Investec Finance plc Un-audited condensed Financial Statements for the six months ended 30 September 2010
(Thomson Reuters ONE) -
Investec Finance plc
Incorporated in England and Wales
Registration number 4111949
Un-audited condensed Financial Statements for the six months ended 30 September
2010
Zebra Capital Plans Retails Structured Products Programme
Investec Finance plc - the company
Interim Management Report
The Interim Management Report is issued by Investec Finance plc in accordance
with the UK Listing Authority's Disclosure and Transparency Rules. Unless
otherwise stated, performance and figures highlighted below refer to the six
months ended 30 September 2010 and the corresponding period in the previous
year.
Principal activity and business review
Investec Finance plc (the 'Company') is a wholly owned subsidiary of Investec
Bank plc ("IBP") which is in turn a wholly-owned subsidiary of Investec plc (the
'Investec Group'), which is listed on the London Stock Exchange.
The principal activity of the company is to engage in financial arrangements and
transactions and to assist in financing the operations of the Investec Group. In
previous years the company has issued Guaranteed Subordinated Step-Up notes, a
fixed coupon sterling bond, a Euro denominated floating rate note and has issued
Euro Commercial Paper. In each case the proceeds have been on-lent to the
company's parent on similar terms so as to minimise liquidity, interest rate and
foreign currency risk. The company will continue to operate in this capacity for
the foreseeable future.
On 9 May 2008, the company launched a £3,000,000,000 Zebra Capital Plans Retail
Structured Products Programme (the 'Programme'). In terms of the Programme, the
company may from time to time issue notes (the 'Zebra Plan Notes') that are
linked to the performance of one or more preference shares issued by Zebra
Capital II Limited, a company incorporated in the Cayman Islands. The payment
of all amounts due in respect of the Notes will be unconditionally and
irrevocably guaranteed by Investec Bank plc on an unsubordinated basis. After
each issue, applications will be made for the Notes to be admitted to listing on
the Official List of the FSA and to trading on the Regulated Market of the
London Stock Exchange. As a result, and in terms of the Programme, the company
is required to publicly release its results. The financial risks are managed at
the Investec plc group level. The company's exposure to financial risks is
further discussed in note 16.
Performance overview and principal risks
During the current period no new Notes have been issued in terms of the
Programme. The Company does not expect to issue any further new Notes under
this Programme. In addition to this Programme, Investec Bank plc
has created a notes platform, the GBP4,000,000,000 Zebra Capital Plans Retail
Structured Products Programme, under which new structured product launches have
been made since September 2009.
Any market risk with respect to the performance of the preference shares issued
by Zebra Capital II Limited is matched with Investec Bank plc. Any liquidity
risk, interest rate risk or foreign currency risk is eliminated as the terms and
currency of the Notes are matched with the terms and currency of the lending
to Investec Bank plc. As such, all material principal risks and uncertainties
are mitigated.
The un-audited condensed Financial Statements have not been audited or reviewed
by the company's auditors in pursuant to the Auditing Practices Board guidance
Review of Interim Financial Information.
This announcement includes an un-audited condensed set of Financial Statements
produced by the Company for the six months ended 30 September 2010. This
document will also be available on Investec's website at
http://www.investec.co.uk/#home/investor_relations.html
Enquires and further information contact:
The Investor Relations Team
Phone number:
+27 11 286 7070 | +44 207 597 5546
30 November 2010
directors' responsibilitY STATEMENT
The directors confirm that, to the best of their knowledge:
* the un-audited condensed set of financial statements has been prepared in
accordance with United Kingdom Generally Accepted Accounting Practice
(United Kingdom Accounting Standards and applicable law) and the Companies
Act 2006, gives a true and fair view of assets, liabilities, financial
position and results of the company for that period; and
* the interim management report of the company includes a fair review of the
development and performance of the business and the position of the company
together with a description of the principal risks and uncertainties that
they face as required by the FSA Disclosure Rules and Transparency Rules
4.2.7, and
* the un-audited condensed Financial Statements have not been audited or
reviewed by the company's auditors in pursuant to the Auditing Practices
Board guidance on Review of Interim Financial Information.
Neither the company nor the directors accept any liability to any person in
relation to the half-yearly financial report except to the extent that such
liability could arise under English law. Acordingly, any liability to a person
who has demonstrated reliance on any untrue or misleading statement or omission
shall be determined in accordance with section 90A of the Financial Services and
Markets Act 2000.
Corporate Governance Statement
The Directors are responsible for internal control of the company and for
reviewing the effectiveness of those controls. Procedures have been designed for
safeguarding assets against unauthorised use or disposition; for maintaining
proper accounting records; and for the reliability and usefulness of financial
information used within the business or for publication. Such procedures are
designed to manage rather than eliminate the risk of failure to achieve business
objectives and can only provide reasonable and not absolute assurance against
material misstatement, errors, losses or fraud. The procedures enable the
company to comply with the regulatory obligations. Investec Finance plc also
makes use of the controls of the Investec Plc Group as many controls, including
audit committee are at a group level. For further details, refer to notes to
the combined Investec Plc and Investec Ltd consolidated financial statements,
Risk Management and Corporate Governance report.
Signed on behalf of the board of directors
S Koseff
Director
30 November 2010
pROFIT AND LOSS ACCOUNT
for the six months ended 30 September 2010
Un-audited Un-audited Audited
six months to six months to year to
30 September 30 September 31 March
2010 2009 2010
Notes £000 £000 £000
Interest receivable from parent 17,186 20,275 37,017
undertaking
Interest payable 4 (16,652) (19,803) (36,125)
Amortisation of bond costs (514) (1,054) (2,093)
Fee income from parent 5 - 210 234
undertaking
Principal transactions 6 - 630 1,304
Administration expenses 7 - (96) (172)
--------------- --------------- ---------
PROFIT ON ORDINARY ACTIVITIES 20 162 165
BEFORE TAXATION
Taxation 8 - - 314
--------------- --------------- ---------
PROFIT FOR THE PERIOD 20 162 479
The above activities are continuing.
There are no recognised gains or losses in the current or prior period other
than those passed through the profit and loss account.
There is no material difference between the results disclosed in the profit and
loss account for current or prior period and the results on an unmodified
historical cost basis.
The accompanying notes form part of these un-audited condensed financial
statements.
BALANCE SHEET
at 30 September 2010
Un-audited Audited Un-audited
30 September 31 March 30 September
2010 2010 2009
Notes £000 £000 £000
CURRENT ASSETS
Debtors:
Amounts falling due within one 9 6,553 6,343 5,145
year
Amounts falling due after one 9 70,674 111,836 101,938
year
Amounts falling due after one 10 449,810 441,629 504,968
year - subordinated loans
-------------- ----------- -------------
527,037 559,808 612,051
CREDITORS: AMOUNTS FALLING DUE 11 (17,029) (11,312) (910)
WITHIN ONE YEAR
-------------- ----------- -------------
NET CURRENT ASSETS 510,008 548,496 611,141
-------------- ----------- -------------
CREDITORS: AMOUNTS FALLING DUE 12 (509,364) (547,872) (610,834)
AFTER MORE THAN ONE YEAR
-------------- ----------- -------------
NET ASSETS 644 624 307
CAPITAL AND RESERVES
Called up share capital 13 50 50 50
Profit and loss account 14 594 574 257
-------------- ----------- -------------
EQUITY SHAREHOLDERS' FUNDS 15 644 624 307
NOTES TO THE UN-AUDITED CONDENSED FINANCIAL STATEMENTS
The accompanying notes form part of the un-audited condensed financial
statements.
1. ACCOUNTING POLICIES
Basis of presentation
The interim financial statements have been prepared in accordance with the
recognition and measurement requirements of Financial Reporting Standards and
the disclosure of transparency rules. The accounting policies applied in the
preparation of the results for the six months ended 30 September 2010 are
consistent with those adopted in the Company's audited Financial Statements for
the year ended 31 March 2010, in accordance with FSA Disclosure Rules and
Transparency Rules 4.2.6.
The information in this report for the six months to 30 September 2010, which
was approved by the board of directors on 30 November 2010, does not constitute
statutory accounts as defined in Section 435 of the UK Companies Act 2006 ("2006
Act"). Statutory accounts for the year ended 31 March 2010, which contained an
unqualified audit report under Chapter 3, Part 16 of the 2006 Act and which did
not contain statements under Section 498 of the 2006 Act, have been delivered to
the Registrar of Companies in accordance with Section 1068 of the 2006 Act.
Segmental reporting
The company's business activities are to engage in financial arrangements and
transactions and to assist in financing the operations of the Investec Group.
The Company's activities are conducted within the UK.
Cash flow statement
The company is exempt from the requirements to prepare a cash flow statement
under Financial Reporting Standard 1, because a consolidated cash flow statement
is included in the publicly available consolidated financial statements of its
ultimate holding company, Investec plc.
Taxation
Corporation tax payable is provided on taxable profits at the current rate.
Deferred tax is recognised in respect of all timing differences that have
originated but not reversed at the balance sheet date where transactions or
events that result in an obligation to pay more tax in the future or a right to
pay less tax in the future have occurred at the balance sheet date. This is
subject to deferred tax assets only being recognised if it is considered more
likely than not that there will be suitable profits from which the future
reversal of the underlying timing differences can be deducted. Timing
differences are differences between the company's taxable profits and its
results as stated in the financial statements, which are capable of reversal in
one or more subsequent periods.
Deferred tax is measured at a non-discounted basis at the tax rates that are
expected to apply in the periods in which the timing differences are expected to
reverse based on tax rates and laws that have been enacted or substantively
enacted at the balance sheet date.
Related party transactions
The directors have taken advantage of the exemptions available in Financial
Reporting Standard 8 from disclosing transactions with related parties which are
members of Investec plc Group.
Debt instruments and associated finance costs
Guaranteed subordinated step-up notes and debt securities in issue are initially
recognised at fair value and are carried in the balance sheet at amortised cost
applying the effective interest rate method.
Some debt instruments are structured notes which contain both a derivative and
non-derivative component. These instruments are reported on the balance at a
valuation which includes the fair value of the embedded derivative.
Loans and receivables
Loans and receivables are carried in the balance sheet at amortised cost
applying the effective interest rate method.
Disclosure of financial instruments
The directors have taken advantage of the disclosure exemptions available to
subsidiary undertakings in Financial Reporting Standard 29.
2. SEGMENTAL INFORMATION
All of the company's business relates to engaging in financial arrangements and
transactions and assisting in financing the operations of the Investec plc group
and is carried out in the United Kingdom.
2. emoluments of directors
The directors were employed and remunerated as directors or executives of
Investec plc and its subsidiaries ("the group") in respect of their services to
the group as a whole, and it is therefore considered that there is no
appropriate basis on which they can apportion part of their remuneration for
their services to the company.
2. interest payable
Un-audited Un-audited Audited
6 months to 30 6 months to 30 Year to 31 March
September September
2010 2009 2010
£000 £000 £000
Interest payable on 7,750 7,750 15,500
subordinated step-up
notes
Interest payable on 7,691 10,851 19,120
subordinated callable
step-up notes
Interest payable on 70 - -
debt securities in
issue - less than one
year
Interest payable on - 100 153
debt securities in
issue - more than one
year
Value increase of the 1,141 1,102 1,352
deposit element of
Zebra plan notes
---------------------------------------------------------
16,652 19,803 36,125
2. Fee income from parent undertaking
In prior periods administration and direct expenses related to the Zebra notes
products were paid by the company and then recharged to the parent undertaking
inclusive of a 5% margin. This recharge was shown as fee income. As no new notes
were issued under the Programme in the current period no expenses have been
incurred by the company.
2. PRINCIPAL TRANSACTIONS
There is no principal transaction income in the current period.
The income of £630,000 in the half year 30 September 2009 resulted from the
cancellation and write down of £50,032,000 Guaranteed Undated Subordinated
Callable Step-up Notes and the release of Investec Bank plc from the principal
amount of £49,383,524 Undated Subordinated Callable Step-up Notes and net
interest adjustments.
2. administratION expenses
There are no administration expenses in the current period as no new notes were
issued under the Programme.
Administration expenses incurred in the half year 30 September 2009 relate to
the £3,000,000,000 Zebra Capital Plans Retail Structured Products Programme
launched by the company on 9 May 2008.
The company has no employees in the current or prior period.
2. TAXation
Un-audited Un-audited Audited
30 September 30 September 31 March
2010 2009 2010
£000 £000 £000
Taxation - - (314)
The effective rate for the period is different from the standard rate of UK
corporation tax due to the following items:
£000 £000 £000
Tax on profit on ordinary activities at UK rate of 28% 6 46 46
(28%)
Non-taxable profit on debt buy back - (177) (360)
Losses surrendered to/(from) fellow group companies for nil (6) 131 -
payment
------ ------- ------
- - (314)
2. Debtors: EXCLUDING SUBORDINATED LOANS
Un-audited Audited Un-audited
30 September 31 March 30 September
2010 2010 2009
Amounts falling due within one year £000 £000 £000
Amounts owed by parent undertaking 6,236 6,016 5,080
Group relief 314 314 -
Other assets 3 13 65
----------------- ---------- -------------
6,553 6,343 5,145
Amounts falling after one year
Amounts owed by parent undertaking 70,674 111,836 101,938
Amounts owed by the parent undertaking primarily represents the proceeds of the
issue of debt securities which have been lent to the parent at the same interest
and repayment terms as the debt securities, and the proceeds of the issue of the
Zebra Plan Notes and the positive fair value of the equity derivatives purchased
from the parent undertaking to match the risks of the embedded equity
derivatives within the Zebra Plan products.
2. DEBTORS: AMOUNTS DUE AFTER ONE YEAR - SUBORDINATED LOAN
Un-audited Audited Un-audited
30 September 31 March 30 September
2010 2010 2009
Subordinated loans to parent £000 £000 £000
undertaking
Subordinated Step-up Notes 205,102 197,092 205,102
Undated Subordinated Callable Step-up 244,708 244,537 299,866
Notes
----------------- ---------- -------------
449,810 441,629 504,968
The net proceeds of two issues of Step-up Notes by the company have been lent to
the immediate parent undertaking, Investec Bank plc on a subordinated basis.
1. The term of the first loan is 1 March 2016 but it may be redeemed at any
time after 1 March 2011. The interest rate on the loan is fixed at 8.1618%
until 1 March 2011 and interest is paid annually. After 1 March 2011 the
interest rate will be reset in line with the interest rate on the Guaranteed
Subordinated Step-up Notes.
2. The second loan is undated but it may be redeemed at any time after 23
January 2017. The interest rate on the loan is fixed at 6.4578% until 23
January 2017 and the interest is paid semi-annually. After 23 January 2017
the interest rate will be reset in line with the interest rate on the
Guaranteed Undated Subordinated Callable Step-up Notes.
On the 15 September 2009 the Company entered into a release agreement with
IBP to release the principal amount of £49,383,524 of the debt owed by IBP to
the Company pursuant to the intra-group funding agreement dated 23 January 2007
in consideration for an amount of £26,960,189 to be paid by IBP to the Company.
On the 8 December 2009 the Company entered into a release agreement with IBP
to release the principal amount of £54,483,439 of the debt owed by IBP to the
Company pursuant to the intra-group funding agreement dated 23 January 2007 in
consideration for an amount of £38,449,744 to be paid by IBP to the Company.
The terms of the step-up notes, which are guaranteed by Investec Bank plc,
are detailed in note 12.
2. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
Un-audited Audited Un-audited
30 September 31 March 30 September
2010 2010 2009
£000 £000 £000
Amount owed to parent undertaking 1,140 1,140 910
Debt Securities in issue 15,889 10,172 -
----------------- ---------- -------------
17,029 11,312 910
The company issued on 6 June 2006 a 5 year bond with a coupon of 3 month US
dollar libor plus 40 basis point and a face value of USD 25,000,000 repayable 6
June 2011.
The company issued on 14 September 2009 a 1 year bank guaranteed credit linked
note with a fixed coupon of 4.12 per cent. and a face value of GBP 10,000,000
repayable 20 September 2010.
2. CREDITORS: AMOUNTS FALLING DUE after more than ONE YEAR
Un-audited Audited Un-audited
30 September 31 March 30 September
2010 2010 2009
£000 £000 £000
Guaranteed Subordinated Step-up Notes 208,787 200,655 208,050
Guaranteed Undated Subordinated Callable 245,790 245,553 300,821
Step-up Notes
Debt securities in issue - 16,486 15,648
Valuation of structured notes issued 54,787 85,178 86,315
-------------- ---------- -------------
509,364 547,872 610,834
On 1 March 2004 the company issued £200,000,000 of 7.75 per cent. Guaranteed
Subordinated Step-up Notes due 2016 at a discount. Interest is paid annually.
The notes are guaranteed by Investec Bank plc and are listed on the Luxembourg
Stock Exchange. The step-up notes may be redeemed by the issuer, at par, at any
time after 1 March 2011, subject to the prior consent of the Financial Services
Authority. On 1 March 2011 the interest rate will be reset to become the
aggregate of 3.5 per cent. and the gross redemption yield of the relevant
benchmark gilt.
On 23 January 2007 the company issued £350,000,000 6.25 per cent. Guaranteed
Undated Subordinated Callable Step-up Notes callable 2017 at a discount.
Interest is paid semi-annually. The notes are guaranteed by Investec Bank plc
and are listed on the Luxembourg Stock Exchange. The step-up notes may be
redeemed by the issuer, at par, at any time after 23 January 2017, subject to
the prior consent of the Financial Services Authority. On 23 January 2017 the
interest rate will be reset to become three month LIBOR plus 2.11% payable
quarterly in arrears. On 25 September 2009, £50,032,000 of the notes
representing approximately 14.3 per cent of the total issued principal amount,
were cancelled. A further £55,177,000 of the notes representing approximately
15.8 per cent of the original total issued principal amount was cancelled on 8
December 2009. As at the period-end 30 September 2010 the principal amount in
issue was £244,971,000.
The amounts due under the Zebra Plan Notes are linked to the performance
of preference shares issued by Zebra Capital II Limited and consequently the
amounts due under the notes disclosed above includes movements in the fair value
of these embedded equity derivatives. As at 30 September 2010 the positive fair
value of these derivatives was £10,378,479 (March 2010: £4,970,980), a positive
movement in the period of £5,407,499 (March 2010: £9,549,871). The company has
matched this risk by entering into matching contracts with its parent. Included
in amounts owed by parent undertaking after one year in note 9 above is a
negative fair value of embedded derivatives of £10,378,479 (March 2010:
£4,970,980).
2. CALLED UP SHARE CAPITAL
Un-audited Audited Un-audited
30 September 31 March 30
September
2010 2010 2009
£000 £000 £000
Authorised:
100,000 (2010 - 100,000) ordinary shares 100 100 100
of £1 each
Allotted, called up and fully paid
50,000 (2010 - 50,000) ordinary shares of 50 50 50
£1 each
2. REserves
Un-audited Audited Un-audited
30 September 31 March 30 September
2010 2010 2009
£000 £000 £000
Profit and loss account
At beginning of period 574 95 95
Profit for the period 20 479 162
---------------- ----------- ---------------
At end of period 594 574 257
2. RECONCILIATION OF Movement in SHAREHOLDERS' funds
Un-audited Audited Un-audited
30 September 31 March 30 September
2010 2010 2009
£000 £000 £000
Opening shareholders' funds 624 145 145
Profit for the period 20 479 162
----------------- ------------ ---------------
Closing shareholders' funds 644 624 307
2. RISK MANAGEMENT
As a wholly-owned subsidiary of Investec plc, the company falls under the
Investec plc Group's Risk Management Framework which is set out in the combined
Investec plc and Investec Limited 2010 financial statements, Risk Management and
Corporate Governance report. The company's function is to raise finance for the
Investec Group and its policy is to on-lend the proceeds of any financial
indebtedness to its immediate parent, Investec Bank plc, on back to back terms
that minimise any liquidity, currency or interest rate risk.
Credit risk
As all net funds raised by the company are on-lent to Investec Bank plc, the
company is therefore dependent on repayment of principal and interest from
Investec Bank plc for the purposes of meeting its financial obligations. Its
financial obligations in respect of the Guaranteed Undated Subordinated Callable
Step-up Notes, Guaranteed Subordinated Step-up Notes, Euro denominated floating
rate note issues and Zebra Capital Plans Retail Structured Products Notes are
guaranteed by Investec Bank plc.
Liquidity risk
Loans to Investec Bank plc are matched in terms of maturity and interest payment
dates to those of the related borrowing so as to eliminate any liquidity risk.
Foreign currency risk
Loans to Investec Bank plc are denominated in the same currency as the related
borrowing so as to ensure that the company is not exposed to foreign currency
risk.
Market risk
Any market risk with respect to the performance of the Zebra Capital Plans
Retail Structured Products Preference Share Linked Notes is matched with
Investec Bank plc. Equity derivative financial instruments written have been
matched with equity derivatives purchased from Investec Bank plc providing the
same terms and conditions and as such mitigating any risk.
Capital Management
The company manages and monitors its capital on an ongoing basis and with
consideration for the ongoing commitments of the entity. The company is not
regulated and therefore it is not subject to any capital adequacy requirements.
2. ULTIMATE parent undertaking
The company's immediate parent undertaking is Investec Bank plc.
The company's ultimate parent undertaking and controlling party is Investec plc,
a company incorporated in the United Kingdom and registered in England and
Wales. The consolidated financial statements of Investec plc and Investec Bank
plc are available to the public at 2 Gresham Street, London, EC2V 7QP. Investec
Bank plc is the smallest group and Investec plc is the largest group in which
the results of the company are consolidated.
[HUG#1468368]
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Investec Finance Plc via Thomson Reuters ONE
Unternehmensinformation / Kurzprofil:
Datum: 02.12.2010 - 18:15 Uhr
Sprache: Deutsch
News-ID 49360
Anzahl Zeichen: 35852
contact information:
Kategorie:
Business News
Diese Pressemitteilung wurde bisher 159 mal aufgerufen.
Die Pressemitteilung mit dem Titel:
"Investec Finance plc Un-audited condensed Financial Statements for the six months ended 30 September 2010"
steht unter der journalistisch-redaktionellen Verantwortung von
Investec Finance Plc (Nachricht senden)
Beachten Sie bitte die weiteren Informationen zum Haftungsauschluß (gemäß TMG - TeleMedianGesetz) und dem Datenschutz (gemäß der DSGVO).
