New Star Inv Regulatory News (NSI)

NEW STAR INVESTMENT TRUST PLC HALF YEAR RESULTS For the six months ended 31st December 2014 INVESTMENT OBJECTIVE The Company's objective is to achieve long term growth. FINANCIAL HIGHLIGHTS 31st 30th % December June 2014 2014 Change PERFORMANCE Net assets (£ `000) 77,355 76,227 1.5Net asset value per Ordinary share 108.92p 107.33p 1.5Mid-market price per Ordinary share 71.50p 71.50p --Discount (Premium) of price to net asset 34.4% 33.4% N/Avalue NAV performance 1.5% 4.0%IA Mixed Investment 40-85% Shares (total 3.4% 8.0%return)MSCI AC World Index (total return, sterling 7.8% 9.6%adjusted)MSCI UK Index (total return) -1.3% 12.3% Six months Six months ended 31st ended 31st December December 2014 2013 REVENUE Return per Ordinary share 0.18p 0.25p Dividend per Ordinary share - - TOTAL RETURN Net assets 1.5% 3.1% INTERIM MANAGEMENT REPORT CHAIRMAN'S STATEMENT PERFORMANCE Your Company's net assets rose 1.5% over the six months to 31st December 2014,taking the net asset value (NAV) per ordinary share to 108.92p. By comparison,the Investment Association's Mixed Investment 40-85% Shares index gained 3.4%.The MSCI AC World Total Return Index posted a positive return of 7.8% while theMSCI UK Index fell by 1.3%. UK government bonds performed strongly, returning10.3%. Further information is provided in the Investment Manager's report. Your Company made a revenue profit for the six months of £128,000 (2013: £179,000). GEARING AND DIVIDENDS Your Company has no borrowings. It ended the period under review with cashrepresenting 15.7% of its NAV and is likely to maintain a significant cashposition. Your Company has small retained revenue reserves. Your directors donot recommend the payment of an interim dividend (2013: nil). DISCOUNT During the period under review, the Company's shares continued to trade at asignificant discount to their NAV. Your Board has explored variouspossibilities with a view to reducing this discount but no satisfactorysolution has been found. This position is, however, kept under continual reviewby your directors. THE ALTERNATIVE INVESTMENT FUND MANAGERS DIRECTIVE The Alternative Investment Fund Managers Directive (AIFMD) is a European Uniondirective creating an EU-wide framework for the regulation of managers ofAlternative Investment Funds (AIFs), including investment trusts. The directiverequires all AIFs to nominate an Alternative Investment Fund Manager (AIFM),which can be the Company itself or a third party. Your Board has registered theCompany as its own AIFM, with Brompton Asset Management providing supportservices. This approach minimises the cost to shareholders of implementing thedirective without affecting the management of your Company. OUTLOOK The potential for negative surprises has increased as a result of fallinginflation, sharp falls in commodity prices and heightened currency volatility. Your company's investments in dollars, gold and gold securities, however,provide an important source of diversification and may prove defensive shouldthe economic outlook worsen. The divergent monetary policies now being adoptedby major central banks may lead to a further strengthening in the dollar. Theremay be further sterling weakness over the next few months given theuncertainties associated with the impending UK general election and thepossible consequences for the UK's EU membership. Investments in gold and goldsecurities may benefit as investors seek safety in the light of the continuedcentral bank monetary expansion and attendant fiat currency debasement. Overall, however, your Investment Manager remains positive about the prospectsfor equities in 2015 as central banks continue to expand monetary support andlower energy costs prove supportive for global growth. NET ASSET VALUE Your Company's unaudited NAV at 31st January 2015 was 112.50p. Geoffrey Howard-SpinkChairman23 February 2015 MARKET REVIEW In October, the Federal Reserve stuck to its script and stopped quantitativeeasing, the extraordinary policy of monetary expansion first adopted during thecredit crisis in 2008. During the subsequent six years, successive programmesof quantitative easing eventually culminated in an "open-ended" commitment tocontinue money-printing until unemployment fell below target. US economic dataended 2014 sufficiently robust to justify the Federal Reserve making the firstmoves to normalise monetary policy. Unemployment fell to 5.7%, leadingindicators remained strong and consumer confidence was high. At the period end,US interest rates were widely expected to start rising from the middle of 2015although the pace of increase was predicted to be slow. US equities rose 16.37% in sterling during the period, outperforming a 7.81%gain for global equities. The majority of the gains from US equities can beattributed to the rise in the dollar, which gained 9.66% relative to sterling.Dollar strength is a consequence of the divergent path of monetary policyadopted by the Federal Reserve compared to the course taken by other majorcentral banks. In time, the currency's strength may prove a headwind for the USeconomy, a point confirmed by Janet Yellen, the Federal Reserve chairman, whoindicated that a stronger currency, eurozone economic weakness and increasedgeopolitical risk were reasons for keeping monetary policy exceptionallyaccommodative for longer than some observers had expected. Despite robust US economic data, bond markets outperformed equities during theperiod under review as weak global inflation compounded fears of a slowdown inglobal economic growth. Gilts and sterling corporate bonds returned 10.28% and7.19% respectively. In the UK, inflation fell to 0.5% annualised in December,the lowest level since May 2000. The chancellor, George Osborne, celebratedthis boost to real disposable incomes while warning that inflation could fallfurther and even turn negative in the months ahead. The prospect of a UKinterest rate rise receded in consequence. Eurozone prices fell 0.6% in January 2015. The weakness was a result of poordemand exacerbated by recent falls in energy and commodity prices. The oilprice fell 42.92% in sterling during the second half of 2014. Falls of thismagnitude have generally been associated with falling global demand but, inthis instance, it was the result of supply-side development. Saudi Arabia maintained supply in the face of increased production from USshale oil producers to defend its market share. The fall in energy prices islikely to be sustained because it will take some time to achieve a long-lastingreduction in supply. As long as economic recovery is robust enough to preventthe onset of deflation, cheaper oil should ultimately stimulate global economicgrowth. UK equities fell 1.33% during the period because weakness among energy andother natural resources companies, which represent a significant proportion ofthe UK equity market, adversely impacted returns. The increase in the UKcurrent account deficit was also a major concern and contributed to sterlingweakness. Immediately after the period end, the European Central Bank (ECB) took actionto prevent short-term falling prices leading to long-term deflation, a state ofaffairs in which consumers defer purchases in the expectation of further fallsin prices, thus causing economic activity to stall. The ECB finally adoptedquantitative easing, saying it would purchase €60 billion of assets each monthfrom March 2015 until September 2016 and possibly beyond that date if theinflation outlook had not improved. This will lead to an increase in themonetary base of at least €1.1 trillion, which should be sufficient to reversethe decline in the ECB balance sheet since 2012. The ECB is mandated to achieveprice stability whereas the Federal Reserve has an obligation to achieve fullemployment. It has, however, adopted a similarly "open-ended" approach,implying that eurozone quantitative easing will continue until inflation nearsits 2% target. Equities in Europe excluding the UK are potentiallywell-supported by quantitative easing, cheaper energy and a weaker euro. The stronger dollar and weaker commodity prices significantly affected otherassets including equities in Asia Pacific excluding Japan and emerging markets.These equity markets lagged global equities over the period, rising just 5.44%and 1.27% respectively in sterling. The equity markets of oil-exporting nationssuch as Russia were adversely affected. The Russian stock market fell 43.96% insterling during the period, mainly as a result of the 37.76% decline in therouble. By contrast oil importers such as India benefited. Indian equities rose11.46% and the rupee appreciated 4.49% against sterling. PORTFOLIO REVIEW The net asset value of the Company rose 1.5% during the period under review.Your Company ended the period with significant investments in cash, gold andgold securities while having the majority of its investments in globalequities. By comparison, the Investment Association's Mixed Investment 40-85%Shares Index, which measures a peer group of funds with a multi-asset approachto investing and a typical investment in global equities in the 40-85% range,rose 3.4% during the period. The MSCI AC World Total Return Index gained 7.8%while the MSCI UK Total Return Index fell 1.3%. The strong performance of US equities aided by a significant rise in the dollarwas a major contributor to the returns from global equities. Your Company has alow allocation to US equities and this adversely affected returns during theperiod compared to the peer group. Fundsmith Equity and Polar Capital GlobalTechnology, however, both have significant investments in US equities and thisfactor contributed to their gains of 18.53% and 12.33% respectively. Inaddition, the majority of the cash in New Star Investment Trust was invested indollars, which benefited from their significant appreciation relative tosterling during the period. The extraordinary monetary policy of recent yearshas increased the importance of considering currency when making investmentdecisions. The disparate performance of your Company's investments in developing economyequity markets was largely attributable to the impact of the stronger dollarand weaker commodity prices on their underlying economies. Geo-political eventsalso played a significant role in determining investment market returns duringthe period. Neptune Russia and Greater Russia fell 38.39% as the impact of thearmed conflict in the Ukraine and the weaker oil price led to a sharp fall inthe rouble. Investec Africa fell 6.47% as the fall in the oil price resulted inmajor falls for the equity markets of Ghana and Nigeria, where a significantproportion of this fund is invested. By contrast, First State IndianSubcontinent and Wells Fargo China rose 25.87% and 21.35% respectively becauseboth India and China are net importers of oil and should, therefore, benefitfrom cheaper energy costs. The stronger dollar proved a headwind for the gold price, which fell 1.94% insterling during the period. Blackrock Gold & General, which is invested in goldequities, fell 14.31%, whereas your Company's investment in the Gold BullionSecurities exchange-traded fund, which invests in the physical commodity, fell0.20%. Your Company ended the period under review with no investments in conventionalgilts or longer-dated fixed income securities. These assets performed well inthe period because falling inflation and the prospect of a major ECB programmeof asset purchases pushed yields close to all-time lows. Central bank policiesof quantitative easing had, however, materially inflated the valuation of thisasset class by the period end to point where yields did not offer sufficientcompensation for the risks of rising inflation and interest rates over thelonger term. DIRECTORS' REPORT PERFORMANCE In the six months to 31st December 2014 the net asset value per Ordinary shareincreased by 1.5% to 108.92p, whilst the share price remained unchanged at71.50p. This compares to an increase of 3.4% in the IA Mixed Investment 40-85%Shares Index. INVESTMENT OBJECTIVE The Company's investment objective is to achieve long-term capital growth. INVESTMENT POLICY The Company's investment policy is to allocate assets to global investmentopportunities through investment in equity, bond, commodity, real estate,currency and other markets. The Company's assets may have significantweightings to any one asset class or market, including cash. The Company will invest in pooled investment vehicles, exchange traded funds,futures, options, limited partnerships and direct investments in relevantmarkets. The Company may invest up to 15% of its net assets in directinvestments in relevant markets. The Company will not follow any index with reference to asset classes,countries, sectors or stocks. Aggregate asset class exposure to any one of theUnited States, the United Kingdom, Europe ex UK, Asia ex Japan, Japan orEmerging Markets and to any individual industry sector will be limited to 50%of the Company's net assets, such values being assessed at the time ofinvestment and for funds by reference to their published investment policy or,where appropriate, their underlying investment exposure. The Company may invest up to 20% of its net asset value in unlisted securities(excluding unquoted pooled investment vehicles) such values being assessed atthe time of investment. The Company will not invest more than 15% of its net assets in any singleinvestment, such values being assessed at the time of investment. Derivative instruments and forward foreign exchange contracts may be used forthe purposes of efficient portfolio management and currency hedging.Derivatives may also be used outside of efficient portfolio management to meetthe Company's investment objective. The Company may take outright shortpositions in relation to up to 30% of its net assets, with a limit on shortsales of individual stocks of up to 5% of its net assets, such values beingassessed at the time of investment. The Company may borrow up to 30% of netassets for short-term funding or long-term investment purposes. No more than10%, in aggregate, of the value of the Company's total assets may be investedin other closed-ended investment funds except where such funds have themselvespublished investment policies to invest no more than 15% of their total assetsin other listed closed-ended investment funds. SHARE CAPITAL The Company's share capital comprises 305,000,000 Ordinary shares of 1p each,of which 71,023,695 (2013: 71,023,695) have been issued fully paid. No Ordinaryshares are held in treasury, and none were bought back or issued during the sixmonths to 31st December 2014. RISK MANAGEMENT The principal risks associated with the Company that have been identified bythe Board, together with the steps taken to mitigate them, are as follows: Investment strategy: inappropriate long-term strategy, asset allocation andmanager selection might lead to the underperformance of the Company. TheCompany's strategy is kept under regular review by the Board. Investmentperformance is discussed at every Board meeting and the Directors receive amonthly report which details the Company's asset allocation, portfolio changesand performance. Business conditions and general economy: the Company's investment returns areinfluenced by general economic conditions in the UK and globally. Factors suchas interest rates, inflation, investor sentiment and the availability and costof credit could adversely affect investment returns. The Board regularlyconsiders the economic environment in which the Company operates. The portfoliois managed with a view to mitigating risk by investing in a spread of differentasset classes and geographic regions. Portfolio risks - market price, foreign currency and interest rate risks: thedownward valuation of investments contained in the portfolio would lead to areduction in the Company's net asset value. A proportion of the Company'sportfolio is invested in investments denominated in foreign currencies andmovements in exchange rates can significantly affect their sterling value. Itis the Board's policy to hold an appropriate spread of investments in order toreduce the risk arising from factors specific to a particular investment orsector. The Investment Manager takes account of foreign currency risk andinterest rate risk when making investment decisions. The Company does not normally hedge against foreign currency movementsaffecting the value of the investment portfolio, although hedging techniquesmay be employed in appropriate circumstances. Investment Manager: the quality of the management team employed by theInvestment Manager is an important factor in delivering good performance andthe loss by the Investment Manager of key staff could adversely affectinvestment returns. The Company's portfolio is managed by Gill Lakin. The Boardreceives a monthly financial report which includes information on performance,and a representative of the Investment Manager attends each Board meeting. TheBoard is kept informed of any personnel changes to the investment team employedby the Investment Manager. Tax and regulatory risks: a breach of The Investment Trusts (Approved company)(Tax) Regulations 2011 (the Regulations) could lead to a loss of investmenttrust status, resulting in capital gains realised within the portfolio beingsubject to United Kingdom capital gains tax. A breach of the UKLA Listing Rulescould result in suspension of the Company's shares, while a breach of companylaw could lead to criminal proceedings, or financial or reputational damage.The Board employs Brompton Asset Management LLP as Investment Manager andPhoenix Administration Services Limited as Corporate Secretary andAdministrator to help manage the Company's legal and regulatory obligations.The Board receives a monthly financial report which includes information on theCompany's compliance with the Regulations. Operational: disruption to, or failure of, the Investment Manager's orAdministrator's accounting, dealing or payment systems or the Custodian'srecords could prevent the accurate reporting and monitoring of the Company'sfinancial position. The Company is also exposed to the operational risk thatone or more of its suppliers may not provide the required level of service. INVESTMENT MANAGEMENT ARRANGEMENT AND RELATED PARTY TRANSACTIONS In common with most investment trusts the Company does not have any executivedirectors or employees. The day-to-day management and administration of theCompany, including investment management, accounting and company secretarialmatters, and custodian arrangements are delegated to specialist third partyservice providers. Details of related party transactions are contained in the Annual Report. Therehave been no material transactions with related parties during the period whichhave had a significant impact on the performance of the Company. GOING CONCERN The Directors believe that it is appropriate to continue to adopt the goingconcern basis in preparing the accounts as the assets of the Company consistmainly of securities that are readily realisable or cash and it has nosignificant liabilities. Accordingly, the Company has adequate financialresources to continue in operational existence for the foreseeable future. AUDITORS The half year financial report has been reviewed, but not audited, by Ernst &Young LLP pursuant to the Auditing Practices Board guidance on the Review ofInterim Financial Information. RESPONSIBILITY STATEMENT The Directors of the Company confirm that to the best of their knowledge: * The financial statements contained within the half year financial report to 31st December 2014 have been prepared in accordance with International Accounting Standard 34 `Interim Financial Reporting'; * The Chairman's statement or the Investment Manager's report include a fair review of important events that have occurred during the first six months of the financial year and their impact on the financial statements; * The Chairman's statement or the Investment Manager's report include a fair review of the potential risks and uncertainties for the remaining six months of the year; * The Director's report includes a fair review of the information concerning transactions with the investment manager and changes since the last annual report. By order of the Board Phoenix Administration Services LimitedSecretary23 February 2015 INDEPENDENT REVIEW REPORT TO NEW STAR INVESTMENT TRUST PLC INTRODUCTION We have been engaged by the Company to review the financial statements in thehalf-yearly financial report for the six months ended 31 December 2014 whichcomprises the consolidated statement of comprehensive income, consolidatedstatement of changes in equity, consolidated balance sheet, consolidated cashflow statement and related explanatory notes 1 to 8. We have read the otherinformation contained in the half yearly financial report and consideredwhether it contains any apparent misstatements or material inconsistencies withthe information in the financial statements. This report is made solely to the company in accordance with guidance containedin International Standard on Review Engagements 2410 (UK and Ireland) "Reviewof Interim Financial Information Performed by the Independent Auditor of theEntity" issued by the Auditing Practices Board. To the fullest extent permittedby law, we do not accept or assume responsibility to anyone other than thecompany, for our work, for this report, or for the conclusions we have formed. DIRECTORS' RESPONSIBILITIES The half-yearly financial report is the responsibility of, and has beenapproved by, the directors. The directors are responsible for preparing thehalf-yearly financial report in accordance with the Disclosure and TransparencyRules of the United Kingdom's Financial Conduct Authority. As disclosed in note 1, the annual financial statements of the Group areprepared in accordance with IFRSs as adopted by the European Union. Thefinancial statements included in this half-yearly financial report has beenprepared in accordance with International Accounting Standard 34, "InterimFinancial Reporting", as adopted by the European Union. OUR RESPONSIBILITY Our responsibility is to express to the Company a conclusion on the financialstatements in the half year financial report based on our review. SCOPE OF REVIEW We conducted our review in accordance with International Standard on ReviewEngagements (UK and Ireland) 2410, "Review of Interim Financial InformationPerformed by the Independent Auditor of the Entity" issued by the AuditingPractices Board for use in the United Kingdom. A review of interim financialinformation consists of making enquiries, primarily of persons responsible forfinancial and accounting matters, and applying analytical and other reviewprocedures. A review is substantially less in scope than an audit conducted inaccordance with International Standards on Auditing (UK and Ireland) andconsequently does not enable us to obtain assurance that we would become awareof all significant matters that might be identified in an audit. Accordingly,we do not express an audit opinion. CONCLUSION Based on our review, nothing has come to our attention that causes us tobelieve that the financial statements in the half-yearly financial report forthe six months ended 31 December 2014 is not prepared, in all materialrespects, in accordance with International Accounting Standard 34 as adopted bythe European Union and the Disclosure and Transparency Rules of the UnitedKingdom's Financial Conduct Authority. Ernst & Young LLPLondon23 February 2015 SCHEDULE OF TOP TWENTY INVESTMENTSat 31st December 2014 Holding Activity Bid-market % of value invested £'000 portfolio Henderson Euro Special Situations Fund Investment Fund 7,962 12.18Fundsmith Equity Fund Investment Fund 6,011 9.19Artemis UK Special Situations Fund Investment Fund 3,912 5.98FP Brompton Global Conservative Fund Investment Fund 3,409 5.21Trojan Investment Fund Investment Fund 3,167 4.84Aberforth Geared Income Trust Investment Company 3,162 4.84Blackrock Gold & General Fund Investment Fund 2,879 4.40Aquilus Inflection Fund Investment Fund 2,669 4.08First State Indian Subcontinent Fund Investment Fund 2,446 3.74Polar Capital Global Technology Fund Investment Fund 2,334 3.57Investec Africa Fund Investment Fund 2,214 3.39Gold Bullion Securities ETF Exchange Traded 2,039 3.12 FundFP Brompton Global Opportunities Fund Investment Fund 2,028 3.10FP Brompton Global Growth Fund Investment Fund 1,978 3.02FP Brompton Global Income Fund Investment Fund 1,938 2.96PFS Brompton UK Recovery Unit Trust Investment Fund 1,923 2.94FP Brompton Global Equity Fund Investment Fund 1,791 2.74FP Brompton Global Balanced Fund Investment Fund 1,694 2.59Standard Life Investment European Investment Fund 1,687 2.58Income FundNeptune Russia & Greater Russia Fund Investment Fund 1,558 2.38 56,801 86.85 Balance held in 15 investments 8,590 13.15Total investments (excluding cash) 65,391 100.00 The investment portfolio can be further analysed as follows:Equities (including investment companies) 6,184Loan -Investment funds and ETFs 59,207 65,391 All the Company's investments are either unlisted or are unit trust/OEIC fundswith the exception of Aberforth Geared Income Trust, BH Global Limited, MitonGroup, Gold Bullion Securities ETF, iShares FTSE 250, Immedia Group and AsiaResource Minerals. CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOMEfor the six months ended 31st December 2014 Six months ended 31st December 2014 (unaudited) Notes Revenue Capital Total Return Return Return £`000 £`000 £`000 INCOME Investment income 488 - 488Other operating income 3 - 3Total income 2 491 - 491 GAINS AND LOSSES ON INVESTMENTS Gains on investments at fair value - 196 196through profit or lossOther exchange gains - 798 798Management fee rebates - 6 6 491 1,000 1,491 EXPENSES Management fees 3 (234) - (234)Other expenses (129) - (129) (363) - (363) PROFIT BEFORE FINANCE COSTS AND TAX 128 1,000 1,128 Finance costs - - - PROFIT BEFORE TAX 128 1,000 1,128 Tax - - - PROFIT FOR THE PERIOD 128 1,000 1,128 EARNINGS PER SHARE Ordinary shares (pence) 4 0.18p 1.41p 1.59p The total column of this statement represents the Group's profit and lossaccount, prepared in accordance with IFRS. The supplementary Revenue Return andCapital Return columns are both prepared under guidance published by theAssociation of Investment Companies. All items in the above statement derivefrom continuing operations. No operations were acquired or discontinued duringthe period. All income is attributable to the equity holders of the parent company. Thereare no minority interests. CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOMEfor the six months ended 31st December 2013 and the year ended 30th June 2014 Six months ended Year ended 31st December 2013 30th June 2014 (unaudited) (audited) Notes Revenue Capital Total Revenue Capital Total Return Return Return Return Return Return £'000 £'000 £'000 £'000 £'000 £'000 INCOME Investment income 559 - 559 778 - 778Other operating income 5 - 5 8 - 8 Total income 2 564 - 564 786 - 786 GAINS AND LOSSES ONINVESTMENTS Gains on investments at - 2,591 2,591 - 3,545 3,545fair value throughprofit or lossOther exchange losses - (502) (502) - (726) (726)Management fee rebates - 7 7 - 11 11 564 2,096 2,660 786 2,830 3,616 EXPENSES Management fees 3 (254) - (254) (491) - (491)Other expenses (131) - (131) (218) - (218) (385) - (385) (709) - (709) PROFIT BEFORE FINANCE 179 2,096 2,275 77 2,830 2,907COSTS AND TAX Finance costs - - - - - - PROFIT BEFORE TAX 179 2,096 2,275 77 2,830 2,907 Tax - - - - - - PROFIT FOR THE PERIOD 179 2,096 2,275 77 2,830 2,907 EARNINGS PER SHARE Ordinary shares (pence) 4 0.25 2.95 3.20 0.11 3.98 4.09 The total column of this statement represents the Group's profit and lossaccount, prepared in accordance with IFRS. The supplementary Revenue Return andCapital Return columns are both prepared under guidance published by theAssociation of Investment Companies. All items in the above statement derivefrom continuing operations. No operations were acquired or discontinued duringthe periods. All income is attributable to the equity holders of the parent company. Thereare no minority interests. CONSOLIDATED STATEMENT OF CHANGES IN EQUITYfor the six months ended 31st December 2014 (unaudited) Share Share Special Retained capital premium reserve earnings Total £`000 £`000 £`000 £`000 £'000 At 30th JUNE 2014 710 21,573 56,908 (2,964) 76,227Total comprehensive income for - - - 1,128 1,128the periodAt 31st DECEMBER 2014 710 21,573 56,908 (1,836) 77,355 CONSOLIDATED STATEMENT OF CHANGES IN EQUITYfor the six months ended 31st December 2013 (unaudited) Share Share Special Retained capital premium reserve earnings Total £`000 £`000 £`000 £`000 £'000 At 30th JUNE 2013 710 21,573 56,908 (5,871) 73,320Total comprehensive income for - - - 2,275 2,275the periodAt 31st DECEMBER 2013 710 21,573 56,908 (3,596) 75,595 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY for the year ended 30th June 2014 (audited) Share Share Special Retained capital premium reserve earnings Total £`000 £`000 £`000 £`000 £`000 At 30th JUNE 2013 710 21,573 56,908 (5,871) 73,320Total comprehensive income for - - - 2,907 2,907the yearAt 30th JUNE 2014 710 21,573 56,908 (2,964) 76,227 CONSOLIDATED BALANCE SHEETat 31st December 2014 Notes 31st December 31st December 30th June 2014 2013 2014 (unaudited) (unaudited) (audited) £`000 £`000 £`000 NON-CURRENT ASSETS Investments at fair value 5 65,391 58,475 64,890through profit or loss CURRENT ASSETS Other receivables 9 154 361Cash and cash equivalents 12,132 17,184 11,171 12,141 17,338 11,532 TOTAL ASSETS 77,532 75,813 76,422 CURRENT LIABILITIES Other payables (177) (218) (195) TOTAL ASSETS LESS CURRENT 77,355 75,595 76,227LIABILITIES NON-CURRENT LIABILITIES ______________- ________________- ___________- NET ASSETS 77,355 75,595 76,227 EQUITY ATTRIBUTABLE TOEQUITY HOLDERS Called-up share capital 710 710 710Share premium 21,573 21,573 21,573Special reserve 56,908 56,908 56,908Retained earnings 6 (1,836) (3,596) (2,964) TOTAL EQUITY 77,355 75,595 76,227 NET ASSET VALUE PER 7 108.92 106.44 107.33ORDINARY SHARE (PENCE) The half year report was approved and authorised for issue by the Board on 23February 2015. CONSOLIDATED CASH FLOW STATEMENTfor the six months ended 31st December 2014 Six months Six months Year ended ended ended 31st 31st 30th December December June 201 2013 2014 (unaudited) (unaudited) (audited) £`000 £`000 £`000 NET CASH INFLOW FROM OPERATING ACTIVITIES 155 246 88 INVESTING ACTIVITIES Purchase of investments (443) (2,371) (10,363) Sale of investments 451 4,842 7,203 NET CASH INFLOW/(OUTFLOW) FROM INVESTING 2,471 (3,160)ACTIVITIES 8 EQUITY DIVIDENDS PAID - - - NET CASH INFLOW/( OUTFLOW) BEFORE 163 2,717 (3,072)FINANCING INCREASE/( DECREASE) IN CASH 163 2,717 (3,072) RECONCILIATION OF NET CASH FLOW TOMOVEMENT IN NET FUNDS Increase/( Decrease) in cash resulting 163 2,717 (3,072)from cash flows Exchange movements 798 (502) (726) Movement in net funds 961 2,215 (3,798) Net funds at start of period/year 11,171 14,969 14,969 NET FUNDS AT END OF PERIOD/YEAR 12,132 17,184 11,171 RECONCILIATION OF PROFIT BEFORE FINANCECOSTS AND TAXATION TO NET CASH FLOW FROMOPERATING ACTIVITIES Profit before finance costs and taxation 1,128 2,275 2,907Gains on investments (196) (2,591) (3,545)Exchange differences (798) 502 726Management fee rebates (6) (7) (11) Revenue profit before finance costs and 128 179 77taxationDecrease in debtors 45 37 -Decrease in creditors (37) (8) (31)Taxation 13 31 31Management fee rebates 6 7 11 NET CASH INFLOW FROM OPERATING ACTIVITIES 155 246 88 NOTES TO THE INTERIM FINANCIAL STATEMENTS for the six months ended 31st December 2014 1. ACCOUNTING POLICIES These consolidated half year financial statements comprise the unauditedresults of the Company and its subsidiary, JIT Securities Limited, for the sixmonths to 31st December 2014. The comparative information for the six months to31st December 2013 and the year to 30th June 2014 do not constitute statutoryaccounts under the Companies Act 2006. Full statutory accounts for the year to30th June 2014 included an unqualified audit report, did not contain anystatements under section 498 of the Companies Act 2006, and have been filedwith the Registrar of Companies. The half year financial statements have been prepared in accordance withInternational Accounting Standard 34 `Interim Financial Reporting', and arepresented in pounds sterling, as this is the Group's functional currency. The same accounting policies have been followed in the interim financialstatements as applied to the accounts for the year ended 30th June 2014, whichare prepared in accordance with IFRSs as adopted by the European Union. TheCompany has adopted IFRS 10 Consolidated Financial Statements and the Amendmentto IFRS 10 for Investment Entities. Under IFRS 10 the Board considers that theCompany meets the criteria of an investment entity. No segmental reporting is provided as the Group is engaged in a single segment. 2. TOTAL INCOME For the six For the six For the months ended months ended year ended 31st December 31st December 30th June 2014 2013 2014 £'000 £'000 £'000Income from InvestmentsUK net dividend income 451 536 737UK unfranked investment income 34 23 41Loan interest income 3 - - 488 559 778Operating IncomeBank interest receivable 3 5 8 3 5 8 For the six For the six For the months ended months ended year ended 31st December 31st December 30th June 2014 2013 2014 £'000 £'000 £'000 Total income comprisesDividends 485 559 778Other income 6 5 8 491 564 786 3. MANAGEMENT FEES For the six For the six For the months ended months ended year ended 31st December 31st December 30th June 2014 2013 2014 £'000 £'000 £'000 Investment management fee 234 254 491Performance fee - - - 234 254 491 The management fee is payable in arrears and is calculated at a rate of 3/16%per quarter of the total assets of the Company and its subsidiary after thededuction of the value of any investments managed by the Investment Manager (asdefined in the management agreement). The Investment Manager is also entitledto a performance fee of 15% of the growth in net assets over a hurdle of3-month Sterling LIBOR plus 1% per annum, payable six monthly in arrears,subject to a high water mark. The aggregate of the Company's management fee andany performance fee are subject to a cap of 4.99% of net assets in anyfinancial year (with any performance fee in excess of this cap capable of beingearned in subsequent periods). The performance fee will be charged 100% tocapital, in accordance with the Board's expectation of how any out-performancewill be generated. No performance fee is payable for the period. 4. RETURN PER ORDINARY SHARE For the six For the six For the months ended months ended year ended 31st December 31st December 30th June 2014 2013 2014 £'000 £'000 £'000 Revenue return 128 179 77Capital return 1,000 2,096 2,830Total return 1,128 2,275 2,907 Weighted average number of Ordinary 71,023,695 71,023,695 71,023,695shares Revenue return per Ordinary share 0.18p 0.25p 0.11pCapital return per Ordinary share 1.41p 2.95p 3.98pTotal return per Ordinary share 1.59p 3.20p 4.09p 5. INVESTMENTS AT FAIR VALUE THROUGH PROFIT AND LOSS At At At 31st December 31st December 30th June 2014 2013 2014 £'000 £'000 £'000 GROUP AND COMPANY 65,391 58,475 64,890 ANALYSIS OF INVESTMENT PORTFOLIO - GROUP AND COMPANY Six months ended 31st December 2014 Listed* Unlisted** Total (Level 1) (Level 3) £'000 £'000 £'000 Opening book cost 53,101 4,454 57,555Opening investment holding gains/ 10,643 (3,308) 7,335(losses)Opening valuation 63,744 1,146 64,890 Movement in period:Purchase at cost 273 189 462 Sales- Proceeds - (157) (157)- Realised gains on sales - (36) (36) Investment holding gains/(losses) (78) 310 232 Closing valuation 63,939 1,452 65,391Closing book cost 53,374 4,450 57,824Unrealised investment holding gains/ 10,565 (2,998) 7,567(losses) Closing valuation 63,939 1,452 65,391 * Listed investments include unit trust and OEIC funds which are valued atquoted prices ** The Unlisted investments, representing less than 2% of the Company's NAV,have been valued in accordance with IPEVC valuation guidelines. The largestunquoted investment amounting to £1,143,000 was valued at the latesttransaction price. There were no reclassification of assets between Level 1 and Level 3. For the six For the six For the months ended months ended year ended 31st December 31st December 30th June 2014 2013 2014 £'000 £'000 £'000 ANALYSIS OF CAPITAL GAINS AND LOSSESRealised (losses)/gains on sales of (36) (5) 730investmentsIncrease in investment holding gains 232 2,596 2,815 196 2,591 3,545 6. RETAINED EARNINGS At At At 31st December 31st December 30th June 2014 2013 2014 £'000 £'000 £'000 Capital reserve - realised (9,613) (10,624) (10,381)Capital reserve - revaluation 7,567 6,844 7,335Revenue reserve 210 184 82 (1,836) (3,596) (2,964) 7. NET ASSET VALUE PER ORDINARY SHARE 31st December 31st December 30th June 2014 2013 2014 £'000 £'000 £'000 Net assets attributable to Ordinary 77,355 75,595 76,227shareholdersOrdinary shares in issue at end of 71,023,695 71,023,695 71,023,695period Net asset value per Ordinary share 108.92p 106.44p 107.33p 8. TRANSACTIONS WITH THE INVESTMENT MANAGER During the period there have been no new related party transactions that haveaffected the financial position or performance of the Group. Since 1st January 2010 Brompton has acted as Investment Manager to the Company.This relationship is governed by an agreement dated 23rd December 2009. Mr Duffield is the senior partner of Brompton Asset Management Group LLP theultimate parent of Brompton. The total investment management fee payable to Brompton for the half year ended31st December 2014 was £234,000 (2013: £254,000) and at the half year end £117,000 (2013: £130,000) was accrued. No performance fee was payable in respectof the half year ended 31st December 2014 (2013: £nil). The Group's investments include seven funds managed by Brompton or itsassociates totalling £14,761,000. No investment management fees were payabledirectly by the Company in respect of these investments.