,129 12,372 89,892
Receivables 5,532 734 231
---------------------- ---- --------- ---------- -------- ----------- -------- ---------
15,111 12,008 12,603
Current liabilities
Payables (4,537) (267) (1,225)
---------------------- ---- --------- ---------- -------- ----------- -------- ---------
Net current
assets 10,574 11,741 11,378
---------------------- ---- --------- ---------- -------- ----------- -------- ---------
Net assets 122,025 143,870 101,270
---------------------- ---- --------- ---------- -------- ----------- -------- ---------
Share capital
and reserves
Called-up share
capital 7 1,001 1,001 1,001
Special distributable
reserve* 95,885 95,886 95,885
Capital reserve 24,238 46,108 3,106
Revenue reserve* 901 875 1,278
---------------------- ---- --------- ---------- -------- ----------- -------- ---------
Total shareholders'
funds 122,025 143,870 101,270
Net asset value
per ordinary
share 6 124.2p 146.4p 103.0p
---------------------- ---- --------- ---------- -------- ----------- -------- ---------
* These reserves are distributable.
Gabelli Value Plus+ Trust Plc is registered in England and Wales
under Company number 9361576.
The financial statements were approved by the Board of Directors
on 4 January 2021 and signed on its behalf by
Peter Dicks
Chairman
The notes form part of these financial statements.
Notes to the condensed financial statements
1 Condensed financial statements
The half yearly report has not been audited by the Company's
auditors.
2 Accounting policies
For the half years ended 30 September 2020 and 2019, the Company
applied FRS 104 - Interim Financial Reporting and for the year
ended 31 March 2020, the Company applied FRS 102. The Financial
Reporting Standard applicable in the UK and Republic of Ireland,
which forms part of the revised Generally Accepted Accounting
Practice (New UK GAAP) issued by the Financial Reporting Council
('FRC') in 2015.
At the Company's Annual General Meeting held on 30 July 2020 a
continuation vote was put to shareholders and defeated. Resolutions
put forward by ACG at a General Meeting of the Company held on 7
December 2020 were also defeated. The Board is currently
considering options, including a members' voluntary liquidation, in
order to deliver on the outcome of these votes for
shareholders.
The outcome of these votes represents a material uncertainty
which may cast significant doubt on the Company's ability to
continue as a going concern. The financial statements do not
include the adjustments that would result if the Company was unable
to continue as a going concern. In arriving at the decision on the
basis of preparation, the Board has considered the financial
position of the Company, its cashflow and liquidity position, as
well as the uncertainty arising from the outcome of the votes.
If it were not appropriate to prepare the financial statements
on a going concern basis of accounting then adjustments would be
required to reclassify all assets as current and a provision for
further liabilities, including liquidation costs, would be made. In
the Directors' opinion the impact of these adjustments on the
financial statements is not expected to be significant.
These condensed financial statements have been prepared on a
going concern basis in accordance with the Disclosure Guidance and
Transparency Rules of the Financial Conduct Authority (FRS 102 and
FRS 104), the revised Statement of Recommended Practice "Financial
Statements of Investment Trust Companies and Venture Capital
Trusts" (SORP) issued by the AIC in October 2019 and Companies Act
2006.
The accounting policies applied for the condensed set of
financial statements are set out in the Company's Annual Report for
the year ended 31 March 2020.
Statement of estimation uncertainty - In the application of the
Company's accounting policies, the Investment Manager is required
to make judgements, estimates, and assumptions about carrying
values of assets and liabilities that are not always readily
apparent from other sources. The estimates and associated
assumptions are based on historical experience and other factors
that are considered to be relevant. Actual results may vary from
these estimates. There have been no significant judgements,
estimates, or assumptions for the period.
Cash flow statement - The statement of cash flows has not been
included in the financial statements as the Company meets the
conditions set out in paragraph 7.1A of FRS 102, which state that a
statement of cashflows is not required to be provided by investment
funds that meet all of the following conditions:
(i) substantially all of the entity's investments are highly liquid;
(ii) substantially all of the entity's investments are carried
at market value; and
(iii) the entity provides a statement of changes in net
assets.
3 Investments at fair value through profit or loss
(Unaudited) (Unaudited) (Audited)
As at As at As at
30 September 30 September 31 March
2020 2019 2020
GBP000 GBP000 GBP000
------------------------------ ------------- ------------- ---------
Opening book cost 120,116 128,532 128,532
Opening investment holding
(losses)/gains (30,224) 8,612 8,612
------------------------------ ------------- ------------- ---------
Opening market value 89,892 137,144 137,144
------------------------------ ------------- ------------- ---------
Additions at cost 20,792 26,807 60,402
Disposals proceeds received (21,210) (40,368) (73,761)
Gains/(losses) on investments 21,977 8,546 (33,893)
------------------------------ ------------- ------------- ---------
Market value of investments 111,451 132,129 89,892
------------------------------ ------------- ------------- ---------
Closing book cost 113,943 117,270 120,116
Closing investment holding
(losses)/gains (2,492) 14,859 (30,224)
------------------------------ ------------- ------------- ---------
Closing market value 111,451 132,129 89,892
------------------------------ ------------- ------------- ---------
The company received GBP21,210,000 (30 September 2019:
GBP40,368,000, 31 March 2020: GBP73,761,000) from investments sold
in the period. The book cost of these investments when they were
purchased was GBP26,965,000 (30 September 2019: GBP38,069,000, 31
March 2020: GBP68,818,000).
Fair value hierarchy
The Company has adopted the 'Amendments to FRS 102 - Fair value
hierarchy disclosure', where an entity is required to classify fair
value measurements using a fair value hierarchy that reflects the
significance of the inputs used in making the measurements.
The fair value hierarchy shall have the following levels:
-- Level 1 - The unadjusted quoted price in an active market for
identical assets or liabilities that the entity can access at the
measurement date.
-- Level 2 - Inputs other than quoted prices included within
Level 1 that are observable, i.e., developed using market data, for
the asset or liability, either directly or indirectly.
-- Level 3 - Inputs are unobservable, i.e., for which market
data is unavailable, for the asset or liability.
The financial assets measured at fair value through profit or
loss in the financial statements are grouped into the fair value
hierarchy as follows:
As at 30 September 2020 (Unaudited)
------------------------------------------
Level 1 Level 2 Level 3 Total
GBP000 GBP000 GBP000 GBP000
----------------- --------- --------- --------- ---------
Financial
assets at
fair value
through profit
or loss
Quoted equities 111,451 - - 111,451
----------------- --------- --------- --------- ---------
Net fair value 111,451 - - 111,451
----------------- --------- --------- --------- ---------
As at 30 September 2019 (Unaudited)
------------------------------------------
Level 1 Level 2 Level 3 Total
GBP000 GBP000 GBP000 GBP000
----------------- --------- --------- --------- ---------
Financial
assets at
fair value
through profit
or loss
Quoted equities 132,129 - - 132,129
----------------- --------- --------- --------- ---------
Net fair value 132,129 - - 132,129
----------------- --------- --------- --------- ---------
As at 31 March 2020 (Audited)
-------------------------------------
Level 1 Level 2 Level 3 Total
GBP000 GBP000 GBP000 GBP000
----------------- -------- -------- -------- -------
Financial
assets at
fair value
through profit
or loss
Quoted equities 89,892 - - 89,892
----------------- -------- -------- -------- -------
Net fair value 89,892 - - 89,892
----------------- -------- -------- -------- -------
Net realised and unrealised gains/(losses) on investments
(Unaudited) (Unaudited) (Audited)
Half year Half year Year ended
ended ended 31 March
30 September 30 September 2020
2020 2019 GBP000
GBP000 GBP000
------------------------------- --------------- --------------- -----------
Realised (losses)/gains
on investments (5,755) 2,300 4,943
Movement in unrealised
gains/(losses) on investments 27,732 6,246 (38,836)
------------------------------- --------------- --------------- -----------
Net realised and unrealised
gains on investments 21,977 8,546 (33,893)
------------------------------- --------------- --------------- -----------
Transaction costs
During the respective periods commissions (paid mostly to
G.research, LLC, an affiliate of the Investment Manager) and other
expenses were incurred in acquiring or disposing of investments
classified at fair value through profit or loss. These have been
expensed through capital and are within gains/(losses) in the
Statement of Comprehensive Income. The total costs were as
follows:
(Unaudited) (Unaudited) (Audited)
Half year Half year Year ended
ended ended 31 March
30 September 30 September 2020
2020 2019
GBP000 GBP000 GBP000
----------- --------------- --------------- ------------
Purchases 19 22 53
Sales 20 17 41
----------- --------------- --------------- ------------
Total 39 39 94
----------- --------------- --------------- ------------
4 Taxation on ordinary activities
(Unaudited)
Half year ended 30 September
2020
----------------------------------
Revenue Capital Total
Analysis of the charge GBP000 GBP000 GBP000
in the period
-------------------------- ---------- ---------- ----------
Foreign withholding
taxes on dividends 160 - 160
Total 160 - 160
-------------------------- ---------- ---------- ----------
(Unaudited)
Half year ended 30 September
2019
----------------------------------
Revenue Capital Total
Analysis of the charge GBP000 GBP000 GBP000
in the period
-------------------------- ---------- ---------- ----------
Foreign withholding
taxes on dividends 134 - 134
Foreign withholding
taxes on REIT 4 - 4
-------------------------- ---------- ---------- ----------
Total 138 - 138
-------------------------- ---------- ---------- ----------
(Audited)
Year ended 31 March 2020
------------------------------
Revenue Capital Total
Analysis of the charge GBP000 GBP000 GBP000
in the year
-------------------------- --------- --------- --------
Foreign withholding
taxes on dividends 272 - 272
Foreign withholding
taxes on REIT 9 - 9
-------------------------- --------- --------- --------
Total 281 - 281
-------------------------- --------- --------- --------
5 Equity dividends
(Unaudited) (Unaudited)
Half year Half year (Audited)
ended ended Year ended
30 September 30 September 31 March
2020 2019 2020
GBP000 GBP000 GBP000
--------------------- -------------- -------------- --------------
Final dividend
of 0.75p paid
for the year ended
31 March 2019 - 744 744
Final dividend
of 1p paid for
the year ended
31 March 2020 983 - -
--------------------- -------------- -------------- --------------
Total 983 744 744
--------------------- -------------- -------------- --------------
6 Return per ordinary share and net asset value
The return and net asset value per ordinary share are calculated
with reference to the following amounts :
(Unaudited) (Unaudited) (Audited)
Half year Half year Year ended
ended ended 31 March
30 September 30 September 2020
2020 2019
---------------------------- --------------- ------------- ---------------
Revenue return
Revenue return attributable GBP675,000 GBP1,078,000
to ordinary shareholders GBP606,000
---------------------------- --------------- ------------- ---------------
Weighted average number
of shares in issue during
period 98,282,193 99,019,642 98,650,562
Total revenue return per
ordinary share 0.62p 0.68p 1.09p
---------------------------- --------------- ------------- ---------------
Capital return
Capital return attributable GBP8,228,000 (GBP34,774,000)
to ordinary shareholders GBP21,132,000
---------------------------- --------------- ------------- ---------------
Weighted average number
of shares in issue during
period 98,282,193 99,019,642 99,650,562
Total capital return per
ordinary share 21.50p 8.31p (35.25p)
---------------------------- --------------- ------------- ---------------
Total return
Total return per ordinary
share 22.12p 8.99p (34.16p)
---------------------------- --------------- ------------- ---------------
(Unaudited) (Unaudited) (Audited)
As at As at As at
30 September 30 September 31 March
2020 2019 2020
-------------------------- --------------- -------------- --------------
Net asset value per share
Net assets attributable
to shareholders GBP122,025,000 GBP143,870,000 GBP101,270,000
Number of shares in issue
at period end 98,282,193 98,282,193 98,282,193
Net asset value per share 124.2p 146.4p 103.0p
-------------------------- --------------- -------------- --------------
7 Called up share capital
(Unaudited) (Unaudited) (Audited)
As at As at As at
30 September 30 September 31 March
2020 2019 2020
GBP000 GBP000 GBP000
------------------------------------- --------------- ------------- ------------
Allotted, called up and fully
paid:
98,282,193 (31.03.2020: 98,282,193;
30.09.2019: 98,282,193)
Ordinary shares of 1p each
- equity 983 983 983
------------------------------------- --------------- ------------- ------------
Treasury shares:
1,818,808 (31.03.2020: 1,818,808;
30.09.2019: 1,818,808)
Ordinary shares of 1p each
- equity 18 18 18
------------------------------------- --------------- ------------- ------------
Total shares 1,001 1,001 1,001
------------------------------------- --------------- ------------- ------------
During the half year ended 30 September 2020 the Company did not
buy back any shares (30 September 2019: 1,424,500) into treasury at
a cost of GBPnil (30 September 2019: GBP1,804,483).
8 Related party transactions
During the half year ended 30 September 2020, with the exception
of Investment Management fees, Directors' remuneration, Directors'
shareholdings, secretarial fees, and other administrative fees, the
Company paid brokerage commissions on security trades of GBP27,304
(30 September 2019: GBP36,552; 31 March 2020: GBP76,776) to
G.research, LLC, an affiliate of the Investment Manager.
9 Contingent Liabilities and Commitments
As at 30 September 2020, the Company had no contingent
liabilities or commitments (30 September 2019: nil, 31 March 2020:
nil).
10 Half-Yearly report
The financial information contained in this half year financial
report does not constitute statutory accounts as defined in section
435 of the Companies Act 2006. The financial information for the
six months ended 30 September 2020 and 30 September 2019 has not
been audited.
The information for the year ended 31 March 2020 has been
extracted from the latest published audited financial statements,
which have been filed with the Registrar of Companies. The report
of the Auditors on those accounts contained no qualification or
statement under sections 498(2) or 498(3) of the Companies Act
2006.
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