• by  • January 8, 2015 • Crystal Amber

    CRYSTAL AMBER FUND LIMITED                           
    
    ("Crystal Amber Fund" or the "Fund")                      
    
    Monthly Net Asset Value                            
    
    Crystal Amber Fund announces that its unaudited net asset value ("NAV") per share on 31 December 2014 was 152.72p (30 November 2014: 150.07p per share).
    
    The proportion of the Fund's NAV at 31 December 2014 represented by the ten largest holdings, other investments and cash (including accruals), was as follows:
    Top ten holdings Pence per share held Percentage of investee equity
    AER Lingus Group plc 34.4 2.80%
    Sutton Harbour Holdings plc 11.9 29.20%
    Leaf Clean Energy Company 11.1 19.70%
    Thorntons plc 10.6 13.20%
    Tribal Group plc 7.7 3.90%
    NBNK Investments plc 7.5 28.20%
    Hurricane Energy plc 7.2 4.70%
    Juridica Investments Ltd 6.9 3.70%
    STV Group plc 6.9 3.60%
    4imprint Group plc 6.8 2.30%
    Total of ten largest holdings 111
    Other investments 37.6
    Cash and accruals 4.1

     

    Investment Adviser's quarterly commentary on the portfolio
    
    Over the quarter to 31 December 2014, NAV per share was down 1.48 per cent.
    
    The top three positive contributors to NAV growth over the quarter to 31 December 2014 were Aer Lingus Group plc (7.8 per cent contribution), 4imprint Group plc (0.53 per cent) and Plus500 Ltd (0.48 per cent).  The three main detractors have been Hurricane Energy plc (-2.34 per cent), Sutton Harbour
    Holdings plc (-1.67 per cent) and Thorntons plc (-1.29 per cent).
    
    
    Over the quarter to 31 December 2014, the Fund disclosed an increase in its positions in Thorntons plc, NBNK Investments plc, Hurricane Energy plc and a reduction in its holdings in 4imprint Group plc, Hayward Tyler Group plc and Juridica Investments Ltd. 
    
    Aer Lingus Group plc ("Aer Lingus")
    
    Over the period, the company reported strong trading, implemented the staff pension fund solution following four years of negotiations, and received a conditional offer from International Consolidated Airline Group (IAG).
    
    Trading over the important summer months was strong, with revenue up 14% year-on-year, driven by strong short haul performance and success of the long haul capacity expansion.  As a result, profit guidance for 2014 was upgraded.
    
    In September 2014, Aer Lingus reached a tripartite agreement with trade unions and the company's main pension fund trustees to implement the recommendations of the Expert Panel.  In November 2014, scheme members voted in favour of the
    settlement and shareholders approved the €191 million contribution to the arrangement. On 23 December 2014, the Pension's regulator approved the changes to the scheme and so it was implemented as intended on 1 January 2015.
    
    On 14 December 2014, the company received a conditional approach from IAG which was rejected by Aer Lingus' board as undervaluing the company. 
    
    In our view, Aer Lingus' growth strategy has been validated by its recent performance. The Dublin hub, at the core of the company's transatlantic gateway
    model, is gaining traction with the launch in 2014 of additional new long haul routes and feeder connections.
    
    The Fund had considered Aer Lingus to be highly vulnerable to a takeover offer from one of its larger rivals. As the largest institutional shareholder in Aer Lingus, the Fund now looks forward to engaging with the board of Aer Lingus.
    
    API Group plc ("API")
    
    The company announced weaker trading in its metallic pigment product, a speciality of its US foils division.
    
    Following engagement with the company, API announced that its chairman Richard Wright would be stepping down in short order, with the CEO assuming his role temporarily.
    
    The Fund has actively supported the search for a new chairman and looks forward to engaging with a strengthened board. 
    
    4imprint Groupplc("4imprint")
    
    4imprint reported good trading, with third quarter revenue in its main US division 25 per cent ahead of the previous year. 
    
    
    Following the pension buy-in in September 2014, the company announced the change of its presentational currency to US dollars from the 2014 preliminary results.  In December 2014, 4imprint announced that the CEO of its operating
    unit will become group CEO and its executive chairman will become non-executive.  
    
    Thorntons plc ("Thorntons")
    
    On 23 December 2014, Thorntons announced that despite like-for-like sales growth in its retail division, a decline in sales in its UK commercial channel would result in reduced earnings for the year to 30 June 2015.
    
    In addition, the company conceded that its customers had suffered from earlier difficulties resulting from its new centralised warehouse.
    
    Despite these operational issues, the Fund remains confident in Thorntons' brand value, growth prospects and strategic value.
    
    Proposed placing of new ordinary shares and new dividend policy
    
    On 10 December 2014, the Fund announced that it was considering a secondary issue of new shares to facilitate further investment opportunities.  On 18 December 2014 the Fund announced that it had received conditional commitments from investors and that it expected to raise minimum gross proceeds in excess
    of £30 million. 
    
    The Fund's new dividend policy will aim to distribute income and realised gains from investments. On 10 December 2014, the Board announced it intends to
    recommend a dividend of 2.5p per share in respect of the six months ending 30 June 2015, which will be payable in or around September 2015 and an interim dividend of 2.5p per share in respect of the six months ending 31 December 2015, making a total of 5p per share for the 2015 calendar year which, on the
    basis of the NAV at 31 December 2014, would represent a dividend yield of approximately 3.3 per cent.
    
    Transactions in Shares          
    
    Over the period, the Fund bought back 903,106 shares at an average price of 135p per share as part of its previously announced buyback programme.