29th Apr 2016 12:05
LONDON (Alliance News) - Global Resources Investment Trust PLC on Friday said things could be looking up, after depressed global commodity markets hit the junior resource sector in 2015.
In a statement, Global Resources Investment Trust said its net asset value per share was 20.3 pence at the end of 2015, down 60.8% from August 31, 2014. Its NAV per share was 25.7p as of Wednesday this week.
Global Resources wrote down a number of unquoted investments, which contributed significantly to the fall in NAV.
"This is the second full chairman's statement that I have written, and it gives me no pleasure to report on what was a dreadful period for global commodity markets. The junior resource sector again proved to be especially vulnerable and illiquid. 2016 has, however, started more brightly with indications that the worst may, finally, be behind us," Chairman Anthony St John, a hereditary member of the House Of Lords in the UK.
The chairman said Global Resources' ability to continue as a going concern depends on the support of holders of the GBP5.0 million of 9.0% cumulative unsecured loan stock issued in 2014.
LIM Asia Multi-Strategy Fund, which owns GBP3.5 million of the GBP4.7 million CULS still in issue, requested repayment after the steep decline in Global Resources' NAV meant it was no longer within its promised cover ratio in relation to the value of its investments versus the principal amount of outstanding CULS.
"The company does not have sufficient cash or liquid assets to repay the amount owed immediately," according to Lord St John. "LIM and the other two CULS holders have all indicated in writing a current intention to support the company through the realisation of assets over a longer period with the purpose of enabling the Company to repay the CULS."
The trust sold its whole position in NuLegacy Gold in April, realising GBP2.2 million, and its manager has said it expects to be able to make enough money from the sale of a "small number of quoted positions" over a period of three to four months to allow the CULS to be repaid.
Shares in Global Resources, which is managed by David Hutchins and Kjeld Thygesen of RDP Fund Management LLP, were down 2.0% at 6.00 pence Friday.
By Samuel Agini; [email protected]; @samuelagini
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