BRITISH & AMERICAN INVESTMENT TRUST PLC
GROUP FINANCIAL HIGHLIGHTS
For the six months ended 30 June 2013
Audited
Unaudited Unaudited Year
6 months 6 months ended
to 31
to 30 December
June 30 June
2013 2012 2012
£'000 £'000 £'000
Revenue
Return before tax 1,355 879 2,107
_________ _________ _________
Earnings per £1 ordinary shares - basic (note
4) 4.72p 2.81p 7.02p
_________ _________ _________
Earnings per £1 ordinary shares - diluted (note
4) 3.87p 2.51p 6.01p
_________ _________ _________
Capital
Total equity 24,152 23,297 23,345
_________ _________ _________
Revenue reserve (note 7) 1,200 870 1,245
_________ _________ _________
Capital reserve (note 7) (12,048) (12,573) (12,900)
_________ _________ _________
Net assets per ordinary share (note 5)
- Basic £0.57 £0.53 £0.53
_________ _________ _________
- Diluted £0.69 £0.67 £0.67
_________ _________ _________
Diluted net assets per ordinary share at 23
August 2013 £0.71
_________
Dividends*
Dividends per ordinary share (note 3) 2.7p 2.7p 7.6p
_________ _________ _________
Dividends per preference share (note 3) 1.75p 1.75p 3.5p
_________ _________ _________
* Dividends declared for the period. Dividends shown in the accounts are, by
contrast, dividends paid or approved
in the period.
Copies of this report will be posted to shareholders and be available for
download at the company's website: www.baitgroup.co.uk.
GROUP INVESTMENT PORTFOLIO
As at 30 June 2013
Company Nature of Valuation Percentageof
Business £'000 portfolio
%
Geron Corporation Biomedical - USA 3,438 15.16*
RIT Capital Partners Investment Trust 3,087 13.61
Dunedin Income Growth Investment Trust 2,570 11.33
British Assets Trust Investment Trust 1,913 8.43
St. James's Place Global Equity Unit Trust 1,722 7.59
________ ________
Prudential Life Assurance 1,700 7.50
Scottish American Investment Company Investment Trust 966 4.26
Alliance Trust Investment Trust 748 3.30
Invesco Income Growth Trust Investment Trust 743 3.27
BioTime Inc NPV Biotechnology 587 2.59
________ ________
F&C Asset Management - 6.75% FRN Sub. General Financial
Bonds 2026 524 2.31
Royal & Sun Alliance Insurance Group Insurance -
- Cum. irred. preference shares Non-Life 465 2.05
Merchants Trust Investment Trust 458 2.02
Rothschilds Cont. Finance - Notes Financial 444 1.96
Shires Income Investment Trust 443 1.95
________ ________
Matrix Chatham EZT (unquoted) Enterprise Zone 438 1.93
Trust
Earthport Software and 338 1.49
computer services
Barclays - 9% PIB Capital Bonds Bank retail 245 1.08
Jupiter Income Trust Unit Trust 198 0.87
Emblaze Software and 163 0.72
computer services
________ ________
20 Largest investments 21,190 93.42
Other investments (number of holdings 1,491 6.58
: 25)
________ ________
Total investments 22,681 100.00
________ ________
*Geron Corporation. 6.53% held by the company and 8.63% held by subsidiaries.
In addition the Group holds net purchases of £1,634,000 of put options in Geron
Corporation as part of its hedging strategy.
Unaudited Interim Report
30 June 2013
Registered number : 433137
Directors Registered office
J Anthony V Townsend (Chairman) Wessex House
Jonathan C Woolf (Managing Director) 1 Chesham Street
Dominic G Dreyfus (Non-executive) London SW1X 8ND
Ronald G Paterson (Non-executive) Telephone: 020 7201 3100
Website: www.baitgroup.co.uk
Chairman's Statement
I report our results for the 6 months to 30 June 2013.
Revenue
The profit on the revenue account before tax amounted to £1.4 million (30 June
2012: £0.9 million), an increase of 54 percent reflecting a higher level of
special dividends received in the period.
A gain of £0.9 million (30 June 2012: £0.3 million) was registered on the
capital account before capitalised expenses, incorporating a realised loss of £
1.0 million (30 June 2012: £0.6 million loss) and an unrealised gain of £1.9
million (30 June 2012: £1.0 million).
The revenue earnings per ordinary share were 4.7 pence on an undiluted basis
(30 June 2012: 2.8 pence) and 3.9 pence on a fully diluted basis (30 June 2012:
2.5 pence).
Net Assets and performance
Group net assets were £24.2 million (£23.3 million, at 31 December 2012), an
increase of 3.7 percent. Over the same six month period, the FTSE 100 index
increased by 5.4 percent and the All Share index increased by 6.4 percent. On
a total return basis, after adding back dividends paid during the period, group
net assets increased by 9.4 percent compared to a total return on the FTSE 100
index of approximately 7.0 percent. The net asset value per £1 ordinary share
was 57 pence (prior charges deducted at par) and 69 pence on a fully diluted
basis.
As noted above, the UK stock market finished modestly ahead at the half year;
however, it had risen strongly during the period to register a gain of 11
percent by the end of May which was then mostly lost in June as markets
worldwide reversed following anxieties that the sustained monetary stimulus
measures in the USA would shortly be withdrawn. Markets then steadied somewhat
in July and August as the US Federal Reserve attempted to play down these fears
through its submissions to US Congress. The economic and investment themes of
the period are set out in more detail in the Managing Director's report below.
As at 23 August, group net assets were £25.0 million, an increase of 3.4
percent since 30 June. This compares with an increase of 4.5 percent in the
FTSE 100 index and an increase of 5.1 percent in the All Share index over the
same period, and is equivalent to 60 pence per share (prior charges deducted at
par) and 71 pence per share on a fully diluted basis.
Dividend
We intend to pay an interim dividend of 2.7 pence per ordinary share on 7
November 2013 to shareholders on the register at 11 October 2013. This
represents an unchanged dividend from last year's interim dividend. A
preference dividend of 1.75 pence will be paid to preference shareholders on
the same date.
Outlook
As I reported in April, equity markets had enjoyed firm and substantial growth
in the early months of 2013 as global recessionary concerns abated and were
close to regaining their all time highs before sentiment changed in June as
fears emerged that the liquidity programme provided by the Federal Reserve
could be withdrawn somewhat earlier than expected. Since then, all of the fall
experienced in June has been reversed and the UK equity market is now ahead 11
percent since the beginning of the year. This also reflects the growing
evidence that the UK economy is finally growing again, albeit weakly, after
several years of stagnation.
While in the USA markets have been guided to expect a gradual reduction in
monetary stimulus in the foreseeable future, in the UK the Bank of England has
recently introduced a new and revolutionary policy of issuing medium term
interest rate guidance under its new Governor which, unlike in the USA,
indicates no change in the historically low sterling interest rates for a
number of years ahead. As noted in the Managing Director's report below, we
believe that this unprecedented period of certainty in UK interest rates
provides us with an opportunity to capture value and income in the portfolio by
entering into a modest amount of gearing over the coming period.
Against this background, therefore, we intend to pursue a modest programme of
additional investment through gearing as opportunities present themselves to
enhance returns on our growth and income holdings.
Anthony Townsend
29 August 2013
Managing Director's Report
UK equity market performance in the first half of 2013 repeated for a third
year that of the two previous years, with a strong rise in early months (11
percent) followed by a significant reversal, eliminating most of the gains by
the end of the second quarter (to 3 percent). As noted above, the portfolio
outperformed the benchmark index by approximately 2.5 percent on a total return
basis over the period.
As reported in April, the strength in equity valuations in the first four
months of the year derived from a confluence of factors, including the
realisation that various economic disaster scenarios in the USA and Eurozone
were less likely to occur and a consequent rotation from bond investment into
equities, a change in focus of economic policy from austerity to growth and
some actual signs of growth appearing in 2013 in the USA and latterly the in
UK.
Despite this general shift in sentiment, a number of substantial concerns
remain in global markets as the volatility of the first six months
demonstrates. These concerns include the weakness in the recovery and length
of time required to recapture lost levels of GDP, the withdrawal of emergency
liquidity measures in the USA (so-called 'tapering') and its possible effects
on financial investment, continuing worries about sovereign debt sustainability
in the Eurozone and evidence of lower levels of economic growth in China.
In the UK, the most significant events of the past few months have been
increasing evidence of an albeit weak return to growth, including revisions to
official statistics which in fact eliminated the second leg of the recession in
2012 (so called 'double-dip') and the fear of a 'triple dip', increased
corporate earnings, despite continued low levels of corporate lending from
banks as they face increasing capital requirements, and an increase in consumer
spending. In addition, the housing market has finally begun to show growth
throughout the UK with sales increasing significantly over the summer,
supported by increased levels of mortgage lending following a series of bank
lending incentivisation programmes introduced by the government this year.
The other significant event was the introduction by the Bank of England for the
first time in August of a medium term projection of UK interest rates. After
an unprecedented period of historically low sterling interest rates, there were
concerns, as in the USA, that expectations of rate increases in the short term
as the economy began to show signs of recovery would undermine the recovery,
which was judged to be frail following the effects of the global banking
crisis. A medium term projection for interest rates was designed to allay
these fears and inject a level of stability to promote financial investment and
sustain the recovery.
The medium term interest rate projection announced in August by the new Bank of
England Governor indicated a longer period than expected of continued low
interest rates (to at least 2016) using a new target of unemployment (of 7
percent), in addition to the previous inflation target. Although various
caveats remain related to inflation and market instability, it is generally
expected that a further period of ultra-low interest rate will be sustained
over the next few years. As noted above, this is designed to promote financial
investment, and as such also provides us with opportunities to add investments
to our currently fully invested portfolio using modest levels of gearing to
achieve higher returns in both the growth and income elements of our
portfolio. We will therefore be pursuing this strategy over the coming period
while expectations of relatively low inflationary growth in the economy
persist.
Jonathan C Woolf
29 August 2013
CONSOLIDATED INCOME STATEMENT
Six months ended 30
June 2013
Unaudited Unaudited Audited
6 months to 30 June 6 months to 30 June Year ended 31 December
2013 2012 2012
Note Revenue Capital Revenue Capital Revenue Capital
return return Total return return Total return return Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
Investment 2
income 1,554 - 1,554 1,062 - 1,062 2,486 - 2,486
Holding gains on
investments at
fair value
through profit
or loss - 1,908 1,908 - 1,047 1,047 - 1,446 1,446
Losses on
disposal of
investments at
fair value
through profit
or loss - (959) (959) - (613) (613) - (1,237) (1,237)
Expenses (199) (97) (296) (183) (96) (279) (379) (198) (577)
_____ _____ _____ _____ _____ _____ _____ _____ _____
Profit before
tax 1,355 852 2,207 879 338 1,217 2,107 11 2,118
Taxation - - - - - - (3) - (3)
_____ _____ _____ _____ _____ _____ _____ _____ _____
Profit for the
period 1,355 852 2,207 879 338 1,217 2,104 11 2,115
_____ _____ _____ _____ _____ _____ _____ _____ _____
Earnings per 4
ordinary share
Basic 4.72p 3.41p 8.13p 2.81p 1.35p 4.16p 7.02p 0.04p 7.06p
Diluted 3.87p 2.44p 6.31p 2.51p 0.97p 3.48p 6.01p 0.03p 6.04p
The group does not have any income or expense that is not included in the
profit for the period and all items derive from continuing operations.
Accordingly, the 'Profit for the period' is also the 'Total Comprehensive
Income for the period' as defined in IAS 1(revised) and no separate Statement
of Comprehensive Income has been presented.
The total column of this statement is the Group's Income Statement, prepared in
accordance with IFRS. The supplementary revenue return and capital return
columns are both prepared under guidelines published by the Association of
Investment Companies.
All profit and total comprehensive income is attributable to the equity holders
of the parent company. There are no minority interests.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Six months ended 30 June 2013
Unaudited
Six months ended 30 June 2013
Share Capital Retained Total
capital reserve earnings
£'000 £'000 £'000 £'000
Balance at 31 December 2012 35,000 (12,900) 1,245 23,345
Profit for the period - 852 1,355 2,207
Ordinary dividend paid - - (1,225) (1,225)
Preference dividend paid - - (175) (175)
________ ________ ________ ________
Balance at 30 June 2013 35,000 (12,048) 1,200 24,152
________ ________ ________ ________
Unaudited
Six months ended 30 June 2012
Share Capital Retained Total
capital reserve earnings
£'000 £'000 £'000 £'000
Balance at 31 December 2011 35,000 (12,911) 1,341 23,430
Profit for the period - 338 879 1,217
Ordinary dividend paid - - (1,175) (1,175)
Preference dividend paid - - (175) (175)
________ ________ ________ ________
Balance at 30 June 2012 35,000 (12,573) 870 23,297
________ ________ ________ ________
Audited
Year ended 31 December 2012
Share Capital Retained Total
capital reserve earnings
£'000 £'000 £'000 £'000
Balance at 31 December 2011 35,000 (12,911) 1,341 23,430
Profit for the period - 11 2,104 2,115
Ordinary dividend paid - - (1,850) (1,850)
Preference dividend paid - - (350) (350)
________ ________ ________ ________
Balance at 31 December 2012 35,000 (12,900) 1,245 23,345
________ ________ ________ ________
CONSOLIDATED BALANCE SHEET
As at 30 June 2013
Audited
Unaudited Unaudited 31
30 June 30 June December
2013 2012 2012
£'000 £'000 £'000
Non-current assets
Investments - fair value through profit or
loss (note 1) 22,681 21,604 21,137
_________ _________ _________
Current assets
Receivables 1,684 202 1,190
Derivatives - fair value through profit or
loss 3,249 2,832 3,204
Cash and cash equivalents 691 1,286 740
_________ _________ _________
5,624 4,320 5,134
_________ _________ _________
Total assets 28,305 25,924 26,271
_________ _________ _________
Current liabilities
Other current liabilities (2,538) (1,313) (1,307)
Derivatives - fair value through profit or
loss (1,615) (1,314) (1,619)
_________ _________ _________
(4,153) (2,627) (2,926)
_________ _________ _________
Total assets less current liabilities 24,152 23,297 23,345
_________ _________ _________
Net assets 24,152 23,297 23,345
_________ _________ _________
Equity attributable to equity holders
Ordinary share capital 25,000 25,000 25,000
Convertible preference share capital 10,000 10,000 10,000
Capital reserve (12,048) (12,573) (12,900)
Retained revenue earnings 1,200 870 1,245
_________ _________ _________
Total equity 24,152 23,297 23,345
_________ _________ _________
Net assets per ordinary share - basic £0.57 £0.53 £0.53
_________ _________ _________
Net assets per ordinary share - diluted £0.69 £0.67 £0.67
_________ _________ _________
CONSOLIDATED CASHFLOW STATEMENT
Six months ended 30 June 2013
Unaudited Unaudited Audited
6 months 6 months Year ended
to to 31
30 June 30 June December
2013 2012 2012
£'000 £'000 £'000
Cash flow from operating activities
Profit before tax 2,207 1,217 2,118
Adjustment for:
Profits on investments (949) (434) (209)
Scrip dividends (3) (3) (8)
Film income tax deducted at source - - (3)
Proceeds on disposal of investments at fair
value
through profit or loss 14,696 7,786 16,255
Purchases of investments at fair value
through profit or loss (13,008) (5,862) (14,111)
________ ________ ________
Operating cash flows before movements
in working capital 2,943 2,704 4,042
Increase in receivables (3,518) (3,118) (3,372)
Increase in payables 1,751 2,753 1,798
________ ________ ________
Net cash from operating activities
before income taxes 1,176 2,339 2,468
________ ________ ________
Net cash flows from operating activities 1,176 2,339 2,468
________ ________ ________
Cash flow from financing activities
Dividends paid on ordinary shares (1,225) (1,175) (1,850)
________ ________ ________
Net cash used in financing activities (1,225) (1,175) (1,850)
________ ________ ________
Net (decrease)/increase in cash and cash
equivalents (49) 1,164 618
Cash and cash equivalents at beginning of
period 740 122 122
________ ________ ________
Cash and cash equivalents at end of period 691 1,286 740
________ ________ ________
NOTES TO THE gROUP RESULTS
Accounting policies
Basis of preparation
This interim report is prepared in accordance with IAS 34 and on the basis of
the accounting policies set out in the group's annual Report and Accounts at 31
December 2012.
Basis of consolidation
These consolidated condensed financial statements incorporate the financial
statements of the company and its subsidiary undertakings made up to 30 June.
Control is achieved where the company has the power to govern the financial and
operating policies of an investee entity so as to obtain benefits from its
activities. All intra-group transactions, balances, income and expenses are
eliminated on consolidation.
Significant accounting policies
In order better to reflect the activities of an investment trust company and in
accordance with guidance issued by the Association of Investment Companies
(AIC), supplementary information which analyses the income statement between
items of a revenue and capital nature has been presented alongside the income
statement.
As the entity's business is investing in financial assets with a view to
profiting from their total return in the form of interest, dividends or
increases in fair value, listed equities and fixed income securities are
designated as fair value through profit or loss on initial recognition. The
group manages and evaluates the performance of these investments on a fair
value basis in accordance with its investment strategy, and information about
the group is provided internally on this basis to the entity's key management
personnel.
Investments held at fair value through profit or loss, including derivatives
held for trading, are initially recognised at fair value.
All purchases and sales of investments are recognised on the trade date.
After initial recognition, investments, which are designated as at fair value
through profit or loss, are measured at fair value. Gains or losses on
investments designated as at fair value through profit or loss are included in
net profit or loss as a capital item, and material transaction costs on
acquisition and disposal of investments are expensed and included in the
capital column of the income statement. For investments that are actively
traded in organised financial markets, fair value is determined by reference to
Stock Exchange quoted market bid prices or last traded prices, depending upon
the convention of the exchange on which the investment is quoted at the close
of business on the balance sheet date. Investments in units of unit trusts or
shares in OEICs are valued at the closing price released by the relevant
investment manager.
In respect of unquoted investments, or where the market for a financial
instrument is not active, fair value is established by using an appropriate
valuation technique.
Investments in subsidiary companies are held at the fair value of their
underlying assets and liabilities, calculated in accordance with the above
policy. Where a subsidiary has negative net assets it is included in
investments at nil value and a provision made against it on the balance sheet.
Dividend income from investments is recognised as income when the shareholders'
rights to receive payment has been established, normally the ex-dividend date.
Interest income on fixed interest securities is recognised on a time
apportionment basis so as to reflect the effective interest rate of the
security.
Property EZT income is recognised on the date the distribution is receivable.
Film royalty income is recognised on receipt of royalty statements covering
periods ending in the financial year.
When special dividends are received, the underlying circumstances are reviewed
on a case by case basis in determining whether the amount is capital or income
in nature. Amounts recognised as income will form part of the company's
distribution. Any tax thereon will follow the accounting treatment of the
principal amount.
All expenses are accounted for on an accruals basis. Expenses are charged as
revenue items in the income statement except as follows:
- transaction costs which are incurred on the purchase or sale of an investment
designated as fair value through profit or loss are expensed and included in
the capital column of the income statement;
- expenses are split and presented partly as capital items where a connection
with the maintenance or enhancement of the value of the investments held can be
demonstrated, and accordingly investment management and related costs have been
allocated 50% (2012 - 50%) to revenue and 50% (2012 -50%) to capital, in order
to reflect the directors' long-term view of the nature of the expected
investment returns of the company.
The 3.5% cumulative convertible non-redeemable preference shares issued by the
company are classified as equity instruments in accordance with IAS 32
'Financial Instruments - Disclosure and Presentation' and FRS 25 as the company
has no contractual obligation to redeem the preference shares for cash or pay
preference dividends unless similar dividends are declared to ordinary
shareholders.
Segmental reporting
The directors are of the opinion that the Group is engaged in a single segment
of business, that is investment business, and therefore no segmental reporting
is provided.
2. Investment income
Unaudited Unaudited Audited
6 months 6 months Year ended
to 30 June to 30 June 31 December
2013 2012 2012
£'000 £'000 £'000
Income from investments 1,546 1,063 2,491
Other income/(loss) 8 (1) (5)
___________ ___________ ___________
1,554 1,062 2,486
_________ _________ _________
3. Proposed dividends
Unaudited Unaudited Audited
6 months to 6 months to Year ended
30 June 2013 30 June 2012 31 December 2012
Interim Interim Final
Pence per Pence per Pence per
share £'000 share £'000 share £'000
Ordinary 2.7 675 2.7 675 4.9 1,225
shares
Preference
shares -
1.75 175 1.75 175 1.75 175
fixed
_________ _________ _________
850 850 1,400
_______ _______ _______
The directors have declared an interim dividend of 2.7p (2012 - 2.7p) per
ordinary share, payable on 7 November 2013 to shareholders registered on 11
October 2013. The shares will be quoted ex-dividend on 9 October 2013.
The dividends on ordinary shares are based on 25,000,000 ordinary £1 shares.
Dividends on preference shares are based on 10,000,000 non-voting 3.5%
convertible preference shares of £1.
The holders of the 3.5% convertible preference shares will be paid a dividend
of £175,000 being 1.75p per share. The payment will be made on the same date as
the dividend to the ordinary shareholders.
Amounts recognised as distributions to ordinary shareholders in the period:
Unaudited Unaudited Audited
6 months to 6 months to Year ended
30 June 2013 30 June 2012 31 December 2012
Pence per Pence per Pence per
share £'000 share £'000 share £'000
Ordinary
shares -
final 4.9 1,225 4.7 1,175 4.7 1,175
Ordinary
shares -
interim - - - - 2.7 675
Preference
shares -
fixed 1.75 175 1.75 175 3.5 350
_________ _________ _________
1,400 1,350 2,200
_______ _______ _______
4. Earnings per ordinary share
Unaudited Unaudited Audited
6 months 6 months Year ended
to 30 June to 30 June 31
2013 2012 December
£'000 £'000 2012
£'000
Basic earnings per share
Calculated on the basis of:
Net revenue profit after preference 1,180 704 1,754
dividends
Net capital profit 852 338 11
_________ _________ _________
Net total earnings after preference 2,032 1,042 1,765
dividends
_______ _______ _______
Ordinary shares in issue 25,000 25,000 25,000
_______ _______ _______
Diluted earnings per share
Calculated on the basis of:
Net revenue profit 1,355 879 2,104
Net capital profit 852 338 11
_________ _________ _________
Profit after taxation 2,207 1,217 2,115
_______ _______ _______
Ordinary and preference shares in issue 35,000 35,000 35,000
_______ _______ _______
Diluted earnings per share is calculated taking into account the preference
shares which are convertible to ordinary shares on a one for one basis, under
certain conditions, at any time during the period 1 January 2006 to 31 December
2025 (both dates inclusive).
5. Net asset value attributable to each share
Basic net asset value attributable to each share has been calculated by
reference to 25,000,000 ordinary shares, and group net assets attributable to
shareholders as follows:
Unaudited Unaudited Audited
30 June 30 June 31 December
2013 2012 2012
£'000 £'000 £'000
Total net assets 24,152 23,297 23,345
Less convertible preference (10,000) (10,000) (10,000)
shares
____________ ____________ ____________
Net assets attributable to 14,152 13,297 13,345
ordinary shareholders
_________ _________ _________
Diluted net asset value is calculated on the total net assets in the table
above and on 35,000,000 shares, taking into account the preference shares which
are convertible to ordinary shares on a one for one basis, under certain
conditions, at any time during the period 1 January 2006 to 31 December 2025
(both dates inclusive).
6. Financial information
This interim statement is not the company's statutory accounts. The statutory
accounts for the year ended 31 December 2012 have been delivered to the
Registrar of Companies and received an audit report which was unqualified, did
not include a reference to any matters to which the auditors drew attention by
way of emphasis without qualifying the report, and did not contain statements
under section 498(2) or (3) of the Companies Act 2006.
The Interim Report will be sent to the company's shareholders shortly, and
members of the public may obtain a copy at that time on application to the
company's registered office or by download at the company's website
www.baitgroup.co.uk.
7. Retained earnings
The table below shows the movement in the retained earnings analysed between
revenue and capital items.
Capital Retained
reserve earnings
£'000
£'000
1 January 2013 (12,900) 1,245
Allocation of profit for the year 852 1,355
Ordinary and preference dividends paid - (1,400)
____________ ____________
At 30 June 2013 (12,048) 1,200
_________ _________
The capital reserve includes £1,213,000 of investment holding gains (30 June
2012 - £45,000,
31 December 2012 - £87,000 loss).
DIRECTORS' RESPONSIBILITIES STATEMENT
Principal risks and uncertainties
The principal risks and uncertainties faced by the company continue to be as
described in the previous annual accounts. Further information on each of these
areas, together with the risks associated with the company's financial
instruments are shown in the Directors' Report and notes to the financial
statements within the Annual Report and Accounts for the year ended 31 December
2012.
The Chairman's Statement and Managing Director's report include commentary on
the main factors affecting the investment portfolio during the period and the
outlook for the remainder of the year.
Directors' responsibilities statement
The Directors are responsible for preparing the half-yearly report in
accordance with applicable law and regulations. The Directors confirm that to
the best of their knowledge the interim financial statements, within the
half-yearly report, have been prepared in accordance with IAS 34 'Interim
Financial Reporting'. The Directors further confirm that the Chairman's
Statement and Managing Director's Report includes a fair review of the
information required by 4.2.7R and 4.2.8R of the FSA's Disclosure and
Transparency Rules.
The Directors of the company are listed in the section preceding the Chairman's
Statement.
The half-yearly report was approved by the Board on 29 August 2013 and the
above responsibility statement was signed on its behalf by:
Jonathan C Woolf
INDEPENDENT REVIEW REPORT TO
BRITISH & AMERICAN INVESTMENT TRUST PLC
Introduction
We have reviewed the condensed set of consolidated financial statements in the
half-yearly financial report of British & American Investment Trust PLC for the
six months ended 30 June 2013 which comprises the Consolidated Income
Statement, the Consolidated Statement of Changes in Equity, the Consolidated
Balance Sheet, the Consolidated Cashflow Statement and the related explanatory
notes that have been reviewed. We have read the other information contained in
the half yearly financial report Group Financial Highlights, the Chairman's
Statement, the Managing Director's Report, the Group Investment Portfolio and
the Directors responsibilities statement, and considered whether it contains
any apparent misstatements or material inconsistencies with the information in
the condensed set of financial statements.
This report is made solely to the company's members, as a body, in accordance
with International Standard on Review Engagements (UK and Ireland) 2410,
'Review of Interim Financial Information performed by the Independent Auditor
of the Entity'. Our review work has been undertaken so that we might state to
the company's members those matters we are required to state to them in an
independent review report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to anyone other
than the company and the company's members as a body, for our review work, for
this report, or for the conclusion we have formed.
Directors' responsibilities
The half-yearly financial report is the responsibility of, and has been
approved by, the directors. The directors are responsible for preparing the
half-yearly financial report in accordance with the Disclosure and Transparency
Rules of the United Kingdom's Financial Services Authority.
As disclosed in note 1,the annual financial statements of the group are
prepared in accordance with International Financial Reporting Standards as
adopted by the European Union. The condensed set of financial statements
included in this half-yearly financial report has been prepared in accordance
with International Accounting Standard 34, 'Interim Financial Reporting', as
adopted by the European Union.
Our responsibility
Our responsibility is to express to the company a conclusion on the condensed
set of financial statements in the half-yearly financial report based on our
review.
Scope of review
We conducted our review in accordance with International Standard on Review
Engagements (UK and Ireland) 2410, 'Review of Interim Financial Information
Performed by the Independent Auditor of the Entity'. A review of interim
financial information consists of making enquiries, primarily of persons
responsible for financial and accounting matters, and applying analytical and
other review procedures. A review is substantially less in scope than an audit
conducted in accordance with International Standards on Auditing (UK and
Ireland) and consequently does not enable us to obtain assurance that we would
become aware of 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 to
believe that the condensed set of financial statements in the half-yearly
financial report for the six months ended 30 June 2013 is not prepared, in all
material respects, in accordance with International Accounting Standard 34,
'Interim Financial Reporting', as adopted by the European Union and the
Disclosure and Transparency Rules of the United Kingdom's Financial Services
Authority.
GRANT THORNTON UK LLP
AUDITOR
London
29 August 2013