Last checked at 
26 Oct 2017 07:00
26 October 2017
LMS Capital plc
3rd Quarter 2017 update
LMS Capital plc ("the Company") is issuing the following update covering the period from 1 July 2017 to today's date.
30 September 2017 Net Asset Value
The Company's unaudited net asset value ("NAV") at 30 September 2017 was £59.9 million (30 June 2017: £71.7 million), equivalent to 74p per share (30 June 2017: 74p). The most significant movements in the quarter were:
1. Completion in August of the tender offer referred to below;
2. An increase of £0.4 million in the value of the Company's holding of shares and warrants in Gresham House plc (the warrants having a strike price of 323p). This is the result of the significant increase in the share price of Gresham House plc since 30 June 2017;
3. The Weatherford International share price also improved and this increased NAV by £0.3 million;
4. SFEP reported an increase in value of its assets of £0.7 million (excluding currency impact);
5. Against these increases, adverse foreign currency movements, reflecting the strengthening of sterling against the US dollar in the quarter, reduced NAV by £1.1 million.
The NAV at the end of September is based on the valuation of the Company's investments as at 30 June 2017, adjusted for transactions in the three months ended 30 September 2017, price movements on quoted securities, movements in foreign currency exchange rates, cash calls and distributions from funds, latest reports from third party fund managers, purchases and sales of quoted and unquoted securities, and operating expenses. The next full valuation of the portfolio will be for the Company's full year results as at 31 December 2017.
Since the end of September, further movements in the prices of the Company's quoted investments and changes in the sterling/US dollar exchange rate have not had a significant impact (either individually or in aggregate) on the Company's NAV as at the end of September.
Portfolio management
Gresham House Asset Management Limited ("GHAM") continues to make good progress in executing its mandate. As reflected in the NAV movements above, on 15 August the Company announced the completion of the tender offer which returned £11 million to shareholders. This was the full amount of the further returns proposed in the circular sent to shareholders on 27 July 2016 and represents a significant landmark as the Company implements the investment strategy approved by shareholders in August 2016.
GHAM is evaluating a recent early stage approach for one of the Company's investments and continues to monitor opportunities on others. There were no new investments in the three months to 30 September 2017.
Strategy and outlook
With the final commitment to return capital to shareholders fulfilled, the Company is now focused on re-investing any future realization proceeds in line with the new investment policy, including private equity and alternative, specialist asset classes. There is a growing pipeline of opportunities in the areas identified by the investment manager. As well as seeking new investments the Company continues to focus on managing the cost base, improvements in investor communication, and managing the existing portfolio of investments to ensure value is optimised.
The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.
For further information please contact:
LMS Capital plc 020 3837 6270
Martin Knight, Chairman
Gresham House Asset Management Limited 020 3837 6270
Graham Bird
J.P. Morgan Cazenove 020 7742 4000
Michael Wentworth-Stanley