RNS Number:3742O
Oryx International Growth Fund Ld
21 December 2006
FOR IMMEDIATE RELEASE
RELEASED BY HSBC SECURITIES SERVICES (GUERNSEY) LIMITED
ORYX INTERNATIONAL GROWTH FUND LIMITED
PRELIMINARY ANNOUNCEMENT
THE BOARD OF DIRECTORS OF ORYX INTERNATIONAL GROWTH FUND LIMITED ANNOUNCE
UNAUDITED RESULTS FOR THE SIX MONTHS ENDED 31 OCTOBER 2006:
UNAUDITED CONSOLIDATED BALANCE SHEET
as at 30 September 2006
(Expressed in pounds sterling)
30 September 30 September
2006 2005
# #
ASSETS
Bank balances 20,581,721 4,927,702
Dividends and interest receivable 335,573 143,034
Amounts due from brokers 471,217 209,609
Other receivables 540,822 249,047
Listed investments at fair value
(Cost #31,504,892: 2005 - #16,052,462) 34,397,308 18,290,313
Unlisted investments at fair value
(Cost #4,581,003: 2005 - #3,906,297) 5,973,675 5,181,451
TOTAL ASSETS 62,300,316 29,001,156
LIABILITIES
Bank overdrafts 71,921 4,337
Amounts due to brokers 804,659 365,640
Creditors and accrued expenses 1,792,403 101,508
TOTAL LIABILITIES 2,668,983 471,485
NET ASSETS 59,631,333 28,529,671
REPRESENTED BY:
CAPITAL AND RESERVES
Called up share capital 18,029,988 5,333,045
Share premium 19,588,739 5,678,409
Capital redemption reserve 1,246,500 1,246,500
Other reserves 17,643,852 16,271,717
38,479,091 23,196,626
TOTAL EQUITY SHAREHOLDERS' FUNDS 56,509,079 28,529,671
Minority Interests 3,122,254 -
59,631,333 28,529,671
Net Asset Value per Share - Ordinary # 3.10 # 2.67
Net Asset Value per Share - C Share # 1.06 N/a
Diluted Net Asset Value per Share - Ordinary # 3.10 # 2.67
Diluted Net Asset Value per Share - C Share # 1.06 N/a
UNAUDITED CONSOLIDATED INCOME STATEMENT
for the period ended 30 September 2006
(Expressed in pounds sterling)
6 month to 6 month to
30 September 30 September
2006 2005
# #
INCOME
Deposit interest 297,969 90,350
Dividends and investment income 642,366 714,465
940,335 804,815
EXPENDITURE
Management and investment adviser's fee 225,708 156,421
Finance charge - 7,220
Custodian fees 12,529 8,807
Administration fees 19,672 11,880
Registrar and transfer agent fees 997 527
Directors' fees and expenses 63,507 50,657
Audit fees 6,588 6,015
Insurance 4,458 4,746
Legal and professional fees 1,963 78,971
Termination costs of Baltimore directors and employees 459,465 -
Miscellaneous expenses 49,466 13,355
844,353 338,599
NET INCOME BEFORE TAXATION 95,982 466,216
Taxation (51,066) (69,392)
NET INCOME FOR THE PERIOD
AFTER TAXATION 44,916 396,824
Realised gain on investments 2,860,764 2,377,118
Gain on foreign currency translation 49,880 13,904
Movement in unrealised (loss)/gain on
revaluation of investments (885,770) 10,136
Transaction costs (361,468) (35,133)
TOTAL SURPLUS ATTRIBUTABLE TO
SHAREHOLDERS FOR THE PERIOD 1,708,322 2,762,849
Basic earnings per share for the period - Ordinary # 0.14 # 0.27
Basic earnings per share for the period - C Share # 0.01 N/a
Diluted earnings per share for the period - Ordinary # 0.14 # 0.26
Diluted earnings per share for the period - C Share # 0.01 N/a
UNAUDITED CONSOLIDATED STATEMENT OF CASH FLOWS
for the period ended 30 September 2006
(Expressed in pounds sterling)
6 month to 6 month to
30 September 30 September
2006 2005
# #
Net cash (outflow)/inflow from
operating activities (13,863) 285,625
INVESTING ACTIVITIES
Purchase of investments (23,684,207) (10,388,446)
Sale of investments 21,895,483 11,292,916
Transaction costs (361,468) (35,133)
Net cash (outflow)/inflow from investing activities (2,150,192) 869,337
FINANCING ACTIVITIES
Cash acquired on acquisition of Baltimore Plc 15,907,268 -
Net cash inflow from financing activities 15,907,268 -
Net cash inflow 13,743,213 1,154,962
RECONCILIATION OF NET CASH FLOW TO
MOVEMENT IN NET FUNDS
Net cash inflow 13,743,213 1,154,962
Exchange movements 49,880 13,904
Net cash at beginning of period 6,716,707 3,754,499
Net cash at end of period 20,509,800 4,923,365
CHAIRMAN'S STATEMENT
During the period under review, the Company underwent a fundamental change with
the takeover of Baltimore plc which went unconditional on 18 July 2006. This
resulted in the creation of a "C" share which will trade independently from the
ordinary shares until the Board merge the two businesses.
I am pleased to report that the ordinary shares saw an increase in net asset
value of 5 per cent. in the last six months and 16 per cent. over the last
twelve to #3.10. This represents the continuing success of the manager's
investment strategy of investing in activist situations where value can be
extracted. There are no direct comparables for the "C" shares, however progress
is being made to align the portfolio to the ordinary shares so that they will,
in due course, be compatible.
In line with our stated policy, the Board do not propose paying a dividend,
however it will be our intention to continue buying in ordinary shares when the
discount allows it to be enhancing to net asset value.
Nigel Cayzer
Chairman
INVESTMENT ADVISER'S REPORT
The performance of the Company attributable to the ordinary shares can largely
be attributable to the good performance of the unquoted portfolio. In
particular Nationwide Accident went public and has subsequently risen by nearly
50%. Paramount was taken over at a 100% premium to holding cost. A number of
other investments are in discussions to be acquired and your Board has revalued
these to reflect "fair value".
The quoted portfolio has been more challenging following a very weak period in
equity markets in May. Inevitably there have been successes and failures.
Recent purchases such as Biotrace, Telecom Plus, Compel, Inspired Gaming and
Avanti Screen Media have generally performed well. This, however, has been
offset by a very disappointing performance by Lambert Howarth, Cardpoint and
Ferraris. Communisis was also disappointing but we are optimistic that a new
chef executive will revitalise the company over the next eighteen months.
The Company was successful in acquiring Baltimore plc. These assets are now
held in a 'C' share pool which will be merged with the ordinary share pool as
soon as the two respective portfolios merge and remaining Baltimore liabilities
are fully qualified.
Both the ordinary and Oryx C shareholders will benefit from reduced overhead
costs as these are shared over a greater asset base.
Considerable progress has been made over the past few weeks to resolve the
issues at Baltimore. These can be summarised as follows:
1. The Baltimore portfolio consisted of a small number of illiquid investments.
These have largely been liquidated at a premium to fair asset value (i.e. value
for purposes of the offer).
2. The lease on the company's office has been surrendered again at a
considerable saving.
3. The outstanding contract for difference has been resolved and the shares
purchased for cancellation.
4. Nearly all current expenses of the trust have been eliminated and the
contact with Duncan Soukup terminated at a saving of some #280,000 to Oryx C
shareholders. All litigation relating to Mr. Soukup has been dropped by both
parties.
5. Baltimore's remaining liabilities have been identified and we will seek to
mitigate these over the next few months.
Conclusion:
Despite variable market conditions, we remain optimistic that the Group will
maintain the momentum of the last six months.
North Atlantic Value LLP
12 December 2006
UNAUDITED TEN LARGEST EQUITY HOLDINGS
as at 30 September 2006
Bavaria Indkapital - Cost #1,933,665 (91,450 shares)
This was acquired as part of the Baltimore portfolio. Recent results have been
good but this holding will be reduced when the "lock up" is released in January
2007.
Market value #2,441,966 representing 4.10 per cent. of Net Asset Value.
Compel Group Plc - Cost #1,858,775 (2,170,000 shares)
The company is a small conglomerate offering technology rental services and
consulting. Profits rose 60 per cent. last year and the outlook for the current
years is good. The shares were acquired at a significant discount to the
estimated underlying value of the business.
Market value #2,126,600 representing 3.57 per cent. of Net Asset Value.
Santa Maria - Cost #680,088 (96,613 Ontario Inc shares and 1,264,823 Loan Notes
13 per cent.
17/5/08)
Santa Maria is the leading manufacturer and wholesaler of proscuitto and salami
in Canada, with a small export business to the US. It also imports and
distributes leading branded Italian foodstuffs, such as olive oil and dry pasta.
It has a strong position in the specialty retail sector and has expanded into
supermarkets, including manufacturing supermarkets; own label products. The
company is performing well in 2006 with results ahead of budget. There is an
offer to acquire the company at a premium to the current valuation.
Market value #2,033,561 representing 3.41 per cent. of Net Asset Value.
Inspired Gaming Group Plc - Cost #1,832,401 (1,000,000 shares)
The company is the largest owner operator of slot machines in the United
Kingdom. The shares were acquired on an attractive multiple of earnings and
EBITDA and have the potential to double if server based gaming technology is
successfully rolled out.
Market value #1,850,000 representing 3.10 per cent. of Net Asset Value.
Electronic Data Processing Plc - Cost #1,681,117 (3,090,000 shares)
The company is in fact a property business. The shares were purchased at a
discount to net asset value and have performed steadily since purchase.
Market value #1,792,200 representing 3.01 per cent. of Net Asset Value.
Augean Plc - Cost #1,696,453 (1,177,668 shares)
The company is the largest owner of hazardous waste sites in the United Kingdom.
The company is a prime candidate for acquisition and trades at a discount to
private market value.
Market value #1,660,512 representing 2.78 per cent. of Net Asset Value.
Telecom Plus Plc - Cost #1,414,512 (1,135,000 shares)
The company is the UK's leading bill aggregate for the utility industry offering
its clients all of the major utilities through a simple monthly payment. The
company has substantial cash balances and no debt. Earlier this year the company
entered into a performance related contract which gave Powergen the right to
acquire the business at about twice the current share price. The company
recently stated that trading was ahead of budget.
Market value #1,623,050 representing 2.72 per cent. of Net Asset Value.
Nationwide Accident Repair Services Plc ("Nationwide") - Cost #237,708 (950,000
shares)
Nationwide was taken private in 2002 through a management buy-in. Nationwide is
the largest chain of automobile body shops in the United Kingdom. Since its
purchase, loss-making operations and peripheral assets have been disposed of.
All debt has been repaid and the company has significant cash balances.
Nationwide had a good year in 2005 and interim results for 2006 have also been
favourable. The company has now gone public and has performed satisfactorily
since the IPO.
Market value #1,529,500 representing 2.56 per cent. of Net Asset Value.
Georgica Plc - Cost #853,997 (1,000,000 shares)
Georgica plc operates pool halls and bowling alleys in the United Kingdom. The
business consists of 170 billiard sites and 39 ten pin bowling facilities.
Twelve non-core Megabowl sites are being disposed off. We believe there is
further scope for margin improvement subsequent to recent renovations. Cashflows
should improve enough to enable the company to do share buybacks with surplus
cash. The share price rose substantially following an announcement that the
company was in discussions to be acquired. Following this, one third of the
holding was sold at a substantial profit.
Market value #1,460,000 representing 2.45 per cent. of Net Asset Value.
Gleeson (MJ) Group Plc - Cost #1,166,286 (400,000 shares)
Gleeson (MJ) Group plc is a construction operations company. The Group builds
houses and private purchases housing associations and local authorities, in
addition to providing electrical/mechanical engineering contracting, property
investment, and residential and commercial development services. The company has
announced a radical restructuring of its business portfolio which is expected to
significantly enhance shareholder value over the next twelve months.
Market value #1,432,000 representing 2.40 per cent. of Net Asset Value.
NOTES TO THE ACCOUNTS
For the period ended 30 September 2006
1. GENERAL
Oryx International Growth Fund Limited (the "Company") was incorporated in
Guernsey on 2 December 1994 and commenced activities on 3 March 1995.
On 26 July 2006 the Company acquired the entire issued share capital of
Baltimore plc. Under the terms of the offer, the consideration payable for these
shares was in the form of an issue of a new Class of shares, Oryx C Shares,
whereby each Baltimore shareholder was entitled to 1,000 Oryx C Shares for every
5,319 Baltimore shares held.
On 26 July 2006, Oryx C Shares were issued as a result of Baltimore shareholders
holding 140,286,701 Baltimore shares accepting the offer.
At a Directors Meeting on 3 October it was resolved that the Company acquire all
the remaining shares in Baltimore pursuant to a compulsory acquisition
procedure.
2. ACCOUNTING POLICIES
The financial statements are prepared under the historical cost convention as
modified by the revaluation of investments and in accordance with UK applicable
accounting standards.
The accounting policies have been applied consistently by the Group and are
consistent with those used in the previous reporting period.
a) Income Recognition
Dividends arising on the Group's listed and unlisted investments have been
accounted for on an ex-dividend basis. Deposit interest is accrued on a
day-to-day basis. Loan interest is accounted using the effective interest
method. All income is shown gross of any applicable withholding tax.
b) Valuation of investments
Classification
All investments of the Group are designated into the financial assets at fair
value through profit or loss category.
This category comprises financial instruments designated at fair value through
profit or loss upon initial recognition - these include financial assets that
are not held for trading purposes and which may be sold. These are principally
investments in listed and unlisted equities.
Measurement
Financial instruments are measured initially at fair value being the transaction
price. Subsequent to initial recognition, all instruments classified as fair
value through profit or loss are measured at fair value with changes in their
fair value recognised in the Income Statement. Transaction costs are separately
disclosed in the income statement.
Fair value measurement principles
Listed investments have been valued at the bid market price ruling at the
balance sheet date. In the absence of the bid market price, the closing price
has been taken, or, in either case, if the market is closed on the balance sheet
date, the bid market or closing price on the preceding business day.
Unlisted investments traded on AIM have been valued at their published bid
prices at the balance sheet date. Unlisted investments where there is not an
active market are valued using an appropriate valuation technique so as to
establish fair value at the balance sheet date.
Transaction costs applicable to investment transactions have been recognised in
the Income Statement.
c) Foreign Currency Translation
Items included in the Group's financial statements are measured using the
currency of the primary economic environment in which it operates (the "
functional currency"). This is the pound sterling which reflects the Group's
primary activity of investing in Sterling securities.
Foreign currency assets and liabilities have been translated at the exchange
rates ruling at the balance sheet date. Transactions in foreign currency during
the period have been translated into pounds sterling at the spot exchange rate
in effect at the date of the transaction. Realised and unrealised gains or
losses on currency translation are recognised in the Income Statement.
d) Realised and Unrealised Gains and Losses
Realised gains and losses arising on the disposal of investments are calculated
by reference to the cost attributable to those investments and the sales
proceeds, and are included in the Income Statement. Unrealised gains and losses
arising on investments held at the balance sheet date are also included in the
Income Statement.
e) Expenses
Expenses in relation to the placing of C Shares were borne by the subscribers of
the C Shares and not by existing ordinary shareholders.
f) Convertible Loan Stock at 30 September 2005
All outstanding loan stock was converted during the period ended 30 September
2005. The Convertible Loan Stock is recorded at the amount of the net proceeds.
The difference between the recorded amount and the redemption value of the loan
stock, the finance cost, is being charged at a constant rate over the period to
maturity to the Income Statement. Under the provisions of FRS 25, the equity
portion of the Convertible Loan Stock should be separated from the debt portion.
However, all the loan stock outstanding was converted during the period and the
amount outstanding at 1 April 2005 was immaterial, this split between debt and
equity separated from the debt portion was not deemed necessary and has not been
disclosed.
3. SHARE CAPITAL AND SHARE PREMIUM
a) Authorised Share Capital
#
50,000,000 ordinary shares of 50p each 25,000,000
40,000,000 C Shares of 50p each 20,000,000
45,000,000
On 24 July 2006, pursuant to an ordinary resolution approved at the
Extraordinary General Meeting, the Company increased its Authorised Share
Capital from #25,000,000 to #45,000,000 by the creation of 40,000,000 C Shares
of 50p each. These shares carry the rights attached thereto set out in the new
Articles of Association.
b) Ordinary Shares Issued - 1 April 2006 to 30 September 2006
Number of Share Share
Ordinary shares of 50p each and Shares Capital Premium
Management shares of 50p each: # #
At 1 April 2006 10,666,088 5,333,044 5,678,410
Issued during the period - - -
At 30 September 2006 10,666,088 5,333,044 5,678,410
C Shares Issued - 1 April 2006 to 30 September 2006
Number of Share Share
Shares Capital Premium
C Shares of 50p each: # #
At 1 April 2006 - - -
Issued during the period 25,393,888 12,696,944 13,910,329
At 30 September 2006 25,393,888 12,696,944 13,910,329
4. OTHER RESERVES
Included in Other Reserves is #1,063,207 relating to share capital contracted to
be issued to holders of Baltimore Plc shares who have accepted the offer of
shares. An amount of #4,401,355 has been deducted from Other Reserves in respect
of C Shares held by the Group for cancellation.
5. MINORITY INTERESTS
At 30 September 2006, shares representing 9.8 per cent. of the share capital of
Baltimore plc were not owned by or contracted to the Company. The Minority
Interests in the assets of the balance sheet of the Group amount to #3,122,254.
6. RECONCILIATION OF NET INVESTMENT EXPENSE TO NET CASH FLOW FROM
OPERATING ACTIVITIES
Ord shares C shares Total
2006 2006 2006 2005
# # # #
Net income/(expense) for the period 395,724 (350,808) 44,916 396,824
Increase in dividends and interest receivable (140,109) (86,990) (227,099) (27,131)
Decrease/(increase) in debtors (253,538) 287,140 33,602 (22,963)
Increase/(decrease) in creditors and
accrued expenses 35,087 99,631 134,718 (68,325)
Finance charge - - - 7,220
37,164 (51,027) (13,863) 285,625
7. RECONCILIATION OF NET ASSET VALUE TO PUBLISHED NET ASSET VALUE
# #
Ordinary shares per share per share
Published Net Asset Value 33,294,771 3.12
Management shares in issue 1 -
Unrealised loss on revaluation of investments at
Bid/mid price (ref. Note (a) below) (270,189) (0.02)
Net Asset Value attributable to shareholders 33,024,583 3.10
# #
C Shares per share per share
Published Net Asset Value 26,776,644 1.06
Unrealised loss on revaluation of investments at
Bid/mid price (ref. Note (a) below) (169,894) -
Net Asset Value attributable to shareholders 26,606,750 1.06
(a) In accordance with United Kingdom Financial Reporting Standards the Group's
long investments have been valued at bid price. However, in accordance with the
Company's principal documents the Net Asset Value reported each month reflects
the investments being valued at the closing, last or mid-market (as the
Directors in all circumstances considers appropriate) price as notified to the
Group on the valuation day by a member of the stock exchange concerned. Certain
investments remain valued at fair value as determined in good faith by the
Directors.
8. POST BALANCE SHEET EVENTS
At a Directors Meeting on 3 October it was resolved that the Company acquire all
the remaining shares in Baltimore pursuant to a compulsory acquisition
procedure.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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