Stand. Life UK Small (SLS) - Interim Management Statement RNS Number : 3638R Standard Life UK Small.Co's Tst PLC 16 November 2012 Standard Life UK Smaller Companies Trust PLC Interim Management Statement Three months ended 30 September 2012 To the members of Standard Life UK Smaller Companies Trust plc ('the Company') This Interim Management Statement ('IMS') has been produced solely to provide additional information to shareholders as a body to meet the relevant requirements of the UK Listing Authority's Disclosure and Transparency Rules. It should not be relied upon by any other party or for any other purpose. This IMS relates to the period from 1 July to 30 September 2012 and contains information that covers this period and up to the date of publication of this IMS, unless otherwise specified. Investment objective The objective of the Company is to achieve long term capital growth by investment in UK quoted smaller companies. Benchmark Numis Smaller Companies Index (excluding Investment Companies). The benchmark was renamed on 11 April 2012, having previously been named the RBS Hoare Govett Smaller Companies Index (excluding Investment Companies). Material events On 1 September 2012, the Company announced its Annual Financial Report for the year ended 30 June 2012. As at 30 September 2012, the Company had a capital structure comprising £24,935,071 nominal amount of Convertible Unsecured Loan Stock 2018 ("CULS") and 64,999,905 Ordinary shares of 25 pence each, with voting rights. There were no Ordinary shares held in treasury. On 5 October 2012, the Company issued 4,679 new Ordinary shares under its block listing authority granted on 28 April 2011("the April 2011 Block listing authority) further to the conversion date of 30 September 2012 in relation to the CULS. During October and November 2012 the Company issued a total of 1,025,000 new Ordinary shares under the April 2011 block listing authority. Details of these share issues are set out in the table below. Date of Issue NAV No of Shares Price 05/10/2012 n/a 4,679 237.2542 15/10/2012 236.66 225,000 238.25 16/10/2012 234.65 100,000 238.25 16/10/2012 235.85 100,000 238.25 18/10/2012 237.96 100,000 241.00 22/10/2012 237.46 100,000 240.00 24/10/2012 235.45 50,000 238.00 29/10/2012 233.76 50,000 236.25 09/11/2012 232.74 125,000 235.50 12/11/2012 231.89 25,000 233.25 12/11/2012 231.64 75,000 232.25 15/11/2012 229.73 75,000 231.50 1,029,679 As at the date of this IMS the capital structure of the Company comprises £24,923,960 nominal amount of CULS and 66,029,584 Ordinary shares in issue, with voting rights. All resolutions put to the Annual General Meeting of the Company held on 11 October 2012, were duly passed by shareholders, including approval of a final dividend of 2.10 pence per Ordinary share. The final dividend was paid on 18 October 2012 to shareholders on the register as at close of business on 21 September 2012. The ex- dividend date was 19 September 2012. Manager's Investment Review and Outlook for the three months ended 30 September 2012 Market Review UK smaller companies made strong gains in the third quarter. Markets were boosted by central bank stimulus measures. The UK economy remained sluggish with data mixed. Environment UK smaller companies delivered positive returns in each of the last three months, outperforming their large-cap counterparts over the quarter as a result. In the year to date, the FTSE SmallCap Index is up 19.3%, significantly ahead of the FTSE 100 Index. During the third quarter, UK equities gained confidence from stimulus efforts by central banks across the globe. Early in the period, risk appetite was boosted by a speech from European Central Bank (ECB) President Mario Draghi in which he stated that the ECB would do 'whatever it takes' to support the euro. The rally was sustained into the autumn, with equities gaining a further boost from the Federal Reserve's announcement of a third round of quantitative easing in September. The domestic economy remained sluggish and continued to contract in the second quarter of the year. However, an initial estimate of -0.7% was subsequently revised up to -0.4%. In addition, the Jubilee in June is estimated to have had a -0.5% impact. While economic data generally remained weak, there was some positive news including surprisingly robust employment trends. This prompted optimism that an Olympics related boost might ensure a return to growth in the third quarter, an expectation which was subsequently confirmed. Elsewhere, CPI inflation continued to trend lower, falling to 2.5% in August from a peak of over 5% in September 2011. This led to growing expectations of further stimulus measures from the Bank of England. Performance Performance benefited from exposure to online fashion retailer ASOS. This is the Company's largest single holding and it outperformed following a positive set of results which seemed to indicate that its UK business is recovering and its international operations are performing well. Also positive was the exposure to investment banker Hargreaves Lansdown which reported strong trading and appears well positioned to cope with the industry changes resulting from implementation of the retail distribution review (RDR) in December 2012. The holding in EMIS, which supplies specialised software to GPs, was also beneficial. The shares outperformed on the back of earnings upgrades, together with good visibility on the company's future earnings streams. Key detractors from performance included luxury handbag brand Mulberry, which lagged as a result of signs that trading may be moderating. This appeared to exacerbate concerns about the outlook for luxury brands following a profit warning from rival Burberry. The Company's exposure to property website Rightmove was a further negative. It suffered in an environment in which investors favouring more 'risk on' stocks failed to reward the company's relative resilience. In a similar vein, Abcam, the market leader in the sale of antibodies for the life science industry, lagged because of its perceived defensive characteristics. Activity Key purchases during the quarter included adding to the holding in high quality mass affluent clothing brand Ted Baker which is continuing to grow its UK business and to expand internationally. The Company also bought additional shares in payment services company PayPoint, which processes bills and general payments for customers without bank accounts. The company is trading well and diversifying into the payments via mobile phone business. Shares were purchased in polyurethane flooring manufacturer James Halstead, which we regard as a world leading business underpinned by its strong exports. The Company's holding in copper producer First Quantum Minerals was reduced given evidence of slowing demand from China for a range of commodity metals. The Company also took profits on some of its shares in industrial equipment manufacturer Spirax-Sarco. Outlook The present macroeconomic backdrop remains challenging. Ongoing difficulties in the Euro-zone, sluggish economic growth in Europe, and the possibility of a slowdown in the US and Far East, all give cause for concern. We do not, however, think that this will be sufficient to derail the market which we expect to make modest progress over the course of the year. We continue to favour growth-oriented, quality companies with strong earnings momentum. (Source: Standard Life Investments) Largest Ten holdings and Changes in Period Ranking as Market Value at 30 at September Ranking as at 30 June 2012 Total Investments 30 Sep 2012 2012 Investment (£) (%) 1 3 ASOS 8,463,811 5.2 2 2 Paddy Power 7,948,673 4.8 3 1 Telecom Plus 7,220,958 4.4 4 4 Abcam 6,837,986 4.2 5 5 Rightmove 6,585,600 4.0 6 6 Hargreaves 6,285,000 3.8 Lansdown 7 11 EMIS 5,944,917 3.6 8 7 Telecity 5,518,519 3.4 9 10 Domino's Pizza 5,047,447 3.1 10 17 Aveva 4,710,178 2.9 39.4 Net assets breakdown as at 30 September 2012 % Consumer Services 29.9 Industrials 24.4 Information Technology 18.0 Consumer Goods 10.7 Health Care 8.6 Financials 7.6 Telecommunications 4.8 Basic Materials 3.7 Oil & Gas 1.8 Net Borrowings (9.5) Total 100.0 General description of Company's financial position and performance as at 30 September 2012 Trust Managers Standard Life Investments (Since 01/09/2003) Market Capitalisation £147.5m Gross Assets £172.7m Ordinary Share Price 227.0p Ordinary Share Net Asset Value 229.4p* (Discount)/Premium of Ordinary Share Price to Net Asset Value (1.0)% 3.2% (Source: 12 Month High DataStream) (9.5)% 12 Month Low (Source: Datastream) Yield (net) - (note: level of yield changes on a daily basis) 1.4% Current equity gearing (note: level of gearing changes on a daily 9.5% basis) 3.5% Convertible Unsecured Loan Stock 2018 Conversion Price 237.2542p 3.5% Convertible Unsecured Loan Stock 2018 Price 107.0p CULS Conversion and Interest Payment Dates 31 March and 30 September Trust Annual Management Fee 0.85% of Gross Assets Dividends Semi Annually April/October * Capital Only Net Asset Value Source: Standard Life Investments. Performance Q3 2012 1 year 2 years 3 years 4 years 5 years (%) (%) (%) (%) (%) (%) Share price 11.8 14.6 29.5 94.8 127.0 92.0 Net asset value 6.1 15.1 25.6 73.0 88.1 65.6 NSCI (ex Investment Companies) 8.7 20.1 16.8 32.0 62.4 10.0 Source: Thomson Datastream, capital returns. The percentage growth figures above are calculated over periods to 30 September 2012 on a mid to mid basis. For the Manager's current Investment Review & Outlook, please refer to the latest Trust Quarterly Update which is available via the Company's web-page at www.standardlifeinvestments.com/its Please note that past performance is not necessarily a guide to the future and that the value of investments and the income from them may fall as well as rise. Investors may not get back the amount they originally invested. For Standard Life UK Smaller Companies Trust plc Maven Capital Partners UK LLP, Secretaries 16 November 2012 This information is provided by RNS The company news service from the London Stock Exchange END IMSGGGQWGUPPGCQ -0- Nov/16/2012 14:38 GMT
Stand. Life UK Small SLS Interim Management Statement
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