RNS Number:9005S
American Investment Trust Limited
04 December 2003
The American Investment Trust Limited
(Formerly The American Income Trust Limited)
Preliminary Announcement of Annual Unaudited results
For the year ended 30 September 2003
Chairman's Statement
The difficult conditions in markets in equities and bonds, and indeed in split
capital investment trusts, to which I referred in the 2002 Annual Report
continued in the first half of the Group's year although more recently we have
seen an improvement in the underlying asset position as all areas have shown
positive returns. The Net Asset Value of the Group's Ordinary Shares, however,
remained nil at the year end, a situation that is unchanged at the time of
writing and is unlikely to recover in the near future. The report of the
Investment Adviser summarises the difficulties faced during the year.
The Group's portfolio performed strongly against its benchmark over the year.
Both Growth and Income Portfolios have posted good capital returns during the
year. The Board has decided to re-weight the benchmark for the forthcoming year
to more accurately reflect the current breakdown of the Group's Income
portfolio.
The Board believes that circumstances still exist which can provide
opportunities for payment of the Annuity dividend and restoration of at least
some of the capital deficiency for the Zero Dividend Preference ("ZDP") shares
although it must be emphasised that the problems facing the Group remain very
serious.
At the beginning of the Group's year (on 3 October 2002) the Group repaid all of
outstanding bank debt with The Royal Bank of Scotland International Limited of
#128.1m, at a cost breaking its interest rate swap agreements of #18.1m. This
dramatically altered the shape of the Company's portfolio and, as I stated in my
Interim Statement, we have sought to continue to follow the Company's original
Investment Policy and accordingly have rebuilt the Company's exposure to the US
equity market.
Current advice received by the Directors suggests that the Group cannot buy back
any ZDP shares until such time as the dividends on the parent company's annuity
shares have been fully restored. However, a resolution will be proposed at the
AGM of the subsidiary company to enable repurchases should circumstances change
in the future.
R J M L Ottley
Chairman
4 December 2003
Group Statement of Total Return
Year ended Year ended
30 September 2003 30 September 2002
(unaudited) (audited)
Revenue Capital Total Revenue Capital Total
#'000 #'000 #'000 #'000 #'000 #'000
Gains/(losses) on - 1,448 1,448 - (52,374) (52,374)
investments
Income 407 - 407 10,201 - 10,201
Investment advisory and (51) (13) (64) (453) (1,384) (1,837)
management fee
Other expenses (178) (34) (212) (201) (393) (594)
Write back of preliminary 28 154 182 - - -
expenses
Exchange gains - 9 9 - 402 402
Net return before finance 206 1,564 1,770 9,547 (53,749) (44,202)
costs
Interest payable and (30) (8) (38) (2,601) (24,032) (26,633)
similar charges
Compounding entitlements - (2,400) (2,400) - (2,202) (2,202)
of ZDP's of subsidiary
Return on ordinary 176 (844) (668) 6,946 (79,983) (73,037)
activities
Appropriations in respect
of non-equity shares:
Dividends on Annuity (2,250) - (2,250) (2,226) - (2,226)
shares
Other appropriations for
discount on redemption
of Annuity shares - 1,166 1,166 - 1,070 1,070
Return attributable to (2,074) 322 (1,752) 4,720 (78,913) (74,193)
equity Shareholders
Appropriations in respect
of equity shares
Dividends on Ordinary - - - (5,062) - (5,062)
shares
Transfer (from)/to (2,074) 322 (1,752) (342) (78,913) (79,255)
reserves
Return per share on an
Articles of
Association basis (pence):
Annuity 15.00 (15.00) - 14.84 - 14.84
Ordinary (1.54) 1.54 - 3.48 (44.35) (40.87)
Return per share on a FRS
4 basis (pence):
Annuity 15.00 (7.77) 7.23 14.84 (7.13) 7.71
Ordinary (1.54) 0.24 (1.30) 3.48 (58.45) (54.97)
The revenue column of this statement represents the revenue account of the
Group.
All revenue and capital items in the above statement derive from continuing
operations.
Balance Sheet
As at As at
30 September 2003 30 September 2002
(unaudited) (audited)
Group Company Group Company
#'000 #'000 #'000 #'000
Fixed assets
Investments 7,291 7,291 8,090 8,090
Subsidiary undertaking - - - -
7,921 7,921 8,090 8,090
Current assets
Debtors 80 80 18,783 18,783
Cash at bank 962 962 127,321 127,321
1,042 1,042 146,104 146,104
Current liabilities
Creditors: amounts falling (44) (44) (147,637) (147,637)
due within one year
Net current assets/ 998 998 (1,533) (1,533)
(liabilities)
Total assets less current 8,289 8,289 6,557 6,557
liabilities
Creditors: amounts falling
due after more than one
year excluding ZDP shares
Loan from subsidiary - (22,500) - (22,500)
undertaking
Amounts due under - (6,563) - (4,163)
subscription agreement
- (29,063) - (26,663)
ZDP shares of subsidiary (29,063) - (26,663) -
Net liabilities (20,774) (20,774) (20,106) (20,106)
Share capital and reserves
Called-up share capital 1,500 1,500 1,500 1,500
Special reserve 141,750 141,750 141,750 141,750
Capital reserve - realised (132,883) (132,883) (117,903) (117,903)
- unrealised (28,816) (28,816) (44,118) (44,118)
Redemption reserve (3,133) (3,133) (1,967) (1,967)
Revenue reserve 808 808 632 632
Shareholders' deficit (20,774) (20,774) (20,106) (20,106)
Attributable on an Articles
basis:
Annuity shares - non-equity - - - -
Ordinary shares - equity - - - -
Loss to be attributed against (20,774) (20,774) (20,106) (20,106)
non-Shareholder entitlement
(20,774) (20,774) (20,106) (20,106)
Attributable on a FRS 4
basis:
Annuity shares - non-equity 14,117 14,117 13,033 13,033
Ordinary shares - equity (34,891) (34,891) (33,139) (33,139)
(20,774) (20,774) (20,106) (20,106)
Net Asset Value per share on
an Articles basis (pence):
Annuity shares - - - -
Ordinary shares - - - -
Net Asset Value per share on
a FRS 4 basis (pence):
Annuity shares 94.11 94.11 86.89 86.89
Ordinary shares (25.85) (25.85) (24.55) (24.55)
Group Cash Flow Statement
Year ended Year ended
30 September 2003 30 September 2002
(unaudited) (audited)
#'000 #'000 #'000 #'000
Net cash inflow from operating 387 12,338
activities
Servicing of finance
Loan interest paid (19,196) (9,520)
Annuity dividends paid (563) (1,875)
Net cash outflow from servicing (19,759) (11,395)
of finance
Financial investment
Purchases of investments (5,318) (103,635)
Sales of investments 25,968 190,298
Net cash inflow from financial 20,650 86,663
investment
Equity dividends paid - (6,074)
Net cash inflow before 1,278 81,532
financing
Financing
Repayment of loans (127,712) -
Net cash outflow from (127,712) -
financing
(Decrease)/increase in cash in (126,434) 81,532
year
Reconciliation of net cash flow
to movements in net debt
(Decrease)/increase in cash in (126,434) 81,532
year as above
Cash outflow from decrease in 127,712 -
debt
Change in net debt resulting 1,278 81,532
from cash flows
Exchange movements 9 402
Compounding entitlement of ZDP's (2,400) (2,202)
of subsidiary
Movement in net debt in the (1,113) 79,732
year
Opening net debt (26,988) (106,720)
Closing net debt (28,101) (26,988)
Notes:
1. Income
2003 2002
Withholding Withholding
Gross Tax Net Gross Tax Net
#'000 #'000 #'000 #'000 #'000 #'000
Dividends 82 (21) 61 2,988 (121) 2,867
Bond interest 306 - 306 5,811 - 5,811
Bank interest 40 - 40 1,523 - 1,523
Total Income 428 (21) 407 10,322 (121) 10,201
2. Return per share
2003 2002
Revenue Capital Total Revenue Capital Total
p p p p p p
Articles basis
Annuity 15.00 (15.00) - 14.84 - 14.84
Ordinary (1.54) 1.54 - 3.48 (44.35) (40.87)
There was a shortfall in assets attributable under the Articles of Association
at 30 September 2003 and 30 September 2002. Details of the shortfalls can be
found in note 3.
The revenue loss per Ordinary share is based on the net revenue loss of
#2,074,000 (2002 - return of #4,720,000) for the year, after deductions in
respect of the appropriations on the Annuity shares of #2,250,000 (2002 -
#2,226,000) and on 135,000,000 (2002 - 135,000,000) Ordinary shares, being the
weighted average number of Ordinary shares in issue during the year.
The capital return per Ordinary share is based on the net capital return of
#322,000 (2002 - loss of #78,913,000) for the year, less the discount on
redemption of the Annuity shares of #1,166,000 (2002 - #1,070,000), plus the
shortfall of assets in the year of #668,000 (2002 - #20,106,000), plus the
appropriation in respect of the Annuity dividends not declared of #2,250,000
(2002 - #nil), and on 135,000,000 (2002 - 135,000,000) Ordinary shares being the
weighted average number of Ordinary shares in issue during the year.
The revenue return per Annuity share is based on appropriations in respect of
the Annuity shares of #2,250,000 (2002 - #2,226,000) and on 15,000,000 (2002 -
15,000,000) Annuity shares, being the weighted average number of Annuity shares
in issue during the year.
The capital loss per Annuity share is based on the appropriation in respect of
the Annuity dividends not declared of #2,250,000 (2002 - #nil) and on 15,000,000
(2002 - 15,000,000) Annuity shares, being the weighted average number of Annuity
shares in issue during the year.
2003 2002
FRS 4 basis Revenue Capital Total Revenue Capital Total
p p p p p p
Annuity 15.00 (7.77) 7.23 14.84 (7.13) 7.71
Ordinary (1.54) 0.24 (1.30) 3.48 (58.45) (54.97)
The revenue loss per Ordinary share is based on the net revenue loss of
#2,074,000 (2002 - return of #4,720,000) for the year after deductions in
respect of the appropriations on the Annuity shares of #2,250,000 (2002 -
#2,226,000) and on 135,000,000 (2002 - 135,000,000) Ordinary shares, being the
weighted average number of Ordinary shares in issue during the year.
The capital return per Ordinary share is based on the net capital return of
#322,000 (2002 - loss of #78,913,000) for the year and on 135,000,000 (2002 -
135,000,000) Ordinary shares, being the weighted average number of Ordinary
shares in issue during the year.
The revenue return per Annuity share is based on appropriations in respect of
the Annuity shares of #2,250,000 (2002 - #2,226,000) and on 15,000,000 (2002 -
15,000,000) Annuity shares, being the weighted average number of Annuity shares
in issue during the year.
The capital loss per Annuity share is based on the other appropriations for
discount on redemption of Annuity shares of #1,166,000 (2002 - #1,070,000) and
on 15,000,000 (2002 - 15,000,000) Annuity shares, being the weighted average
number of Annuity shares in issue during the year.
Reconciliation of capital (loss)/return on a FRS 4 2003 2002
basis to an Articles basis #'000 #'000
FRS 4 basis Annuity capital loss (1,166) (1,070)
FRS 4 discount on redemption of the Annuity shares 1,166 1,070
Appropriation in respect of Annuity dividends not (2,250) -
declared
Articles basis - Annuity capital loss (2,250) -
FRS 4 basis Ordinary capital return/(loss) 322 (78,913)
FRS 4 discount on redemption of the Annuity shares (1,166) (1,070)
Appropriation in respect of Annuity dividends not 2,250 -
declared
Shortfall in assets* 668 20,106
Articles basis - Ordinary capital return/(loss) 2,074 (59,877)
*See note 3 for further information.
3. Net Asset Value per share
At the year end, there was a shortfall in assets attributable under the Articles
of Association.
The net asset value per share and the net asset values attributable to each
class of share at the year end calculated in accordance with the Articles of
Association were as follows:
Group and Company
Net asset value Net asset value
per share attributable
attributable
2003 2002 2003 2002
p p #'000 #'000
Non-equity - Annuity shares - - - -
Equity - Ordinary shares - - - -
Loss to be attributed against (20,774) (20,106)
non-shareholder entitlement
Total Shareholders' deficit (20,774) (20,106)
On a winding up and under an Articles, the loss to be attributed against the
non-shareholder entitlement would reduce the amount available to distribute
against the ZDP share entitlement by #20,774,000 (2002 - #20,106,000), from
#29,063,000 (2002 - #26,663,000) to #8,289,000 (2002 - #6,557,000).
The net asset value per Ordinary share is based on total equity Shareholders'
funds of #nil (2002 - #nil) and on 135,000,000 (2002 - 135,000,000) Ordinary
shares, being the number of Ordinary shares in issue at the year end.
The net asset value per Annuity share is based on Annuity dividends not declared
of #2,250,000 (2002 - #nil) plus the final capital entitlement of the Annuity
shares of #150,000 (2002 - #150,000), less the shortfall in assets to meet the
ZDP obligation of the Group of #150,000 (2002 - #150,000), less the
appropriation in respect of Annuity dividends not declared of #2,250,000 (2002 -
#nil) and on 15,000,000 (2002 - 15,000,000) Annuity shares, being the number of
Annuity shares in issue at the year end.
On a winding up the revenue reserves of the Company (other than the accrued
dividends declared but unpaid on the Annuity shares) will be available to meet
the entitlements of the ZDP shares, therefore no assets have been attributed to
the Ordinary shares. The Net Asset Value per Ordinary share has been attributed
in accordance with the AITC Statement of Recommended Practice, which states that
the net assets of the Company should be attributed as set out in the Articles of
Association of the Company on a return of assets, or liquidation, or otherwise.
If the ZDP shares are fully covered, the Ordinary shares are entitled (subject
to the rights of the Annuity Shareholders) to receive all the revenue profits of
the Company (including accumulated revenue reserves) available for distribution.
The net asset value per share and the net asset values attributable to each
class of share at the year end calculated in accordance with FRS 4 were as
follows:
Group and Company
Net asset value per share Net asset value
attributable attributable
2003 2002 2003 2002
p p #'000 #'000
Non-equity - 94.11 86.89 14,117 13,033
Annuity
shares
Equity - (25.85) (24.55) (34,891) (33,139)
Ordinary
shares
Total (20,774) (20,106)
Shareholders'
deficit
The net asset value per Ordinary share is based on a total equity Shareholders'
deficit of #34,891,000 (2002 - deficit of #33,139,000) and on 135,000,000 (2002
- 135,000,000) Ordinary shares, being the number of Ordinary shares in issue at
the year end.
The net asset value per Annuity share is based on #14,117,000 (2002 -
#13,033,000) and on 15,000,000 (2002 - 15,000,000) Annuity shares, being the
number of Annuity shares in issue at the year end.
2003 2002 2003 2002
Net asset value per Shareholders'
share deficit
Reconciliation of FRS 4 to p p #'000 #'000
Articles basis
FRS 4 Annuity shares net assets 94.11 86.89 14,117 13,033
attributable
Appropriation for discount on 20.89 13.11 3,133 1,967
redemption
Discount to initial capital (99.00) (99.00) (14,850) (14,850)
entitlement
Shortfall in funds to pay final (1.00) (1.00) (150) (150)
Annuity shares capital
entitlement
Appropriation in respect of (15.00) - (2,250) -
Annuity dividends not declared
Non-equity shares - Annuity - - - -
entitlement
FRS 4 Ordinary shares net assets (25.85) (24.55) (34,891) (33,139)
attributable
Allocated against Annuity 10.46 9.65 14,117 13,033
shares
Final Annuity shares (0.11) (0.11) (150) (150)
entitlement
Shortfall in funds to pay final 0.11 0.11 150 150
Annuity shares capital
entitlement
Ordinary shares shortfall (15.39) (14.90) (20,774)* (20,106)*
Loss to be attributed against 15.39 14.90 20,774 20,106
non-shareholder entitlement
Equity shares - - - -
* Represents the total shortfall in assets of the Ordinary shares of #20,774,000
(2002 - #20,106,000).
4. The financial information for the year ended 30 September 2003 comprise
non-statutory accounts. The financial information for the year ended 30
September 2002 has been extracted from the published accounts that have been
delivered to the Jersey Financial Services Commission and on which the report of
the auditors is unqualified and did not contain a statement under Article 111 of
the Companies (Jersey) Law 1991. The statutory accounts for 2003 will be
finalised on the basis of the financial information presented by the Directors
in this preliminary announcement and will be delivered to the Jersey Financial
Services Commission in due course.
5. The Annual Report will be posted to shareholders in due course and further
copies will be available from the registered office, Aberdeen Asset Managers
Jersey Limited, No.1 Seaton Place, St. Helier, Jersey JE4 8YJ.
Aberdeen Asset Managers Jersey Limited
Secretaries
4 December 2003
This information is provided by RNS
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END
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