TIDMATY
RNS Number : 2261Q
Athelney Trust PLC
24 February 2021
Athelney Trust PLC
Legal Entity Identifier:
213800ON67TJC7F4DL05
NON- STATUTORY ACCOUNTS
The financial information set out below does not constitute
the Company's statutory accounts for the years ended 31 December
2020 and 2019 but is derived from those accounts. Statutory
accounts for 2019 have been delivered to the Registrar of
Companies, and those for 2020 will be delivered in due course.
The auditors have reported on those accounts; their report
was (i) unqualified, (ii) did not include a reference to
any matters to which the auditors drew attention by way of
emphasis without qualifying their report and (iii) did not
contain a statement under Section 498 (2) or (3) of the Companies
Act 2006. The text of the Auditor's report can be found in
the Company's full Annual Report and Accounts on the Company
website: www.athelneytrust.co.uk
Athelney Trust plc, the investor in small companies and junior
markets announces its final results for the 12 months ended
31 December 2020.
Chairman's Statement and Business Review
Dear Shareholder
I am pleased to present the Annual Financial Report for the year
to 31 December 2020.
The Strategic Report section of this Annual Report has been
prepared to help Shareholders understand how the Company operates
and assess its performance.
Overview
Athelney Trust plc (the 'Company' or 'Trust') faced
unprecedented market conditions resulting from the global COVID-19
pandemic declared in March, subsequent disruption to life, business
and the economy from two national lockdowns, and vaccine
announcements in November and December. The company performed well
in this context, with unusually large market swings and uncertainty
leading to increased share price volatility. The key performance
points are as follows:
-- At 31 December 2020, audited Net Asset Value (NAV) was 255.3p
per share (2019: 266.9p), a decrease of 4.3% over the year as
compared to a 6.4% decline in the FTSE 250 and a 14.3% decline in
the FTSE 100.
-- The Trust's investment performance over 12 months as measured
by NAV total return, which is the change in NAV plus the dividend
paid, was -0.22% (2019: 22.2%). Long term performance represented
by the Trust's average 10-year total shareholder return of +112%
lagged the FTSE 100 (+119%) and lagged the FTSE 250 (+194%).
-- The 12-month revenue return per ordinary share was 5.9p
(2019: 9.1p), a decrease of 35%.
-- The first interim dividend of 1.7p per share was paid on 25 September 2020.
-- Your Board recommend a final dividend of 7.7p per share
making a total dividend payable for the year of 9.4p (2019: 9.3p)
an increase of 1%. UK Inflation for the year of 2020 was 0.8%
(Office for National Statistics).
-- This is the 18th successive year of progressive dividend and
importantly returns the Trust to a top position in the dividend
yield league table for Investment Companies as well as keeps us in
the Next Generation of Dividend Heroes list maintained by the AIC
(the trust was top of the list in February 2021).
Board and Governance
The Board places significant importance on corporate governance
and compliance with the AIC and UK Corporate Governance Codes. Full
details are set out in the Corporate Governance section on pages 14
to 17.
An Independent Board
The Directors in place at the time of signing these accounts
are:
-- Myself, Frank Ashton - Non-Executive Chairman
-- Simon Moore - Non-Executive Director, Chair of Audit
Committee, Chair of Remuneration Committee
-- Dr Manny Pohl - Managing Director, Fund Manager
We currently have three directors who together make up an
independent Board under the AIC Code of Governance 2020. I have no
current or prior connection with any major shareholder of the
Company and maintain I am an independent Chairman. The Board is
also agreed that Simon Moore was independent at 31 December
2020.
Capital Gains
During the year the Company realised capital profits before
expenses arising on the sale of investments in the sum of
GBP223,957 (2019: GBP262,480).
Portfolio Review
Holdings Purchased
Holdings of Clinigen and Yougov were purchased for the first
time.
Additional holdings of 4imprint, Abcam, AEW UK, Begbies Traynor,
Churchill China, Clarke (T), Fevertree, Homeserve, Jarvis
Securities, JD Sport, Lok'n Store, Rightmove, Smart Metering were
also acquired.
Holdings Sold or Trimmed
Andrews Sykes, Biffa, Boohoo, Camellia, Costain, Custodian REIT,
Greencore, Hill & Smith, Marstons, Mountview Estates, Picton
Property, Randall & Quillter, Regional REIT, Vianet, Vitec, VP,
Wilmington
Corporate Activity
The holding of Hansteen was subject to a Tender Offer during the
year at a capital profit of 15%.
Dividend
In line with the majority of investment trusts and after
consulting shareholders, the board decided the Trust should pay a
dividend more frequently than once a year. During the year the
Company paid its first interim dividend of 1.7p on 25 September
2020.
The Board is very pleased to recommend a final dividend of 7.7p
per ordinary share making the total dividend this year 9.4p (2019:
9.3p). This represents an increase of 1% over the previous year.
Subject to shareholder approval at the Annual General Meeting on 30
March 2021, the dividend will be paid on 6 April 2021 to
shareholders on the register on 12 March 2021 .
Review
It is hard to conceive what else, short of banking collapse or
world war, might in a single year have the same impact and
longer-term implications for the world today as COVID-19; hardly
any UK business has been untouched by related challenges including
huge, panic-driven market swings. In addition, economic uncertainty
was exacerbated by a drawn-out US Presidential election plus
perhaps an inevitable last-minute UK-EU agreement to a Brexit
deal.
The darkest cloud however arrived in the last quarter, with a
resurgence of the virus in more transmissible form in several
countries. It may not be more deadly; however, it means the UK and
other major economies must consider lockdown for longer and hope
that mutations do not dim the hope that mass vaccination
provides.
I am very pleased therefore to report that NAV outperformed both
the FTSE 100 and 250 markets over the year by 10 and 2.1 percentage
points respectively. In the past 18-24 months Manny Pohl has shown
focus and efficiency in shaping a portfolio that continues to
deliver today and promises much for tomorrow. The Board is very
grateful for his efforts in a difficult year, leading market
research and a team approach that is founded on strong basic
financial and value filters. Some companies and sectors have
benefited from the conditions in 2020 (mostly the big tech names,
plus precious metals) while others seem stuck with a valuation that
defies logic. Finding a balance in the portfolio, now even more
focused to 30+ companies, to provide growth over time, at the same
time as delivering the usual Trust income during such a
pandemic-affected market has been a challenge in 2020.
Our status as a closed-ended fund provides a key advantage over
open-ended funds; we can use reserves created in good years to
smooth out dividend payments through better and leaner years. 2020
was most definitely lean as UK dividends fell by 44% to GBP61.9bn,
the lowest annual total since 2011. The Bank of England's PRA
lifted the prohibition on banking dividends in December, which
since March had resulted in the financial sector accounting for 40%
of the cuts, and the beleaguered oil sector for another fifth.
Protection is now in place since December to prevent excessive bank
dividends being paid. Some dividend suspensions were reversed in
the last quarter, however the year's meagre results have triggered
renewed interest in value-creation and cash-generative businesses,
as income investors follow the inevitable correction. Our revenue
return of 5.9p per share was 35% down compared to last year, and
comparatively speaking, a good outcome.
Against this backdrop I am delighted to tell you that your Board
recommends a final dividend payment of 7.7p (total 9.4p). This
shares the benefits of prudence in previous good years and
increases our dividend once more, subject to approval at the AGM.
At a share price of 215p on 31 December, this represents a dividend
yield of 4.37% (better than the average 2020 yield from FTSE 100
companies of 3.77% and much better than the FTSE 250).
In terms of costs the Trust has continued to be prudent and has
not added a fourth Board member to replace David Lawman who retired
by rotation at the April AGM; total remuneration reduced by 14%
compared to 2019. Non-executive Director's fees remain at
GBP10,500. Other Trusts reduced management and Directors' fees
through this year. I believe that along with a reduced management
fee of 0.75% since January 2019, we have managed ongoing costs very
effectively in 'normal operating conditions' and compared to the
very unusual year of 2019, our ongoing charges figure has fallen
from 4.30% to 2.45%. As detailed on page 33 in note 3, nearly every
line item represented a cost reduction on the prior year.
Outlook
All hope for a swift return to normal dividend payments, however
some expect this will not take place during 2021, especially with
the further COVID-19 restrictions while UK vaccinations take place
for the most vulnerable groups in the first quarter. Link Group
expects a best-case UK dividend increase of 8.1% (excluding special
payments) and a slow start to the dividend year while a great deal
of uncertainty still lingers. Much depends on vaccination success
leading to our gaining a meaningful release from lockdown that
lasts long enough to deliver sustained growth in GDP after what
seems likely to be shortly announced as a UK double-dip recession
in 2020.
There may well be pent-up enthusiasm from retail shoppers and
investors alike. Some, maybe many might go on a spending spree, and
the Bank of England believes there is upside risk from this.
Current talk of negative interest rates may come to nothing, but
the UK economy needs stimulating as we plan to exit lockdown in
four stages between 8 March and 21 June this year. Investors have
long waited for the time where neither Brexit nor COVID-19
uncertainties keep foreign investors away, and some dislocated
shares can return to par from their 'cheap comparative valuations'.
If true, this now seems most likely to happen in 2021 and will
present further opportunities for the Trust focusing on the UK
Small Companies sector.
Good companies at fair prices are still overlooked by house
analysts. Those with commitment to a proven system, prepared to
analyse fully and act on conviction, will come out on top in the
long run. Our Managing Director and Fund Manager has many years'
experience relevant to operating successfully in the conditions of
2021 - this bodes well for your Trust.
Our AGM in 2020 was held virtually, with no shareholders
present, as movement restrictions and the safety of our investors
and staff made a physical meeting impossible. We will be holding a
similar event for the AGM this year on 30 March 2021 at 9.00am.
Shareholder engagement and opinion is very important to us, so
there are plans in place to give you the opportunity to engage with
the Board by sending your questions to us in advance and making
sure there is a proxy for your vote. Details of the proposed AGM
can be found in the Notice to the AGM publication.
I leave you with the simple words of one of the inspirations of
2020 - Captain Sir Tom Moore, who after a remarkable 100(th) year,
sadly recently died from COVID-19. "Things will get better. The sun
will shine again".
Frank Ashton
Non-Executive Chairman
24 February 2021
Fund Manager's Review
Reflecting on 2020, an extraordinary year
The Global Scene
Reflecting on the year that was, it can be confidently said, it
was one like no other! This year we saw our world turn upside down
with the unimaginable coming to the fore. We've seen the full gamut
of external factors impact Global markets, including raging
bushfires, a deadly pandemic, never-before-seen stimulus packages,
trade wars and an election that tested the Democratic system of the
United States.
Before I begin with this year's review, I'd like to acknowledge
those who have worked tirelessly throughout this year for the
benefit of our society - nurses, doctors, police and members of the
defence forces. While we have all managed the significant
challenges and pressures COVID-19 has placed upon us, this crisis
has certainty provided each of us with some timely lessons: to
cherish the physical times we have with loved ones, enjoy our
social connections and to embrace our lives outdoors. Cafes and
conference rooms were replaced by the disquiet of working from
home, separated from our colleagues and families as we all complied
with social distancing.
Businesses needed to adapt to survive - gin distilleries became
hand sanitiser producers, event staging manufacturers built
flat-pack office desks, and nearly every service organisation
implemented a work from home program. Five years' worth of
technology adoption occurred within weeks as businesses worked out
new ways of connecting staff and customers, we created discussion
channels on Slack and attended Board meetings with our pets. This
recent explosion in the use of technology is highlighted by the
fact that in the five-year period from 2010 to 2015 the global
market capitalisation of vertical software companies increased by
GBP90bn from GBP50bn to GBP140bn, whereas in the period from 2015
to 2020 their market capitalisation increased by a further GBP340bn
to GBP480bn.
However, something in this technology focused world was missing:
the face-to-face interaction and mentoring that occurs within the
office environment. For business leaders, these items have become
the next challenge for those who need to engage with their teams
and provide purpose and a sense of community when normal social
interactions are not possible. To ensure business success through
these times, leaders need to ensure their companies adopt
change-orientated capabilities that help firms redeploy and
reconfigure their resource base while ensuring they remain
responsible to all stakeholders and as investors, we need to ensure
that we are able to identify these companies.
The Markets and Our Portfolio
Global markets rose across the board over the last quarter with
most markets trending up since the April 2020 lows. After initially
under-performing the US tech stocks, UK stocks advanced strongly on
the news of a vaccine and a Brexit trade agreement. The pound rose
to its highest level against the USD since March 2020. Without
doubt, some areas of the global market look expensive when viewed
historically but it was the year of technology as mentioned
previously and the stock markets are merely reflecting the rapid
changes taking place in the economy. The FTSE-250 hit a record high
of 22,114.30 on 2(nd) of January 2020 before collapsing by 44.1%
over the next 2 months. It then increased by 66% over the next nine
months to close the year at 20,488.3, down 6.4% over the year. By
comparison, our portfolio increased by 3.5% (adjusting for outflows
on a time weighted basis) over the same period.
While the FTSE-250 only declined by 6.4% this is a
capitalisation weighted index and one should not lose sight of the
fact that there are many more smaller businesses in trouble,
evidenced in the latest Red Flag Alert research report by Begbies
Traynor for 2020, which reported that 630,000 businesses in the UK
are recorded to be in significant distress at the end of the fourth
quarter, the largest quarterly increase (73,000) in financially
distressed companies since the second quarter of 2017. This 13%
increase (from 557,000 in Q3 2020) comes as the UK is plunged into
another nationwide lockdown and clearly these figures would have
been much worse had it not been for Government support. The sad
truth is that for many companies this will provide little more than
a stay of execution as debt levels become unmanageable and
structural changes across many sectors take their toll.
While the majority of the stocks in the portfolio contributed to
the outperformance of the portfolio versus the market, a handful of
names performed exceptionally well, which included Games Workshop
(LSE: GAW), Jarvis Securities (LSE: JIM) and Treatt (LSE: TET); a
brief description of these 3 companies follows. The biggest
detractors from returns over the year included 4IMPRINT (LSE:
FOUR), Forterra (LSE: FORT) and Paypoint (LSE: PAY). At an
aggregate level, all of our alpha was generated through stock
selection, as opposed to sector selection and this is consistent
with our style as a bottom-up, benchmark unaware, high conviction
manager.
Games Workshop Group plc (LSE: GAW)
Games Workshop designs, manufactures, distributes and markets a
hobby based upon collecting, modelling, painting and tabletop
gaming with model soldiers. Its key brands are the high fantasy
Warhammer and dark future Warhammer 40,000 game systems which it
has been able to expand out to encompass video games, books and new
campaigns. Games Workshops' competitive advantage is driven by the
fact that it has limited competition with the games voraciously
supported by a legion of fans worldwide, who will go to great
lengths (and expense) to produce their own accompaniments to add to
the series lore and backstory. The company generates most of its
income in North America and during the COVID-19 lockdown, the
majority of the 529 retail stores were restricted or closed but
normal trading did resume in the period that the stores were
allowed to trade.
Jarvis Securities plc (LSE: JIM)
Jarvis offers retail execution-only stockbroking, ISA and SIPP
investment wrappers, savings schemes, and financial administration,
settlement and custody services to other stockbrokers and
investment firms as well as individuals. It offers Dial-n-Deal for
clients wanting to open an account over the telephone and sell
shares in certificated form while sellmysharecertificates.com is a
share sale postal service. It also offers outsourced services to
investment professionals and other financial intermediaries and its
subsidiary, Jarvis Investment Management Ltd, is an outsourced
investment administration and Model B settlement services provider.
We believe that this business model should be able to offset the
effects of the depressed market conditions and through organic
growth be able to translate increased trade volumes into improved
profits.
Treatt plc (LSE: TET)
Treatt manufactures and supplies various natural extracts and
ingredients to the flavour, fragrance, beverage, and consumer
product industries from their bases in the UK, the US and China. It
has a diverse product portfolio with particular expertise in
citrus, tea and sugar reduction. The company also provides
ingredient applications for beverage and household products; and
fragrance ingredients that are the result of over a century of
knowledge and innovation. The business has continued partnering
with customers to develop exciting products in the fast-evolving
beverages market and some material new business wins have been
achieved including in the global alcoholic seltzer category which
is continuing to grow strongly. Treatt is well positioned as a
supplier of natural extracts and with its technical expertise
enables it to add significant value to customers across a growing
range of applications resulting in margin expansion as well as
revenue growth.
Investment Philosophy
As far as portfolio investments are concerned, our investment
philosophy is clear:
I. The economics of a business drives long-term investment returns; and
II. Investing in high quality, growth businesses that have the
ability to generate predictable, above-average economic returns
will produce superior investment performance over the
long-term.
In essence, this means that in assessing potential investments
we:
1. Value long-term potential, not just performance
2. Choose high-quality, growing businesses; and
3. Ignore temporary market turbulence.
The key attributes that will define our investments are:
-- Organic Sales Growth: Quality franchises organically growing
sales above GDP growth that can do so (sustainably) because they
have a large, growing market opportunity and compelling competitive
advantage which will drive ongoing market share gains are
attractive.
-- A Proven Track Record: This encompasses both the management's
capability and the strength of the business' model. Generally, a
firm that consistently delivers a Return on Equity of greater than
15% indicates a Quality Franchise for us. Our investment philosophy
is built on the belief that a stock's long-term return to
shareholders is driven by the return on capital of the underlying
business.
-- Company's Future Profits: In essence we are backing a proven
management team and a successful business model. Management are the
key decision makers regarding the company's strategy and its
competitive position in the marketplace and it is critical that we
have confidence in the company's ability to sustainably execute its
strategy and grow their earnings, even in a tough environment like
the current COVID-19 and Brexit conundrum.
-- Low Leverage: We require investments to operate with low
levels of debt, which ensure that they have sufficient resources to
execute on their strategy. An Interest Coverage above 4x provides
sufficient bandwidth in times of economic trouble. As a long-term
investor, capital preservation is the highest priority. There is
nothing that changes a management team's focus toward the short
term quicker than impending debt refinancing when market conditions
suddenly change for the worse. We need to be comfortable that this
will not happen and that the company has a strong enough balance
sheet so that it will retain optionality and can quickly and
efficiently execute its strategy over the long-term.
Sleep Well rather than Eat Well
As our process aims to find high-quality businesses that we own
for the very long-term, our portfolio turnover remains low. Through
time we continue to have investments that we have held for over ten
years, however, this doesn't mean we aren't always looking for new
investments. As mentioned in our monthly reports, the focus this
year has been to continue to restructure the portfolio to align it
with our investment philosophy while cognisant of the need to
maintain the dividend paid to shareholders.
Investment management is more than merely generating alpha in
excess of a benchmark. While that is a core part of our mandate,
other very important qualitative issues are central to what we do.
For example, we recognise that capital allocation is a vehicle
through which to drive change. We have the opportunity to demand
specific standards of corporate governance, decide whether specific
social and ethical issues are acceptable and, if they are not, we
vote with our feet.
For us, the integrity and credibility of any management team is
a founding principle to our investment process. We need to trust
that management has the best interests for all stakeholders at
heart, and we have faith that they will make sound strategic
decisions and have substantial experience and capabilities in their
chosen field. As custodians of our capital, we must ensure that we
are doing whatever we can to preserve capital and grow it over
time. We allocate capital to investments which we believe are
sustainable in the long-term, and finding trustworthy, values-based
management that aligns with our core values and beliefs will ensure
above-average economic portfolio returns. Sustainability of
investment performance or the improvement of the wellbeing of
broader society hinges upon ethical, transparent, and honest
leadership and in cases where we feel we can add something to the
conversation, we engage with the company.
Looking Forward
While the COVID epidemic has affected most businesses
negatively, our investment philosophy is based on the belief the
long-term economics of a business drives long-term investment
returns. The long-term financial metrics of our portfolio
companies, including organic sales growth, earnings and dividend
growth, should provide the impetus for improvement in valuations or
at least be supportive of the current valuations in the future. Our
companies have strong business models with capable and experienced
management teams which we expect will continue to deliver
above-average returns to shareholders. Dividends are expected to be
re-instated where they have been cut or withheld, with the Athelney
dividend supported in the short-term by the reserves we have built
up in the good times and by the distributions from the high
yielding property trusts. Over time we expect that the dividends
from the high growth quality companies in the portfolio will
increase sufficiently so that the property trusts can be replaced
by other high growth quality companies without jeopardising our AIC
dividend hero status.
While we do feel that the markets are relatively fully valued
and do not see a significant improvement in the P/E ratings of the
market, for many of the companies in the portfolio our estimates
and forecasts for total portfolio return remain promising.
Update
The unaudited NAV on 31 January 2021 was 256.2p per share - up
0.35% from 31 December 2020, the third monthly increase in a row
and beating the FTSE 100(-0.82%), FTSE 250 (-1.27%), Small Cap
Index (+0.24%) as well as AIM All-share Index (+0.31%). The share
price on the same day was 210p (trading at a discount of 18%).
Further updates can be found at www.athelneytrust.co.uk
Dr Manny Pohl AM
Fund Manager
24 February 2021
Section 172(1) Statement
The Directors of the Company are required to promote the success
of the Company for the benefit of the Members and Shareholders as a
whole. Section 172(1) of the Companies Act (2006) expands this duty
and requires the Directors to consider a broader range of
interested parties when considering the promotion of the Company.
This wider group of stakeholders will include employees, if any,
suppliers, customers and others, and the Board will look to
understand and take into account the needs of each stakeholder,
although recognising that different stakeholders may have
conflicting priorities and not all decisions made will be to the
benefit of all stakeholder groups.
When making decisions the Board should consider the
following:
-- the likely consequences of any decisions in the long-term;
-- the interests of the Company's employees (if applicable);
-- the impact of the Company's operations on the environment and the community;
-- the need to foster the Company's business relationships with
suppliers, customers and others;
-- the need to act fairly for all members of the Company, and
-- the desirability of the Company maintaining a reputation for
high standards of business conduct.
In line with similar small Investment Trusts and Investment
Companies, Athelney Trust plc does not have any customers and
relies on a number of third-party providers of services such as
Company Administrator, the Custodian and the Registrar to maintain
its operations. The Company takes into account the regulations of
the market in which it operates and has regard to the environment
and the wider community in which it operates.
At every Board meeting the Directors review the performance of
the Company towards meeting the Company's Investment Objective
through its strategy. Manny Pohl is the fund manager and reports to
other Board members and answers any questions raised. The
compliance with existing regulatory and legal requirements are
reviewed, together with any new regulations that are due to be
introduced or are being proposed that may affect the Company.
The Board recognises the importance of, and is committed to,
understanding the views of Shareholders and maintaining
communication with its Shareholders in the most appropriate
manner.
This is undertaken through:
Annual General Meeting
The Company, in normal circumstances encourages all Shareholders
to attend and participate at its Annual General Meeting ("AGM").
Whilst the formal business of the meeting is the primary purpose of
the meeting, members of the Board are available to answer questions
directly from Shareholders, to provide an update to the meeting and
to offer Shareholders an insight into the business.
The AGM held in April 2020 was subject to government COVID-19
restrictions and the Board reluctantly held the meeting behind
closed doors and Shareholders were requested not to attend. Voting
was poll based and Shareholders were requested to email any
questions to the Directors. In light of the current Government
COVID-19 guidance the Directors have again decided to hold the 2021
AGM behind closed doors. Further details regarding the 2021 AGM are
contained in the Notice of the Annual General Meeting published in
a separate notification.
Published Reports
The Company produces Annual and Half Yearly Reports and monthly
fact sheets are all available from the Company's website and paper
copies are available on request from the registered office. The
publication of these reports is considered to be the primary method
of communication to Shareholders and other readers of the reports
and provides detailed information on the portfolio, performance
over the period and an assessment of the outlook for the
Company.
The Annual Report also contains details regarding the Company's
corporate governance and the Board seek to ensure that the Report
is readable and is mindful that it should be fair, balanced and
understandable.
Shareholder enquiries
Shareholders can contact the Company or any of its Directors
through the Company Secretary or through their company email
address. Alternatively, letters can be sent to the registered
office address. Although the Directors are not available full time,
with the assistance of the Company Secretary they seek to maintain
open communication to all Shareholders.
Suppliers
The Company Secretary Deborah Warburton and Administrator GW
& Co. Limited are often the main contact point for advisors and
stakeholders in the Company. Regular communication is maintained
between the Company Secretary and the Directors advising them of
all matters concerning the Company. The Company also relies on the
provision of services from outside parties to operate and gives
consideration to the needs and objectives of those providers and
recognises that their success will often assist the Company in
achieving its objectives.
Regulators
The Company operates in an environment that is governed by legal
and regulatory requirements. The Board recognises that these
requirements are there to protect stakeholders, including the
government.
Environment and Community
As the Company does not have any direct employees nor any
physical office environment of its own it has little direct impact
on the community or the environment. The Company seeks to reduce
its impact on the environment in encouraging Shareholders to
receive Reports electronically rather than through printed hard
copies. When paper copies are requested FSC paper is used. The
Board also engage through electronic means where possible rather
than hold excessive face to face meetings.
Other Statutory Information
As explained within the Report of the Directors on pages 18 to
19, the Company carries on business as an investment trust.
Investment trusts are collective closed-ended public limited
companies.
Board
The Board of Directors is responsible for the overall
stewardship of the Company, including investment and dividend
policies, corporate and gearing strategy, corporate governance
procedures and risk management. Biographical details of the three
male Directors, can be found on pages 2 and 3.
One of the Directors is the Company's only employee (2019: one
employee).
Investment Objective
The investment objective of the Trust is to provide shareholders
with prospects of long-term capital growth with the risks inherent
in small cap investment minimised through a spread of holdings in
quality small cap companies that operate in various industries and
sectors. The Fund Manager also considers that it is important to
maintain a progressive dividend record.
Investment Policy
The assets of the Trust are allocated predominantly to companies
with either a full listing on the London Stock Exchange or a
trading facility on AIM or AQSE. The assets of the Trust have been
allocated in two main ways: first, to the shares of those companies
which have grown steadily over the years in terms of revenue and
profits but, despite this progress are undervalued by the market
when compared to future earnings and dividends; second, those
companies whose shares are undervalued by the market when compared
with the value of land, buildings, other assets or cash on their
balance sheet.
Investment Strategy
The investment strategy employed by the Fund Manager in meeting
the investment objective focuses on active stock selection. The
selection of individual holdings is based on analysis of, amongst
other things, market positioning, competitive advantage, future
growth, financial strength and cash flows. The weighting of
individual investments reflects the Fund Manager's conviction in
those holdings and his views on asset allocation, including between
UK and overseas equities, corporate bonds, cash and gearing.
Investment of Assets
At each Board meeting, the Board considers compliance with the
Company's investment policy and other investment restrictions
during the reporting period. An analysis of the portfolio on 31
December 2020 can be found on pages 9 and 10 of the annual
report.
Responsible Ownership
The Fund Manager takes a particular interest in corporate
governance and social responsibility investment policy. As stated
within the Corporate Governance Statement on pages 14 to 17, the
Fund Manager's current policy is available on the Trust's website
www.athelneytrust.co.uk. The Board supports the Fund Manager on his
voting policy and his stance towards environmental, social and
governance issues.
Review of Performance and Outlook
Reviews of the Company's returns during the financial year, the
position of the Company at the year end, and the outlook for the
coming year are contained in the Chairman's Statement on pages 4 to
5 and the Fund Manager's review on pages 6 to 8 which form part of
the Strategic Report.
Principal Risks and Uncertainties and Risk Management
As stated within the Corporate Governance Statement on pages 14
to 17, the Board applies the principles detailed in the internal
control guidance issued by the Financial Reporting Council, and has
established a continuing process designed to meet the particular
needs of the Company in managing the risks and uncertainties to
which it is exposed.
The principal risks and uncertainties faced by the Company are
described below and in note 12 which provides detailed explanations
of the risks associated with the Company's financial
instruments.
-- Market - the Company's fixed assets consist almost entirely
of listed securities and it is therefore exposed to movements in
the prices of individual securities and the market generally.
-- Investment and strategic - incorrect investment strategy,
asset allocation, stock selection and the use of gearing could all
lead to poor returns for shareholders.
-- Regulatory - Relevant legislation and regulations which apply
to the Company include the Companies Act 2006, the Corporation Tax
Act 2010 ("CTA") and the Listing Rules of the Financial Conduct
Authority ("FCA"). The Company has noted the recommendations of the
UK Corporate Governance Code and its statement of compliance
appears on pages 14 to 17. A breach of the CTA could result in the
Company losing its status as an investment company and becoming
subject to capital gains tax, whilst a breach of the Listing Rules
might result in censure by the FCA. At each Board meeting the
status of the Company is considered and discussed, so as to ensure
that all regulations are being adhered to by the Company and its
service providers.
-- Operational - failure of the accounting systems or disruption
to its business, or that of other third-party service providers,
could lead to an inability to provide accurate reporting and
monitoring, leading to a loss of shareholders' confidence.
-- Financial - inadequate controls by the Fund Manager or other
third-party service providers could lead to misappropriation of
assets. Inappropriate accounting policies or failure to comply with
accounting standards could lead to misreporting or breaches of
regulations.
-- Liquidity - the Company may have difficulty in meeting
obligations associated with financial liabilities.
-- Trading - ATY is a small trust and its shares can be
illiquid, which means that investors may have difficulty in dealing
in larger amounts of shares.
The Company has complied with the MiFID ll and KID legislation
and the deadlines to ensure that shares in the Company were still
able to be traded. A copy of the Company's KID can be found on the
website http://www.athelneytrust.co.uk
The Board is not aware of any breaches of laws or regulations
during the period under review and up to the date of this
report.
The Board seeks to mitigate and manage these risks through
continual review, policy setting and enforcement of contractual
obligations. It also regularly monitors the investment environment
and the management of the Company's investment portfolio.
Investment risk is spread through holding a wide range of
securities in different industrial sectors.
Statement Regarding Annual Report and Financial Statements
Following a detailed review of the Annual Report and Financial
Statements by the Audit Committee, the Directors consider that
taken as a whole it is fair, balanced and understandable and
-- provides the information necessary for shareholders to assess
the Company's performance, business model and strategy.
Environment Emissions
The Company does not have any physical assets, property, or
operations of its own and as such does not generate any greenhouse
gas or other emissions.
Social, Community and Human Rights Issues
The Company has one employee and, as far as the Board is aware,
no issues exist in respect of social, community or human rights
issues.
Alternative Investment Fund Manager's Directive ("AIFMD")
The Company is registered as its own AIFM with the FCA under the
AIFMD and confirms that all required returns have been completed
and filed.
On behalf of the Board
Dr Manny Pohl AM
Managing Director
24 February 2021
Income Statement
For the Year Ended 31 December 2020
2020
2019
Note Revenue Capital Total Revenue Capital Total
GBP GBP GBP GBP GBP GBP
(Losses)/gains
on investments
held at fair
value 8 - (30,695) (30,695) - 1,086,854 1,086,854
Income from
investments 2 160,876 - 160,876 232,262 - 232,262
Investment
management
expenses 3 (3,781) (34,221) (38,002) (3,812) (34,682) (38,494)
Other expenses 3 (29,820) (75,688) (105,508) (32,807) (166,384) (199,191)
--------- ---------- ----------- --------- ---------- ----------
Net return
on ordinary
activities
before taxation 127,275 (140,604) (13,329) 195,643 885,788 1,081,431
Taxation 5 - - - - - -
--------- ---------- ----------- --------- ---------- ----------
Net return
on ordinary
activities
after taxation 6 127,275 (140,604) (13,329) 195,643 885,788 1,081,431
========= ========== =========== ========= ========== ==========
Net return
per ordinary
share 6 5.9p (6.5p) (0.6p) 9.1p 41.0p 50.1p
Dividend per
ordinary share
paid during
the year 7 11p 9.1p
All revenue and capital items in the above statement derive from
continuing operations.
No operations were acquired or discontinued during the year.
The total column of this statement is the Statement of Total
Comprehensive Income of the Company prepared in accordance with
applicable Financial Reporting Standards ("FRS"). The supplementary
revenue return and capital return columns are prepared in
accordance with the Statement of Recommended Practice ("AIC SORP")
issued in October 2019 by the Association of Investment
Companies.
Statement of Changes in Equity
For the Year Ended 31 December 2020
Called-up Capital Capital Total
Share Share reserve reserve Revenue Shareholders'
Capital Premium realised unrealised reserve Funds
GBP GBP GBP GBP GBP GBP
Balance brought
forward at 1 January
2019 539,470 881,087 1,855,088 1,157,686 440,322 4,873,653
Net profits on
realisation
of investments - - 262,480 - - 262,480
Increase in unrealised
appreciation - - - 824,374 - 824,374
Expenses allocated
to
Capital - - (201,066) - - (201,066)
Profit for the
year - - - - 195,643 195,643
Dividend paid
in year - - - - (196,367) (196,367)
Shareholders'
Funds at 31 December
2019 539,470 881,087 1,916,502 1,982,060 439,598 5,758,717
========== ======== ========== =========== ========== ==============
Balance brought
forward at 1 January
2020 539,470 881,087 1,916,502 1,982,060 439,598 5,758,717
Net profits on
realisation
of investments - - 223,957 - - 223,957
Decrease in unrealised
Appreciation - - - (254,652) - (254,652)
Expenses allocated
to
Capital - - (109,909) - - (109,909)
Profit for the
year - - - - 127,275 127,275
Dividend paid
in year - - - - (237,367) (237,367)
Shareholders'
Funds at 31 December
2020 539,470 881,087 2,030,550 1,727,408 329,506 5,508,021
======== ======== ========== ========== ========== ==========
Statement of Financial Position
As at 31 December 2020
Company Number: 02933559
Note 2020 2019
GBP GBP
Fixed assets
Investments held at fair
value through profit and
loss 8 5,310,661 5,466,191
---------- --------------------
Current assets
Debtors 9 142,136 223,733
Cash at bank and in hand 72,601 90,902
214,737 314,635
Creditors: amounts falling
due within one year 10 (17,377) (22,109)
---------- --------------------
Net current assets 197,360 292,526
---------- --------------------
Total assets less current liabilities 5,508,021 5,758,717
Net assets 5,508,021 5,758,717
========== ====================
Capital and reserves
Called up share capital 11 539,470 539,470
Share premium account 881,087 881,087
Other reserves (non distributable)
Capital reserve - realised 2,030,550 1,916,502
Capital reserve - unrealised 1,727,408 1,982,060
Revenue reserve (distributable) 329,506 439,598
Shareholders' funds - all
equity 5,508,021 5,758,717
========== ====================
Net Asset Value per share 13 255.3p 266.9p
These financial statements were approved and authorised for
issue by the Board of Directors on 24 February 2021 and signed on
their behalf by
Dr Manny Pohl AM
Managing Director
Statement of Cash Flows
For the Year Ended 31 December 2020
2020 2019
GBP GBP
Cash flows used in operating
activities
Net revenue return 127,275 195,643
Adjustment for:
Expenses charged to capital (109,909) (201,066)
(Decrease)/increase in creditors (4,732) (1,431)
Decrease/(increase) in debtors 81,597 (10,298)
Cash (used)/from operations 94,231 (17,152)
---------------- -------------------------------------
Cash flows from investing
activities
Purchase of investments (1,137,856) (2,074,201)
Proceeds from sales of investments 1,262,691 2,343,102
---------------- -------------------------------------
Net cash used in investing
activities 124,835 268,901
---------------- -------------------------------------
Equity dividends paid (237,367) (196,367)
Net (decrease)/increase in
cash (18,301) 55,382
Cash at the beginning of the
year 90,902 35,520
---------------- -------------------------------------
Cash at the end of the year 72,601 90,902
================ =====================================
As the company does not have any loans, overdrafts or hire
purchase arrangements, net debt is equal to cash and therefore no
reconciliation of net debt has been disclosed.
Notes to the Financial Statements
For the Year Ended 31 December 2020
1. Accounting Policies
1.1 Statement of Compliance and Basis of Preparation of
Financial Statements
The financial statements are prepared in accordance with
applicable United Kingdom accounting standards, including Financial
Reporting Standard 102 ("FRS 102"), the Companies Act 2006 and with
the AIC Statement of Recommended Practice ("SORP") issued in
October 2019, regarding the Financial Statements of Investment
Trust Companies and Venture Capital Trusts. All the Company's
activities are continuing.
The presentation currency of the financial statements is pounds
sterling, being the functional currency of the primary economic
environment in which the company operates. Monetary amounts in
these financial statements are rounded to the nearest pound.
1.2 Income
Income from investments including taxes deducted at source is
recognised when the right to the return is established (normally
the ex-dividend date). UK dividend income is reported net of tax
credits in accordance with FRS 102 "Income Tax". Interest is dealt
with on an accruals basis.
1.3 Investment Management Expenses
All three Directors are involved in investment management, 10%
of their salaries or fees have been charged to revenue and the
other 90% to capital. All other investment management expenses have
been charged to capital. The Board propose continuing this basis
for future years.
1.4 Other Expenses
Expenses (including VAT) and interest payable are dealt with on
an accruals basis and charged through the Revenue and Capital
Accounts in an allocation that the Board consider to be a fair
distribution of the costs incurred.
1.5 Investments
Listed investments comprise those listed on the Official List of
the London Stock Exchange. Unlisted investments are traded on AIM.
Profits or losses on sales of investments are taken to realised
capital reserve. Any unrealised appreciation or depreciation is
taken to unrealised capital reserve.
Investments have been classified as "fair value through profit
and loss" upon initial recognition.
Subsequent to initial recognition, investments are measured at
fair value with changes in fair value recognised in the Income
Statement.
Securities of companies quoted on a recognised stock exchange
are valued by reference to their quoted bid prices at the close of
the year, similarly, AIM-traded investments are valued using the
closing bid price on 31 December.
1.6 Taxation
The tax effect of different items of income and expenses is
allocated between capital and revenue on the same basis as the
particular item to which it relates, using the Company's effective
rate of tax for the year.
1.7 Judgements and estimates
The Directors confirm that no judgements or significant
estimates have been made in the process of applying the Company's
accounting policies.
1.8 Deferred Taxation
Deferred tax is recognised in respect of all timing differences
that have originated but not reversed by the balance sheet date.
Deferred tax liabilities are recognised for all taxable timing
differences but deferred tax assets are only recognised if it is
considered more likely than not that there will be suitable profits
from which the future reversal of the underlying timing differences
can be deducted. Deferred tax assets and liabilities are calculated
at the tax rates expected to be effective at the time the timing
differences are expected to reverse. Deferred tax assets and
liabilities are not discounted.
1.9 Capital Reserves
Capital Reserve - Realised
Gains and losses on realisation of fixed asset investments are
dealt with in this reserve.
Capital Reserve - Unrealised
Increases and decreases in the valuations of fixed asset
investments are dealt with in this reserve. Unrealised capital
reserves cannot be distributed by way of dividends or similar.
1.10 Dividends
In accordance with FRS 102 "Events after the end of the
Reporting Period", dividends are included in the financial
statements in the year in which they go ex-div.
1.11 Share Issue Expenses
The costs associated with issuing shares are written off against
any premium arising on the issue of Share Capital.
1.12 Financial Instruments
Short term debtors and creditors are held at cost.
2. Income
Income from investments
2020 2019
GBP GBP
UK dividend income 95,482 173,047
Foreign dividend income 17,834 25,542
UK Property REITs 47,480 33,173
Bank interest 80 -
Bank compensation - 500
Total income 160,876 232,262
UK dividend income
2020 2019
GBP GBP
UK Main Market listed investments 65,476 124,674
UK AIM-traded shares 30,006 48,373
95,482 173,047
3. Return on Ordinary Activities before Taxation
The following amounts (inclusive of VAT) are included
within investment management and other expenses:
2020 2019
GBP GBP
Directors' remuneration:
Services as a director 23,625 26,250
Otherwise in connection with management 37,807 45,122
Auditor's remuneration:
Audit Services - Statutory audit 9,250 13,250
Miscellaneous expenses:
Other wages and salaries - 153
Management services 32,472 32,472
PR and communications 2,310 12,351
Stock exchange subscription 11,540 6,748
Sundry investment management and other expenses 24,044 27,633
Legal fees 2,460 73,706
143,508 237,685
4. Employees and Directors' Remuneration
2020 2019
GBP GBP
Costs in respect of Directors:
Non-executive Directors' fees 23,625 26,250
Wages and salaries 37,807 45,122
Social security costs - 153
61,432 71,525
Average number of employees:
Chairman - -
Investment 1 1
Administration - -
1 1
5. Taxation
(i) On the basis of these financial statements no provision has
been made for corporation tax (2019: Nil).
(ii) Factors affecting the tax charge for the year.
The tax charge for the period is higher than (2019: lower than)
the average small company rate of corporation
tax in the UK of 19 per cent. The differences are explained below:
2020 2019
GBP GBP
Total return on ordinary activities before
tax (13,329) 1,081,431
Total return on ordinary activities multiplied
by the
average small company rate of corporation
tax 19%
(2019: 19%) ( 2,532) 205,472
Effects of:
UK dividend income not taxable (18,142) (32,879)
Revaluation of shares not taxable 48,384 (156,631)
Capital gains not taxable (42,552) (49,871)
Unrelieved management expenses 14,842 33,909
Current tax charge for the year - -
The Company has unrelieved excess revenue management expenses of
GBP401,358 at 31 December 2020 (2019: GBP356,765) and GBP102,597
(2019: GBP102,597) of capital losses for Corporation Tax purposes
and which are available to be carried forward to future years. It
is unlikely that the Company will generate sufficient taxable
profits in the future to utilise these expenses and therefore no
deferred tax asset has been recognised.
For the year ended 31 December 2019, the Company received
approval from HM Revenue and Customs under Section 1158 of the
Corporation Tax Act 2010, therefore the Company was not liable to
Corporation Tax on any realised investment gains for 2019. The
Directors intend to continue to meet the conditions required to
obtain approval and therefore no deferred tax has been provided on
any capital gains or losses arising on the revaluation or disposal
of investments.
6. Return per Ordinary Share
The calculation of earnings per share has been performed in
accordance with FRS 102.
2020
GBP GBP GBP
Revenue Capital Total
Attributable return on ordinary
activities after taxation 127,275 (140,604) (13,329)
Weighted average number of shares 2,157,881
Return per ordinary share 5.9p (6.5p) (0.6p)
2019
GBP GBP GBP
Revenue Capital Total
Attributable return on ordinary
activities after taxation 195,643 885,788 1,081,431
Weighted average number of shares 2,157,881
Return per ordinary share 9.1p 41.0p 50.1p
7. Dividend
2020 2019
GBP GBP
Final dividend in respect of 2019 of 9.3p
(2019: a final
dividend of 9.1p was paid in respect of 2018)
per share 200,683 196,367
Interim dividend in respect of 2020 of 1.7p 36,684 -
per share
237,367 196,367
Set out below is the total dividend payable in respect of the
financial year, which is the basis on which the requirements of
Section 1158 of the Corporation Tax Act 2010 are considered.
It is recommended that a final dividend of 7.7p (2019: 9.3p) per
ordinary share be paid out of revenue profits amounting to a total
of GBP166,157. For the year 2019, a final dividend of 9.3p was paid
on 16 April 2020 amounting to a total of GBP200,683.
Summary of dividends paid for the last 10 financial years
Ex-div date Dividend Amount Financial
Type Year
Proposed 11/3/2021 Final 7.7p 2020
10/9/2020 Interim 1.7p 2020
19/3/2020 Final 9.3p 2019
20/3/2019 Final 9.1p 2018
01/3/2018 Final 8.9p 2017
09/3/2017 Final 8.6p 2016
17/3/2016 Final 7.9p 2015
19/3/2015 Final 6.7p 2014
19/3/2014 Final 5.5p 2013
20/3/2013 Final 5.0p 2012
21/3/2012 Final 4.95p 2011
06/4/2011 Final 4.9p 2010
2020 2019
GBP GBP
Revenue available for distribution 127,275 195,643
Interim dividend paid (36,684) -
Final dividend in respect of financial year
Ended 31 December 2020 (166,157) (200,683)
Undistributed Revenue Reserve ( 75,566) ( 5,040)
8. Investments
Movements in year 2020 2019
GBP GBP
Valuation at beginning of year 5,466,191 4,648,238
Purchases at cost 1,137,856 2,074,201
Sales - proceeds (1,262,691) (2,343,102)
- realised gains on sales 223,957 262,480
(Decrease)/Increase in unrealised appreciation (254,652) 824,374
Valuation at end of year 5,310,661 5,466,191
Book cost at end of year 3,583,255 3,484,131
Unrealised appreciation at the end of the
year 1,727,406 1,982,060
5,310,661 5,466,191
UK Main Market listed investments 3,791,591 4,258,921
UK AIM-traded shares 1,519,070 1,207,270
5,310,661 5,466,191
(Losses)/gains on investments
2020 2019
GBP GBP
Realised gains on sales 223,957 262,480
(Decrease)/Increase in unrealised Appreciation (254,652) 824,374
(30,695) 1,086,854
The purchase costs and sales proceeds above include transaction
costs of GBP7,910 (2019: GBP15,533) and GBP5,056 (2019: GBP8,810)
respectively.
9. Debtors
2020 2019
GBP GBP
Investment transaction debtors 133,210 213,862
Other debtors 8,926 9,871
142,136 223,733
10. Creditors: amounts falling due within one year
2020 2019
GBP GBP
Social Other creditors security and other
taxes - 1,148
Other creditors 2,850 2,956
Accruals and deferred income 14,527 18,005
17,377 22,109
11. Called Up Share Capital
2020 2019
GBP GBP
Authorised
10,000,000 Ordinary Shares of 25p 2,500,000 2,500,000
Allotted, called up and fully paid
2,157,881 Ordinary Shares of 25p 539,470 539,470
12. Financial Instruments
The Company's financial instruments comprise equity investments,
cash balances and debtors and creditors that arise directly from
its operations, for example, in respect of sales and purchases
awaiting settlement.
The major risks associated with the Company are market, credit
and liquidity risk. The Company has established a framework for
managing these risks. The Directors have guidelines for the
management of investments and financial instruments.
Market Risk
Market price risk arises mainly from uncertainty about future
prices of financial investments used in the Company's business. It
represents the potential loss the Company might suffer through
holding market positions by way of price movements other than
movements in exchange rates and interest rates.
The Company's investment portfolio is exposed to market price
fluctuations which are monitored by the Fund Manager who gives
timely reports of relevant information to the Directors.
Adherence to the investment objectives and the internal controls
on investments set by the Company mitigates the risk of excessive
exposure to any one particular type of security or issuer.
The Company's exposure to other changes in market prices at 31
December on its investments is as follows:
A 20% decrease in the market value of investments at 31 December
2020 would have decreased net assets attributable shareholders by
49 pence per share (2019: 51 pence per share). An increase of the
same percentage would have an equal but opposite effect on net
assets available to shareholders.
Market risk also arises from changes in interest rates and
exchange risk. All of the Company's assets are in sterling and
accordingly the Company has limited currency exposure. The majority
of the Company's financial assets are non-interest bearing, as a
result, the Company's financial assets are not subject to
significant risk due to fluctuations in the prevailing levels of
market interest rates.
The carrying amounts of financial assets best represent the
maximum credit risk exposure at the balance sheet date. Bankruptcy
or insolvency of the custodian may cause the Company's rights with
respect to securities held with the custodian to be delayed.
Liquidity Risk
Liquidity Risk is the risk that the Company may have difficulty
in meeting obligations associated with financial liabilities. The
Company is able to reposition its investment portfolio when
required so as to accommodate liquidity needs. However, it may be
difficult to realise its investment portfolio in adverse market
conditions.
Maturity Analysis of Financial Liabilities
The Company's financial liabilities consist of creditors as
disclosed in note 10. All items are due within one year.
Capital management policies and procedures
The Company's capital management objectives are:
-- to ensure the Company's ability to continue as a going
concern;
-- to provide an adequate return to shareholders;
-- to support the Company's stability and growth;
-- to provide capital for the purpose of further
investments.
The Company actively and regularly reviews and manages its
capital structure to ensure an optimal capital structure, taking
into consideration the future capital requirements of the Company
and capital efficiency, projected operating cash flows and
projected strategic investment opportunities. The management
regards capital as total equity and reserves, for capital
management purposes.
Fair values of financial assets and financial liabilities
Fixed asset investments (see note 8) are valued at market bid
price where available which equates to their fair values. The fair
values of all other assets and liabilities are represented by their
carrying values in the balance sheet.
2020 2019
GBP GBP
Fair value through profit or loss investments 5,310,661 5,466,191
Financial instruments by category
The financial instruments of the Company fall into the following
categories
31 December 2020
At Amortised Assets at Total
Cost fair value
through
profit or
loss
Assets as per balance sheet GBP GBP GBP
Investments - 5,310,661 5,310,661
Debtors 142,136 - 142,136
Cash at bank 72,601 - 72,601
Total 214,737 5,310,661 5,525,398
Liabilities as per the balance sheet
Creditors 17,377 - 17,377
Total 17,377 - 17,377
31 December 2019
At Amortised Assets at Total
Cost fair value
through
profit or
loss
Assets as per balance sheet GBP GBP GBP
Investments - 5,466,191 5,466,191
Debtors 223,733 - 223,733
Cash at bank 90,902 - 90,902
Total 314,635 5,466,191 5,780,826
Liabilities as per the balance sheet
Creditors 22,109 - 22,109
Total 22,109 - 22,109
Fair value hierarchy
In accordance with FRS 102, the Company must disclose the fair
value hierarchy of financial instruments.
The fair value hierarchy consists of the following three
classifications:
Classification A - Quoted prices in active markets for identical
assets or liabilities.
Quoted in an active market in this context means quoted prices
are readily and regularly available and those prices represent
actual and regularly occurring market transactions on an arm's
length basis.
Classification B - The price of a recent transaction for an
identical asset, where quoted prices are unavailable.
The price of a recent transaction for an identical asset
provides evidence of fair value as long as there has not been a
significant change in economic circumstances or a significant lapse
of time since the transaction took place. If it can be demonstrated
that the last transaction price is not a good estimate of fair
value (e.g. because it reflects the amount that an entity would
receive or pay in a forced transaction, involuntary liquidation or
distress sale), that price is adjusted.
Classification C - Inputs for the asset or liability that are
based on observable market data and unobservable market data, to
estimate what the transaction price would have been on the
measurement data in an arm's length exchange motivated by normal
business considerations.
The Company only holds classification A investments (2019:
classification A investments only).
13. Net Asset Value per Share
The net asset value per share is based on net assets of
GBP5,310,661 (2019: GBP5,758,717) divided by 2,157,881 (2019:
2,157,881) ordinary shares in issue at the year end.
2020 2019
GBP GBP
Net asset value per share 255.3p 266.9p
14. Dividends paid to Directors
During the year the following dividends were paid to the
Directors of the Company as a result of their total
shareholding:
Dr Manny Pohl AM GBP59,134(1)
Simon Moore GBP 7,425
Frank Ashton GBP 246
Notes:
1. Manny Pohl's relationship with Global Masters Fund Limited is
described in Note 1 to the table of Directors' interests on page
35. During the year dividends amounting to GBP59,041 were paid to
Global Masters Fund Limited and EC Pohl & Co Pty Ltd and GBP93
to Manny Pohl for shares held in his own name.
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FR DKQBQBBKDFBB
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