TIDMOIG
RNS Number : 5042Z
Oryx International Growth Fund Ld
15 December 2017
15 December 2017
FOR IMMEDIATE RELEASE
RELEASED BY BNP PARIBAS SECURITIES SERVICES S.C.A., GUERNSEY
BRANCH
HALF-YEARLY RESULTS ANNOUNCEMENT
THE BOARD OF DIRECTORS OF Oryx International Growth Fund Limited
ANNOUNCE UNAUDITED CONDENSED HALF-YEARLY RESULTS FOR THE SIX
MONTHSED 30 SEPTEMBER 2017
A copy of the Company's Unaudited Condensed Half Yearly
Financial Report will be available via the following link:
www.oryxinternationalgrowthfund.co.uk
HALF-YEARLY BOARD REPORT
FINANCIAL HIGHLIGHTS, PERFORMANCE SUMMARY AND DIVID HISTORY
Financial highlights
Share buybacks
In the six month period ended 30 September 2017, Oryx
International Growth Fund Limited (the "Company") carried out 2
share buybacks, resulting in a total reduction of 444,000 shares
for a cost of GBP2,782,500. These shares were subsequently
cancelled.
(GBP in millions, except per At 30 September At 31 March
share data and the number of 2017 2017
Ordinary Shares in issue)
Number of Ordinary Shares in
issue 14,415,125 14,859,125
Market capitalisation(1)
- Ordinary Shares 100.55 95.1
Net Asset Value ("NAV") attributable
to shareholders
- Ordinary Shares 123.59 119.23
Investments 120.52 110.54
Cash and cash equivalents 3.37 8.95
NAV per share attributable to
shareholders
- Ordinary Shares 8.57 8.02
Share Price 6.98 6.40
Discount to NAV (based on published
NAV) (20.10)% (21.86)%
Earnings per share 0.49 1.10
Dividend history
No Ordinary Share dividend was declared during the period.
(1) - Source: Bloomberg
CHAIRMAN'S STATEMENT
It is again my pleasure to report a good set of results for the
six months ended 30 September 2017. The net asset value per share
increased by 6.9% which compares favourably with the rise in
appropriate indices. These results consolidate a period of strong
growth over the last five years where the Company's NAV has
increased by 120%.
As has been stated on many occasions in the past, the success of
this Company is derived from investing in situations where the
Manager, Harwood Capital, led by Christopher Mills, is able to
influence the maximisation of value in our holdings. This long term
approach has been very successful and has given shareholders very
strong returns over the last five years. Harwood Capital continue
to look for new investments at attractive prices but this process
can be time consuming and, in a rising market, frustrating. As is
reported below, there are grounds for optimism in the medium term
as investments continue to mature with good prices being achieved
on exit and new opportunities identified.
We continue to buy back shares and during the period, the
Company purchased for cancellation 444,000 shares at an average
discount of 18%. This policy continues to benefit shareholders.
In accordance with our long established policy, the directors
are not recommending a dividend.
Nigel Cayzer
Chairman
15 December 2017
executive sUMMARY
This Executive Summary is designed to provide information about
the Company's business and results for the six month period ended
30 September 2017. It should be read in conjunction with the
Chairman's Statement and the Investment Manager's Report which
gives a detailed review of investment activities for the period and
an outlook for the future.
Corporate summary
The Company is a Guernsey Authorised Closed-Ended Collective
Investment Scheme pursuant to the Protection of Investors
(Bailiwick of Guernsey) Law 1987, as amended, and the Authorised
Closed Ended Investment Scheme Rules 2008 issued by the Guernsey
Financial Services Commission. It was incorporated and registered
with limited liability in Guernsey on 2 December 1994, with
registration number 28917. The Company has a premium listing on the
Main Market of the London Stock Exchange.
The Company's share capital is denominated in Sterling and each
Ordinary Share carries equal voting rights.
The Investment Manager and Investment Adviser during the period
was Harwood Capital LLP (the "Investment Manager" and the
"Investment Adviser") a United Kingdom limited liability
partnership incorporated under the Limited Partnerships Act 2000
(partnership number OC304213) and regulated by the Financial
Conduct Authority.
Harwood Capital LLP was authorised by the Financial Conduct
Authority ("FCA"), on 27 October 2014, as a Small Authorised UK
Alternative Investment Fund Manager ('AIFM') under the Alternative
Investment Fund Managers Directive (the 'AIFMD') and the Company
has been included in Harwood Capital LLP's Schedule of Alternative
Investment Funds ('AIFs'). As a Small Authorised UK AIFM, Harwood
Capital LLP is not subject to the full scope of the Directive but
must report to the FCA annually on the Company and the other AIFs
that it manages.
Significant events
In the six month period ended 30 September 2017, the Company
carried out 2 share buybacks, resulting in a total reduction of
444,000 shares for a cost of GBP2,782,500. These shares were
subsequently cancelled. Please refer to note 10 for more
detail.
Company investment objective and policy
The investment objective of the Company is to seek to generate
consistently high absolute returns whilst maintaining a low level
of risk for shareholders.
The Company principally invests in small and mid-size quoted and
unquoted companies in the United Kingdom and the United States. The
Investment Manager targets companies that have fundamentally strong
business models, but where there may be specific factors which are
constraining the maximisation or realisation of shareholder value,
which may be realised through the pursuit of an activist
shareholder agenda by the Investment Manager. Dividend income is a
secondary consideration when making investment decisions.
Director interests
The Board comprises seven non-executive Directors, five of whom
are independent: Nigel Cayzer (Chairman), Walid Chatila, Rupert
Evans, John Grace and John Radziwill. Christopher Mills is an
employee of the Investment Manager and Sidney Cabessa is a Director
of Harwood Capital Management Limited and are therefore not
regarded as independent. Information on each director is presented
below.
Walid Chatila, Rupert Evans and John Radziwill are members of
the Audit Committee and Nomination Committee. Nigel Cayzer, Sidney
Cabessa, and John Grace are also members of the Nomination
Committee.
Christopher Mills is a Partner and Chief Executive Officer of
the Investment Manager and Investment Adviser. Harwood Capital LLP
is entitled to fees as detailed in notes 4 and 5. Rupert Evans is a
consultant to the law firm Mourant Ozannes, the legal adviser to
the Company.
No fees were paid or are payable to Harwood Capital Management
Limited where Sidney Cabessa is a director. (30 September 2016:
Nil)
Information on the Directors' remuneration is detailed in note
8. Other than fees payable in the ordinary course of business,
there have been no material transactions with these related
parties.
The Company has not set any requirements or guidelines for
Directors to own shares in the Company. As at the date of approval
of the Half-Yearly Financial Report, Directors and their connected
persons held the following number of Ordinary Shares in the
Company:
Director Directors' holdings in the
Company's Ordinary Shares
------------------- ---------------------------
Christopher Mills 328,716
------------------- ---------------------------
John Grace (1) 130,000
346,607
------------------- ---------------------------
(1) John Grace holds a beneficial interest of 130,000 Ordinary
Shares. Mr Grace is also a member of a class of beneficiaries which
holds an interest in 346,607 Ordinary Shares.
Principal risks and uncertainties
When considering the total return of the Company, the Board
takes account of the risk which has been taken in order to achieve
that return. The Board looks at the following risk factors as
listed below:
-- Investment activity and performance
-- Level of discount or premium
-- Market price risk
Information on these risks and how they are managed is given in
the Annual Report and Financial Statements for the year ended 31
March 2017. In the view of the Board, these principal risks and
uncertainties are as applicable to the remaining six months of the
financial year as they were in the six months under review.
Going concern
Under the UK Corporate Governance Code and applicable
regulations, the Directors are required to satisfy themselves that
it is reasonable to assume that the Company is a going concern from
the date of approval of the condensed financial statements.
The Directors have considered the Company's investment objective
and risk management policy, its assets and the expected income and
return from its investments. The Directors are of the opinion that
the Company is able to meet its liabilities and ongoing expenses as
they fall due and they have a reasonable expectation that the
Company has adequate resources to continue in operational existence
for the foreseeable future. Accordingly, these financial statements
have been prepared on a going concern basis and the Directors
believe it is appropriate to continue to adopt this basis for a
period of at least 12 months from the date of approval of these
financial statements.
The special resolution outlined in Article 51 of the Articles of
Incorporation was not passed at the AGM on 31 August 2017. Hence,
the Company will continue its operations until the 2019 AGM when
the special resolution outlined in Article 51 will be proposed to
the shareholders again.
Events after the reporting date
The Directors are not aware of any developments that might have
a significant effect on the operations of the Company in subsequent
financial periods not already disclosed in this report or the
attached condensed financial statements.
Future strategy
The Board continues to believe that the investment strategy and
policy adopted by the Company is appropriate for and is capable of
meeting the Company's investment objective.
The overall strategy remains unchanged and it is the Board's
assessment that the Investment Manager resources are appropriate to
properly manage the Company's portfolio in the current and
anticipated investment environment.
Please refer to the Investment Manager's report for detail
regarding performance to date of the investment portfolio and the
main trends and factors likely to affect those investments.
BOARD MEMBERS
Directors
All Directors are non-executive.
Nigel Cayzer (Chairman)
British
Nigel Cayzer is Chairman of Aberdeen Asian Smaller Companies
Investment Trust PLC. He is also a director of a number of private
companies. He has been Chairman or a director of a number of
Investment Companies and was Chairman of Maggie's, a leading cancer
charity, from 2005 until 2014.
Sidney Cabessa
French
Sidney Cabessa is also a director of Club-Sagem and
Mercator/Nature et découvertes. He was Chairman of CIC Finance, an
Investment Fund and a subsidiary of French banking group, CIC -
Credit Mutuel and was previously a Director of other investment
companies.
Walid Chatila
Canadian
Walid Chatila has more than 11 years of international audit and
special assignment experience in the Middle East and North America.
He is a Certified Public Accountant (Texas 1984) and a Certified
Professional Accountant (Ontario 1991). From 1994 to 2006, he was
the Finance Director of Emirates Holdings in Abu Dhabi, United Arab
Emirates, and between 2006 and 2011, he assumed the role of General
Manager of Al Nowais Investment LLC. He is currently advisor to the
Chairman of Arab Development Establishment in Abu Dhabi.
Rupert Evans
British
Rupert Evans is a Guernsey Advocate and was a partner in the
firm of Ozannes between 1982 and 2003, since then he has been a
consultant to Ozannes (now Mourant Ozannes). He is a non-executive
director of a number of other investment companies some of which
are quoted on recognised stock exchanges. He is a Guernsey
resident.
Christopher Mills
British
Christopher Mills is a Partner and the Chief Executive Officer
of Harwood Capital LLP. He is also Chief Investment Officer of
North Atlantic Smaller Companies Investment Trust plc ("NASCIT").
NASCIT is the winner of numerous Micropal and S&P Investment
Trust awards. In addition, he is a non-executive director of
numerous UK companies which are either currently, or have in the
past five years been, publicly quoted.
John Radziwill
British
John Radziwill is currently a director of INTL FC Stone,
Goldcrown Group Limited, Fourth Street Capital Ltd, Fifth Street
Capital Ltd and Vendor Safe Technologies LLC. In the past ten
years, he also served as a director of Acquisitor Plc and
Acquisitor Holdings (Bermuda) Ltd, Air Express International Corp.,
Radix Ventures Inc, Baltimore Capital Plc, Lionheart Group Inc, USA
Micro Cap Value Co Ltd and Radix Organisation Inc. Mr Radziwill is
a member of the Bar of England and Wales.
John Grace
New Zealander
John Grace is actively involved in the management of several
global businesses including asset management, financial services,
and real estate. He is a Director and Founder of Sterling Grace
International Ltd. Sterling Grace and its affiliates manage
investments for high net-worth investors, institutions and
investment partnerships. The company is active in global money
management, financial services, private equity and real estate
investments. He is also Chairman of Trustees Executors Holdings
Ltd, owner of the premier and oldest New Zealand trust company
established in 1882. It is the market leader in the corporate trust
business. Its clients include government divisions, corporations
and banks. The company is active in wholesale financial services
including trust accounting, securities custody and mutual fund
registry. It is also actively engaged in the personal trust
business. Mr Grace graduated from Georgetown University. Mr Grace
has served as a director of numerous public companies and
charities. He currently supports genetic research and education
initiatives in science at the university of Lausanne, EPFL École
polytechnique fédérale de Lausanne and CERN, the European
Organization for Nuclear Research.
INVESTMENT MANAGER'S REPORT
During the six month period under review, the net asset value
per share rose by 6.9% which compares favourably with the rise in
appropriate indices.
Quoted equities:
The major success for the period was a 100% rise in the value of
Quantum Pharma following a takeover bid. Other stocks that
performed well include EKF Diagnostics Holdings Plc (+10%), Minds
Plus Machines Group (+20%), Bioquell Plc (+50%), Anpario Plc (+30%)
and Ten Entertainment Group which is up 13% since the IPO in early
April.
The successes were offset by weakness in our two wealth
management stocks, Harwood Wealth Management Group Plc and Frenkel
Topping Group Plc which fell by around 15%. Lakehouse Plc also fell
by over 25% due to its modest exposure to the Grenfell Towers
disaster, although the share price has recovered in October. Augean
Plc also fell by over 50% following an HMRC notice that it has
underpaid landfill tax. The company intends to vigorously defend
its position so we are optimistic that there could be a substantial
recovery from the current price.
Unquoted equities:
No new investments were made during the period. Unfortunately,
it was necessary to write down Sherwood Holdings Limited due to
poor trading. This was partly offset by an increase in the
valuation of Jaguar Holdings Limited as a result of significant new
contract wins.
Outlook:
We continue to believe that equities are fairly valued and there
is significant market risk where companies report disappointing
results.
MIFID II will, in our opinion, further reduce market liquidity
and therefore lead to increased volatility. The short term impact
of this on the portfolio might be unfavourable although, in the
long term, we believe it will create significant opportunities
given our different investment strategy.
Finally, we continue to expect further corporate activity over
the next twelve months which should help build the net asset value
over the medium term.
Harwood Capital LLP
15 December 2017
LARGEST EQUITY HOLDINGS
As at 30 September 2017
M J Gleeson Plc
Gleeson is a market leader in building affordable homes in the
North of England. The company continues to perform well relative to
market expectations. Recent results confirmed a significantly
higher than expected dividend which should support further growth
in the share price over the medium term.
Quantum Pharma Plc
The company is being taken over by Clinigen Group plc with the
proceeds expected prior to the end of the calendar year.
EKF Diagnostics Holdings Plc
The company is a leading supplier of point of care product for
the hemoglobin and diabetes markets. Recent results have been very
strong. The company has no net debt with cash balances rising
strongly as the company completes its capital expenditure
programme.
Sportech Plc
The company provides services to the gaming industry. Following
the sale of its UK business, the company is significantly reducing
its cost base which should result in a significant improvement in
profitability over the next twelve months.
The company also has very substantial cash balances which are
expected to be returned to shareholders in the near future.
Satellite Solutions Worldwide Group Ltd
The company provides fast broadband services for people living
in remote locations. The company is a market leader with excellent
prospects due to strong organic growth and add-on acquisitions.
Minds Plus Machines Group
The company is a worldwide company selling domain names
including .London and .VIP. In particular .VIP has been very
popular in China. The company has substantial net cash balances and
is now profitable.
TEN Entertainment Group Plc
The company is the second largest indoor bowling business. The
stock has performed well since the IPO and the recent trading
statement shows that good progress is being made in the current
year.
Goals Soccer Centres Plc
The company is the leading five-a-side soccer business in the
UK. The company is in the midst of a major turnaround following
years of under investment in the sites. A recent joint venture with
City Football in the USA could materially improve profitability
over the long term.
Frenkel Topping Group Plc
The company is a market leader in providing financial advisory
services to people who have suffered catastrophic injuries. In
addition, the company has a fund management business that is
growing rapidly. The company has substantial net cash with profits
also growing rapidly.
Lakehouse Plc
The company provides compliance services mainly for the public
sector. The share price was adversely impacted by the Grenfell
Tower disaster but has recently won substantial new contracts. A
non-core division was sold in early October which has significantly
reduced group debt. The outlook for 2018 is encouraging.
DIRECTORS' STATEMENT OF RESPONSIBILITIES
The Directors are responsible for preparing the Half-Yearly
Financial Report in accordance with applicable Guernsey law and
regulations.
The Directors confirm to the best of their knowledge that:
-- the unaudited condensed half-yearly financial statements have
been prepared in accordance with IAS 34, "Interim Financial
Reporting" and give a true and fair view of the assets,
liabilities, financial position and profit of the Company as at 30
September 2017, as required by the UK Listing Authority Disclosure
Guidance and Transparency Rule 4.2.4R;
-- the combination of the Chairman's Statement, the Investment
Manager's Report, the Executive Summary and the notes to the
unaudited condensed half-yearly financial statements include a fair
view of the information required by:
1. Rule 4.2.7R of the Disclosure Guidance and Transparency Rules
of the UK's Listing Authority ("DTR"), being an indication of
important events that have occurred during the six months ended 30
September 2017 and their impact on the condensed financial
statements; and a description of the principal risks and
uncertainties for the remaining six months of the year; and
2. DTR 4.2.8R, being related party transactions that have taken
place during the six months ended 30 September 2017 and that have
materially affected the financial position or performance of the
Company during that period; and any changes in the related party
transactions described in the last annual report that could do
so.
By order of the Board
Walid Chatila Rupert Evans
Director Director
15 December 2017 15 December 2017
CONDENSED STATEMENT OF COMPREHENSIVE INCOME
For the six months ended 30 September 2017
Six months ended 30 September 2017 Six months ended 30 September 2016
(Unaudited) (Unaudited)
Notes GBP GBP
Income
Investment income 3 359,792 287,988
Realised gain on financial assets
designated at fair value through
profit or loss 9 7,166,200 5,823,562
Unrealised gain on financial assets
designated at fair value through
profit or loss 686,561 6,726,551
(Loss) / gain on foreign currency
translation (1,431) 1,738
------------------------------------ ------
Total income 8,211,122 12,839,839
------------------------------------ ------ ----------------------------------- -----------------------------------
Expenses
Investment manager and investment
advisory fees 4 648,035 519,367
Transaction costs 75,972 47,850
Directors' fees and expenses 8 107,224 83,956
Audit fees 27,853 26,594
Administration fees 7 62,425 43,268
Legal and professional fees 69,907 38,653
Registrar and transfer agent fees 9,281 17,829
Custodian fees 6 15,836 13,577
Insurance fees 2,564 2,550
Regulatory fees 8,755 8,640
Printing fees 14,304 8,832
Other expenses 15,620 17,165
------------------------------------ ------ ----------------------------------- -----------------------------------
Total expenses 1,057,776 828,281
------------------------------------ ------ ----------------------------------- -----------------------------------
Profit before taxation 7,153,346 12,011,558
------------------------------------ ------ ----------------------------------- -----------------------------------
Withholding tax on dividends (11,585) (2,600)
----------------------------------- -----------------------------------
Profit after taxation and total
comprehensive income 7,141,761 12,008,958
------------------------------------ ------ ----------------------------------- -----------------------------------
Basic and diluted earnings per
Ordinary Share 12 0.49 0.79
------------------------------------ ------ ----------------------------------- -----------------------------------
The Company has no items of other comprehensive income, and
therefore the profit for the period is also the total comprehensive
income.
All items in the above statement are derived from continuing
operations. No operations were acquired or discontinued during the
period.
The accompanying notes form an integral part of these financial
statements.
CONDENSED STATEMENT OF FINANCIAL POSITION
As at 30 September 2017
30 September 2017 31 March
2017
Notes (Unaudited) (Audited)
GBP GBP
------------------ --------------
Non-current assets
Listed investments designated at fair value through profit or loss
(Cost - GBP91,837,445 (
31 March 2017 - GBP81,538,669)) 9 116,576,177 102,297,113
Unlisted investments designated at fair value through profit or loss
(Cost - GBP4,169,118
(31 March 2017 - GBP5,183,538)) 9 3,939,675 8,247,821
------------------ --------------
120,515,852 110,544,934
------------------ --------------
Current assets
Cash and cash equivalents 3,366,819 8,949,022
Amounts due from brokers 25,797 332,705
Dividends and interest receivable 41,756 182,025
Other receivables 6,982 3,212
Total current assets 3,441,354 9,466,964
------------------ --------------
Total assets 123,957,206 120,011,898
------------------ --------------
Current liabilities
Other payables and accrued expenses 330,896 340,665
Amounts due to brokers 40,707 250,000
Amounts due for share buybacks - 194,891
Total current liabilities 371,603 785,556
------------------ --------------
Net assets 123,585,603 119,226,342
------------------ --------------
Shareholders' equity
Share capital 10 49,900,846 50,122,846
Capital redemption reserve 1,246,500 1,246,500
Other reserves 72,438,257 67,856,996
------------------ --------------
Total shareholders' equity 123,585,603 119,226,342
------------------ --------------
Net Asset Value per Ordinary Share - basic and diluted
11,13 GBP8.57 GBP8.02
------------------ --------------
The condensed financial statements were approved by the Board of
Directors on 15 December 2017 and are signed on its behalf by:
Walid Chatila Rupert Evans
Director Director
CONDENSED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
For the six months ended 30 September 2017 (Unaudited)
Capital
Share redemption Other
Capital reserve reserves Total
Note GBP GBP GBP GBP
------------------------- ----- ----------- ------------ ------------ ------------
Balance at 1 April
2017 50,122,846 1,246,500 67,856,996 119,226,342
------------------------- ----- ----------- ------------ ------------ ------------
Total comprehensive
income for the period - - 7,141,761 7,141,761
Transactions with
owners, recorded
directly to equity
- Cancellation of
shares 10 (222,000) - (2,560,500) (2,782,500)
------------------------- ----- ----------- ------------ ------------ ------------
Balance at 30 September
2017 49,900,846 1,246,500 72,438,257 123,585,603
------------------------- ----- ----------- ------------ ------------ ------------
For the six months ended 30 September 2016 (Unaudited)
Capital
Share redemption Other
Capital reserve reserves Total
GBP GBP GBP GBP
------------------------- ----------- ------------ ----------- ------------
Balance at 1 April
2016 50,289,346 1,246,500 53,181,631 104,717,477
-------------------------- ----------- ------------ ----------- ------------
Total comprehensive
income for the period - - 12,008,958 12,008,958
Transactions with
owners, recorded
directly to equity
- Cancellation of
shares (69,000) - (744,750) (813,750)
-------------------------- ----------- ------------ ----------- ------------
Balance at 30 September
2016 50,220,346 1,246,500 64,445,839 115,912,685
-------------------------- ----------- ------------ ----------- ------------
CONDENSED STATEMENT OF CASH FLOWS
For the six months ended 30 September 2017
Six months ended 30 Six months ended 30
September 2017 September 2016
GBP GBP
Note (Unaudited) (Unaudited)
-------------------------------------------------------------- ----- ---------------------- -----------------------
Cash outflow from operating activities
Profit after taxation and total comprehensive income for the
period 7,141,761 12,008,958
Adjustments to reconcile profit after tax to net cash flows:
* Realised gain on financial assets designated at fair
value through profit or loss 9 (7,166,200) (5,823,562)
* Unrealised gain on financial assets designated at
fair value through profit or loss (686,561) (6,726,551)
* Net loss / (gain) on foreign currency translation 1,431 (1,738)
Purchase of financial assets designated at fair value through
profit or loss (23,609,924) (27,358,570)
Proceeds from sale of financial assets designated at fair
value through profit or loss 21,491,768 23,148,197
Changes in working capital
Decrease in other receivables 136,499 81,008
Decrease in amounts due from brokers 306,908 158,381
Decrease in other payables and accrued expenses (9,769) (19,220)
Decrease in amounts due to brokers (209,293) (354,959)
Net cash outflow from operating activities (2,603,380) (4,888,056)
-------------------------------------------------------------- ----- ---------------------- -----------------------
Cash outflow from financing activities
Cancellation of shares (2,977,391) (813,750)
Net cash outflow from financing activities (2,977,391) (813,750)
-------------------------------------------------------------- ----- ---------------------- -----------------------
Net decrease in cash and cash equivalents in the period (5,580,771) (5,701,806)
-------------------------------------------------------------- ----- ---------------------- -----------------------
Cash and cash equivalents at the beginning of the period 8,949,022 19,514,960
Effect of exchange rate fluctuations on cash and cash
equivalents (1,432) 1,738
Cash and cash equivalents at the end of period 3,366,819 13,814,892
-------------------------------------------------------------- ----- ---------------------- -----------------------
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
1. General information
The Company was registered in Guernsey on 2 December 1994 and
commenced activities on 3 March 1995. The Company was listed on the
London Stock Exchange on 3 March 1995.
The Company is a Guernsey Authorised Closed-Ended Investment
Scheme and is subject to the Authorised Closed-Ended Investment
Scheme Rules 2008.
The investment activities of the Company are managed by the
Investment Manager and the administration of the Company is
delegated to BNP Paribas Securities Services S.C.A., Guernsey
Branch (the "Administrator").
Legislation in Guernsey governing the preparation and
dissemination of financial statements may differ from legislation
in other jurisdictions.
2. Accounting policies
The Annual Report and Financial Statements is prepared in
accordance with the Disclosure Guidance and Transparency Rules of
the FCA and with International Financial Reporting Standards as
adopted by the European Union ("IFRS") which comprise standards and
interpretations approved by the International Accounting Standards
Board (IASB), and interpretations issued by the International
Accounting Standards and Standing Interpretations Committee as
approved by the International Accounting Standards Committee which
remain in effect. The Half-Yearly Financial Report has been
prepared in accordance with International Accounting Standards
(IAS) 34 - "Interim Financial Reporting". They have also been
prepared using the same accounting policies applied for the year
ended 31 March 2017 Annual Report and Financial Statements.
The Half-Yearly Financial Report has been prepared under a going
concern basis. After analysing the following, the Directors believe
that it is appropriate to adopt the going concern basis in
preparing these financial statements:
-- Working capital - As at 30 September 2017, there was a
working capital surplus of GBP3,069,751. The Directors noted that
as at 30 September 2017 (i) the net investment income for the
period from 1 April 2017 to 30 September 2017 was GBP7,141,761 and
(ii) the Company had no borrowings, as such it has sufficient
capital in hand to cover all expenses (which mainly consist of
Investment Manager's fees, Directors' fees, Administration fees and
Legal and Professional fees) and to meet all of its obligations as
they fall due.
-- Closed-ended Company --- The Company has been authorised by
the Guernsey Financial Services Commission as an Authorised
Closed-ended Collective Investment Scheme, as such there cannot be
any shareholder redemptions, and therefore no cash flows out of the
Company in this respect.
-- Investments - The Company has a tradable portfolio, as 97% of
the investments are listed and can therefore be readily sold for
cash.
The special resolution outlined in Article 51 of the Articles of
Incorporation was not passed at the AGM on 31 August 2017. Hence,
the Company will continue its operations until the 2019 AGM when
the special resolution outlined in Article 51 will be proposed to
the shareholders again.
There have been no changes in accounting policies during the
period. The accounting policies in respect of financial instruments
are set out below at 2.3 due to the significance of financial
instruments to the Company.
2.1 Use of judgements and estimates
In preparing these half-yearly financial statements, management
has made judgements, estimates and assumptions that affect the
application of accounting policies and the reported amounts of
assets and liabilities, income and expenses. Actual results may
differ from these estimates.
The significant judgements made by management in applying the
Company accounting policies and the key sources of estimation
uncertainty were the same as those applied to for the year ended 31
March 2017 Annual Report and Financial Statements.
2.2 Segment reporting
The Directors view the operations of the Company as one
operating segment, being the investment business. All significant
operating decisions are based upon analysis of the Company's
investments as one segment. The financial results from this segment
are equivalent to the financial results of the Company as a whole,
which are evaluated regularly by the chief operating decision-maker
(the Board with insight from the Investment Manager).
2.3 Financial instruments
Financial Assets
Classification
All investments of the Company are designated as financial
assets at fair value through profit or loss. The investments are
purchased mainly for their capital growth and the portfolio is
managed, and performance evaluated, on a fair value basis in
accordance with the Company's documented investment strategy,
therefore the Directors consider that this is the most appropriate
classification.
Initial recognition
Financial assets are measured initially at fair value being the
transaction price. Subsequent to initial recognition on trade date,
all assets classified as fair value through profit or loss are
measured at fair value with changes in their fair value recognised
in the Statement of Comprehensive Income. Transaction costs are
separately disclosed in the Statement of Comprehensive Income.
Fair value measurement principles
Listed investments have been valued at the bid market price
ruling at the reporting 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 financial reporting date, the bid market or
closing price on the preceding business day.
Fair value of unlisted investments is derived in accordance with
the International Private Equity and Venture Capital (IPEV)
valuation guidelines. Their valuation includes all factors that
market participants would consider in setting a price. The primary
valuation techniques employed to value the unlisted investments are
earnings multiples, recent investments and the net asset basis.
Cost is considered appropriate for early stage investments. The
relevance of this methodology can be eroded over time and in these
cases the carrying values will be adjusted to reflect fair
value.
For certain of the Company's financial instruments, including
cash and cash equivalents, dividends and interest receivable and
amounts due from brokers, the carrying amounts approximate fair
value due to their immediate or short-term maturity.
De-recognition
De-recognition of financial assets occurs when the rights to
receive cash flows from financial instruments expire or are
transferred and substantially all of the risks and rewards of
ownership have been transferred.
Financial liabilities
Amounts due to brokers represent payables for investments that
have been contracted for but not yet settled or delivered at the
year end. Financial liabilities include other payables and accrued
expenses, amounts due to brokers and amounts due on redemption of
Ordinary Shares which are held at amortised cost using the
effective interest rate method.
Financial liabilities are recognised initially at fair value,
net of transaction costs incurred and are subsequently carried at
amortised cost using the effective interest rate method. Financial
liabilities are derecognised when the obligation specified in the
contract is discharged, cancelled or expires.
3. Investment income
Six months Six months
ended 30 ended 30
September September
2017 2016
(Unaudited) (Unaudited)
GBP GBP
Dividends 359,792 287,988
Total investment income 359,792 287,988
------------------------- ------------- -------------
4. Investment manager and investment advisory fees
Harwood Capital LLP, the Investment Manager and Investment
Adviser, is entitled to an annual fee of 1.25% on the first GBP15
million of the Net Asset Value of the Company, and 1% of any
excess, payable monthly in arrears. The agreement can be terminated
giving 12 months' notice or immediately should the Investment
Manager be placed into receivership or liquidation. The Investment
Manager is entitled to all the fees accrued and due up to the date
of such termination but is not entitled to compensation in respect
of any termination. Investment Manager and Investment Adviser fees
payable as at 30 September 2017: GBP216,684 (31 March 2017:
GBP199,181).
5. Supplementary management fee
The Investment Manager agreed to waive its right to exercise
management options to subscribe for Ordinary Shares in exchange for
a discretionary bonus ("supplementary management fee").
As at approval of these condensed financial statements, no
recommendation was made in respect of the 2017 supplementary
management fee. The supplementary management fee is paid annually
in arrears.
6. Custodian fees
BNP Paribas Securities Services S.C.A., Guernsey Branch was
appointed as custodian on 1 April 2007 and is entitled to an annual
safekeeping fee based upon the value of investments held plus
transactions fees, subject to a minimum of GBP4,000 per annum.
Custodian fee payable as at 30 September 2017: GBP2,571 (31 March
2017: GBP2,373). This amount is included in other payables and
accrued expenses.
7. Administration fees
The Administrator was appointed on 1 April 2007 and is entitled
to an annual fee at a rate of 0.125% on the first GBP20 million,
0.10% on the next GBP20 million and 0.075% of any excess of the
Total Assets, subject to a minimum of GBP50,000 per annum.
Administration fee payable as at 30 September 2017: GBP18,212 (31
March 2017: GBP16,540). This amount is included in other payables
and accrued expenses.
8. Directors' fees, expenses and interests
With the exception of the Chairman and Audit Committee Chairman,
who are entitled to a fee of GBP27,500 and GBP25,000 per annum
respectively, each Director is entitled to GBP20,000 per annum from
the Company. In addition, all Directors are entitled to
reimbursement of travel, hotel and other expenses incurred by them
in course of their duties relating to the Company.
The Company has no employees other than the Directors.
Directors' fees payable as at 30 September 2017 were GBP38,438 (31
March 2017: GBP37,708). This amount is included in other payables
and accrued expenses.
As at the date of approval of these condensed financial
statements, Christopher Mills and John Grace held Ordinary Shares
in the Company. Please refer to section entitled Director interests
for further details. No other Director holds shares in the
Company.
No pension contributions were payable in respect of any of the
Directors (31 March 2017: GBPnil).
9. Financial assets designated at fair value through profit or loss
30 September 31 March
2017 2017
GBP GBP
Cost at beginning of period
/ year 86,722,207 70,324,593
Additions 23,609,924 58,253,478
Disposals (21,491,768) (50,871,330)
Net realised gains on investments 7,166,200 9,015,466
------------- -------------
Cost at end of period / year 96,006,563 86,722,207
Net unrealised gain on investments 24,509,289 23,822,727
------------- -------------
Fair value at end of the period
/ year 120,515,852 110,544,934
------------- -------------
Representing:
30 September 31 March
2017 2017
GBP GBP
Listed equities 116,576,177 102,297,113
Unlisted equities 3,939,675 8,247,821
------------- ------------
120,515,852 110,544,934
------------- ------------
Investments are predominantly comprised of equity and
equity-related investments in small and mid-sized quoted and
unquoted companies in the United Kingdom and United States.
Fair value hierarchy
Fair value measurement should be determined based on assumptions
that market participants would use in pricing an asset or
liability. As a basis for considering market participant
assumptions, IFRS 13 - "Fair Value measurement" (IFRS 13),
establishes a fair value hierarchy that gives the highest priority
to unadjusted quoted prices in active markets (Level 1) and lowest
priority to unobservable inputs (Level 3). The three levels of the
value hierarchy are as follows.
Level 1: Inputs that reflect unadjusted quoted prices in active
markets for identical assets or liabilities that the Company has
the ability to access at the measurement date;
Level 2: Inputs reflect quoted prices of similar assets and
liabilities in active markets and quoted prices of identical assets
and liabilities in markets that are considered to be inactive, as
well as inputs other than quoted prices within level 1 that are
observable for the asset or liability either directly or
indirectly; and
Level 3: Inputs that are unobservable for the asset or liability
and reflect the Investment Manager's own assumptions in accordance
with the accounting policies disclosed within Note 2 to the
financial statements.
Level Level Level
30 September 2017 1 2 3 Total
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
GBP GBP GBP GBP
Financial assets at
fair value
through profit or
loss
Listed securities 116,576,177 - - 116,576,177
Unlisted securities - - 3,939,675 3,939,675
------------ ------------ ------------ ------------
116,576,177 - 3,939,675 120,515,852
------------ ------------ ------------ ------------
31 March 2017 Level 1 Level 2 Level 3 Total
(Audited) (Audited) (Audited) (Audited)
GBP GBP GBP GBP
Financial assets
at fair value
through profit
or loss
Listed securities 102,297,113 - - 102,297,113
Unlisted securities - 4,533,223 3,714,598 8,247,821
------------ ---------- ---------- ------------
102,297,113 4,533,223 3,714,598 110,544,934
------------ ---------- ---------- ------------
The following table summarises the changes in fair value of the
Company's Level 3 investments.
30 September 31 March 2017
2017
(Unaudited) (Audited)
GBP GBP
Opening balance 3,714,598 5,066,275
Net realised losses on investments (146,262) (1,798,896)
Unrealised (losses) / gains
on investments (608,167) 843,354
Purchase of investments 886,506 -
Sale of investments - (1,631,997)
Transfers from level 1 into
level 3 93,000 3,602,575
Transfers from level 3 into
level 2 - (2,366,713)
------------- --------------
Closing balance 3,939,675 3,714,598
------------- --------------
Change in unrealised losses
on investments included in
Condensed Statement of Comprehensive
Income for Level 3 investments
held 608,167 206,215
------------- --------------
During the period ended 30 September 2017, there was one
transfer from level 1 to level 3 resulting from an investee
company's listing being suspended. There was one transfer from
level 2 to level 1 resulting from one investee company being
listed. (31 March 2017: There were three transfers from level 1 to
level 3 and one transfer from level 3 to level 2).
Transfers between levels are determined based on changes to the
significant inputs used in the fair value estimation. The directors
have selected an accounting policy to apply transfers between
levels in the fair value hierarchy at the beginning of the relevant
reporting period.
Quantitative information of significant unobservable inputs -
Level 3
There were no significant unobservable inputs used at 30
September 2017 and 31 March 2017 in measuring financial instruments
categorised as Level 3 in the fair value hierarchy. The financial
instruments categorised as Level 3 have either a fair value that
either approximates a recent transaction price or is cash held in
escrow pending the outcome of certain post sale conditions (i.e.
warranties).
Sensitivity analysis to significant changes in unobservable
inputs within Level 3 hierarchy - Level 3
No sensitivity analyses have been presented for the period ended
30 September 2017 and the year ended 31 March 2017 given, as
mentioned above, there were no significant unobservable inputs used
at 30 September 2017 or 31 March 2017.
Please refer to note 2.3 for valuation methodology of financial
assets designated at fair value through profit or loss.
10. Share Capital
Authorised share capital
Number
of Shares GBP
Authorised:
------------------- ----------- -----------
Ordinary shares
of 50 pence each 90,000,000 45,000,000
--------------------- ----------- -----------
Ordinary Shares Issued - 1 April 2017 to 30 September 2017
Ordinary Shares of Number Share
50 pence each of Shares capital
GBP
At 1 April 2017 14,859,125 50,122,846
Cancellation of shares (444,000) (222,000)
----------- -----------
At 30 September 2017 14,415,125 49,900,846
----------- -----------
Ordinary Shares Issued - 1 April 2016 to 31 March 2017
Ordinary Shares of Number Share
50 pence each of Shares capital
GBP
At 1 April 2016 15,192,125 50,289,346
Cancellation of shares (333,000) (166,500)
----------- -----------
At 31 March 2017 14,859,125 50,122,846
----------- -----------
Rights attributable to Ordinary Shares
In a winding-up, the holders of Ordinary Shares are entitled to
the repayment of the nominal amount paid up on their shares. In
addition, they have the right to receive surplus assets available
for distribution. The shares confer the right to dividends, and at
general meetings, on a poll, confer the right to one vote in
respect of each Ordinary Share held.
Share buybacks
In accordance with section 315 of The Companies (Guernsey) Law
2008, (as amended) (the "Law"), the Company has been granted
authority to make one or more market acquisitions (as defined in
section 316 of the Law, of Ordinary Shares of 50 pence each in the
capital of the Company ("Ordinary Shares") on such terms and in
such manner as the Directors of the Company may from time to time
determine, provided that:
a) the maximum aggregate number of Ordinary Shares authorised to
be acquired does not exceed 10% of the issued Ordinary Share
capital of the Company on the date the shareholders' resolution is
passed;
b) the minimum price (exclusive of expenses) payable by the
Company for each Ordinary Share is 50 pence and the maximum price
payable by the Company for each Ordinary Share is an amount equal
to 105% of the average of the middle market quotations for an
Ordinary Share as derived from The London Stock Exchange Daily
Official List for the five business days immediately preceding the
day on which that Ordinary Share is purchased and that stipulated
by Article 5(1) of the Buy-back and Stabilisation Regulation being
the higher of the price of the last independent trade and the
highest current independent bid available in the market;
c) subject to paragraph (d), this authority shall expire (unless
previously renewed or revoked) at the earlier of the conclusion of
the next annual general meeting of the Company or on the date which
is 18 months from the date of the previous shareholders'
resolution;
d) notwithstanding paragraph (c), the Company may make a
contract to purchase Ordinary Shares under the authority from the
shareholders' before its expiry which will or may be executed
wholly or partly after the expiry of the authority and may make a
purchase of Ordinary Shares in pursuance of any such contract after
such expiry; and
e) the price payable for any Ordinary Shares so purchased may be
paid by the Company to the fullest extent permitted by the
Companies Law.
A renewal of the authority to make purchases of the Company's
own Ordinary Shares will be sought from existing shareholders at
each annual general meeting of the Company.
Between 1 April 2017 and 30 September 2017, the Company carried
out two share buybacks, resulting in a total reduction of 444,000
shares for a cost of GBP2,782,500. These shares were subsequently
cancelled.
Between 1 April 2016 and 31 March 2017, the Company carried out
six share buybacks, resulting in a total reduction of 1,179,486
shares for a cost of GBP6,161,989. These shares were subsequently
cancelled.
11. Reconciliation of the net asset value to published net asset
value
30 September 31 March 2017
2017
GBP GBP per GBP GBP per
share share
Published net asset value 125,854,893 8.73 121,667,553 8.19
Revaluation of investments
at bid price (2,269,290) (0.16) (2,441,211) (0.17)
-------------- --------- -------------- ---------
Net asset value attributable
to shareholders 123,585,603 8.57 119,226,342 8.02
-------------- --------- -------------- ---------
12. Basic and diluted earnings per Ordinary Share
Six months Six months
ended 30 ended 30
September September
2017 2016
(Unaudited) (Unaudited)
GBP GBP
Total comprehensive income
for the period 7,141,761 12,008,958
Weighted average number of
shares during the period 14,433,180 15,116,835
Basic and diluted
earnings per share 0.49 0.79
13. Net Asset Value per Ordinary Share
30 September 31 March
2017 2017
(Unaudited) (Audited)
GBP GBP
Net asset
value 123,585,603 119,226,342
Number of shares
at period/year end 14,415,125 14,859,125
Net asset value per
share 8.57 8.02
14. Related Parties
All transactions with related parties are carried out at arm's
length and the prices reflect the prevailing fair market value of
the assets on the date of the transaction.
The Investment Adviser is considered to be a related party. The
fees paid are included in the Condensed Statement of Comprehensive
Income and further detailed in notes 4 and 5.
The Directors are also considered to be related parties and
their fees are disclosed in the Statement of Comprehensive Income.
At 30 September 2017, GBP43,479 (31 March 2017: GBP37,708) included
in other payables and accrued expenses was payable to the
Directors.
Christopher Mills is a Director and shareholder of Oryx
International Growth Fund Limited. He is also a Partner and the
Chief Executive of Harwood Capital LLP, the Company's Investment
Manager and Investment Adviser and Chief Investment Officer of
North Atlantic Smaller Companies Investment Trust plc "NASCIT",
which is a substantial shareholder of Oryx.
Rupert Evans is a consultant to the law firm Mourant Ozannes,
the legal adviser to the Company. The Company neither paid fees to
Mourant Ozannes during the period, nor had any dues outstanding at
the Condensed Statement of Financial Position date (31 March 2017:
GBPnil).
As at 30 September 2017, the Company held 2,500,000 shares in
Harwood Wealth Management Group valued at GBP3,250,000. The Company
considers Harwood Wealth Management Group a related party as Mr
Christopher Mills, a non-executive director of Harwood Wealth
Management Group, is also a member of key management personnel of
the Company.
Sidney Cabessa is a Director of Harwood Capital Management
Limited, the parent company of Harwood Capital LLP. No fees were
paid or are payable to Harwood Capital Management Limited.
Christopher Mills and John Grace hold Ordinary Shares in the
Company. Refer to Directors' Interests above for further
details
14. Subsequent events
Management has evaluated subsequent events for the Company
through 15 December 2017, the date the condensed financial
statements were available to be issued, and had concluded there are
not any material events that require disclosure or adjustment of
the condensed financial statements.
COMPANY INFORMATION
Registered Office
BNP Paribas House, St Julian's Avenue, St Peter Port, Guernsey,
GY1 1WA
Investment Manager and Investment Adviser
Harwood Capital LLP
6 Stratton Street, Mayfair, London, W1J 8LD
Custodian
BNP Paribas Securities Services S.C.A., Guernsey Branch
P.O. Box 482, BNP Paribas House, St Julian's Avenue,
St Peter Port, Guernsey, Channel Islands, GY1 1WA
Secretary and Administrator
BNP Paribas Securities Services S.C.A., Guernsey Branch
P.O. Box 482, BNP Paribas House, St Julian's Avenue,
St Peter Port, Guernsey, Channel Islands, GY1 1WA
Registrars
Capita Registrars (Guernsey) Limited
PO Box 627, St Sampson, Guernsey, GY1 4PP
Stockbroker
Winterflood Securities Limited
The Atrium Building, Cannon Bridge House
25 Dowgate Hill, London, EC4R 2GA
Independent Auditors
KPMG Channel Islands Limited
Glategny Court, Glategny Esplanade, St Peter Port, Guernsey, GY1
1WR
Legal Advisors
To the Company as
to Guernsey law:
Mourant Ozannes
1, Le Marchant Street,
St Peter Port,
Guernsey, Channel
Islands, GY1 4HP
To the Company as
to English law:
Bircham Dyson Bell
50 Broadway
London, SW1H 0BL
Website
www.oryxinternationalgrowthfund.co.uk
Enquiries:
Sarah Hendry
BNP Paribas Securities Services SCA, Guernsey Branch
Tel: 01481 750822
A copy of the Company's Half Yearly Financial Report will be
available shortly from the Company Secretary, BNP Paribas
Securities Services S.C.A., Guernsey Branch at BNP Paribas House,
St Julian's Avenue, St Peter Port, Guernsey, GY1 1WA, or on the
Company's website (www.oryxinternationalgrowthfund.co.uk).
Neither the contents of the Company's website nor the contents
of any website accessible from hyperlinks on the Company's website
(or any other website) is incorporated into, or forms part of, this
announcement.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR BUBDDUSBBGRU
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