Polar Capital Regulatory News (POLR)

POLAR CAPITAL HOLDINGS plc ("Polar Capital" or "the Company")

Interim results for the six months ended 30 September 2013

4 December 2013

Financial Highlights

· Net inflows in the six month period ended 30 September 2013 of US$3.2bn despite unpredictable markets

· Assets under Management ("AUM") at 30 September 2013 up 58% to US$11.4bn (31 March 2013: US$7.2bn)

· Core operating profit excluding performance fees up 147% to £10.4m (30 September 2012: £4.2m)

· Profit before share-based payments and amortisation of intangibles of £10.6m (30 September 2012: £4.6m)

· Pre-tax profit of £10.1m (30 September 2012: £3.8m)

· Basic earnings per share 9.53p (30 September 2012: 3.64p) and adjusted* diluted earnings per share 8.77p (30 September 2012: 4.14p)

· Interim dividend per ordinary share of 4.0p declared (2012:2.0p) to be paid in January 2014

· Shareholders' funds of £56.8m (31 March 2013: £53.8m) including cash and investments of £56.7m (31 March 2013: £62.2m)

* Adjusted to exclude cost of share-based payments and amortisation/impairment of intangibles

Corporate Highlights

Launch of three new funds since 31 March 2013

· Long only Biotechnology UCITS fund launched in November 2013

· The Global Convertible Fund launched in September 2013

· Our third investment trust, The Global Financials Trust, which raised £153m in July 2013

Tim Woolley, Chief Executive Officer, commented:

The Company's growth rate over recent quarters has been exceptional and indeed over the last four years our AUM has increased more than fivefold. Our growth rate will undoubtedly slow over the coming quarters and years. In the very near term our growth rate will be heavily influenced by the direction of the Japanese market and fund flows into or out of our Japanese funds given the percentage of overall assets these funds now represent. Over the longer term there remains significant opportunity for further growth in assets and profits if we continue to deliver on investment performance, client service and operational excellence and if global equity markets remain supportive.

Polar Capital Holdings plc is a specialist investment management company offering professional and institutional investors a range of geographical and sector funds. The Company's investment strategies have a fundamental research driven approach. The Company has long only and alternative funds in its product range.

Founded in 2001, Polar currently has 94 employees of whom 46 are investment professionals managing 22 funds, and 7 managed accounts. These funds have combined assets under management of US$11.4bn as at 30 September 2013 (30 March 2013: US$7.2bn)

The Company is AIM quoted following its IPO in February 2007. Consistent with the Company's founding strategy of fostering an equity culture amongst its employees and providing high levels of transparency to clients, 32% of the equity is currently held by Directors, founders and employees.

*Including managed accounts run off the same strategy † The UK Fund was closed on 8 November 2013

Analysis of Changes in Asset Types for the six months to 30 September 2013

Analysis of AUM by Business Unit and Type of Funds as at 30 September 2013

Chief Executive's Statement

I am pleased to report further significant progress over the first six months of our financial year. Our assets under management ("AUM") have increased substantially over the period, reaching $11.4bn at the end of September. This is an increase of 58% over the year end level and an increase of 115% from this time last year. Our balance sheet remains strong and the key metric of core profitability increased 147% over the comparable period last year as set out below:

Profit before tax increased significantly as a result of the increase in core profit with finance income somewhat lower than in the comparable period last year. We can currently report that, on a mark to market basis, the quantum of performance fees receivable at the half year exceeds the level of performance fees receivable on the same basis last year.

Our world class Japanese team has received the majority of our inflows over this period as client interest in Japan has continued to increase following the various reforms introduced by Prime Minister Abe starting last November.

We have also seen significant inflows into a number of other strategies including North America, Healthcare, Emerging Markets and Financials.

Following the departure of our UK manager we now have ten teams in place, giving us scope to accommodate a further two teams at some point in the future, given our strategy of ten to twelve world class active investment management teams.

We have added further to our product range with the successful launch of our Global Financials Investment Trust at the beginning of July and this was followed by the launch of a Global Convertible UCITS fund in September 2013 and by a long only Biotechnology UCITS fund in November 2013.

The Company's growth rate over recent quarters has been exceptional and indeed over the last four years our AUM has increased more than fivefold. Our growth rate will undoubtedly slow over the coming quarters and years. In the very near term our growth rate will be heavily influenced by the direction of the Japanese market and fund flows into or out of our Japanese funds given the percentage of overall assets these funds now represent. Over the longer term there remains significant opportunity for further growth in assets and profits if we continue to deliver on investment performance, client service and operational excellence and if global equity markets remain supportive.

Tim Woolley

Chief Executive

3 December 2013

Interim Consolidated Income Statement for the six months to 30 September 2013

All of the items in the above statements are derived from continuing operations.

Interim Consolidated Statement of Comprehensive Income for the six months to 30 September 2013

Interim Consolidated Balance Sheet as at 30 September 2013

Interim Consolidated Statement of Changes in Equity for the six months to 30 September 2013

Interim Consolidated Statement of Cash Flow for the six months to 30 September 2013

Notes to the Unaudited Interim Condensed Consolidated Financial Statements for the six months to 30 September 2013

1. General Information, Basis of Preparation and Accounting Policies

Polar Capital Holdings plc ("the Company") is a public limited Company registered in England and Wales.

The unaudited interim condensed consolidated financial statements to 30 September 2013 have been prepared in accordance with IAS 34: Interim Financial Reporting.

The unaudited interim condensed consolidated financial statements do not include all the information and disclosures required in annual financial statements, and should be read in conjunction with the Group's annual financial statements as at 31 March 2013 which have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union and the Companies Act 2006 applicable to companies reporting under IFRS.

The accounting policies adopted in the preparation of the unaudited interim condensed consolidated financial statements are consistent with those used in the preparation of the Group's annual financial statements for the year ended 31 March 2013.

2. Revenue

3. Profit on Ordinary Activities Before Taxation

a. This is stated after charging:

b. Auditors' remuneration:

4. Dividends

5. Earnings per Ordinary Share

The calculation of basic earnings per ordinary share is based on the profit for the period of £7,719,758 (September 2012: profit £2,815,265) and on 80,975,377 (September 2012: 77,446,648) ordinary shares, being the weighted number of ordinary shares.

The calculation of diluted earnings per ordinary share is based on the profit for the period of £7,719,758 (September 2012: profit £2,815,265) and 94,298,538 (September 2012: 88,833,779) ordinary shares, being the weighted average number of ordinary shares allowing for all options of 9,602,935 (September 2012: 6,449,376) which are dilutive as well as shares granted under a crystallisation event but not yet issued of 3,720,227 (September 2012: 4,937,756).

The calculation of adjusted earnings per ordinary share is based on a profit for the period of £7,719,758 (September 2012: profit of £2,815,265 but adjusted for the share-based payments charge of £550,900 (September 2012 share base payments charge of: £318,676, amortisation of intangibles of £428,500 and impairment of goodwill of £111,410),and 94,298,538 (September 2012: 88,833,779 ) ordinary shares being the weighted average number of ordinary shares allowing for all dilutive options and as well as shares granted under a crystallisation event but not yet issued.

6. Available-for-sale Financial Assets

7. Notes to the Cash Flow Statement

Reconciliation of profit before taxation to cash generated from operations

8. Related Party Transactions

Transactions between the Company and its subsidiaries, which are related parties of the Company, have been eliminated on consolidation and are not included in this note.

B J D Ashford-Russell is a member of Polar Capital LLP and a director of the Polar Capital Technology Trust PLC (the Trust). Polar Capital LLP is the appointed investment manager of the Trust. The total fees received by the Group as investment manager of the Trust were £2,816,851 (September 2012: £2,606,392). The amounts receivable at period end in this respect were £994,007 (March 2013: £902,900).

At the end of the period, the Group had an outstanding loan due of £1,017,131 (March 2013: £1,017,131) from the Polar Capital Employee Benefit Trust, which was set up in 2002 to hold ordinary shares in Polar Capital Holdings plc for the benefit employees.

9. The Publication of Non-Statutory Accounts

The financial information contained in this unaudited half year report does not constitute statutory accounts as defined in S434 of the Companies Act 2006. The financial information for the six months ended 30 September 2013 and 2012 has not been audited. The information for the year ended 31 March 2013 has been extracted from the latest published audited accounts, which have been filed with the Registrar of Companies. The audited accounts filed with the Registrar of Companies contain a report of the independent auditor dated 13 June 2013. The report of the independent auditor on those financial statements contained no qualification or statement under S498 of the Companies Act 2006.

Shareholder Information

Directors

T H Bartlam Non executive Chairman

T J Woolley Chief Executive Officer

J B Mansell Chief Operating Officer

H G C Aldous Non executive director, Chairman of Audit Committee

B J D Ashford-Russell Non executive director

J M B Cayzer-Colvin Non executive director, Chairman of Remuneration Committee

G V Bumeder Non executive director

M W Thomas Non executive director

Dividend

A first interim dividend of 4.0p per share has been declared for the year to 31 March 2014. This will be paid on 17 January 2014 to shareholders on the register on 3 January 2014. The shares will trade ex-dividend from 31 December 2013. 

Half Year Report 

The Half Year report will be posted to shareholders in January 2014. Copies of this announcement and of the Half Year report will be available from the Secretary at the Registered Office, 4 Matthew Parker Street, London SW1H 9NP and from the Company's website at www.polarcapital.co.uk 

Remuneration Code

Disclosure of the group's Remuneration Code will be made alongside its Pillar 3 disclosure which is available on the Company's website

Nominated Advisorand Corporate Broker to the Company

Canaccord Genuity

Neither the contents of the Company's website nor the contents of any website accessible from the hyperlinks on the Company's website (or any other website) is incorporated into or forms part of this announcement.

ENDS