RNS Number:3208P
Schroder Ventures Intl Inv Tst PLC
03 September 2003
For immediate release 7.00am 3 September 2003
SCHRODER VENTURES INTERNATIONAL INVESTMENT TRUST PLC (SVIIT)
UNAUDITED INTERIM RESULTS FOR THE SIX MONTHS
ENDED 30 JUNE 2003
The Board of SVIIT today announces its unaudited interim results
for the six months ended 30 June 2003.
A solid performance; portfolio valuations stable; fund
advisory business progressing well
Highlights include:
* Net assets broadly in-line with December 2002 at #462.4
million (444.2p per share)
* Solid performance in a difficult operating environment
* At the underlying portfolio company level, cash generation and
resulting reduced debt levels have meant that, despite overall flat
earnings growth, portfolio company valuations have remained stable,
even though average EBIT multiples used to value the portfolio have
decreased
* Compound growth rate in NAV per share of 16.0% per annum over
five years
Nick Ferguson, CEO of SVIIT, commented:
"SVIIT has delivered another set of solid results, in what has been
a difficult operating environment. Over the longer-term, SVIIT
continues to outperform and we are confident that it is well placed
to make further progress in the future.
"The superior long-term performance of private equity has
demonstrated the importance of the asset class. Research shows that
private equity investment trusts have exhibited a superior
performance, on a risk-adjusted basis, to both the FTSE All-Share
and FTSE Small Cap indices.
"We believe that private equity, with its low correlation with
equity markets and attractive risk-adjusted return profile, should
play a significant part in any balanced investment portfolio."
For further information, please contact:
Schroder Ventures International Investment Trust plc
John McLachlan / Nick Ferguson On 03.09.03: 020 7067 0700
Thereafter: 020 7010 8911
Schroder Ventures (London) Limited
Alice Todhunter On 03.09.03: 020 7067 0700
Thereafter: 020 7010 8911
Weber Shandwick Square Mile
Tim Jackaman / Peter Corbin / Christian San Jose 020 7067 0700
Copies of the press release and other corporate information can be
found on the company website at: http://www.sviit.co.uk
Chairman & CEO's Statement
Portfolio Performance
In the first six months of 2003, war in Iraq, the outbreak of SARS
in Asia and continued economic uncertainty led to a very
challenging operating environment for businesses in general.
Against this backdrop, SVIIT's portfolio of companies has performed
well and we are pleased to report a solid set of results.
At the underlying portfolio company level, cash generation and
resulting reduced debt levels have meant that, despite overall flat
earnings growth, portfolio company valuations have remained stable,
even though average EBIT multiples used to value the portfolio have
decreased.
The portfolio is sensitive to currency fluctuations and despite
benefiting from the strengthening of the euro, the valuation of the
portfolio has also been adversely affected by the weak US dollar.
Overall, net assets have remained broadly in-line with December
2002 at #462.4 million (444.2p per share fully diluted). Over five
years, SVIIT has reported a compound growth in net asset value per
share of 16.0% p.a.
New Fund Commitments
No new fund commitments were made during the six-month period.
Since June 2003 however, SVIIT has made two new commitments (both
of which were highlighted in the December 2002 Accounts).
The first is a Euro400 million commitment to Permira's third pan-
European buy-out fund, Permira Europe III at its first closing. We
are considering making a further commitment at the fund's final
closing, which is expected in the coming months.
Permira is a leading international private equity firm and a key
driver behind SVIIT's net asset growth. The firm has an impressive
track record of successful investment, and we look forward to this
fund building on the success of its two predecessor funds, Permira
Europe I and II.
Permira Europe III will make leveraged and unleveraged acquisitions
of European businesses or of global businesses with a strong
European presence, especially in Permira's preferred sectors:
business services, chemicals, consumer, industrial products and
services and technology. Typical deal size will be in the range of
Euro100 million to Euro3 billion.
The second new fund commitment is a US$50 million commitment to The
Japan Fund IV at its first close, which is expected in the coming
months. The Japan Fund IV will invest predominantly in buy-out
transactions in Japan across a range of industries and sectors.
Operating Review
It has been two years since we launched the fund advisory business
within SVIIT and we are pleased with the progress to date.
The first six months of the year have been busy and productive. The
business continues to meet its key milestones and is on track to
build profit streams that will, over time, add incremental value to
SVIIT.
Private Equity Products
The Schroder Private Equity Fund of Funds is now approximately 95%
committed with 19 underlying funds in its portfolio, almost evenly
split between Europe and the US and with an emphasis on buy-out
rather than venture capital funds. The marketing of its successor
fund, the Schroder Private Equity Fund of Funds II, continues, with
a first closing expected in the fourth quarter of this year and a
final closing next year.
Following shareholder approval at the AGM earlier this year, formal
marketing of P123 has started with the target of raising Euro215
million from external investors. It is expected that P123 will
close in the next two months and, at that time, SVIIT will transfer
approximately Euro135 million of assets in Permira Europe I and II to
P123. In return for these assets, SVIIT will have a 40% holding of
the company. P123 will then make a substantial commitment to
Permira Europe III. SVIIT's assets in Permira Europe I and II will
be transferred at 30 June 2003 valuations, updated for any calls
paid or distributions received and material changes since then.
Based on these valuations, and updated for calls and distributions
in July and August, the transfer of Euro135 million of assets would
represent 22% of SVIIT's holdings in these funds. The transfer of
these assets will not affect SVIIT's net asset value as, through
its 40% holding in P123, it will maintain exposure to both a
proportion of the Permira I and II assets and the new capital
raised for P123.
Public Equity Products
You may recall that we wrote to shareholders last year outlining
the establishment of a Public Equities Products team. The team has
been established with the objective of delivering absolute returns
for investors by investing in publicly quoted equities using a
combination of private equity and value investing techniques. Two
products have been launched to date: The SVIIT UK Focus Fund and
the Strategic Recovery Fund. The SVIIT UK Focus Fund, a Dublin
listed open-ended investment company, will invest in public quoted
companies using a combination of private equity and value investing
techniques. The Strategic Recovery Fund will invest in lowly valued
publicly quoted companies that would benefit from strategic,
management or operational change. The fund is advised by a board of
successful industrialists and aims to work with the executive and
non-executive directors of investee companies. It has been
structured as a UK limited partnership and is scheduled to have a
first close later this year. SVIIT has committed to invest a total
of #15.0 million in these two products. Since June, #7.6 million of
this commitment has been invested in the SVIIT UK Focus Fund.
Convertible Bond & Credit Facility
We believe that the current investment environment for private
equity provides an excellent opportunity for SVIIT to make
commitments to new private equity funds, which have the potential
to provide for future net asset growth. In order to provide SVIIT
with the maximum flexibility to capitalise on these opportunities
the Company has increased its credit facility (which was un-drawn
at 30 June 2003) with its bankers by 25% to Euro285 million and in May
issued #40 million of subordinated convertible bonds. Since June,
SVIIT has issued a further #9 million tranche of the same bonds,
bringing the total size of this issue to #49 million. The bonds
are listed on the London Stock Exchange and mature in 2013. They
have a semi-annual coupon of 4.5% and convert into fully paid
ordinary shares of SVIIT at a conversion price of 480p. These bonds
are in addition to the #40 million of subordinated convertible
bonds issued in November 2001 (which mature in 2011), bringing the
total amount of subordinated convertible bonds in issue to #89
million.
Outlook
Recent months have seen renewed interest in investment markets, and
whilst these markets remain fragile, they have improved somewhat
from the lows of recent years. We remain cautiously optimistic that
if this trend continues, the benefits should be reflected in the
portfolio's valuation.
Over the longer-term private equity has outperformed public
markets. Key to this out-performance is manager selection. SVIIT
continues to outperform, reporting a compound growth in net asset
value per share of 16.0% p.a. over five years, which compares to a
6.3% p.a. fall in the FTSE All-Share Index and 0.2% p.a. increase
in the FTSE World Index.
Portfolio Review - June 2003
Summary
In the six months to 30 June 2003, SVIIT's net assets remained
broadly in-line with December 2002 at #462.4 million, equivalent to
444.2p per share on a fully diluted basis (December 2002: #463.2
million - 445.8p per share fully diluted).
The portfolio is sensitive to currencies and despite the strong
performance of the euro and some small write-ups, the valuation of
the portfolio has also been affected by the weak US dollar over the
period, and the write-down of Memec. Memec, which is US dollar
denominated, has been written-down by #7.4 million, a result of
lower comparable EBIT multiples and the negative impact of currency
movements on the company's valuation.
On the whole, the portfolio of companies continued to perform well,
in difficult economic and business conditions, particularly in the
first quarter of 2003. Cash generation leading to reduced debt
levels continues, despite overall flat earnings growth. This has
resulted in many of the portfolio company valuations remaining
stable, even though average EBIT multiples used to value the
portfolio have decreased.
In the first half of 2003, SVIIT received distributions of #3.7
million, lower than in previous periods but not unexpected given
the economic climate. Over the cycle, we expect the level of
distributions to return to the norm as the economic environment
stabilises.
On the investment side, total calls of #26.0 million were paid
during the six-month period, significantly below the #122.7 million
paid in the six months to December 2002. Due to the extensive and
time intensive due-diligence process undertaken for buy-out
transactions, this decreased level of completed transactions is not
an indication of a reduction in deal-flow, and a number of large
transactions were completed in the third quarter; namely, the
directories business of SEAT Pagine Gialle, Holmes Place health
clubs and the spectacle manufacturer, Rodenstock. Since June 2003,
SVIIT has paid a further #68.2 million in calls.
The majority of the portfolio continues to be valued on an earnings
basis (51%). Of the 51%, 12% has been written-down on an earnings
basis, bringing the total percentage of the portfolio valued on a
written-down basis to 22% (December 2002: 12%). The percentage of
the portfolio held at cost has increased slightly to 31%, with the
remainder of the portfolio valued on a quoted (5%) or third-party
(3%) basis.
Given the low level of calls and distributions, the sector,
geographical and stage profile of the portfolio remains largely
unchanged.
The Twenty Largest Underlying Companies represent 75% of the
portfolio (141 companies in total).
Fund Transactions
As noted above, a total of #26.0 million in calls were paid during
the six-month period, funding six new and ten follow-on
investments. The Twenty Largest Underlying Companies remains
broadly unchanged with two new investments: Premiere and
Silverlink. As a result, two companies no longer feature in the
Twenty Largest Underlying Companies, Med-Eng and Betts. Med-Eng
continues to perform well and is valued at a similar level to
December 2002, at #5.8 million. Betts has been written-down by #1.2
million due to a slight decline in earnings and lower comparable
EBIT multiples.
Premiere is the leading Pay-TV operator in Germany and Austria. It
offers exclusive premium Pay-TV content including sports, movies
and special interest packages on 23 channels as well as Pay-per-
View. The company has roughly 2.6 million subscribers serving both
satellite and cable households. SVIIT's share of the investment in
this company is #18.3 million representing 4.0% of net assets.
After a further investment was made in the company earlier this
year, Silverlink, the holding company for the Amanresorts (a group
of high-end luxury resorts and spas), now features in the Twenty
Largest Underlying Companies. At 30 June 2003, SVIIT's share of
this investment was #13.1 million, representing 2.8% of net assets.
Since June, #4.1 million has been repaid from the cost of this
investment, reducing the value of SVIIT's holding in this
company now to #9.0 million.
Since 30 June 2003, there have been three major new investments
made by funds in which SVIIT invests, all of which are likely to
feature among SVIIT's Twenty Largest Underlying Companies at
December 2003: the directories business of SEAT Pagine Gialle,
Holmes Place and Rodenstock.
Through its commitment to Permira Europe II, SVIIT has invested in
the telephone directories, directory assistance and business
information operations of SEAT Pagine Gialle. The company has
significant market share in Italy, the UK and Germany and is
Italy's leading yellow pages and telephone directory publisher.
SVIIT's initial investment in this company is approximately #42
million. Following the completion of the public tender offer for
the remaining ordinary share-capital of the company, SVIIT's total
commitment to this investment could rise to approximately #68
million (dependent on the take-up of the public tender offer).
Holmes Place is one of Europe's leading premium health club
operators with approximately 270,000 members across 61 clubs in the
UK, Portugal, Switzerland, Spain, Germany and Austria. SVIIT's
share of this investment is approximately #17 million.
Rodenstock is one of the world's leading manufacturers of
spectacles. Headquartered in Munich, it supplies prescription
eyewear and sunglasses. The company has almost 6,000 employees
based in 18 countries and dedicated production sites in Germany,
Thailand and the Czech Republic. SVIIT's share of the investment is
approximately #8 million.
The effective closure of the IPO markets for new issues and the
fact that many trade buyers are cash constrained has meant that, in
general, the current rate of realisations by private equity funds
has fallen. SVIIT has not been immune to this lack of activity,
with the level of distributions in the first half falling to #3.7
million at a relatively low premium of 12% to December 2002
valuations. Since June, SVIIT has received further distributions of
#7.8 million, #3.7 million from the sale of Palini & Bertoli and
#4.1 million from the return of cost from Silverlink. Palini &
Bertoli, a carbon steel plates manufacturing company, was sold at a
162% uplift to cost and 47% uplift to its December 2002 valuation.
Since inception, SVIIT has recorded an uplift on realisations to
previous valuations of approximately 46%. If public markets remain
favourable, we expect further distributions during the current
period.
With the exception of the write-down of Memec, the overall
portfolio valuation has remained relatively unchanged.
The two most significant write-ups are TFL and Euro Dental. TFL is
a supplier of specialty chemicals to the leather processing
industry; and Euro Dental is a mail order house for dental
consumables with predominant market share in Germany and Italy.
Both companies are performing well and continue to increase
earnings and pay down debt.
Company 30 June 2003 31 December Change in
Valuation 2002 Period
#'000 Valuation
#'000 #'000
TFL 10,112 7,146 2,966
Euro Dental 9,152 7,050 2,102
The most significant write-down during the period was Memec, a
global specialist semiconductor distributor. Memec has been written
down by #7.4 million, a result of a combination of lower comparable
EBIT multiples and the negative impact of the US dollar on the
company's valuation. The company itself has repaid all of its
acquisition bank debt and is in a good position to capitalise on
any up-turn in the semiconductor cycle.
Company 30 June 2003 31 December Change in
Valuation 2002 Period
#'000 Valuation
#'000 #'000
Memec 46,883 54,278 (7,395)
Valuation Basis (by Value)
The largest shift in the profile of the valuation basis is the
increase in the percentage of the portfolio valued below cost
(either written-down to cost or on an earnings basis) to 22%. This
increase is almost entirely due to Memec.
30 June 2003 31 December 2002
% (by Value) % (by Value)
Cost 31 28
P/E 1 2
EBIT 38 49
Written-down - EBIT 12 1
Written-down 10 11
Third Party 3 4
Quoted 5 5
____ ____
100 100
(Under British Venture Capital Association (BVCA) valuation
guidelines, investments are normally carried at cost, less a
provision if appropriate, for at least the first 12 months after
acquisition.)
On a 'like for like' basis the weighted average discounted EBIT
multiple declined from 8.1 in December 2002 to 7.3. Including new
entrants to this valuation category, the weighted discounted EBIT
multiple decreased to 7.4 (December 2002: 8.1). The gross weighted
average EBIT multiple also decreased to 10.3 (December 2002: 11.3).
This average number is influenced by the higher than average
multiple used for the valuation of semiconductor companies. The
average discounted EBIT multiple for non-semiconductor companies
was 5.9. The average discount applied to companies valued on an
EBIT basis remained unchanged.
The discounted weighted average P/E multiple has increased to 9.0
(December 2002: 7.7) and the average discount applied to quoted
investments was 17% (December 2002: 16%).
Geographical and Sector Distribution (by Value)
Neither the sector nor geographical weightings of the portfolio
have changed significantly since December 2002.
Sector Analysis
30 June 2003 31 December
% (by Value) 2002
% (by Value)
Consumer 32 31
Medical/health 21 21
Computer/other
electronics 18 21
Chemicals 10 9
Industrial 9 10
products/services
Other manufacturing 4 5
Other services 5 2
Construction 1 1
____ ____
100 100
The portfolio continues to be dominated by three main sectors;
consumer (32%); medical/health (21%); and computers/other
electronics (18%). Going forward, the new significant investments
in SEAT Pagine Gialle, Holmes Place and Rodenstock will further
increase the portfolio's weighting to the consumer sector.
Geographical Analysis
30 June 2003 31 December
% (by Value) 2002
% (by Value)
Multinational 35 37
Continental Europe 24 21
UK 19 19
North America 12 14
Far East/Asia Pacific 10 9
____ ____
100 100
Multinational and Continental European companies continue to make
up the majority of the portfolio (59%). The decline in the
portfolio's weighting to North America is predominantly due to the
weakness of the US dollar.
Portfolio Maturity
Whilst still low, the average age of the portfolio is maturing with
43% of investments held for more than three years, 57% being held
for under three years, and 27% held for under a year.
Investments in Companies (# million)
30 June 2003
Year* W/Down Cost Earnings/ Quoted Total
Third Party
1992 & Prior 0.3 7.9 8.2
1993 1.0 1.0
1994 1.1 1.1
1995 0.6 2.1 2.7
1996 0.3 4.4 0.1 4.8
1997 0.1 0.1 32.1 0.8 33.1
1998 0.7 27.6 1.1 29.4
1999 0.7 0.3 22.3 12.6 35.9
2000 49.5 12.9 121.3 2.8 186.5
2001 0.6 8.5 68.0 0.3 77.4
2002 0.1 121.1 5.3 126.5
2003 19.9 19.9
_______ _______ _______ _______ _______
52.3 162.8 282.7 28.7 526.5
Investments in Companies (# million)
31 December 2002
Year* W/Down Cost Earnings/ Quoted Total
Third Party
1992 & Prior 0.2 - - 8.4 8.6
1993 - - 0.2 1.2 1.4
1994 - - 0.9 - 0.9
1995 - - 0.6 1.8 2.4
1996 1.6 - 5.7 0.1 7.4
1997 0.9 2.1 23.0 0.7 26.7
1998 1.9 - 25.7 1.2 28.8
1999 1.4 0.8 19.1 10.4 31.7
2000 48.4 11.7 129.4 1.9 191.4
2001 0.6 10.4 58.7 0.3 70.0
2002 - 108.9 - - 108.9
_______ _______ _______ _______ _______
55.0 133.9 263.3 26.0 478.2
* Year of original investment in underlying companies
Deal Type
SVIIT's portfolio continues to be biased toward Management Buy-
Outs/Ins (78%), with limited exposure to early stage investing,
almost entirely in life sciences. The slight increase in the
portfolio's exposure to Development is due to the new investment in
Premiere.
30 June 2003 31 December 2002
% %
Early stage/Start-up 5 4
Development 17 14
Buy-Outs/Ins 78 82
____ ____
100 100
Fund Commitments
At 30 June 2003, SVIIT had #280.4 million in uncalled commitments
to eight funds (December 2002: #293.4 million to nine funds).
Since 30 June 2003, SVIIT has committed Euro 400 million (#278.4
million*) to Permira's third pan-European buy-out fund, Permira
Europe III, at the fund's first close. SVIIT is considering making
a further commitment at the fund's final closing, which is expected
in the coming months.
Permira Europe III's investment strategy will follow that of its
predecessors, Permira Europe I and II. Permira Europe III will make
leveraged and unleveraged acquisitions of European businesses or of
global businesses with a strong European presence, especially in
Permira's preferred sectors: business services, chemicals,
consumer, industrial products and services and technology. Typical
deal sizes will be in the range of Euro100 million to Euro3 billion.
Uncalled Fund Amount Amount SVIIT
Commitments Called uncalled Uncalled
(Local (Local commitment*
Currency) Currency) #m
Permira Europe II Euro 492.7m Euro 257.3m 179.0
The Japan Venture Yen2,962.6m Yen 487.4m 2.5
Fund III
Schroder Ventures US$73.7m US$34.9m 21.1
Asia Pacific Fund
Schroder Ventures US US$42.1m US$31.1m 18.8
Fund
Schroder Canadian C$17.0m C$0.9m 0.4
Buy-Out Fund II
Schroder Canadian C$14.0m C$36.5m 16.3
Buy-Out Fund III
Schroder Ventures
International Life US$77.6m US$4.1m 2.5
Sciences Fund II
International Life US$9.4m US$65.6m 39.8
Sciences Fund III
______
Total #280.4
*Based on exchange rates at 30 June 2003
In addition, SVIIT plans to commit US$50 million (#30.3 million*)
to The Japan Fund IV at its first closing, which is scheduled for
later this year. The Japan Fund IV will predominantly invest in buy-
out transactions in Japan across a range of industries.
SVIIT's return on its holdings of Schroder Ventures and Permira
funds is summarised below:
Six-months to Six-months to
30 June 2003 31 December
#m 2002
#m
Opening Valuation 484.0 422.8
Calls Payable 26.0 122.7
Distributions Receivable (3.7) (104.5)
____ ____
506.3 441.0
Increase/in Value of Portfolio 2.2 43.0
______ ______
Closing Portfolio 508.5 484.0
Cash & Marketable Securities
At 30 June 2003, SVIIT's gross cash balance of #32.5 million
(December 2002: #18.8 million) was held principally in money market
funds, reflecting anticipated short-term cash flows.
Conclusion
SVIIT's portfolio of companies continues to perform well in
difficult economic and business environments. Since June, whilst
remaining fragile, markets have improved somewhat and if this trend
continues it is expected that this will have a positive impact on
the portfolio. SVIIT has reported a compound growth in net asset
value per share of 16.0% p.a. over five years, which compares
favourably to a 6.3% p.a. fall in the FTSE All-Share Index and 0.2%
p.a. increase in the FTSE World Index.
Twenty Largest Underlying Companies
In the following pages, we show SVIIT's twenty largest investments
by value as at 30 June 2003.
Travelodge & Little Chef (UK)
Company #000's
Cost 56,468
Value 60,271
Date of Acquisition Dec 2002
Travelodge is the second largest operator in the UK budget hotel
sectors, providing around 13,000 rooms in 227 hotels located
around Britain. Little Chef is the largest roadside restaurant
chain in Britain with approximately 400 outlets. The valuation
basis is cost in fund currency; the holding represents 13.0% of
net assets.
Memec (UK)
Company #000's
Cost 51,837
Value 46,883
Date of Acquisition Oct 2000
Memec is a global specialist semiconductor distributor with
operations in all of the world's key technology markets: Europe,
the Americas, Japan and the Asia Pacific regions. The valuation
basis is written-down on an EBITDA basis; the holding represents
10.1% of SVIIT's net assets.
Cognis (Germany)
Company #000's
Cost 33,652
Value 40,730
Date of Acquisition Nov 2001
Cognis is a leading world-wide supplier of speciality chemicals
which was carved out from Henkel in 1999. The three divisions of
the Cognis Group - Oleochemicals, Care Chemicals and Organic
Specialities - supply international manufacturers of detergents,
cleaners and cosmetics, as well as other industrial customers.
The valuation basis is EBITDA; the holding represents 8.8% of
SVIIT's net assets.
Ferretti (Italy)
Company #000's
Cost 35,381
Value 39,398
Date of Acquisition Nov 2002
Ferretti was originally acquired by funds advised by Permira in
1998 and floated on the Milan Stock Exchange in June 2000. At
flotation Permira sold the majority of its interest in Ferretti
and has since sold its remaining holding. Since 1998 the Ferretti
Group has grown organically and through acquisitions and is
currently Europe's largest builder of luxury motor yachts. The
valuation basis is cost in fund currency; the holding represents
8.5% of SVIIT's net assets.
Sirona Dental Systems Group (Germany)
Company #000's
Cost 20,266
Value 26,884
Date of Acquisition Nov 1997
Sirona is a manufacturer of professional dental equipment with its
own distribution network. The company is a total system provider
of dental equipment and is recognised globally for providing high
quality, technologically superior products covering nearly the
entire product range for the dental practice. The valuation basis
is EBIT; the holding represents 5.8% of SVIIT's net assets.
Hogg Robinson (UK)
Company #000's
Cost 24,154
Value 26,582
Date of Acquisition June 2000
Hogg Robinson is a services company comprising two principal
activities: international business travel and outsourced employee
benefit services. The company's travel operations include
corporate travel management and e-commerce. The employee benefit
services comprise benefit consulting, administration and payment
processing. The valuation basis is EBITDA; the holding represents
5.7% of SVIIT's net assets.
Takko (Germany)
Company #000's
Cost 18,563
Value 21,458
Date of Acquisition Mar 2000
Takko is a retailer of fashionable "value for money" clothing
targeting the young family and women aged between 25 and 40. It
runs over 520 stores in Germany and Austria. The valuation basis
is EBIT; the holding represents 4.6% of SVIIT's net assets.
Premiere (Germany)
Company #000's
Cost 17,562
Value 18,313
Date of Acquisition February 2003
Premiere is the only visible Pay-TV operator in Germany and
Austria. It offers exclusive premium Pay-TV content including
sports, movies and special interest packages on 23 channels as
well as Pay-per-View. The company has roughly 2.6 million
subscribers serving both satellite and cable households. The
valuation basis is cost in fund currency; the holding represents
4.0% of SVIIT's net assets.
austriamicrosystems (formerly AMS) (Austria)
Company #000's
Cost 36,192
Value 17,150
Date of Acquisition June 2000
austriamicrosystems designs, manufactures and sells semiconductor
speciality products, focusing on analogue and mixed signal ASICS
(Application - Specific Integrated Circuits). The company serves
the wireless communications, industrial and automotive end-
customer markets. The valuation basis is write-down; the holding
represents 3.7% of SVIIT's net assets.
Leica Microsystems (Germany)
Company #000's
Cost 11,849
Value 13,879
Date of Acquisition Mar 1998
Leica manufactures and supplies microscopes and related equipment
for the healthcare, research and semiconductor industries. The
company has leading positions in most of its markets and a strong
track record in product innovation. The valuation basis is
EBITDA; the holding represents 3.0% of SVIIT's net assets.
Silverlink Holdings (Asia)
Company #000's
Cost 13,604
Value 13,117
Date of Acquisition December 2002
Silverlink Holdings is the holding company for Amanresorts, which
own and operate a group of high-end luxury resorts and spas.
Amanresorts opened its flagship resort, Amanpuri in Phuket,
Thailand in 1988 and has since added 12 hotels in Indonesia, the
Philippines, France, North Africa, Mexico, the United States and
French Polynesia. It now owns and/or manages 13 resorts with a
number of them being regularly voted amongst the top ten hotels
worldwide. The valuation basis is cost in fund currency; the
holding represents 2.8% of SVIIT's net assets.
Grammer (Germany)
Company #000's
Cost 9,250
Value 10,738
Date of Acquisition June 2001
Grammer supplies seating equipment to the automotive/commercial
vehicle industry. The company serves three different segments of
the automotive/commercial vehicle industry: automotive equipment
(mainly seating utilities), commercial vehicle driver seats and
commercial vehicle passenger seats. The valuation basis is EBITDA;
the holding represents 2.3% of net assets.
Kiekert (Germany)
Company #000's
Cost 14,545
Value 10,595
Date of Acquisition Sept 2000
Kiekert produces complete systems for all devices that open,
close, lock and unlock cars and has operated in this market since
1920. Products include highly integrated system locks as well as
complex door modules. The valuation basis is write-down; the
holding represents 2.3% of SVIIT's net assets.
EEMS (Italy)
Company #000's
Cost 1,759
Value 10,215
Date of Acquisition May 1999
EEMS performs assembly and test services for DRAM and Flash memory
chip manufacturers. It also assembles memory modules, which are
used in PCs, telecoms and the automotive industry. The valuation
basis is EBITDA; the holding represents 2.2% of SVIIT's net
assets.
TFL (Germany)
Company #000's
Cost 5,582
Value 10,112
Date of Acquisition March 2001
TFL is a supplier of specialty chemical to the leather processing
industry. TFL has postioned itself as a supplier of the full
product range for all stages of the leather production process,
providing a single source for its customers (predominantly
tanneries). The valuation basis is EBITDA; the holding represents
2.2% of SVIIT's net assets.
Euro Dental (Germany)
Company #000's
Cost 3,684
Value 9,152
Date of Acquisition Jan 2000
Euro Dental is a leading mail order house for dental consumables
in Germany. The company has two subsidiaries, Krugg, the market
leading distributor of dental consumables in Italy and a small
start-up company called Dentranet, which is aimed at exploiting e-
commerce opportunities in the German dental consumables market.
The valuation basis is EBIT; the holding represents 2.0% of
SVIIT's net assets.
AP Plasman (Canada)
Company #000's
Cost 11,102
Value 7,875
Date of Acquisition Sept 2000
AP Plasman is an integrated group of five companies providing
moulds and plastic components in addition to the painting and
finishing of parts, primarily for the automotive industry. The
valuation basis is write-down; the holding represents 1.7% of
SVIIT's net assets.
Parkway Holdings (Singapore)
Company #000's
Cost 19,700
Value 7,721
Date of Acquisition Dec 1999
Parkway is a private healthcare provider in Singapore with an
established network of hospitals and clinics in Malaysia,
Indonesia and India. The company has the region's best known brand
name and a reputation for technological leadership. The valuation
basis is quoted; the holding represents 1.7% of SVIIT's net
assets.
Mesa Communications (USA)
Company #'000's
Cost 8,766
Value 7,072
Date of Acquisition Mar 2000
Mesa is an independent owner and manager of wireless communication
towers, growing aggressively through acquisition and development
in the US. The valuation basis is write-down; the holding
represents 1.5% of SVIIT's net assets.
Washtec (Germany)
Company #000's
Cost 5,939
Value 6,575
Date of Acquisition Feb 1998
Washtec was formed from the merger of California Kleindienst and
Wesumat, and manufactures car wash equipment. Permira funds had
previously invested in California Kleindienst. The valuation
basis is quoted; the holding represents 1.4% of SVIIT's net
assets.
Schroder Ventures International Investment Trust plc
Unaudited Results
CONSOLIDATED STATEMENT OF TOTAL RETURN
(incorporating the Revenue Account)
For the six months ended For the six months ended
30 June 2003 31 December 2002
Revenue Capital Total Revenue Capital Total
#'000 #'000 #'000 #'000 #'000 #'000
Realised gains on
investments - 88 88 - 57,997 57,997
Unrealised
gains/(losses) on
investments - 1,780 1,780 - (15,420) (15,420)
-------------------------------------------------------------------------------------
Gains on investments - 1,868 1,868 - 42,577 42,577
Exchange losses on
current
assets/liabilities - (45) (45) - (901) (901)
Exchange
gains/(losses) on
currency balances 208 (288) (80) (17) 591 574
Income 2,610 - 2,610 3,385 - 3,385
Expenses (3,669) - (3,669) (4,065) - (4,065)
-------------------------------------------------------------------------------------
Net (deficit)/return
before
finance costs and
taxation (851) 1,535 684 (697) 42,267 41,570
Interest payable and
similar charges (2,071) - (2,071) (1,523) - (1,523)
-------------------------------------------------------------------------------------
Net (deficit)/return
on ordinary
activities before
taxation (2,922) 1,535 (1,387) (2,220) 42,267 40,047
Tax on ordinary
activities 128 - 128 36 - 36
-------------------------------------------------------------------------------------
(Deficit)/return on
ordinary
activities after
taxation (2,794) 1,535 (1,259) (2,184) 42,267 40,083
Minority interest-
equity - (16) (16) (1) 23 22
-------------------------------------------------------------------------------------
(Deficit)/return on
ordinary
activities after
tax and minority
interest
attributable
to equity
shareholders (2,794) 1,519 (1,275) (2,185) 42,290 40,105
Dividends - - - - - -
-------------------------------------------------------------------------------------
(Deficit)/return on
ordinary
activities (2,794) 1,519 (1,275) (2,185) 42,290 40,105
-------------------------------------------------------------------------------------
(Deficit)/return
per ordinary share (2.73)p 1.48p (1.25)p (2.14)p 41.35p 39.21p
-------------------------------------------------------------------------------------
The revenue column of this statement is the Group's profit and loss
account. All revenue and capital items in the above statement
derive from continuing operations. No operations were discontinued
in the six months.
Schroder Ventures International Investment Trust plc
Unaudited Results
COMPANY STATEMENT OF TOTAL RETURN
(incorporating the Revenue Account)
For the six months ended For the six months ended
30 June 2003 31 December 2002
Revenue Capital Total Revenue Capital Total
#'000 #'000 #'000 #'000 #'000 #'000
Realised
(losses)/gains on
investments - (181) (181) - 57,969 57,969
Unrealised
gains/(losses) on
investments - 2,030 2,030 - (15,300) (15,300)
-------------------------------------------------------------------------------------
Gains on investments - 1,849 1,849 - 42,669 42,669
Exchange losses on
current
assets/liabilities - (45) (45) - (901) (901)
Exchange
(losses)/gains on
currency balances - (278) (278) - 629 629
Income 724 - 724 521 - 521
Expenses (448) - (448) (755) - (755)
-------------------------------------------------------------------------------------
Net return/(deficit)
before
Finance costs and
taxation 276 1,526 1,802 (234) 42,397 42,163
Interest payable and
similar charges (2,071) - (2,071) (1,522) - (1,522)
-------------------------------------------------------------------------------------
Net (deficit)/return
on ordinary
activities before
taxation (1,795) 1,526 (269) (1,756) 42,397 40,641
Tax on ordinary
activities 130 - 130 (1) - (1)
-------------------------------------------------------------------------------------
(Deficit)/return on
ordinary
activities after
taxation (1,665) 1,526 (139) (1,757) 42,397 40,640
Dividends - - - - - -
-------------------------------------------------------------------------------------
(Deficit)/return on
ordinary activities (1,665) 1,526 (139) (1,757) 42,397 40,640
-------------------------------------------------------------------------------------
(Deficit)/return
per ordinary share (1.63)p 1.49p (0.14)p (1.72)p 41.46p 39.74p
-------------------------------------------------------------------------------------
The revenue column of this statement is the Company's profit and
loss account. All revenue and capital items in the above statement
derive from continuing operations. No operations were discontinued
in the six months.
Schroder Ventures International Investment Trust plc
Unaudited Results
BALANCE SHEETS
30 June 2003 31 December 2002
Group Company Group Company
#'000 #'000 #'000 #'000
Tangible fixed assets 236 - 282 -
--------------------------------------------------------------------------
236 - 282 -
--------------------------------------------------------------------------
Fixed asset investments
Funds and co-investments 508,509 482,718 483,959 459,043
Listed UK equities 497 497 - -
Money market instruments 26,811 26,811 13,911 13,911
Investment in subsidiaries - 30,620 - 28,920
--------------------------------------------------------------------------
535,817 540,646 497,870 501,874
--------------------------------------------------------------------------
Current assets
Debtors 4,280 3,292 4,490 1,364
Cash at bank 5,700 1,501 4,887 1,031
--------------------------------------------------------------------------
9,980 4,793 9,377 2,395
--------------------------------------------------------------------------
Current liabilities
Creditors: amounts falling
due within one year 4,758 2,829 4,783 817
--------------------------------------------------------------------------
Net current
assets/(liabilities) 5,222 1,964 4,594 1,578
--------------------------------------------------------------------------
Total assets less current
liabilities 541,275 542,610 502,746 503,452
Creditors: amounts falling
due after one year 78,499 78,008 39,201 39,201
Minority interest - non-
equity 100 - 100 -
Minority interest - equity 269 - 253 -
--------------------------------------------------------------------------
Net assets 462,407 464,602 463,192 464,251
--------------------------------------------------------------------------
Capital and reserves
Called up share capital 102,391 102,391 102,266 102,266
Share premium account 7,818 7,818 7,453 7,453
Capital redemption reserve 3,204 3,204 3,204 3,204
Share purchase reserve 92,054 92,054 92,054 92,054
Capital reserve 260,514 260,606 258,995 259,080
Revenue reserve (3,574) (1,471) (780) 194
--------------------------------------------------------------------------
Equity shareholders' funds 462,407 464,602 463,192 464,251
--------------------------------------------------------------------------
Net asset value per ordinary
share - undiluted 451.6p 453.8p 452.9p 454.0p
--------------------------------------------------------------------------
Net asset value per ordinary
share - diluted 444.2p 446.1p 445.8p 446.7p
--------------------------------------------------------------------------
Schroder Ventures International Investment Trust plc
Unaudited Results
CONSOLIDATED CASHFLOW STATEMENT
For the six For the six
months ended months ended
30 June 2003 31 December 2002
#'000 #'000
Operating activities
Investment income 493 440
Interest received 135 228
Investment advisory fee income
received 2,605 1,857
Administrative expenses paid (5,094) (2,433)
----------------------------------------------------------------------------
Net cash (outflow)/inflow from
operating activities (1,861) 92
----------------------------------------------------------------------------
Return on investments and servicing
of finance
Interest paid - (1,801)
Loan facility finance costs (1,221) (634)
----------------------------------------------------------------------------
Net cash outflow from investments and
servicing of finance (1,221) (2,435)
----------------------------------------------------------------------------
Taxation
UK tax recovered/(paid) 60 (24)
Overseas tax recovered 2 -
----------------------------------------------------------------------------
Total tax recovered/(paid) 62 (24)
----------------------------------------------------------------------------
Capital expenditure and financial
investment
Purchase of money market instruments (44,711) (127,797)
Purchase of tangible fixed assets (5) (34)
Purchase of UK listed equities (395) -
Sale of money market instruments 31,342 144,494
Calls paid and secondary units
purchased (26,029) (122,677)
Capital distributions received 3,714 104,510
----------------------------------------------------------------------------
Net cash outflow from capital
expenditure
and financial investment (36,084) (1,504)
----------------------------------------------------------------------------
Equity dividends paid
Dividends - -
----------------------------------------------------------------------------
Total dividends paid - -
----------------------------------------------------------------------------
Financing
Drawdown from loan facility - 25,110
Repayment of loan facility - (26,011)
Proceeds from convertible bond issue 40,000 -
Issue costs of convertible bonds (3) (218)
----------------------------------------------------------------------------
Net cash inflow/(outflow) from
financing 39,997 (1,119)
----------------------------------------------------------------------------
Net cash inflow/(outflow) 893 (4,990)
----------------------------------------------------------------------------
Reconciliation of net cash flow to
movement in net debt
Increase/(decrease) in cash during
the period 893 (4,990)
Exchange (loss)/gain on currency
balances (80) 574
Increase in convertible bonds in
issue (38,807) (49)
----------------------------------------------------------------------------
Change in net debt (37,994) (4,465)
Net debt at the beginning of the
period (34,314) (29,849)
----------------------------------------------------------------------------
Net debt at the end of the period (72,308) (34,314)
----------------------------------------------------------------------------
Notes:
1. Audit Status
The above financial information is unaudited and does not
amount to statutory accounts under Section 240 of the
Companies Act 1985 (as amended). The information given as
comparative figures for the six months ended 31 December 2002
does not constitute the Company's statutory accounts for that
financial period. Statutory accounts for the six months ended
31 December 2002 have been reported on by the Company's
auditors and delivered to the Registrar of Companies. The
report of the auditors was unqualified and did not contain a
statement under Section 237(2) or (3) of the Companies Act
1985.
This announcement is prepared on the basis of the accounting
policies as set out in the most recent published set of annual
financial statements.
This statement was approved by the Board of Directors on 1
September 2003.
2. Dividend
No dividend has been declared in respect of the 6 months ended
30 June 2003.
3. Diluted NAV
At 30 June 2003, the diluted NAV's are 444.2p for the Group
and 446.1p for the Company. The diluted NAV calculations
assume that share options with a strike price lower than the
undiluted NAV are exercised at the balance sheet date,
resulting in the issue of 5,451,530 ordinary shares for
consideration of #21,096,398. In addition, the #39.5m 2011
convertible bonds are assumed to convert at the balance sheet
date at an exercise price of 399p into 9,899,749 ordinary
shares. There is no dilution in respect of the #40m 2013
convertible bonds as their exercise price, 480p, exceeds the
undiluted NAV.
4. Interim Report & Accounts
Copies of the report and accounts will be circulated to
shareholders in September 2003, and from the date of release
may also be obtained from the Registered Office of the Company
at 31 Gresham Street, London, EC2V 7QA.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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