27th Aug 2008 07:00
Press release
For immediate release on Wednesday 27th August, 2008
The information contained herein is not for publication or distribution topersons in the United States of America. Any securities referred to hereinhave not been and will not be registered under the U.S. Securities Act of 1933,as amended (the "Securities Act"), and may not be offered or sold withoutregistration thereunder or pursuant to an available exemption therefrom. Anypublic offering of securities to be made in the United States would have to bemade by means of a prospectus that would be obtainable from the issuer or itsagents and would contain detailed information about the issuer of thesecurities and its management, as well as financial statements. Neither thisdocument nor the information contained herein constitutes an offer to sell orthe solicitation of an offer to buy any securities. These materials do notconstitute an offer of securities for sale in the United States. No money,securities or other consideration is being solicited, and, if sent in responseto the information contained herein, will not be accepted.
Candover Investments plc
Interim results for the six months ended 30th June, 2008
Financial highlights:
* Net assets per share were 2051p, broadly in line with net assets per share
of 2065p at 31st December, 2007. This compares to a decline in the FTSE All
Share Index of 13.1% over the same period. * Net assets per share increased by 11.0% over the 12 months to 30th June 2008. The FTSE All-Share Index decreased 16.1% over the same period
* The net assets per share incorporates favourable currency movements of 87p
per share and provisions against investments of 68p per share * Interim dividend per share increased by 10% to 22.0p (2007: 20.0p) not withstanding a slight decline in pre-tax profits
* Ten year compound growth in net assets per share of 12.7% per annum; FTSE
All-Share Index growth over the same period of 0.4% per annum
Operating highlights:
* Invested ‚£103.5m in the period, of which ‚£49.9m was invested alongside the
2005 Fund in the acquisition of Stork. An additional ‚£31.1m was committed
to acquire a stake in Expro International * Two transactions completed since the period end - the investments in Technogym and Expro International
* Sale of residual shares in Wellstream and Aspen and the refinancing of Wood
Mackenzie accounted for the majority of the ‚£31.7m of proceeds during the
period
* Candover 2008 Fund first closing of ¢â€š¬2.8bn in August, including ¢â€š¬1bn from
Candover * Early expansion into new regions with teams beginning to explore opportunities in Asia and Eastern Europe.
Gerry Grimstone, Chairman of Candover Investments plc, commented:
"The value of Candover's portfolio has been largely maintained despite thecontinued economic uncertainty. The recent investments in Technogym and ExproInternational show that Candover is very much open for business despite thecredit crisis. Although no company can be immune from the economic pressuresfacing Europe, our portfolio is in good shape, and we continue to believe thatthis is a good time to invest with company valuations and debt multiples backto more sensible levels. Realisations, however, will be harder to achieve.The first closing of the Candover 2008 Fund marks a significant milestone inour activities, and we expect that our commitment of ¢â€š¬1 billion to this Fundwill help underpin Candover's continued success."
Ends.
For further information, please contact:
Gerry Grimstone +44 207 489 9848
Chairman, Candover Investments plc
Colin Buffin +44 207 489 9848
Managing Director, Candover Partners Limited
Susanna Voyle/Peter Hewer +44 207 353 4200Tulchan CommunicationsChairman's statementIntroductionCandover continues to make good progress despite the economic slowdown, withthe value of our portfolio being largely maintained. Net assets per shareshowed a modest decline of 0.7% over the six months to 30th June, 2008,compared to a decrease of 13.1% in the FTSE All-Share Index over the sameperiod. Year on year, however, our net assets per share increased by 11.0% overthe 12 months to 30th June, 2008 compared with a decrease of 16.1% in the FTSEAll-Share Index.At 30th June, 2008, the unaudited net assets attributable to the ordinaryshares were ‚£448.3 million compared to ‚£451.3 million at 31st December, 2007.Net assets per share were 2051p compared to 2065p at 31st December, 2007 and1848p at 30th June, 2007.Our performanceThe net asset value has remained broadly in line with the December 2007 level.The increase in the value of unrealised investments of ‚£5.7 millionincorporates favourable currency movements of ‚£20.6 million. This has beenoffset by the reduction in retained earnings following the payment of the finaldividend for the previous year.The valuation of financial investments at 30th June, 2008 was ‚£424.5 million,compared to ‚£344.9 million at 31st December, 2007 and reflects new investmentsnet of realisations of ‚£73.9 million, and a net increase of ‚£5.7 million in thevaluation of investments. The sale of the residual shares in Wellstream andAspen realised proceeds of ‚£24.1 million, and as a result, the value ascribedto Candover's share of the carried interest in the 2001 Fund was increased by ‚£3.4 million (16p per share) to ‚£24.4 million.Profits before tax for the six months under review were ‚£9.5 million, comparedto ‚£10.6 million for the first half of 2007. This reflects our current cautiousview on fixed asset investment income given the uncertain outlook for theEuropean economy.
Cash and liquid assets, net of loans of ‚£158.1 million, totalled ‚£25.0 million compared with ‚£114.2 million at 31st December, 2007.
The strength of the euro against the pound in the first half of the year benefitted the valuation of our portfolio and, combined with movements on our cash portfolio net of debt, added about 87p to our NAV. We will continue to monitor our exposure to foreign currencies and, if need be, will take appropriate action to reduce our exposure to such movements.
Our environment
As expected, European buyout market activity in the first half of 2008 wassignificantly lower than during the first half of 2007, with values down bymore than 58% from ¢â€š¬115 billion to ¢â€š¬48 billion. This was largely due to ashortage in the availability of debt for the larger transactions thathistorically have accounted for the majority of the market in value terms. Weexpect the difficult market conditions to continue in the second half, and weanticipate that the buyout market in 2008 will be significantly behind therecords set in recent years.
Dividends
The Board has decided to increase the interim dividend by 10.0% to 22.0p per ordinary share compared to 20.0p per ordinary share last year. The dividend will be paid on 15th October, 2008 to shareholders on the register at 19th September, 2008.
The Candover 2008 Fund
In March it was announced that we had commenced marketing our tenth fund, theCandover 2008 Fund, with a target of ¢â€š¬5.0 billion. The Fund held its firstclosing in August with total commitments of ¢â€š¬2.8 billion. Candover committed ¢â€š¬1.0 billion to the Fund. The 2008 Fund has already made its first investment,contributing two thirds of the funding for Expro International, with the 2005Fund providing one third.The Board
There have been several changes to the Board during the period. Jimmy Westretired from the Board at the AGM in May, having served as a director for over20 years, and we are very grateful for his contribution to the company duringthat time. He has been succeeded as Senior Independent Director by AntonyHichens.Lord Jay of Ewelme and Nicholas Jones were appointed as non-executive directorsduring the period and we are delighted to welcome them to the Board. Aspreviously reported, Michael Jay was the Permanent Under-Secretary at theForeign Office and Head of the Diplomatic Service. Nicholas was until recentlyVice Chairman of Lazard in London.
Geographic expansion
We continue to explore ways to enhance shareholder value. Whilst our primaryfocus remains on pan-European buyouts, we believe that our experience in Europeover the past 28 years puts us in a strong position to expand into new regions,although we intend to tread cautiously.The Candover Asia operation is now up and running with the opening of an officein Hong Kong. The Asian team is led by Jamie Paton, who set up 3i's North Asianbusiness. He has been joined by five other experienced individuals. We expectto open an office in Mumbai shortly.We have also established a new team to focus on opportunities in EasternEurope, led by Lindsay Stuart, who has 25 years of private equity experience.We believe that the continued economic development of Eastern Europe representsan interesting opportunity for Candover. The team of four will initially bebased in London.
We have also strengthened our pan-European buyout team with a number of hires, bringing the team up to 43 investment executives.
Prospects
The value of Candover's portfolio has been largely maintained despite thecontinued economic uncertainty. The recent investments in Technogym and ExproInternational show that Candover is very much open for business despite thecredit crisis. Although no company can be immune from the economic pressuresfacing Europe, our portfolio is in good shape, and we continue to believe thatthis is a good time to invest with company valuations and debt multiples backto more sensible levels. Realisations, however, will be harder to achieve.The first closing of the Candover 2008 Fund marks a significant milestone inour activities, and we expect that our commitment of ¢â€š¬1 billion to this Fundwill help underpin Candover's continued success.G E GrimstoneChairman27th August, 2008Interim management report
Despite the slowdown in European buyout activity, Candover has made a strong start to the year with one investment, two realisations and a refinancing achieved during the half year, and a further two investments made since the period end.
Investments
In January, Candover and the 2005 Fund invested ‚£351.8 million in Stork, adiversified Dutch engineering conglomerate active in component manufacturingfor civil and military aerospace, maintenance and support of aeroplanes (mainlyFokker aircraft) and provision of technical services.Since the period end, Candover and the 2005 Fund invested ‚£141.8 million toacquire a significant minority stake in Technogym. The company is a globalleader in the design, production and marketing of premium fitness equipment andwellness products which serves the major fitness club chains, as well asprofessional customers in the hospitality, corporate, education, medical andmilitary markets.Additionally, Candover and the 2005 and 2008 Funds completed the acquisition ofExpro International, an oilfield services business which provides products andservices to commission, measure and improve the flow management of oil and gaswells. Candover and the 2005 and 2008 Funds invested ‚£473.6 million in total.Candover and the 2005 Fund initially acquired an 8% stake in Expro during thehalf year, prior to a consortium completing the delisting in August. Candover'sfinal investment amount will be increased, but that amount will depend on thelevel of syndication.Date of Company Activity Candover 2005 investment Fund ‚£m ‚£m January Stork Engineering 49.9 301.9April Expro Oilfield services 31.1 133.8 International 81.0 435.7
Candover also made four investments during the half year in existing portfolio companies:
* ‚£3.8 million in Gala Coral, alongside ‚£30.1 million provided by the 2001
Fund, as part of a refinancing.
* ‚£15.7 million in Parques Reunidos, alongside ‚£95.3 million provided by the
2005 Fund to fund follow-on acquisitions.
* ‚£1.1 million in Alma, alongside ‚£6.7 million provided by the 2005 Fund to
fund a follow-on acquisition.
* ‚£0.8 million in Ferretti, alongside ‚£4.7 million provided by the 2005 Fund
as part of a restructuring within the holding company.
Realisations
Candover and its managed funds achieved realisation proceeds totalling ‚£292.1 million during the period; Candover's share was ‚£31.7 million.
In April, we sold our residual shares in Wellstream. The shares have performedextremely well since listing at 320p per share in April 2007. We sold ourshares for 1210p per share in April 2008, bringing Wellstream's overallinvestment multiple to 6.9 times the original investment. In May we sold ourresidual shares in Aspen, and together with earlier proceeds, the investmentgenerated an investment multiple (at constant currency) of 1.9 times theoriginal investment. In addition, Wood Mackenzie completed its secondrefinancing, and has now returned 0.8 times the original investment.Date of Company Proceeds Exit route exit Candover 2001 Fund ‚£m ‚£m April Wellstream 15.6 143.6 Sale of quoted stock April Wood Mackenzie 5.3 49.1 Refinancing May Aspen 8.5 67.7 Sale of quoted stock Other 2.3 - 31.7 260.4 ValuationsThe portfolio continues to diversify by sector and geography. The valueattributed to UK based companies reduced from 44% at the year end to 36% at theperiod end, and we would expect this to fall further in the coming years asCandover seeks to diversify its portfolio across Europe as well as exploringopportunities in Asia and Eastern Europe. Industrial companies make up 40% ofthe portfolio, although the diversity within that group ensures that we are notover-exposed to a particular niche, with companies ranging from precisionoptics to luxury motor yacht manufacturers.Our continued success at completing transactions since the start of the creditcrunch is reflected in the immaturity of the portfolio: 27% of the portfolio isless than a year old; 64% of the portfolio is less than two years old.
The 20 largest companies represent 99% of the portfolio.
Investments
Analysis by value as at 30th June, 2008
By valuation method
1. Multiple of earnings 73%2. Cost 27%By region1. United Kingdom 36%2. Benelux 17%3. Italy 12%4. France 8%5. Spain 8%6. Scandinavia 8%7. Germany 6%8. Switzerland 5%By sector1. Industrials 40%2. Support services 16%3. Leisure 10%4. Financials 8%5. Energy 13%6. Media 7%7. Health 3%8. External funds 3%By age1. 5 years 16%OutlookLooking ahead, there can be no doubt that the markets in which we operate willcontinue to be challenging. We do not foresee any easing of the tight creditmarket conditions in the short term and this will continue to have an impact onthe industry as a whole, with financing costs increasing and levels of activityremaining depressed. However, we consider that current market conditionspresent us with more opportunities than challenges and believe that we canmaintain the momentum we have achieved so far this year.Colin Buffin Marek Gumienny
Managing Director Managing Director Candover Partners Limited Candover Partners Limited 27th August, 2008 27th August, 2008
20 largest investments as at 30th June, 2008
Residual Effective cost of Directors' equity % of Date of investment valuation interest Candover's Basis ofInvestment Geography investment ‚£000 ‚£000 (fully net assets valuation diluted) Stork Netherlands January 49,862 53,037 6.5% 11.8% Transaction 2008 value Engineering conglomerate Ferretti Italy January 32,879 48,572 5.5% 10.8% Multiple of 2007 earnings Luxury yacht manufacturer Expro UK April 2008 31,069 31,069 See note 6.9% TransactionInternational 1 value Oilfield services Hilding Anders Sweden December 27,418 30,942 9.1% 6.9% Multiple of 2006 earnings Bed manufacturer Parques Spain March 2007 26,176 28,227 5.6% 6.3% Multiple ofReunidos earnings Operator of attraction parks DX Group UK September 28,038 28,038 8.9% 6.3% Multiple of 2006 earnings Mail services Springer Germany January/ 573 24,989 4.0% 5.6% Multiple ofScience + earningsBusiness Media Academic September publisher 2003 Alma France December 20,504 22,746 5.5% 5.1% TransactionConsulting 2007 valueGroup Cost reduction and tax recovery services EurotaxGlass's Switzerland June 2006 17,394 20,018 8.0% 4.5% Multiple of earnings Automotive data intelligence Wood Mackenzie UK July 2005/ 1,775 18,987 6.3% 4.2% Multiple of earnings Energy October research 2007 ALcontrol UK December 13,202 15,131 6.8% 3.4% Multiple of 2004 earnings Laboratory testing Qioptiq UK December 9,567 13,732 7.4% 3.1% Multiple of 2005 earnings Optical engineering Ontex Belgium January 21,324 12,710 6.3% 2.8% Multiple of 2003/ earnings Hygienic July 2007 disposables Capital Safety UK June 2007 11,433 11,308 6.4% 2.5% Multiple ofGroup earnings Fall protection equipment Gala Coral UK March 28,623 10,621 1.8% 2.4% Multiple of 2003/ earnings Retail gaming October 2005 Equity Trust UK May 2003 7,587 8,561 5.5% 1.9% Multiple of earnings Trust services Ciclad 4 France July 2005 3,912 5,210 NA 1.2% Multiple of earnings French buyout fund ICG Mezzanine UK March 2004 3,181 3,613 NA 0.8% Multiple ofFund 2003 earnings Mezzanine fund Ono Spain November 3,083 3,598 0.2% 0.8% Multiple of 2005 earnings Cable TV Ciclad 3 France April 2000 nil 3,563 NA 0.8% Multiple of earningsFrench buyout fund
Note 1 Candover's final investment amount, and therefore its effective equity interest, will depend on the level of syndication
Principal risks and uncertainties
Details of the principal risks and uncertainties facing the Group were set outon pages 61 to 68 of the 2007 Annual Report and Accounts, a copy of which isavailable on the website. In summary, those risks and uncertainties were asfollows: market risk, currency risk (in particular the euro and US dollar),interest rate risk, other price risk, liquidity risk, credit risk, fair valuesof financial assets and financial liabilities and capital management policiesand procedures.
The principal risks and uncertainties identified in the 2007 Annual Report remain unchanged and each of them has the potential to affect the Group's results during the remainder of 2008.
Candover aims to minimise risk by:
* Diversifying the portfolio by size, sector and geography
* Monitoring the Group's exposure to foreign currencies and fixed interest
securities
* Using foreign currency borrowing and derivative financial instruments to
reduce the Group's exposure to future exchange rate movements
* Ensuring full and timely access to relevant information from the investee
companies and attending board meetings
* Managing cash and non-cash equivalents in such a way that they are readily
realisable to meet investment and operating needs
* Monitoring and reviewing the broad structure of the Group's capital on an
ongoing basis
Our views on the current market conditions are reflected in the Chairman's statement and interim management report.
Statement of directors' responsibilities
The directors of Candover Investments plc confirm that, to the best of theirknowledge, the condensed set of financial statements on pages 9 to 14 in theinterim financial statement have been prepared in accordance with IAS 34`Interim Financial Reporting', and that the interim management report on pages3 to 5 of the interim financial statement includes a fair review of theinformation required by DTR 4.2.7 and DTR 4.2.8.The directors of Candover Investments plc are listed on page 16 of the interimfinancial statement.By order of the BoardAndrew MoberlyCompany Secretary27th August, 2008
Independent review report to Candover Investments plc
Introduction
We have been engaged by the Company to review the condensed set of financialstatements in the half-yearly financial report for the six months ended 30thJune, 2008 which comprises the Group income statement, Statement of recognisedincome and expenses, Reconciliation of movements in equity, Group balancesheet, Group cash flow statement and the related notes. We have read the otherinformation contained in the half-yearly financial report and consideredwhether it contains any apparent misstatements or material inconsistencies withthe information in the condensed set of financial statements.This report is made solely to the Company in accordance with guidance containedin ISRE (UK and Ireland) 2410, 'Review of Interim Financial Informationperformed by the Independent Auditor of the Entity'. Our review work has beenundertaken so that we might state to the Company those matters we are requiredto state to them in a review report and for no other purpose. To the fullestextent permitted by law, we do not accept or assume responsibility to anyoneother than the company, for our review work, for this report, or for theconclusion 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 2, the annual financial statements of the group areprepared in accordance with IFRSs as adopted by the European Union. Thecondensed set of financial statements included in this half-yearly financialreport has been prepared in accordance with International Accounting Standard34, 'Interim Financial Reporting', as adopted by the European Union.
Our responsibility
Our responsibility is to express to the Company a conclusion on the condensedset of financial statements in the half-yearly financial report based on ourreview.Scope of review
We conducted our review in accordance with International Standard on ReviewEngagements (UK and Ireland) 2410, 'Review of Interim Financial InformationPerformed by the Independent Auditor of the Entity' issued by the AuditingPractices Board for use in the United Kingdom. A review of interim financialinformation consists of making enquiries, primarily of persons responsible forfinancial and accounting matters, and applying analytical and other reviewprocedures. A review is substantially less in scope than an audit conducted inaccordance with International Standards on Auditing (UK and Ireland) andconsequently does not enable us to obtain assurance that we would become awareof 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 tobelieve that the condensed set of financial statements in the half-yearlyfinancial report for the six months ended 30 June 2008 is not prepared, in allmaterial respects, in accordance with International Accounting Standard 34 asadopted by the European Union and the Disclosure and Transparency Rules of theUnited Kingdom's Financial Services Authority.GRANT THORNTON UK LLPAUDITORLONDON27th August, 2008Group income statement
for the period ended 30th June, 2008
Six months to Six months to Year to 31st 30th June, 2008 30th June, 2007 December, 2007 Revenue Capital Total* Revenue Capital Total* Revenue Capital Total*Unaudited ‚£000 ‚£000 ‚£000 ‚£000 ‚£000 ‚£000 ‚£000 ‚£000 ‚£000 Gains on financial investments and cash equivalents at fair value through profit and loss Realised gains and - 15,083 15,083 - 9,520 9,520 - 70,012 70,012losses Unrealised gains - 6,663 6,663 - 70,545 70,545 - 64,292 64,292and losses - 21,746 21,746 - 80,065 80,065 - 134,304 134,304 Revenue Management fees from
managed funds 19,973 - 19,973 18,855 - 18,855 37,400 - 37,400
Investment and 11,978 - 11,978 10,688 - 10,688 21,888 - 21,888other income 31,951 - 31,951 29,543 - 29,543 59,288 - 59,288 Administrative (21,358) (5,830) (27,188) (18,934) (5,296) (24,230) (37,920) (9,339) (47,259)expenses Profit before 10,593 15,916 26,509 10,609 74,769 85,378 21,368 124,965 146,333finance costs and taxation Finance costs (1,132) (4,718) (5,850) (10) (260) (270) (369) (1,984) (2,353) Movement in the - (14,832) (14,832) - - - - (1,989) (1,989)fair value of derivatives Exchange movements - (1,402) (1,402) - - - - (3,567) (3,567)on borrowings Profit before 9,461 (5,036) 4,425 10,599 74,509 85,108 20,999 117,425 138,424taxation Taxation (2,743) 3,006 263 (3,308) 1,522 (1,786) (6,880) 3,397 (3,483) Profit attributable to equity 6,718 (2,030) 4,688 7,291 76,031 83,322 14,119 120,822 134,941shareholders Earnings per ordinary share Basic 30p (9)p 21p 33p 348p 381p 64p 553p 617p Diluted 30p (9)p 21p 33p 348p 381p 64p 552p 616p
Dividends paid 8,743 - 8,743 7,918 - 7,918 12,290 - 12,290 (‚£000)
An interim dividend in respect of 2008 of 22p per ordinary share, amounting to a total dividend of ‚£4,808,000, is proposed.
This dividend is not reflected in the interim financial statement.
* The total column represents the Income Statement under IFRS.
Statement of recognised income and expenses
for the period ended 30th June, 2008
Six months Six months Year to to to 31st 30th June, 30th June, December, 2008 2007 2007 Unaudited ‚£000 ‚£000 ‚£000
Profit attributable to equity shareholders 4,688 83,322 134,941
Exchange differences on translation of (178) (40) (111)foreign operations Total recognised income and expenses 4,510 83,282
134,830
Reconciliation of movements in equity
for the period ended 30th June, 2008
Six months Six months Year to to to 31st 30th June, 30th June, December, 2008 2007 2007Unaudited ‚£000 ‚£000 ‚£000 Opening total equity 451,265 328,521 328,521 Total recognised income and expenses 4,510 83,282 134,830 Return of cash - (66) (67) Share-based payments 1,263 - 271 Dividends (8,743) (7,918) (12,290) Closing total equity 448,295 403,819 451,265Group balance sheetat 30th June, 2008 30th June, 30th June, 31st December, 2008 2007 2007 Unaudited Notes ‚£000 ‚£000 ‚£000 ‚£000 ‚£000 ‚£000 Non-current assets Property, plant and 3,962 3,311 4,146equipment Financial investments designated at fair value through profitand loss Investee companies 3 399,663 359,313 323,477 Other financial 3 24,828 19,051 21,407 investments 424,491 378,364 344,884 Deferred tax asset 6,066 4,894 4,894 434,519 386,569 353,924 Current assets Trade and other 32,697 33,782 33,574 receivables Derivative financial 7,312 - 8,374 instruments Cash and cash 183,083 18,482 240,309 equivalents 223,092 52,264 282,257 Current liabilities Trade and other (26,289) (21,548) (49,462) payables Loans and borrowings - (11,523) - Derivative financial (24,049) - (7,731) instruments Current tax (916) (1,943) (1,658) liabilities (51,254) (35,014) (58,851) Net current assets 171,838 17,250 223,406 Total assets less 606,357 403,819 577,330current liabilities Non-current liabilities Loans and borrowings (158,062) - (126,065) Net assets 448,295 403,819 451,265 Equity attributable to equity holders Called up share 5,464 5,464 5,464capital Share premium 1,232 1,232 1,232account Share-based payment 1,534 - 271reserve Translation reserve (308) (59) (130) Capital redemption 499 499 499reserve Capital reserve - 359,085 253,731 326,593realised Capital reserve - 42,961 105,555 77,483unrealised Revenue reserve 37,828 37,397 39,853 Total equity 448,295 403,819 451,265 Net asset value per share Basic 2051p 1848p 2065p Diluted 1996p 1848p 2048pGroup cash flow statementfor the period ended 30th June, 2008 Six months to Six months to Year to 31st 30th June, 2007 30th June, 2007 December, 2007 Unaudited ‚£000 ‚£000 ‚£000 ‚£000 ‚£000 ‚£000 Cash flow from operating activities
Cash flow from operations (16,897) (627) 33,068 Interest paid (4,765) (295) (637) Tax paid (1,651) (3,962) (5,944) Net cash from operating (23,313) (4,884) 26,487activities Cash flows from investing activities Purchase of property, (267) (1,841) (3,146) plant and equipment
Purchase of financial (103,485) (55,334) (90,485)
investments Sale of property, plant - - 92 and equipment Sale of financial 31,684 52,852 162,415 investments Net cash(outflow)/inflow (72,068) (4,323) 68,876from investing activities Cash flows from financing activities Equity dividends paid (8,743) (7,918) (12,315) Return of cash - (5,064) (5,064) Loans repayments - (22,212) (33,735) Advances of loans 32,958 - 119,870 Net cash from financing 24,215 (35,194) 68,756activities (Decrease)/increase in (71,166) (44,401) 164,119cash and cash equivalents Opening cash and cash 240,309 63,437 63,437equivalents Effect of exchange rates 13,940 (554) 12,753and revaluation on cash and cash equivalents Closing cash and cash 183,083 18,482 240,309equivalents
Notes to the financial statements
Note 1 - General information
The information for the year ended 31st December, 2007 does not constitutestatutory accounts as defined in Section 240 of the United Kingdom CompaniesAct 1985. Comparative figures for 31st December, 2007 are taken from the fullaccounts, which have been delivered to the Registrar of Companies and containan unqualified audit report and did not contain a statement under Section 237(2) or Section 237(3) of the Companies Act 1985.
Note 2 - Basis of accounting
The Group financial statements are prepared under International FinancialReporting Standards (IFRS) as adopted by the European Union. This statement hasbeen prepared using accounting policies and presentation consistent with thoseapplied in the preparation of the accounts for the Group for the year ended31st December, 2007, and in accordance with International Accounting Standard34, `Interim Financial Reporting'.Note 3 - Financial investments designated at fair value through profit and loss Six months to Six months to Year to 30th June, 30th June, 31st December, 2008 2007 2007 ‚£000 ‚£000 ‚£000 Opening valuation 344,884 295,263 295,263 Additions at cost 103,485 55,334 90,485 Disposals (29,588) (42,606) (96,468) Appreciation 5,710 70,373 55,604 Closing valuation 424,491 378,364 344,884
`Other financial investments' comprise the Company's valuation of its investment as a Special Limited Partner in managed funds.
Note 4 - Related party transactions
The Company's interest in the Candover 1997, 2001 and 2005 Funds is disclosed in note 10 on page 54 of the 2007 Annual Report and Accounts.
As at 30th June, 2008, Candover's investments as a Special Limited Partner inthe 2001 and 2005 Funds were valued at ‚£24,452,000 and ‚£248,000 respectively(31st December, 2007: 2001 Fund ‚£21,005,000 and 2005 Fund ‚£202,000). Candover'sinvestment in the unauthorised unit trust, which is a Special Limited Partnerin the 1997 Fund, was valued at ‚£128,000 (31st December, 2007: ‚£200,000).The directors have authorised commitments of ¢â€š¬500.0 million and ¢â€š¬300.0 million,which will be invested pro rata and in parallel with the Candover 2005 Fund andCandover 2001 Fund respectively. At 30th June, 2008, the outstanding commitmentto the Candover 2005 Fund was ¢â€š¬128.7 million (31st December, 2007: ¢â€š¬236.7million), and the outstanding commitment to the Candover 2001 Fund was ¢â€š¬4.4million (31st December, 2007: ¢â€š¬10.5 million). At 30th June, 2008, theoutstanding commitments to other investment funds were ¢â€š¬5.1 million (31stDecember, 2007: ¢â€š¬6.0 million).The Company's subsidiaries are listed in note 11 on page 55 of the 2007 AnnualReport, which includes a description of the nature of their business. The tablebelow lists those subsidiaries set up during the half year. Nature of Country of Issued share business Incorporation capital Candover Asia Limited Identifying investment Hong Kong HK$1 opportunities in Asia Candover Eastern Identifying investment England & ‚£1European Partners opportunities in Eastern Wales Limited Europe Candover 2008 GP General Partner of the Guernsey ‚£10,000Limited Candover 2008 Fund During the period, the Company undertook transactions with Candover ServicesLimited which provided investment and administration services to the Company,for which the Company was charged ‚£6,667,000 (2007: ‚£6,667,000).
Note 5 - Post balance sheet events
Since the period end, Candover committed ¢â€š¬1.0 billion to the 2008 Fund.Candover also invested ‚£20.1 million in Technogym and completed the delistingof Expro International. Candover's eventual investment in Expro Internationalwill be increased, but that amount will depend on the level of syndication.
Further informationInformation for shareholdersShare price
The Company's shares are listed on the London Stock Exchange under share code "CDI". The share price is quoted daily in the Financial Times, The Daily Telegraph, The Times, The Independent and the Evening Standard and is also available on our website at http://www.candoverinvestments.com/ and http:// www.candoverinvestments.com/investor-info/price-graph
ISA status
The Board has considered the ISA status of Candover's shares and for the time being considers that a decision to make Candover's shares eligible for inclusion in an ISA will impose constraints on the Company's investment criteria that will not be in the overall interests of shareholders.
Website
For the latest information about Candover Investments plc visit our website:
Home page - http://www.candoverinvestments.com
Latest plc news - http://www.candoverinvestments.com/media/latest-plc-news
Dividend History - http://www.candoverinvestments.com/financial-performance/ dividend-his
Registrars
Enquiries concerning registered shareholdings, including changes of address,should be referred to:Capita RegistrarsNorthern HouseWoodsome ParkFenay BridgeHuddersfieldWest Yorkshire HD8 0LATelephone +44 (0)871 664 0300*Facsimile +44 (0)1484 600911email [email protected]
* Calls cost 10p per minute plus network extras
Board of directorsG E Grimstone *¢â‚¬ Non-executive ChairmanA P Hichens MBA ‚§*¢â‚¬ Non-executive, nominations committee chairmanSenior Independent DirectorLord Jay of Ewelme GCMG ‚§*¢â‚¬ Non-executive N M H Jones FCA ‚§* Non-executive C Russell FSIP FCA ‚§*Non-executive, audit committee chairmanR A Stone FCA ‚§*¢â‚¬ Non-executive, remuneration committee chairman
* Member of the remuneration committee
⤠Member of the audit committee
¢â‚¬ Member of the nominations committee
vendorRelated Shares:
CDI.L