Interim Results

Third Point Offshore Investors Ltd - Interim Results

PR Newswire

London, August 29

Third Point Offshore Investors Limited (the "Company")(a closed-ended investment company incorporated with limited liability under the laws of Guernsey with registered number 47161)LEI Number: 549300WXTCG65AQ7V644 Renewal Date- 05/10/2019

28 August 2019

HALF-YEAR Results for the SIX months ended 30 june 2019

Third Point Offshore Investors Limited (“TPOIL” or the “Company”), the closed-end, London listed event-driven, value-oriented hedge fund managed by Daniel S. Loeb’s Third Point LLC (the “Investment Manager”) announces its half year results for the six months ended 30 June 2019.

Financial Highlights (as at 30 June 2019 unless otherwise stated)

Portfolio Performance of the Master Fund

Outlook

Steve Bates, Chairman of Third Point Offshore Investors Limited, commented: “I am pleased to see the positive initiatives enacted by the Investment Manager at the start of the year bear fruit with double-digit NAV per share growth in the first half of 2019, much of which has come from activist investments, a strategy in which it specializes.

“The Board and the Investment Manager recognise that the Company’s persistent discount to NAV remains too high. Further to the initiatives implemented last year, the Board is committed to exploring and enacting other measures, such as increased communication to existing and prospective investors, in an effort to substantially narrow the Company’s discount.”

[1] Net of share buyback purchases and cancellations.

Enquiries:

Notes to Editors

TPOIL is a feeder fund that invests in Third Point Offshore Fund Ltd. (the “Master Fund”), with the investment objective of achieving uncorrelated, long-term, attractive risk-adjusted returns. The Company has one share class (LSE: TPOU).

Chairman’s Statement

Dear Shareholder,

I am pleased to present the Twelfth Unaudited Semi-Annual Financials for Third Point Offshore Investors (“the Company”).

The Company was established as a closed-end investment company, registered and incorporated in Guernsey on 19 July 2007. The Company invests its assets in Third Point Offshore Master Fund L.P. (the “Master Partnership”) via Third Point Offshore Fund, Ltd. (the “Master Fund”), which pursues an opportunistic investment approach based on event-driven fundamental value analysis.

The first half of our financial year represented a sharp recovery from the difficult conditions experienced towards the end of 2018. For the half year, the Net Asset Value (NAV) rose by 15.1% with net exposure to equity markets averaging around 40%, meaning significantly less value at risk in a volatile period marked by slowing global growth. The portfolio was invested in equities, both long and short as well as credit markets. Although, given the dynamism of the portfolio and the low net exposure to equities, I do not believe benchmark comparisons to be particularly informative for investors in the Company, it is worth noting the MSCI World Index was up +17.4% for the same period. The stated return (of 15.1%) differs from the 13% return achieved by the Master Fund because of the accretive effect of the share cancellation described below.

The manager, under the leadership of Daniel Loeb, responded to the market conditions which characterized the end of 2018 by reducing some market, sector, and factor exposure in key equity holdings. The objective of this approach was to isolate fundamental, idiosyncratic returns and hedge out any unwanted risks. This had the effect of further reducing the beta (or market exposure) of the portfolio to equity markets from that which had been the traditional range for the manager in recent history.

The manager also invested in additional resources to seek anomalies which arise as a result of changes in the way markets operate. This initiative has involved a greater focus on data science combined with more investment in strategic thinking. For example, the increase in passive investing through ETF’s and the like have allowed specialist managers like Third Point to identify ‘herding’ behaviour and to focus on areas which passive products are not designed to exploit.

Much of the alpha generated over the year has come from activist (or perhaps more accurately, constructivist) positions. A significant new ‘constructivist’ position in Japanese company, Sony, was added during the period, and a letter with proposals to reorganize the company was published. More details of portfolio performance drivers can be found in the manager’s report, which follows.

During the past year, the Board has implemented a series of changes with the goal of reducing the stubborn discount to NAV at which the shares trade. These include:

Despite these actions, which were designed to bolster governance and take into account the concerns of shareholders, the discount has remained stubbornly wide. While it is impossible to know why a discount persists at a particular level, there are further measures we can take. Principally, these are focused on better communication of the message about the Company to existing and prospective investors. To some extent, the Company’s investment thesis is hard to explain to a generalist, but the Manager has committed to provide more information about what the Company is doing, more frequently and to a broader investment audience. For additional information, please visit the Company’s website: www.thirdpointoffshore.com. In time, your Board hopes that these efforts will bear fruit in attracting new shareholders who will rebalance the shareholder register and bring the discount down.

If this combination of efforts does not achieve the objective of narrowing the discount substantially, the Board will consider further initiatives. We do need, however, to balance the interests of all shareholders and maintaining the scale of the Company and its liquidity is very important for many of them. These matters are kept under constant review, as you would expect.

Keith Dorrian retired from the Board after the AGM in July, and I would like to record our gratitude to him for his sterling service over the years. In total, three new directors have joined in 2019 - Rupert Dorey, Huw Evans and myself. Rupert has wide experience in the closed end fund world and has extensive experience in debt capital markets. Huw is a Chartered Accountant and has advised a wide range of companies in financial services and other sectors on mergers and acquisitions and more general corporate strategy. He has been identified as a replacement for Chris Legge who has indicated that he does not intend to stand for re- election at the AGM in 2020. I was appointed to take over from Claire Whittet as Chairman of the Company, a role which I am now endeavouring to fill.

Looking ahead, the monetary background has become substantially more supportive of risk assets than was the case at the end of 2018. Nevertheless, this easier money environment reflects an ambivalent performance by the global economy in recent months and a heightening of geopolitical tension to do with trade disputes and the deteriorating situation with Iran. Despite the robust performance of equity markets this year, the Manager remains concerned that high returns will be tempered by greater volatility than seen recently. Although predictions of the end of the economic cycle look a little premature, the economy has been expanding since 2009 and there are some signs of strain, particularly in labour markets. The Manager has great flexibility in how the Master Fund is invested and remains focused on adding value to a number of key investments through the application of a constructive approach.

My fellow Directors and I are honoured to serve our shareholders.

Steve Bates

August 28, 2019

Directors’ Report

The Directors submit their Report, together with the Company’s Statements of Assets and Liabilities, Statements of Operations, Statements of Changes in Net Assets, Statements of Cash Flows and the related notes for the period ended 30 June 2019, (together the “Unaudited Condensed Interim Financial Statements”). These Unaudited Condensed Interim Financial Statements have been properly prepared, in accordance with accounting principles generally accepted in the United States of America, any relevant enactment for the time being in force, and are in agreement with the accounting records and have been properly prepared in all material aspects.

The Company

The Company was incorporated in Guernsey on 19 June 2007 as an authorised closed-ended investment scheme and was admitted to a secondary listing (Chapter 14) on the Official List of the London Stock Exchange on 23 July 2007. The proceeds from the initial issue of shares on listing amounted to approximately US$523 million. Following changes to the Listing Rules on 6 April 2010, the secondary listing became a standard listing. The Company was admitted to the Premium Official List Segment (“Premium Listing”) of the London Stock Exchange (“LSE”) on 10 September 2018.

The shares of the Company are quoted on the LSE in two currencies. On 28 March 2019, FTSE published an update to the UK Index Series Guide to Calculation Method for the Median Liquidity Test which stated that: “Where a security has a market quote in multiple currencies, only volume data from the eligible Sterling quote will be used in the liquidity test.” Based on this revised calculation method the Shares have been removed from the UK Index Series.

The Company is a member of the Association of Investment Companies (“AIC”).

Investment Objective and Policy

The Company’s investment objective is to provide its Shareholders with consistent long term capital appreciation utilising the investment skills of Third Point LLC (the “Investment Manager”) through investment of all of its capital (net of short term working capital requirements) in Class E and N Shares of Third Point Offshore Fund, Ltd (the “Master Fund”), an exempted company formed under the laws of the Cayman Islands on 21 October 1996.

The Master Fund is a limited partner of Third Point Offshore Master Fund L.P. (the “Master Partnership”), an exempted limited partnership organised under the laws of the Cayman Islands, of which Third Point Advisors II L.L.C., an affiliate of the Investment Manager, is the general partner. Third Point LLC is the Investment Manager to the Company, the Master Fund and the Master Partnership. The Master Fund and the Master Partnership have the same investment objectives, investment strategies and investment restrictions.

The Master Fund and Master Partnership’s investment objective is to seek to generate consistent long-term capital appreciation, by investing capital in securities and other instruments in select asset classes, sectors, and geographies, by taking long and short positions. The Investment Manager’s implementation of the Master Fund and Master Partnership’s investment policy is the main driver of the Company’s performance.

The Investment Manager identifies opportunities by combining a fundamental approach to single security analysis with a reasoned view on global, political and economic events that shapes portfolio construction and drives risk management.

The Investment Manager seeks market and economic dislocations and supplements its analysis with considerations of managing overall exposures across specific asset classes, sectors, and geographies by evaluating sizing, concentration, factor risk, and beta, among other considerations. The resulting portfolio expresses the Investment Manager’s best ideas for generating alpha and its tolerance for risk given global market conditions. The Investment Manager is opportunistic and often seeks a catalyst that will unlock value or alter the lens through which the greater market values a particular investment. The Investment Manager applies aspects of this framework to its decision-making process, and this approach informs the timing and risk of each investment.

As of 1 January 2019, the Company transferred substantially all of its holding into a newly-created share class of the Master Fund. The new share class is subject to a 25% quarterly redemption gate. The Company plans to redeem an appropriate amount each quarter to account for planned share buybacks and Company fees and expenses.

The new share class attracts a lower management fee and the Company now also qualifies for an additional reduction in management fee applicable to it based on its size and longevity as an investor in the Master Fund. As a result, the Company’s management fee in the newly created share class has been reduced from 2.0% to 1.25% per annum since 1 January 2019. Any Ordinary Shares traded mid-month will be purchased and held by the Master Partnership until the Company is able to cancel the shares following each month-end. Shares cannot be cancelled intra-month because of legal and logistical factors. The Company and the Master Partnership do not intend to hold any shares longer than the minimum required to comply with these factors, expected to be no more than one month.

Results and Dividends

The results for the period are set out in the Statements of Operations. As disclosed in the announcement dated 1 March 2018, the Board, after consultation with major shareholders, resolved that the Dividend Policy should be discontinued with immediate effect.

On 5 December 2018, the Board announced the implementation of a share buyback programme, with share purchases being made through the market at prices below the then prevailing NAV per share.

Key performance indicators (“KPI’s”)

At each Board meeting, the Board considers a number of performance measures to assess the Company’s success in achieving its objectives. Below are the main KPI’s which have been identified by the Board for determining the progress of the Company:

Directors

The Directors of the Company during the period and to the date of this report are as listed on this Interim Report.

Directors’ Interests

Mr. Targoff holds the position of Chief Operating Officer, Partner and General Counsel of Third Point LLC.

Pursuant to an instrument of indemnity entered into between the Company and each Director, the Company has undertaken, subject to certain limitations, to indemnify each Director out of the assets and profits of the Company against all costs, charges, losses, damages, expenses and liabilities arising out of any claims made against them in connection with the performance of their duties as a Director of the Company.

Steve Bates held 2,923 shares as at 30 June 2019.

Christopher Legge and Keith Dorrian held 6,500 and 4,500 shares respectively as at 30 June 2019 (31 December 2018: Christopher Legge and Keith Dorrian held 4,500 and 2,500 U.S. Dollar shares respectively).

Rupert & Rosemary Dorey held 12,000 shares between them as at 30 June 2019.

Claire Whittet and her husband Martin Whittet, held 2,500 shares as at 30 June 2019 through their joint Retirement Annuity Trust Scheme (RATS).

Corporate Governance Policy

The Board has considered the principles and recommendations of the Association of Investment Companies Code of Corporate Governance (“AIC Code”). The AIC Code addresses all the principles set out in the UK Corporate Governance Code (the “UK Code”), as well as setting out additional principles and recommendations on issues that are of specific relevance.

The Board has determined that reporting against the principles and recommendations of the AIC Code will provide appropriate information to Shareholders. The Company has complied with all the recommendations of the AIC Code and the relevant provisions of the UK Code, except as set out below.

The UK Code includes provisions relating to:

The Board considers these provisions are not relevant to the position of the Company, being an externally advised investment company with no executive directors or employees. The Company has therefore not reported further in respect of these provisions.

The AIC Code provides a “comply or explain” code of corporate governance designed especially for the needs of investment companies. The AIC published the code of corporate governance and the Company has reviewed its compliance with these standards. The UK Financial Reporting Council (“FRC”) has confirmed that so far as investment companies are concerned it considers that companies which comply with the AIC Code will be treated as meeting their obligations under the UK Code and Section 9.8.6 of the Listing Rules. The AIC Code is publicly available at: https://www.theaic.co.uk/sites/default/files/documents/ AIC2019AICCodeofCorporateGovernanceFeb19.pdf. In July 2018, the FRC released a revised Corporate Governance Code which became effective for accounting periods beginning on or after 1 January 2019. The AIC also updated its Code on 5 February 2019, to reflect the revised principle and provisions in the 2018 UK Corporate governance Code. The 2019 AIC Code also came into effect for accounting periods beginning on or after 1 January 2019. The Board are reporting under the 2019 AIC Code for the current period.

The Company does not have employees, hence no whistle-blowing policy is necessary. However, the Directors have satisfied themselves that the Company’s service providers have appropriate whistle- blowing policies and procedures and confirmation has been sought from the service providers that nothing has arisen under those policies and procedures which should be brought to the attention of the Board. The UK Code is publicly available at: https://www.frc.org.uk/getattachment/88bd8c45-50ea- 4841-95b0-d2f4f48069a2/2018-UK-Corporate-Governance-Code-FINAL.pdf. The Board on an annual basis, ensures that service providers have appropriate whistleblowing, AML, disaster recovery and risk monitoring policies in place.

The AIC Code requires the Company to appoint Nomination, Remuneration and Management Engagement Committees. The independent directors of the Board will act as these committees and the first meetings will be held in August 2019. The Nomination and Remuneration Committee considers the composition of and recruitment to the Board, and will consider market practice, peer group statistics and the requirements of the role when determining remuneration levels of the Directors. The Management Engagement Committee will review the performance of the Company’s service providers.

The Code of Corporate Governance (the “Guernsey Code”) provides a framework that applies to all entities licensed by the Guernsey Financial Services Commission (“GFSC”) or which are registered or authorised as a collective investment scheme. Companies reporting against the UK Code or the AIC Code are deemed to comply with the Guernsey Code. It is the Company’s policy to comply with the AIC Code.

The Board confirms that, throughout the period covered in the Unaudited Condensed Interim Financial Statements, the Company complied with the Guernsey Code issued by the GFSC, to the extent it was applicable based upon its legal and operating structure and its nature, scale and complexity.

Board Structure

The Board currently consists of six non-executive Directors. As the Chairman of the Board is an independent non-executive, the Board considers it unnecessary to appoint a senior independent Director.

1 Mr. Dorrian retired at the AGM on 3 July 2019.

2 Mr. Evans was appointed as a Director on 21 August 2019.

Mr. J Targoff, the Chief Operating Officer, General Counsel and Partner of the Investment Manager, is not considered independent. All other Directors are considered by the Board to be independent of the Company’s Investment Manager.

As required by the AIC Code, every Director should be subject to annual re-election by the Shareholders. Any Directors appointed to the Board since the previous AGM also retire and stand for re-election. The Independent Directors take the lead in any discussions relating to the appointment or re-appointment of directors.

The Board meets at least four times a year and in addition there is regular contact between the Board, the Investment Manager and Northern Trust International Fund Administration Services (Guernsey) Limited (the “Administrator” and “Corporate Secretary”). The Board requires to be supplied in a timely manner with information by the Investment Manager, the Administrator, and the Corporate Secretary and other advisors in a form and of a quality appropriate to enable it to discharge its duties. The Board, excluding Mr. Targoff, regularly reviews the performance of the Investment Manager and the Master Fund to ensure that performance is satisfactory and in accordance with the terms and conditions of the relative appointments and Prospectus. It carries this review out through consideration of a number of objective and subjective criteria and through a review of the terms and conditions of the advisors’ appointment with the aim of evaluating performance, identifying any weaknesses and ensuring value for money for the Company’s Shareholders.

New Directors will receive an induction from the Investment Manager on joining the Board, and all Directors undertake relevant training as necessary.

The Company has no executive Directors or employees. All matters, including strategy, investment and dividend policies, gearing and corporate governance procedures are reserved for approval by the Board of Directors. The Board receives full information on the Company’s investment performance, assets, liabilities and other relevant information in advance of Board meetings.

Board Tenure and Succession Planning

The Board notes the AIC Code and UK Code requirement for all Directors be subject to annual re-election. In accordance with the Company’s articles of incorporation, the Independent Directors and Mr. Targoff (treated for the purposes of the AIC Code as a Non-Independent Director) shall retire and offer themselves for re-election at each AGM.

The Board believes that benefits to Shareholders arise from the Directors’ long-term knowledge and experience of the Company and its management including their ongoing ability to independently review the performance of the Investment Manager.

The Directors undertake an annual evaluation of the Board’s performance and continuing independence and during this evaluation (which includes a review of the diversity of experience within the Board to ensure that it remains appropriate) all Directors are asked to confirm their future intentions. The Board has robust procedures for the identification of prospective Non-Executive Director candidates, and as part of the selection process, due regard is paid to the recommendations for board diversity. However, ability and experience will be the prime considerations.

Steve Bates was appointed Chairman of the Board on 5 February 2019. In addition, in view of Keith Dorrian’s decision not to stand for re-election at the 2019 AGM, the Board interviewed a number of candidates which culminated in Rupert Dorey joining the Board on 5 February 2019.

Chris Legge has indicated that he does not intend to stand for re-election at the AGM in 2020 and the Board has identified Huw Evans as a suitable replacement. Mr. Evans was appointed as a Director on 21 August 2019.

Directors’ Biographies

Steve Bates

Mr. Bates has over 38 years’ experience in the investment industry. He began his career in 1980 with James Capel & Co. as an analyst covering US markets. From 1984 to 2003, he worked for JP Morgan and its predecessor Flemings where he was responsible for establishing and managing a range of Emerging Markets businesses and investment activities across regions. Since then, Mr. Bates has been Chief Investment Officer for GuardCap Asset Management Limited and its predecessor company. He is currently Chairman of both VinaCapital Vietnam Opportunities Fund and of BMO Capital & Income Investment Trust and is a Non- Executive Director of Biotech Growth Trust plc, all of which are listed on the London Stock Exchange. Mr. Bates holds a law degree from Cambridge University and is a CFA charterholder.

Rupert Dorey

Mr Dorey has 35 years of experience in financial markets. Mr Dorey was at CSFB for 17 years from 1988 to 2005 where he specialised in credit related products, including derivative instruments where his expertise was principally in the areas of debt distribution, origination and trading, covering all types of debt from investment grade to high yield and distressed debt. He held a number of positions at CSFB, including establishing CSFB’s high yield debt distribution business in Europe, fixed income credit product coordinator for European offices and head of UK Credit and Rates Sales. Since 2005 he has been acting in a Non-Executive Directorship capacity for a number of Hedge Funds, Private Equity & Infrastructure Funds, for both listed and unlisted vehicles. He is former President of the Guernsey Chamber of Commerce and is a member of the Institute of Directors. Rupert has extensive experience as both Director and Chairman of exchange listed and unlisted funds, chairing 9 of the funds, seven of which have been listed and 2 of which are FTSE 250 companies. He has served on boards with 18 different managers, including Apollo, Aviva, M&G, Partners Group, Cinven, Neuberger Berman and Harbourvest.

Huw Evans

Huw Evans is Guernsey resident and qualified as a Chartered Accountant with KPMG (then Peat Marwick Mitchell) in 1983. He subsequently worked for three years in the Corporate Finance department of Schroders before joining Phoenix Securities Limited in 1986. Over the next twelve years he advised a wide range of companies in financial services and other sectors on mergers and acquisitions and more general corporate strategy. Since moving to Guernsey in 2005, he has acted as a professional non-executive Director of a number of Guernsey-based companies and funds. He holds an MA in Biochemistry from Cambridge University.

Christopher Legge

Christopher Legge, is a Guernsey resident and worked for Ernst & Young in Guernsey from 1983 to 2003. Having joined the firm as an audit manager in 1983, he was appointed a partner in 1986 and managing partner in 1998. From 1990 to 1998, he was head of Audit and Accountancy and was responsible for the audits of a number of insurance, banking, investment fund and financial services clients. He also had responsibility for the firm’s training, quality control and compliance functions. He was appointed managing partner of Ernst & Young for the Channel Islands region in 2000. Since his retirement from Ernst & Young in 2003, Mr. Legge has held a number of non-executive directorships in the financial sector. He is an FCA and holds a BA (Hons) in Economics from the University of Manchester.

Joshua L. Targoff

Joshua L. Targoff has been the Chief Operating Officer of the Investment Manager since May 2009. He joined as General Counsel in May 2008. Previously, Mr. Targoff was the General Counsel of the Investment Banking Division of Jefferies & Co. Mr. Targoff spent seven years doing M & A transactional work at Debevoise & Plimpton LLP. Mr. Targoff graduated with a J.D. from Yale Law School, and holds a B.A. from Brown University. In 2012, Mr. Targoff was made a Partner of the Investment Manager.

Claire Whittet

Claire Whittet is a Chartered Banker. She is a Guernsey resident and has 40 years’ experience in the banking industry. After gaining an MA in Geography from Edinburgh University, she joined the Bank of Scotland where she remained until moving to Guernsey in 1996. In the intervening period she was involved in a wide variety of credit transactions including commercial and corporate finance. She joined Bank of Bermuda in Guernsey becoming Global Head of Private Client Credit and moved to Rothschild & Co Bank International Ltd as Director of Lending in 2003. She was latterly Co-Head and Managing Director and since May 2016 has been a Non-Executive Director of the bank. She is a Non-Executive Director of a number of listed and unlisted funds, is a Member of the Chartered Institute of Bankers in Scotland, the Insurance Institute and holds the Institute of Directors Diploma in Company Direction.

Cross Directorships

Mr. Legge and Mrs. Whittet are also both Directors of another listed Fund (TwentyFour Select Monthly Income Fund Limited). Mr. Bates and Mr. Evans are also both Directors of another listed Fund (VinaCapital Vietnam Opportunity Fund Limited). The Board believes that this does not create a conflict or affect their independence.

A number of the directors are Non-Executive Directors of other listed funds. The Board notes that none of these funds are trading companies and confirms that all Non-Executive Directors of the Company have sufficient time and commitment (as evidenced by their attendance and participation at meetings) to devote to this Company.

Meeting Attendance Records

The table below lists Directors’ attendance at meetings during the period.

1 Mr. Bates and Mr. Dorey were appointed 5 February 2019.

2 Mr. Dorrian did not stand for re-election at AGM on 3 July 2019.

3 Mr. Targoff is not a member of the Audit Committee.

4 Mr. Targoff does not attend Meetings as a Director where recommendations from the Investment Manager are under consideration.

Committees of the Board

The AIC Code requires the Company to appoint Nomination, Remuneration and Management Engagement Committees. The independent directors of the Board will act as these committees and the first meetings will be held in August 2019. The Nomination and Remuneration Committee considers the composition of and recruitment to the Board, and will consider market practice, peer group statistics and the requirements of the role when determining remuneration levels of the Directors. The function of the Management Engagement Committee is to ensure that the Company’s management agreement is competitive and reasonable for the Shareholders, along with the Company’s agreements with all other third party service providers (other than the external auditors).

Following the “Women on Boards” review conducted by Lord Davies of Abersoch in February 2011, the Board has examined Lord Davies recommendations and noted that it is consistently reviewing its policy and future appointments to the Board will continue to be based on the individual’s skills and experience regardless of gender.

The Committee also reviews annually the performance of the Investment Manager with a view to determining whether to recommend to the Board that the Investment Manager’s mandate be renewed, subject to the specific notice period requirement of the agreement. The other third party service providers are also reviewed on an annual basis.

The Investment Manager has wide experience in managing and administering fund vehicles and has access to extensive investment management resources. The Board considers that the continued appointment of the Investment Manager on the terms agreed would be in the interests of the Company’s Shareholders as a whole.

Audit Committee

The Company’s Audit Committee conducts formal meetings at least three times a year for the purpose, amongst others, of considering the appointment, independence, effectiveness of the audit and remuneration of the auditors and to review and recommend the annual statutory accounts, Interim Report and Unaudited Condensed Interim Financial Statements to the Board of Directors.

Directors’ Duties and Responsibilities

The Directors have adopted a set of Reserved Powers, which establish the key purpose of the Board and detail its major duties. These duties cover the following areas of responsibility:

These Reserved Powers of the Board have been adopted by the Directors to clearly demonstrate the seriousness with which the Board takes its fiduciary responsibilities and as an ongoing means of measuring and monitoring the effectiveness of its actions.

The Directors are responsible for the overall management and direction of the affairs of the Company. The Company has no Executive Directors or employees. The Company invests all of its assets in shares of the Master Fund and Third Point LLC acts as Investment Manager to the Master Fund and is responsible for the discretionary investment management of the Master Fund’s investment portfolio under the terms of the Master Fund Prospectus.

Northern Trust International Fund Administration Services (Guernsey) Limited (“NT”) acts as Administrator and Company Secretary and is responsible to the Board under the terms of the Administration Agreement. The Administrator is also responsible to the Board for ensuring compliance with the Rules and Regulations of The Companies (Guernsey) Law, London Stock Exchange listing requirements and observation of the Reserved Powers of the Board and in this respect the Board receives detailed quarterly reports.

The Directors have access to the advice and services of the Company Secretary who is responsible to the Board for ensuring that Board procedures are followed and that it complies with applicable rules and regulations of The Companies (Guernsey) Law, the GFSC and the London Stock Exchange. Individual Directors may, at the expense of the Company, seek independent professional advice on any matter that concerns them in the furtherance of their duties. The Company maintains appropriate Directors’ and Officers’ liability insurance in respect of legal action against its Directors on an ongoing basis and the Company has maintained appropriate Directors’ Liability Insurance cover throughout the period.

The Board is also responsible for safeguarding the assets of the Company and for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Internal Control and Financial Reporting

The Directors acknowledge that they are responsible for establishing and maintaining the Company’s system of internal control and reviewing its effectiveness. Internal control systems are designed to manage rather than eliminate the failure to achieve business objectives and can only provide reasonable but not absolute assurance against material misstatements or loss.

The Directors review all controls including operations, compliance and risk management. The key procedures which have been established to provide internal control are:

Board Performance

The Board and Audit Committee undertake a formal annual evaluation of their own performance and that of their committees and individual Directors. In order to review their effectiveness, the Board and Audit Committee carry out a process of formal self-appraisal. The Directors and Committee consider how the Board and Audit Committee functions as a whole and also review the individual performance of its members. This process is conducted by the respective Chairman reviewing individually with each of the Directors and members of the Committee their performance, contribution and commitment to the Company. The performance of the Chairman is evaluated by the other independent Directors. The performance of the Management Engagement Committee will also be evaluated annually going forward. It is intended to consider having an independent review carried out in 2020.

Management of Principal Risks and Uncertainties

As noted in the Statement of Directors’ Responsibilities in respect of the Unaudited Condensed Interim Financial Statements, the Directors are required to provide a description of the principal risks and uncertainties facing the Company. The Directors have considered the risks and uncertainties facing the Company and have prepared and review regularly a risk matrix which documents the significant risks faced by the Company.

This process has been in place for the period under review and up to the date of approval of the Unaudited Condensed Interim Financial Statements and is reviewed by the Board and is in accordance with the Guidance on Risk Management, Internal Control and Related Financial and Business Reporting.

This document considers the following information:

The Directors have acknowledged they are responsible for establishing and maintaining the Company’s system of internal control and reviewing its effectiveness by focusing on four key areas:

Further discussion on Internal Control is documented in the Directors’ Report under “Internal Control and Financial Reporting”.

The main risks and uncertainties that the Directors consider to apply to the Company are as follows:

Going Concern

During the first six months of 2019, the Directors have carried out a robust assessment of the principal risks facing the Company, including those that would threaten its business model, future performance, solvency or liquidity. The Directors believe that the Company is well placed to manage its business risks successfully, having taken into account the current economic outlook.

The Directors, having considered the above risks and reviewed ongoing budgeted expenses, have a reasonable expectation that the Company will be able to continue in operation and meet its liabilities as they fall due.

After making enquiries and given the nature of the Company and its investment, the Directors are satisfied that it is appropriate to continue to adopt the going concern basis in preparing these Unaudited Condensed Interim Financial Statements. The Master Fund Shares are liquid and can be converted to cash to meet liabilities as they fall due. These shares are subject to a 25% quarterly redemption gate. The Board considers this to be sufficient for normal requirements. After due consideration, the Directors consider that the Company is able to continue for the foreseeable future.

Significant Events During The Period

The FRC and AIC have revised their corporate governance codes, which became effective 1 January 2019. The Company is reporting under these revised codes.

As of 1 January 2019, the Company transferred substantially all of its holding into a newly-created share class of the Master Fund. The new share class is subject to a 25% quarterly redemption gate. The Company plans to redeem an appropriate amount each quarter to account for planned share buybacks and Company fees and expenses. The new share class attracts a lower management fee and the Company also qualifies for an additional reduction in management fee applicable to it based on its size and longevity as an investor in the Master Fund. As a result, the Company’s management fee has been reduced from 2.0% to 1.25% per annum commencing on 1 January 2019.

For the period 1 January 2019 to 30 June 2019, 3,108,828 shares have been repurchased and cancelled at an average cost per share of $14.64.

Steve Bates was appointed as Chairman on 5 February 2019.

Rupert Dorey was appointed as a Director on 5 February 2019.

On 11 February 2019, Christopher Legge purchased 2,000 shares in Third Point Offshore Investors Limited taking his total holding to 6,500 shares.

On 13 February 2019, Rosemary Dorey (spouse of Rupert Dorey, non-executive director of the Company) purchased 5,151 shares in Third Point Offshore Investors Limited taking their combined total holding to 12,000 shares.

On 4 March 2019, Claire Whittet in conjunction with her husband Martin Whittet, beneficially purchased 2,500 shares in Third Point Offshore Investors Limited through their joint Retirement Annuity Trust Scheme (RATS).

The shares of the Company are quoted on the LSE in two currencies. On 28 March 2019, FTSE published an update to the UK Index Series Guide to Calculation Method for the Median Liquidity Test which stated that: “Where a security has a market quote in multiple currencies, only volume data from the eligible Sterling quote will be used in the liquidity test.” Based on this revised calculation method the Shares have been removed from the UK Index Series.

On 30 April 2019, the Board announced the appointment of Numis Securities Limited as a replacement for Jefferies International Limited as Corporate Broker to the Company.

There were no other events during the period which, in the opinion of the Directors, may have an impact on the Unaudited Condensed Interim Financial Statements for the period ended 30 June 2019.

Significant Events After Period-End

On 3 July 2019, the Board of Directors announced the cancellation of all remaining 3,379,753 Shares currently held by the Master Fund for the benefit of the Company. The cancellation is in accordance with the Repurchase Policy announced on 2 May 2018.

Huw Evans was appointed as a Director on 21 August 2019.

There were no other events subsequent to the period-end which, in the opinion of the Directors, may have an impact on the Unaudited Condensed Interim Financial Statements for the period ended 30 June 2019.

Relations with Shareholders

The Board welcomes Shareholders’ views and places great importance on communication with its Shareholders. The Board receives regular reports on the views of shareholders and the Chairman and other Directors are available to meet shareholders if required. Shareholders who wish to communicate with the Board should, in the first instance contact the Administrator, whose contact details can be found on the Company’s website. The Annual General Meeting of the Company provides a forum for shareholders to meet and discuss issues with the Directors of the Company. The twelfth Annual General Meeting was held on 3 July 2019 with all proposed resolutions being passed by the Shareholders.

International Tax Reporting

For the purposes of the US Foreign Account Tax Compliance Act, the Company is registered with the US Internal Revenue Services (“IRS”) as a Guernsey reporting Foreign Financial Institution (“FFI”), received a Global Intermediary Identification Number and can be found on the IRS FFI list.

The Common Reporting Standard (“CRS”) is a global standard for the automatic exchange of financial account information developed by the Organisation for Economic Co-operation and Development (“OECD”), which has been adopted by Guernsey and which came into effect on 1 January 2016.

The Board has taken the necessary action to ensure that the Company is compliant with Guernsey regulations and guidance in this regard.

Criminal Finances Act 2017

In respect of the UK Criminal Finances Act 2017 which has introduced a new corporate criminal offence (“CCO”) of ‘failing to take reasonable steps to prevent the facilitation of tax evasion’, the Board confirms that it is committed to zero tolerance towards the criminal facilitation of tax evasion.

The Board also keeps under review developments involving other social, environmental and regulatory matters, such as Modern Slavery and the General Data Protection Regulation (“GDPR”), and will report on those to the extent they are considered relevant to the Company’s operations.

Significant Shareholdings

As at 16 August 2019, the Company have been notified that the following had significant shareholdings in excess of 5% in the Company:

The Directors confirm to the best of their knowledge:-

Signed on behalf of the Board by:

Steve Bates

Chairman

Christopher Legge

Director

28 August 2019

Disclosure of Directorships in Public Listed Companies

The following summarises the Directors’ directorships in public companies:

Company Name Exchange

Steve Bates

VinaCapital Vietnam Opportunity Fund Limited London

BMO Capital & Income Investment Trust plc London

Biotech Growth Trust plc London

Rupert Dorey

NB Global Floating Rate Income Fund Limited London

AP Alternative Assets, L.P. Euronext

Huw Evans

Standard Life Investments Property Income Trust Limited London

VinaCapital Vietnam Opportunity Fund Limited London

Christopher Legge

Ashmore Global Opportunities Limited London

NB Distressed Debt Investment Fund Limited London

Sherborne Investors (Guernsey) B Limited London

Sherborne Investors (Guernsey) C Limited London

TwentyFour Select Monthly Income Fund Limited London

Claire Whittet

BH Macro Limited London

Eurocastle Investment Limited Euronext

International Public Partners Limited London

Riverstone Energy Limited London

TwentyFour Select Monthly Income Fund Limited London

Statement of Directors’ Responsibilities in Respect of the Financial Statements

The Directors are responsible for preparing the Unaudited Condensed Interim Financial Statements in accordance with applicable Guernsey Law and accounting principles generally accepted in the United States of America.

The Directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the Company and to enable them to ensure that the Unaudited Condensed Interim Financial Statements comply with The Companies (Guernsey) Law, 2008. They are also responsible for the system of internal controls, safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The Directors have responsibility to confirm that:

Steve Bates

Chairman

Christopher Legge

Director

28 August 2019

Investment Manager’s Review

Strategy Performance

For the six months ended 30 June 2019, the net asset value per share increased by +15.1%, more than twice the appreciation in the corresponding share price.

At the onset of 2019, the Investment Manager reoriented the portfolio with a focus on generating alpha by concentrating on specialized strategies in which the Manager possesses an edge relative to competitors. The Manager aimed to reduce market risk by maintaining lower net exposures and less beta across the portfolio. The portfolio has increased exposure to event-driven investments, including activist names, and grew the concentrated book of single name short positions and sector and market hedges to dampen volatility and market correlation. As a result, net equity exposure levels have averaged at ~40% in 2019, significantly below exposure levels in recent years.

Through June, U.S. equity markets were strong despite weak global growth and low overall earnings growth. The strength seems largely driven by the dovish pivot in U.S. Fed policy from targeting higher neutral rates to focusing on low inflation and trade war concerns to initiate a rate cutting cycle. In Europe, the ECB has initiated efforts this year to stimulate Eurozone growth by maintaining rates at sub-zero levels and renewing a program of cheap bank loans, rather than tightening as previously forecast. In Asia, China has stimulated via credit and fiscal policy and may have room to stimulate further.

Despite lower exposures against a strong market backdrop, the Investment Manager was pleased to generate net returns of +13.0% for the Master Fund for the first six months of the year compared to the MSCI World Index returns of +17.4% for the same period. Shares of the Company outperformed the Master Fund with an increase in NAV of +15.1% for the same period. The Company’s returns were enhanced by a significant amount of repurchase activity throughout the year.

During the first six months of 2019, each investment strategy contributed to positive returns with equities as the primary contributor, driving 80% of profits. As a result of portfolio repositioning at the beginning of 2019 and several new investments in event driven and activist situations, the equity portfolio has the highest proportion of idiosyncratic to other types of risks (such as market, sector, and factor) in the past five years. Gains were largely due to strong performance in core equity long positions, especially those with an activist component.

Within credit, the portfolio saw positive performance across each sub-strategy. The best performing position in corporate credit was also the largest position in the portfolio, a stake in the unsecured debt of a U.S. utility business. In sovereign credit, returns were primarily attributable to a recent investment in the debt of a country in Latin America that the Investment Manager knows well following successful historical investments in the region. Finally, the structured credit portfolio also performed well, largely due to gains in securitizations with U.S. residential mortgages as the underlying assets.

The Investment Manager made several adjustments to the portfolio by adding long core positions, primarily in equities, including a publicly announced constructive investment in Sony. Additional details on the investment can be found at www.AStrongerSony.com. Corporate Governance remains a key area of focus for Third Point and the Firm recently dedicated several team members to the topic. Finally, it was announced that Munib Islam was appointed as Co-CIO of Third Point, a title which largely recognizes a role that Munib has played for some time in working with Daniel Loeb to manage the equity team and investment portfolio while overseeing research activities, talent development, and risk.

As of 30 June 2019, the top five single issuer positions in the portfolio were Baxter International Inc., Sony Corp., Nestlé SA, United Technologies Corp., and Campbell Soup Co., excluding any positions deemed confidential.

Risk Outlook

The Investment Manager remains focused on bottom-up, fundamental investing and will continue to monitor global market dynamics including political events and shifts in economic policy, data, and forecasts. The Investment Manager remains more defensively positioned with lower net exposures when compared to recent historical exposure levels.

The Manager believes current positioning, late in the economic cycle, will allow them to take advantage of market corrections and be poised to shift more meaningfully into credit as opportunities emerge. While credit cycles can be difficult to predict, the Manager believes flexible positioning is appropriate given current debt levels throughout the system and the potential for an economic slowdown in the next few years, although there does not appear to be an immediate threat on the horizon. Third Point will also remain focused on generating alpha across a variety of strategies including event driven investing, especially activism, and short selling.

At 30 June 2019, exposure in the Investment Manager’s portfolio was as follows:

Exposure Breakdown1

1 Relates to the Third Point Offshore Master Fund L.P. Exposures are categorized in a manner consistent with the Investment Manager’s classifications for portfolio and risk management purposes.

2 Rates and FX excluded.

Net equity exposure is defined as the long exposure minus the short exposure of all equity positions (including long/short, arbitrage, and other strategies), and can serve as a rough measure of the exposure to fluctuations in overall market levels. The Investment Manager continues to closely monitor the liquidity of the portfolio and is comfortable that the current composition is aligned with the redemption terms of the fund.

Independent Review Report

to third point offshore investors limited

Introduction

We have been engaged by the Company to review the Unaudited Condensed Interim Financial Statements for the six months ended 30 June 2019 which comprise the Statements of Assets and Liabilities, Statements of Operations, Statements of Changes in Net Assets, Statements of Cash Flows and the related notes 1 to 13.

We have read the other information contained in the Interim Report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the Unaudited Condensed Interim Financial Statements.

This report is made solely to the Company in accordance with guidance contained in International Standard on Review Engagements 2410 (UK and Ireland) “Review of Interim Financial Information Performed by the Independent Auditor of the Entity” issued by the Auditing Practices Board. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company, for our work, for this report, or for the conclusions we have formed.

Directors’ Responsibilities

The ‘Interim Report and Unaudited Condensed Interim Financial Statements’ is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the ‘Interim Report and Unaudited Condensed Interim Financial Statements’ in accordance with the Disclosure Guidance and Transparency Rules of the United Kingdom’s Financial Conduct Authority.

As disclosed in note 3, the Unaudited Condensed Interim Financial Statements included in this Unaudited Condensed Interim Report have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”).

Our Responsibility

Our responsibility is to express to the Company a conclusion on the Unaudited Condensed Interim Financial Statements 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”, issued by the Auditing Practices Board for use in the United Kingdom. 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 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 Unaudited Condensed Interim Financial Statements in the ‘Interim Report and Unaudited Condensed Interim Financial Statements’ for the six months ended 30 June 2019 is not prepared, in all material respects, in accordance with US GAAP and the Disclosure Guidance and Transparency Rules of the United Kingdom’s Financial Conduct Authority.

Ernst & Young LLP Guernsey, Channel Islands 28 August 2019

1 The maintenance and integrity of the Company’s website is the responsibility of the Directors; the work carried out by the auditors does not involve consideration of these matters and, accordingly, the auditors accept no responsibility for any changes that may have occurred to the financial statements since they were initially presented on the website

2 Legislation in Guernsey governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions

Statements of Assets and Liabilities

The financial statements were approved by the Board of Directors on 28 August 2019 and signed on its behalf by:

Steve Bates Chairman

Christopher Legge Director

See accompanying notes and attached Unaudited Condensed Interim Financial Statements of Third Point Offshore Fund Ltd. and Third Point Offshore Master Fund L.P.

Statements of Operations

1 Third Point Offshore Independent Voting Company Limited consists of Director Fees, Audit Fee and General Expenses.

See accompanying notes and attached Unaudited Condensed Interim Financial Statements of Third Point Offshore Fund Ltd. and Third Point Offshore Master Fund L.P.

Statements of Changes in Net Assets

See accompanying notes and attached Unaudited Condensed Interim Financial Statements of Third Point Offshore Fund Ltd. and Third Point Offshore Master Fund L.P.

Statements of Cash Flows

¹ Third Point Offshore Independent Voting Company Limited consists of Director Fees, Audit Fee and General Expenses.

See accompanying notes and attached Unaudited Condensed Interim Financial Statements of Third Point Offshore Fund Ltd. and Third Point Offshore Master Fund L.P.

Notes to the Unaudited Condensed Interim Financial Statements

For the period ended 30 June 2019

1.The Company

Third Point Offshore Investors Limited (the “Company”) is an Authorised closed-ended investment company incorporated in Guernsey on 19 June 2007 for an unlimited period, with registration number 47161.

2.Organisation

Investment Objective and Policy

The Company’s investment objective is to provide its Shareholders with consistent long term capital appreciation, utilising the investment skills of the Investment Manager, through investment of all of its capital (net of short-term working capital requirements) through a master-feeder structure in Class E and N shares of Third Point Offshore Fund, Ltd. (the “Master Fund”), an exempted company formed under the laws of the Cayman Islands on 21 October 1996.

The Master Fund’s investment objective is to seek to generate consistent long-term capital appreciation, by investing capital in securities and other instruments in select asset classes, sectors and geographies, by taking long and short positions. The Master Fund is managed by the Investment Manager and the Investment Manager’s implementation of the Master Fund’s investment policy is the main driver of the Company’s performance. The Master Fund invests all of its investable capital in Third Point Offshore Master Fund L.P. (the “Master Partnership”) a corresponding open-ended investment partnership having the same investment objective as the Master Fund.

The Master Fund is a limited partner of the Master Partnership, an exempted limited partnership organised under the laws of the Cayman Islands, of which Third Point Advisors II L.L.C., an affiliate of the Investment Manager, is the general partner. Third Point LLC is the Investment Manager to the Company, the Master Fund and the Master Partnership. The Master Fund and the Master Partnership share the same investment objective, strategies and restrictions as described above.

The Unaudited Condensed Interim Financial Statements of the Master Fund and the Unaudited Condensed Interim Financial Statements of the Master Partnership, should be read alongside the Company’s Unaudited Condensed Interim Financial Statements.

Investment Manager

The Investment Manager is a limited liability company formed on 28 October 1996 under the laws of the State of Delaware. The Investment Manager was appointed on 29 June 2007 and is responsible for the management and investment of the Company’s assets on a discretionary basis in pursuit of the Company’s investment objective, subject to the control of the Company’s Board and certain borrowing and leveraging restrictions.

As per the disclosure within the Annual Accounts, the Company’s annual management fee was reduced to 1.25 per cent (from 2 per cent) effective 1 January 2019 following a transfer of substantially all of its holdings into a new share class in the Master Fund and to reflect the Company’s size and longevity as an investor in the Master Fund. In the period ended 30 June 2019, the Company paid to the Investment Manager at the level of the Master Partnership a fixed management fee of 1.25 percent per annum and a general partner incentive allocation of 20 percent of the Master Fund’s NAV growth (“Full Incentive Fee”) invested in the Master Partnership, subject to certain conditions and related adjustments, by the Master Fund. If a particular series invested in the Master Fund depreciates during any fiscal year and during subsequent years there is a profit attributable to such series, the series must recover an amount equal to 2.5 times the amount of depreciation in the prior years before the Investment Manager is entitled to the Full Incentive Fee. Until this occurs, the series will be subject to a reduced incentive fee of 10%. The Company was allocated US$11,971,040 (30 June 2018: US$2,144,787) of incentive fees for the period ended 30 June 2019.

3.Significant Accounting Policies Basis of Presentation

These Unaudited Condensed Interim Financial Statements have been prepared in accordance with relevant accounting principles generally accepted in the United States of America (“US GAAP”). The functional and presentation currency of the Company is United States Dollars.

Management has determined that the Company is an investment company in conformity with US GAAP. Therefore the Company follows the accounting and reporting guidance for investment companies in the Financial Accounting Standards Board (‘‘FASB’’) Accounting Standards Codification (‘‘ASC’’) 946, Financial Services - Investment Companies (‘‘ASC 946’’).

The following are the significant accounting policies adopted by the Company:

Cash and Cash Equivalents

Cash in the Statements of Assets and Liabilities and for the Statement of Cash Flows comprises cash at bank and on hand.

Due from Broker

Due from broker includes cash balances held at the Company’s clearing broker as of 30 June 2019. The Company clears all of its securities transactions through a major international securities firm, UBS, pursuant to agreements between the Company and prime broker.

Redemptions Receivable

Redemptions receivable are capital withdrawals from the Master Fund which have been requested but not yet settled as at 30 June 2019.

Valuation of Investments

The Company records its investment in the Master Fund at fair value. Fair values are generally determined utilising the net asset value (“NAV”) provided by, or on behalf of, the underlying Investment Managers of each investment fund. In accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 820 “Fair Value Measurement”, fair value is defined as the price the Company would receive upon selling a security in a timely transaction to an independent buyer in the principal or most advantageous market of the security. For further information refer to the Master Partnership’s Unaudited Condensed Interim Financial Statements.

The valuation of securities held by the Master Partnership, which the Master Fund directly invests in, is discussed in the notes to the Master Partnership’s Unaudited Condensed Interim Financial Statements. The net asset value of the Company’s investment in the Master Fund reflects its fair value. At 30 June 2019, the Company’s US Dollar shares represented 13.49% (31 December 2018: 13.30%) of the Master Fund’s NAV.

The Company has adopted ASU 2015-07, Disclosures for Investments in Certain Entities that calculate Net Asset Value per Share (or its equivalent) (“ASU 201-07”) , in which certain investments measured at fair value using the net asset value per share method (or its equivalent) as a practical expedient are not required to be categorised in the fair value hierarchy. Accordingly the Company has not levelled applicable positions.

Uncertainty in Income Tax

ASC Topic 740 “Income Taxes” requires the evaluation of tax positions taken or expected to be taken in the course of preparing the Company’s tax returns to determine whether the tax positions are “more- likely-than-not” of being sustained by the applicable tax authority based on the technical merits of the position. Tax positions deemed to meet the “more-likely-than-not” threshold would be recorded as a tax benefit or expense in the year of determination. Management has evaluated the implications of ASC 740 and has determined that it has not had a material impact on these Unaudited Condensed Interim Financial Statements.

Income and Expenses

The Company records its proportionate share of the Master Fund’s income, expenses and realised and unrealised gains and losses on a monthly basis. In addition, the Company accrues interest income, to the extent it is expected to be collected, and other expenses.

Use of Estimates

The preparation of Unaudited Condensed Interim Financial Statements in conformity with US GAAP may require management to make estimates and assumptions that affect the amounts and disclosures in the financial statements and accompanying notes. Actual results could differ from those estimates. Other than what is underlying in the Master Fund and the Master Partnership, the Company does not use any material estimates in respect of the Unaudited Condensed Interim Financial Statements.

Foreign Exchange

Investment securities and other assets and liabilities denominated in foreign currencies are translated into United States Dollars using exchange rates at the reporting date. Purchases and sales of investments and income and expense items denominated in foreign currencies are translated into United States Dollars at the date of such transaction. All foreign currency translation gains and losses are included in the Statement of Operations.

Recent accounting pronouncements

The Company has not early adopted any standards, interpretation or amendment that has been issued but is not yet effective. The amendments and interpretations which apply for the first time in 2019 have been assessed and do not have an impact on the Unaudited Condensed Interim Financial Statements of the Company.

4.Material Agreements

Management and Incentive fees

The Investment Manager was appointed by the Company to invest its assets in pursuit of the Company’s investment objectives and policies. As disclosed in Note 2, the Investment Manager is remunerated by the Master Partnership by way of management fees and incentive fees.

Administration fees

Under the terms of an Administration Agreement dated 29 June 2007, the Company appointed Northern Trust International Fund Administration Services (Guernsey) Limited as Administrator (the “Administrator”) and Corporate Secretary.

The Administrator is paid fees based on the NAV of the Company, payable quarterly in arrears. The fee is at a rate of 2 basis points of the NAV of the Company for the first £500 million of NAV and a rate of 1.5 basis points for any NAV above £500 million. This fee is subject to a minimum of £4,250 per month. The Administrator is also entitled to an annual corporate governance fee of £30,000 for its company secretarial and compliance activities.

In addition, the Administrator is entitled to be reimbursed out-of-pocket expenses incurred in the course of carrying out its duties, and may charge additional fees for certain other services.

Total Administrator expenses during the period amounted to US$81,991 (30 June 2018: US$87,815) with US$43,837 outstanding (31 December 2018: US$41,974).

Related Party

The Company has entered into a support and custody agreement with Third Point Offshore Independent Voting Company Limited (“VoteCo”) whereby, in return for the services provided by VoteCo, the Company will provide VoteCo with funds from time to time in order to enable VoteCo to meet its obligations as they fall due. Under this agreement, the Company has also agreed to pay all the expenses of VoteCo, including the fees of the directors of VoteCo, the fees of all advisors engaged by the directors of VoteCo and premiums for directors and officers insurance. The Company has also agreed to indemnify the directors of VoteCo in respect of all liabilities that they may incur in their capacity as directors of VoteCo. The expense paid by the Company on behalf of VoteCo during the period is outlined in the Statement of Operations and amounted to US$35,456 (30 June 2018: US$35,454). As at 30 June 2019 expenses accrued by the Company on behalf of VoteCo amounted to US$24,971 (31 December 2018: US$19,855).

5.Directors’ Fees

The Chairman is entitled to a fee of £63,000 per annum. All other independent Directors are entitled to receive £38,000 per annum with the exception of Mr. Legge who receives £46,000 per annum as the audit committee chairman. Mr. Targoff has waived his fees. The Directors are also entitled to be reimbursed for expenses properly incurred in the performance of their duties as Director. The Directors’ fees during the period amounted to US$134,276 (30 June 2018: US$127,875) with US$70,803 outstanding (31 December 2018: US$Nil).

6.Stated Capital

The Company was incorporated with the authority to issue an unlimited number of Ordinary Shares (the “Shares”) with no par value and an unlimited number of Ordinary B Shares (“B Shares”) of no par value.

In respect of each class of Shares a separate class account has been established in the books of the Company. An amount equal to the aggregate proceeds of issue of each Share Class has been credited to the relevant class account. Any increase or decrease in the NAV of the Master Fund, as calculated by the Master Fund, is allocated to the relevant class account in the Company according to the number of shares held by each class.

Each class account is allocated those costs, expenses, losses, dividends, profits, gains and income which the Directors determine in their sole discretion relate to a particular class. Expenses which relate to the Company as a whole rather than specific classes are allocated to each class in the proportion that its NAV bears to the Company as a whole.

Voting Rights

Ordinary Shares carry the right to vote at general meetings of the Company and to receive any dividends, attributable to the Ordinary Shares as a class, declared by the Company and, in a winding-up will be entitled to receive, by way of capital, any surplus assets of the Company attributable to the Ordinary Shares as a class in proportion to their holdings remaining after settlement of any outstanding liabilities of the Company. B Shares also carry the right to vote at general meetings of the Company but carry no rights to distribution of profits or in the winding-up of the Company.

As prescribed in the Company’s Articles, each Shareholder present at general meetings of the Company shall, upon a show of hands, have one vote. Upon a poll, each Shareholder shall, in the case of a separate class meeting, have one vote in respect of each Share or B Share held and, in the case of a general meeting of all Shareholders, have one vote in respect of each US Dollar Share or US Dollar B Share held. Fluctuations in currency rates will not affect the relative voting rights applicable to the Shares and B Shares. In addition all of the Company’s Shareholders have the right to vote on all material changes to the Company’s investment policy.

Repurchase of Shares and Discount Control

The Directors of the Company were granted authority to purchase in the market up to 14.99 percent of the Shares in issue at the Annual General Meeting on 28 June 2018, and they intend to seek annual renewal of this authority from Shareholders. The Directors have utilised this share repurchase authority by introducing a new mechanism that will hopefully enhance future capital growth. Pursuant to the Director’s share repurchase authority, the Company, through the Master Fund, commenced a share repurchase programme in 2007. The Shares are being held by the Master Partnership. The Master Partnership’s gains or losses and implied financing costs related to the shares purchased through the share purchase programme are entirely allocated to the Company’s investment in the Master Fund. The Master Partnership has an ownership of nil% of the USD shares outstanding at 30 June 2019 (31 December 2018: 7.16%).

As at 30 June 2019, the Master Fund held 3,379,753 (31 December 2018: 3,379,753) shares of the Company. On 3 July 2019, the Company announced the cancellation of the remaining 3,379,753 Shares held by the Master Fund, for the benefit of the Company. As a result, the Master Partnership will not hold any shares in the Company. The cancellation is in accordance with the Repurchase Policy announced on 2 May 2018.

Further issue of Shares

Under the Articles, the Directors have the power to issue further shares on a non-pre-emptive basis. If the Directors issue further Shares, the issue price will not be less than the then-prevailing estimated weekly NAV per Share of the relevant class of Shares.

7.Taxation

The Fund is exempt from taxation in Guernsey under the provisions of the Income Tax (Exempt Bodies) (Guernsey) Ordinance 1989.

8.Calculation of Net Asset Value

The NAV of the Company is equal to the value of its total assets less its total liabilities. The NAV per Share of each class is calculated by dividing the NAV of the relevant class account by the number of Ordinary Shares of the relevant class in issue on that day.

9.Related Party Transactions

At 30 June 2019 other investment funds owned by or affiliated with the Investment Manager owned 5,630,444 (31 December 2018: 5,630,444) US Dollar Shares in the Company. Refer to note 4 and note 5 for additional Related Party Transaction disclosures.

10.Significant Events

As of January 1, 2019, the Company transferred substantially all of its holding into a newly-created share class of the Master Fund. The new share class is subject to a 25% quarterly redemption gate. The Company plans to redeem an appropriate amount each quarter to account for planned share buybacks and Company fees and expenses. The new share class attracts a lower management fee and the Company also qualifies for an additional reduction of management fee applicable to it based on its size and longevity as an investor in the Master Fund. As a result, the Company’s management fee has been reduced from 2.0% to 1.25% per annum.

For the period 1 January 2019 to 30 June 2019, 3,108,828 shares have been repurchased and cancelled at an average cost per share of $14.64.

Steve Bates was appointed as Chairman on 5 February 2019. Rupert Dorey was appointed as a Director on 5 February 2019.

On 11 February 2019, Christopher Legge purchased 2,000 shares in Third Point Offshore Investors Limited taking his total holding to 6,500 shares.

On 13 February 2019, Rosemary Dorey (spouse of Rupert Dorey, non-executive director of the Company) purchased 5,151 shares in Third Point Offshore Investors Limited taking their combined total holding to 12,000 shares.

On 4 March 2019, Claire Whittet in conjunction with her husband Martin Whittet, beneficially purchased 2,500 shares in Third Point Offshore Investors Limited through their joint Retirement Annuity Trust Scheme (RATS).

On 30 April 2019, the Board announced the appointment of Numis Securities Limited as Corporate Broker to the Company.

11.Financial Highlights

The following tables include selected data for a single Ordinary Share of each of the Ordinary Share classes in issue at the period-end and other performance information derived from the Unaudited Condensed Interim Financial Statements.

Total return from operations reflects the net return for an investment made at the beginning of the period and is calculated as the change in the NAV per Ordinary Share during the period ended 30 June 2019 and is not annualised. An individual Shareholder’s return may vary from these returns based on the timing of their purchases and sales of shares on the market.

Total return from operations reflects the net return for an investment made at the beginning of the period and is calculated as the change in the NAV per Ordinary Share during the period ended 30 June 2018 and is not annualised. An individual Shareholder’s return may vary from these returns based on the timing of their purchases and sales of shares on the market.

1 Average Net Asset Value for the period is calculated based on published monthly estimates of NAV.

2 Operating expenses are Company expenses together with operating expenses allocated from the Master Fund.

12.Ongoing Charge Calculation

Ongoing charges for the period / year ended 30 June 2019 and 31 December 2018 have been prepared in accordance with the AIC recommended methodology. Performance fees were charged to the Master Fund. In line with AIC guidance, an Ongoing Charge has been disclosed both including and excluding performance fees. The Ongoing charges for period / year ended 30 June 2019 and 31 December 2018 excluding performance fees and including performance fees are based on Company expenses and allocated Master Fund expenses outlined below.

* All Sterling shares were compulsorily converted to the US Dollar class as of 1 July 2018.

13.Subsequent Events

On 3 July 2019, the Board of Directors announced the cancellation of all remaining 3,379,753 Shares currently held by the Master Fund for the benefit of the Company. The cancellation is in accordance with the Repurchase Policy announced on 2 May 2018.

Huw Evans was appointed as a Director on 21 August 2019.

There were no events subsequent to the period-end which, in the opinion of the Directors, may have an impact on the Unaudited Condensed Interim Financial Statements for the period ended 30 June 2019.

Management and Administration

Directors

Steve Bates (Chairman)*1 Christopher Legge*PO Box 255, Trafalgar Court, Les Banques, PO Box 255, Trafalgar Court, Les Banques,St Peter Port, Guernsey, St Peter Port, Guernsey,Channel Islands, GY1 3QL. Channel Islands, GY1 3QL.

Rupert Dorey*1 Joshua L TargoffPO Box 255, Trafalgar Court, Les Banques, PO Box 255, Trafalgar Court, Les Banques,St Peter Port, Guernsey, St Peter Port, Guernsey,Channel Islands, GY1 3QL. Channel Islands, GY1 3QL.

Huw Evans*2 Claire Whittet*PO Box 255, Trafalgar Court, Les Banques, PO Box 255, Trafalgar Court, Les Banques,St Peter Port, Guernsey, St Peter Port, Guernsey,Channel Islands, GY1 3QL. Channel Islands, GY1 3QL.

* These Directors are independent.

1 Appointed 5 February 2019.

2 Appointed 21 August 2019.

Investment Manager Administrator and SecretaryThird Point LLC Northern Trust International Fund18th Floor, 390 Park Avenue, Administration Services (Guernsey) Limited,New York, NY 10022, PO Box 255, Trafalgar Court, Les Banques,United States of America. St Peter Port, Guernsey, Channel Islands, GY1 3QL.

Auditors Legal Advisors (Guernsey Law)Ernst & Young LLP Mourant OzannesPO Box 9, Royal Chambers Royal Chambers, St Julian’s Avenue,St Julian’s Avenue, St Peter Port, Guernsey,St Peter Port, Guernsey, Channel Islands, GY1 4HP. Channel Islands, GY1 4AF.

Receiving Agent

Legal Advisors (UK Law) Link Market Services LimitedHerbert Smith Freehills LLP The Registry,Exchange House, Primrose Street, 34 Beckenham Road,London, EC2A 2HS, Beckenham, Kent BR3 4TU,United Kingdom. United Kingdom.

Legal Advisors (US Law) Corporate BrokerCravath, Swaine & Moore, LLP Numis Securities Limited3825 Eighth Avenue, Worldwide Plaza, The London Stock Exchange Building,New York, NY 10019-7475, 10 Paternoster Square,United States of America. London EC4M 7LT, United Kingdom.

Registrar and CREST Service Provider

Link Market Services (Guernsey) Limited Kepler Partners LLPformerly Capita Registrars (Guernsey) Limited) 9/10 Savile Row,2nd Floor, No.1 Le Truchot, London W1S 3PF,St Peter Port, Guernsey, United Kingdom. Channel Islands, GY1 1WO.

Registered Office Jefferies International Limited4PO Box 255, Trafalgar Court, Les Banques, Vintners PlaceSt Peter Port, Guernsey, 68 Upper Thames Street,Channel Islands, GY1 3QL London EC4V 3BJ, United Kingdom.

3 Appointed on 30 April 2019.

4 Engagement terminated on 26 April 2019.