Final Results
10 Mars 2008 - 1:38PM
UK Regulatory
Final Results
Third Advance Value Realisation Company Limited
Preliminary announcement of results for the year ended 30 November
2007
* �18.9 million returned to Shareholders during the year
* 83% of initial portfolio value returned in cash since launch
* Net assets of �16.2 million as at 30 November 2007
* Holdings reduced from 36 to 16 over the course of the year
CHAIRMAN'S STATEMENT
I am pleased to report that in the year ended 30 November 2007 the
Company has continued to make substantial progress towards achieving
the objective of providing value and liquidity to its investors.
In the first half of the year, the Company returned �9.1 million to
shareholders through the purchase and redemption of all its
outstanding Redeemable Preference Shares. In the second half
8,244,775 Ordinary Shares were bought back at an aggregate cost of
�9.8 million, including �9.0 million returned in a tender offer which
was completed just before the financial year end. Since its launch,
the Company has returned an aggregate of �63.0 million, representing
83 per cent of the initial value of the holdings, and at the
financial year end had net assets of �16.2 million attributable to
the remaining Ordinary Shares in issue.
Performance has also been satisfactory in terms of value achieved.
Against a background of deteriorating market conditions and
substantial portfolio sales, the weighted average NAV, which takes
account of the cash returned to investors, reduced marginally from
105.2p (net of expenses) at 30 November 2006 to 104.0p at 30 November
2007.
The NAV of the Ordinary Shares also remained reasonably stable
reducing from 117.3p at 30 November 2006 to 115.6p at 31 May 2007,
the interim stage, to 111.1p at 30 November 2007. Notwithstanding
market conditions, the Manager has been active and has reduced the
number of holdings from 36 to 16 with the inevitable increased
concentration of holdings and value within the portfolio. As at 30
November 2007, the top three holdings accounted for 61 per cent of
the Company's total net assets and the final return to shareholders
will be significantly influenced by the value received from their
disposal. The three investee companies recently updated the market on
their current trading, two reporting satisfactory trading while the
other, which has been in bid talks for a considerable period, less
so.
The Company had a net revenue loss of 1.7p per Ordinary Share in the
year ended 30 November 2007 and, therefore, the Board will not be
declaring a dividend.
As at 7 March 2008, the number of holdings in TAVR had reduced to 15
and the Company had �0.5 million in cash and receivables. The NAV of
the Ordinary Shares was 97.7p per Share, reflecting considerable
market upheaval. Given the substantial progress made to date, the
Manager is pushing to realise TAVR's remaining holdings ahead of the
originally envisaged target of the Company's third AGM in April 2009.
The environment for achieving this will not be easy as there is
little market liquidity and corporate transactions are also suffering
delays as vendor and purchaser valuations have widened.
The realisation of the remaining holdings will inevitably depend
heavily on how market conditions evolve but investors can take some
comfort that most of the investee companies appear to be in
reasonable financial shape.
The AGM will be held at 145-157 St John Street, London EC1 on 17
April 2008 at 12 noon.
Robert Norbury
10 March 2008
INCOME STATEMENT
For the year ended 30 November 2007
2007 2006
Revenue Capital Total Revenue Capital Total
�'000 �'000 �'000 �'000 �'000 �'000
Gains / (losses) on investments - (158) (158) - 6,884 6,884
Income 480 - 480 1,319 - 1,319
Investment management fee (484) (291) (775) (682) (1,207) (1,889)
Other expenses (364) - (364) (368) - (368)
Return on ordinary activities before taxation (368) (449) (817) 269 5,677 5,946
Taxation - - - - - -
Return on ordinary activities after taxation (368) (449) (817) 269 5,677 5,946
Return per ordinary share (1.67)p (2.04)p (3.71)p 1.19p 25.04p 26.23p
The total column of this statement is the profit and loss account of
the Company. The revenue and capital columns are supplementary to
this and are prepared under guidance published by the Association of
Investment Companies.
A Statement of Total Recognised Gains and Losses is not required as
all the gains and losses of the Company have been reflected in the
above statement.
All revenue and capital items in the above statement derive from
continuing operations.
The comparatives relate to the period from 21 October 2005 to 30
November 2006. The Company was incorporated on 21 October 2005 and
commenced business operations on 21 December 2005.
BALANCE SHEET
At 30 November 2007
2007 2006
�'000 �'000
FIXED ASSETS
Investments at fair value 16,037 35,745
CURRENT ASSETS
Other debtors 16 136
Cash at bank and in hand 469 1,309
485 1,445
CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
Accrued liabilities 138 445
Equity appreciation fee provision 179 525
317 970
NET CURRENT ASSETS 168 475
TOTAL NET ASSETS 16,205 36,220
CAPITAL AND RESERVES
Share capital 1 3
Share purchase reserve 11,361 30,266
Capital redemption reserve 7 5
Realised capital reserve 10,538 4,984
Unrealised capital reserve (5,375) 693
Revenue reserve (327) 269
SHAREHOLDERS' FUNDS 16,205 36,220
Net assets per Ordinary Share 111.05p 118.48p
Net assets per Redeemable Preference Share n/a 100.00p
RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS
For the year ended 30 November 2007
Share Share Capital Realised Unrealised
Share Premium Purchase Redemption Capital Capital Revenue
Capital Account Reserve Reserve Reserve Reserve Reserve Total
�'000 �'000 �'000 �'000 �'000 �'000 �'000 �'000
Opening 3 - 30,266 5 4,984 693 269 36,220
shareholders'
funds
Purchases and (2) - (18,905) 2 (65) - - (18,970)
redemptions
of shares
Profit for - - - - 5,619 (6,068) (368) (817)
the year
Dividend paid - - - - - - (228) (228)
Closing 1 - 11,361 7 10,538 (5,375) (327) 16,205
shareholders'
funds
For the period from incorporation on 21 October 2005 to 30 November
2006
Share Share Capital Realised Unrealised
Share Premium Purchase Redemption Capital Capital Revenue
Capital Account Reserve Reserve Reserve Reserve Reserve Total
�'000 �'000 �'000 �'000 �'000 �'000 �'000 �'000
Opening - - - - - - - -
shareholders'
funds
Issue of 8 76,115 - - - - - 76,123
shares
Share issue (1,757) - - - - - (1,757)
expenses
Cancellation - (38,057) 38,057 - - - - -
of share
premium
Purchases and (5) (36,301) (7,791) 5 - - - (44,092)
redemptions
of shares
Profit for - - - - 4,984 693 269 5,946
the year
Closing 3 - 30,266 5 4,984 693 269 36,220
shareholders'
funds
The Company was incorporated on 21 October 2005 and commenced
business operations on 21 December 2005.
CASH FLOW STATEMENT
For the year ended 30 November 2007
2007 2006
�'000 �'000
OPERATING ACTIVITIES
Cash inflow from investment income and bank 521 1,211
interest
Cash outflow from management expenses (1,810) (1,289)
Cash inflow from disposal of investments 46,174 62,182
Cash outflow from purchase of Treasury Bills (26,543) (14,946)
NET CASH INFLOW FROM OPERATING ACTIVITIES 18,342 47,158
FINANCING
Expenses of issue of share capital - (1,757)
Payments to purchase and redeem own shares (18,954) (44,092)
Equity dividends paid (228)
NET CASH OUTFLOW FROM FINANCING (19,182) (45,849)
(DECREASE) / INCREASE IN CASH (840) 1,309
Opening balance 1,309 -
Cash (outflow) / inflow (840) 1,309
469 1,309
The comparatives relate to the period from 21 October 2005 to 30
November 2006. The Company was incorporated on 21 October 2005 and
commenced business operations on 21 December 2005.
+-------------------------------------------------------------------+
| NOTES |
| |
| (i) The Company is a closed-ended investment company incorporated |
| in Guernsey. The Company is resident for tax purposes in the UK |
| and has managed its affairs to enable it to qualify as an |
| investment trust for taxation purposes under Section 842 of the |
| Income and Corporation Taxes Act 1988. |
| |
| (ii) The Company was incorporated on 21 October 2005 and business |
| operations commenced when the Company listed on the London Stock |
| Exchange on 21 December 2005. |
| |
| (iii) This financial information has been prepared in accordance |
| with applicable United Kingdom accounting standards and the |
| Statement of Recommended Practice 'Financial Statements of |
| Investment Trust Companies ("SORP") issued by the Association of |
| Investment Companies. |
| |
| (iv) Investments have been designated as fair value through |
| profit and loss on initial recognition and have been valued at |
| market bid price at the period end. Suspended securities have |
| been valued at directors' best estimate of the fair value of |
| those securities. |
| |
| (v) Return per Ordinary Share is based on the net return |
| attributable to the weighted average of 22,033,739 (2006: |
| 22,676,538) Ordinary Shares of 0.01p in issue since the Company's |
| listing. |
| |
| (vi) The figure for net assets per Ordinary Share is based on |
| �16,205,000 (2006: �36,220,000) divided by 14,591,942 (2006: |
| 22,836,717) Ordinary Shares in issue at the Balance Sheet date, |
| after attributing 100p for every Redeemable Preference Shares in |
| issue at the Balance Sheet date. As at 30 November 2007 were no |
| remaining Redeemable Preference Shares in issue (2006: |
| 9,163,200). |
| |
| (vii) The directors do not recommend a final dividend for the |
| year ended 30 November 2007. In accordance with UK accounting |
| standards, the final dividend for the period ended 30 November |
| 2006 has been accrued in the year ended 30 November 2007. |
| |
| (viii) The financial information in the preliminary announcement |
| is not the Company's statutory accounts. The annual report will |
| be sent to shareholders and copies may be obtained from the |
| Secretary and or the UK Administration Agent. |
| |
| (ix) The preliminary announcement was approved by the Board on 10 |
| March 2008. |
| |
+-------------------------------------------------------------------+
SECRETARY AND REGISTERED OFFICE
Legis Corporate Services Limited
1 Le Marchant Street
St Peter Port
Guernsey
GY1 4HP
UK ADMINISTRATION AGENT
Cavendish Administration Limited
145-157 St John Street
London
EC1V 4RU
For further information, please contact Robert Legget or Ross
Courtier at Progressive Value Management Limited (020 7566 5550).
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