TIDM57MC
RNS Number : 6331R
Wellcome Trust Finance plc
13 December 2016
Wellcome Trust Finance plc
Annual Report and Financial Statements
Wellcome Trust and Wellcome Trust Finance plc. (a wholly owned
subsidiary of Wellcome Trust) announce that they have each
published their Annual Report and Financial Statements for the year
to 30 September 2016 today. A copy of each document is available on
the Wellcome Trust website at:
https://wellcome.ac.uk/what-we-do/reports.
Wellcome Trust has today issued the following press release in
connection with the publication of its Annual Report and Financial
Statements:
The Wellcome Trust is pleased to report that our investment
portfolio recorded a total return of 18.8 per cent for the year to
30 September 2016, equating to GBP3.5 billion on an investment
portfolio value of GBP18.3 billion at the start of the year. Cash
payments in support of our mission were GBP749 million and the
investment base rose to GBP20.9 billion.
We have returned over GBP13.5 billion (129 per cent cumulative,
10.9 per cent annualised) in the eight years since the start of the
global financial crisis in September 2008, recording positive
returns in each of these years. Returns have been 138 per cent
cumulative (9.1 per cent annualised) over ten years and 446 per
cent cumulative (8.9 per cent annualised) over 20 years. Since the
inception of our investment portfolio in 1985, it has provided a
total return averaging 13.8 per cent a year. We maintain a AAA/aaa
(stable) credit rating.
Depending on actual investment returns, we aim to be able to
commit at least GBP5 billion to our charitable mission over the
next five years.
This year, we enjoyed double-digit returns from every asset
class except property. Each major element of the portfolio (public
equities, private equities, venture capital, hedge funds and
property) has performed strongly over the longer term. Returns in
Sterling were boosted by the sharp depreciation seen after the
Brexit vote as we maintained the vast majority of our overseas
exposure unhedged.
Baroness Manningham-Buller, Chair of the Trust, said: "I am
pleased to report that, once again, our investments have done well,
building on past investment decisions, and despite a turbulent
market. Our charitable expenditure is now over 50 per cent more a
year than it was five years ago in 2011 and more than double that
of a decade ago."
Danny Truell, Managing Partner of the Investment Division at the
Trust, added: "The portfolio has again performed well in a
difficult environment for many investors. The decision to reduce
home country bias and to diversify assets and geographical exposure
has borne fruit. Although future investment returns are unlikely to
match recent experience, we remain confident that the portfolio
should generate sufficient cash flows to insulate the Trust from
potentially more difficult conditions."
With the investment portfolio having grown in complexity over
time and with more assets managed in-house, we have continued to
strengthen our team, largely through internal promotions. To this
end, we have recently moved away from having a sole Chief
Investment Officer and have promoted Nick Moakes and Peter Pereira
Gray to the roles of Managing Partners alongside Danny Truell, who
remains a key part of the team.
Wellcome Trust Finance plc. further announces that a copy of its
Annual Report and Financial Statements for the year ended 30
September 2016 has been submitted to the National Storage
Mechanism, and will shortly be available for inspection at
http://www.morningstar.co.uk/uk/NSM.
In accordance with the Disclosure and Transparency Rules, the
following information is taken from the Annual Report and Financial
Statements for Wellcome Trust Finance plc. for the year ended 30
September 2016.
Wellcome Trust Finance plc
Annual Report and Financial Statements
Year ended 30 September 2016
Strategic Report
The Directors of Wellcome Trust Finance plc present their
Strategic Report for the year ended 30 September 2016.
Strategy and Objectives
The principal activity of Wellcome Trust Finance plc (the
"Company") is to meet its obligations relating to the bonds that it
has previously issued on the London Stock Exchange and to continue
to lend the proceeds to other group entities.
Review of the Business and Future Developments
The Company issued two tranches of bonds: GBP550 million on 25
July 2006 of 4.625% Guaranteed Bonds due July 2036 and GBP275
million on 28 May 2009 of 4.750% Guaranteed Bonds due May 2021 (the
"Bonds"). The Bonds are listed on the London Stock Exchange. The
obligations of the Company in relation to the Bonds are governed by
Trust Deeds between the Company, The Wellcome Trust Limited, as
trustee of the Wellcome Trust, and Citicorp Trustee Company
Limited, as the trustee for the holders of the Bonds. The payment
of all amounts due in respect of the Bonds is unconditionally and
irrevocably guaranteed pursuant to the terms of a guarantee given
by The Wellcome Trust Limited, as trustee of the Wellcome Trust;
the guarantee is part of the Trust Deeds.
The Company loaned the proceeds from the Bonds issued to
Wellcome Trust Group (the "Group") undertakings and receives
interest on these loans.
The Company will continue to receive interest on the loans to
group undertakings and pay interest on the bond liabilities for the
foreseeable future.
Results for the Year
The Company made a profit of GBP3,463,413 (2015: GBP2,475,895)
during the year ended 30 September 2016. As at 30 September 2016
the Company had net assets of GBP137,500,000 (2015:
GBP137,500,000).
Key Performance Indicator
Due to the nature of the Company's operations, the key
performance measures are that the Company meets all its legal
obligations to the Bond holders and that the Company achieves
sufficient return on its assets to be profitable, before any
donations to the Wellcome Trust under Gift Aid. During the year the
Company met all its legal obligations to the Bond holders and had
profits before donations to the Wellcome Trust under Gift Aid.
Principal Risks and Uncertainties
The Directors of the Company implement policies to manage the
inherent risks relating to the financial assets and liabilities of
the Company.
The Directors have assessed for each financial asset and
liability: the market risk, interest rate risk, liquidity risk, and
credit risk exposure. The Company is not exposed to significant
market risk or interest rate risk because the Company's main
financial assets have fixed redemption values, fixed interest rates
and fixed maturity dates, which match those of its financial
liabilities. The liquidity risk of the Company is mitigated by the
matching of the cash flows from the Company's financial assets and
liabilities. Credit risk exposure of the Company's loans is reduced
by the Company only advancing loans to entities within the Group.
Credit risk exposure of the Company's remaining financial assets is
reduced by stringent selection procedures for any external
counterparties with which the Company transacts.
Due to the fixed nature of the Company's assets and liabilities,
there is very little uncertainty to which the Company is
exposed.
The Company's internal control and risk management is undertaken
as part of the Wellcome Trust's processes. The key elements of this
specifically applicable to the Company are:
-- delegation: there is a clear organisational structure with
documented lines of authority and responsibility for control and
documented procedures for reporting decisions, actions and issues;
and
-- review: the Group Audit Committee reviews the effectiveness
of the Company's internal control, its financial reporting process,
the independence of its statutory auditors and its compliance with
relevant statutory and finance regulations and advises the
Directors of any relevant matters.
Corporate and Social Responsibility
Due to the nature of its activities the Company has a minimal
environmental impact. Social responsibility of the Wellcome Trust
Group is detailed in the Wellcome Trust Annual Report and Financial
Statements, which are available at www.wellcome.ac.uk.
This report was approved by the Board of Directors and signed on
its behalf on 12 December 2016 by:
Peter Pereira Gray
Director
12 December 2016
Directors' Report
Report of the Directors
The Directors of Wellcome Trust Finance plc present their report
and the audited Financial Statements for the year ended 30
September 2016.
Future Developments
These are discussed in the Strategic Report.
Charitable Donations
The Company made charitable donations of GBP3,463,413 (2015:
GBP2,475,895) to the Wellcome Trust (a charity registered in
England under the UK Charities Act 2011 (registered charity number
210183)) under Gift Aid.
Financial risk management objectives and policies
These are discussed in the Strategic Report.
Employees
There are no employees of the Company (2015:nil).
The management and administration of the Company is undertaken
by staff from the Wellcome Trust. The Wellcome Trust has not
incurred any incremental staff costs due to the management of this
Company.
Dividend
The Directors do not propose the payment of a dividend (2015:
GBPnil).
Corporate Governance
The Company is limited by shares. Its governing documents are
its articles of association. The shareholder of the company is The
Wellcome Trust Limited, as trustee of the Wellcome Trust.
The Company is considered to be a wholly owned subsidiary of The
Wellcome Trust Limited, as trustee of the Wellcome Trust. The
Company is not subject to the requirements of the UK Corporate
Governance Code because it does not have any equity shares listed
on the London Stock Exchange. A statement on governance policies of
the Group and of the Wellcome Trust is included in the Wellcome
Trust's Annual Report and Financial Statements for the year ended
30 September 2016.
The Audit Committee, the Investment Committee and the internal
audit function of the Wellcome Trust oversee all group
entities.
The Company complies with all appropriate filing and information
requirements of the Financial Conduct Authority.
Directors and their interests
The Directors of the Company who were in office during the year
and up to the date of signing the Financial Statements were:
Nicholas Moakes
Peter Pereira Gray
Daniel Truell
None of the Directors held any beneficial interest in the shares
of the Company or any interest in its parent company, The Wellcome
Trust Limited, as trustee of the Wellcome Trust.
Each of the Directors is an employee of the Wellcome Trust and
receives remuneration from the Wellcome Trust as an employee. No
remuneration is paid to any Director for their services as a
Director.
Directors' Indemnity Policy
The company is party to a group-wide Directors' and Officers'
liability insurance policy which includes all of its current
directors. There are no qualifying indemnity provisions (as defined
in the Companies Act 2006) that benefit the Directors of the
Company.
Statement of Directors' responsibilities
The Directors are responsible for preparing the Strategic
Report, Directors' Report and the Financial Statements in
accordance with applicable law and regulations.
Company law requires the Directors to prepare Financial
Statements for each financial year. Under that law the Directors
have prepared the Financial Statements in accordance with United
Kingdom Generally Accepted Accounting Practice (United Kingdom
Accounting Standards and applicable law), including FRS 102 the
Financial Reporting Standards applicable in U.K. and Republic of
Ireland. Under company law the Directors must not approve the
Financial Statements unless they are satisfied that they give a
true and fair view of the state of affairs of the Company and of
the profit or loss of the Company for that period. In preparing
these Financial Statements, the Directors are required to:
-- select suitable accounting policies and then apply them consistently;
-- make judgements and accounting estimates that are reasonable and prudent;
-- state whether applicable UK Accounting Standards have been
followed, subject to any material departures disclosed and
explained in the Financial Statements;
-- prepare the Financial Statements on the going concern basis
unless it is inappropriate to presume that the company will
continue in business.
The Directors are responsible for keeping adequate accounting
records that are sufficient to show and explain the Company's
transactions and disclose with reasonable accuracy at any time the
financial position of the company and enable them to ensure that
the Financial Statements comply with the Companies Act 2006. They
are also responsible for safeguarding the assets of the Company and
hence for taking reasonable steps for the prevention and detection
of fraud and other irregularities.
The Directors are responsible for the maintenance and integrity
of the company's website. Legislation in the United Kingdom
governing the preparation and dissemination of Financial Statements
may differ from legislation in other jurisdictions.
The Directors consider that the Annual Report and Financial
Statements, taken as a whole, is fair, balanced and understandable
and provides the information necessary for shareholders to assess a
Company's performance, business model and strategy.
Each of the Directors, whose names are listed in the Director's
Report confirm that, to the best of their knowledge:
-- the Financial Statements, which have been prepared in
accordance with United Kingdom Generally Accepted Accounting
Practice (United Kingdom Accounting Standards and applicable law),
including FRS 102 the Financial Reporting Standards applicable in
U.K. and Republic of Ireland, give a true and fair view of the
assets, liabilities, financial position and result of the company;
and
-- the Directors' report contained in this section of the Annual
Report includes a fair review of the development and performance of
the business and the position of the company, together with a
description of the principal risks and uncertainties that it
faces.
Statement of disclosure of information to auditors
Each Director in office at the date of approving this report
confirms that so far as the Director is aware, there is no relevant
audit information of which the Company's auditors are unaware and
each Director has taken all the steps that ought to have been taken
as a Director in order to make themselves aware of any relevant
audit information and to establish that the Company's auditors are
aware of that information.
Independent Auditors
In accordance with Section 485 of the Companies Act 2006, a
resolution dated 29 June 2016 was passed by the members appointing
Deloitte LLP as auditors of the Company.
This report was approved by the Board of Directors and signed on
its behalf on 12 December 2016 by:
Peter Pereira Gray
Director
12 December 2016
Independent Auditor's Report to the members of Wellcome Trust
Finance plc
We have audited the financial statements of Wellcome Trust
Finance plc (the "Company") for the year ended 30 September 2016
which comprise Statement of Income and Retained Earnings, Balance
Sheet and the related notes 1 to 15. The financial reporting
framework that has been applied in their preparation is applicable
law and United Kingdom Accounting Standards (United Kingdom
Generally Accepted Accounting Practice), including FRS 102 the
Financial Reporting Standard applicable in the UK and Republic of
Ireland.
This report is made solely to the company's members, as a body,
in accordance with Chapter 3 of Part 16 of the Companies Act 2006.
Our audit work has been undertaken so that we might state to the
company's members those matters we are required to state to them in
an auditor's report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to
anyone other than the company and the company's members as a body,
for our audit work, for this report, or for the opinions we have
formed.
Respective responsibilities of directors and auditor
As explained more fully in the Directors' Responsibilities
Statement, the directors are responsible for the preparation of the
financial statements and for being satisfied that they give a true
and fair view. Our responsibility is to audit and express an
opinion on the financial statements in accordance with applicable
law and International Standards on Auditing (UK and Ireland). Those
standards require us to comply with the Auditing Practices Board's
Ethical Standards for Auditors.
Scope of the audit of the financial statements
An audit involves obtaining evidence about the amounts and
disclosures in the financial statements sufficient to give
reasonable assurance that the financial statements are free from
material misstatement, whether caused by fraud or error. This
includes an assessment of: whether the accounting policies are
appropriate to the Company's circumstances and have been
consistently applied and adequately disclosed; the reasonableness
of significant accounting estimates made by the directors; and the
overall presentation of the financial statements. In addition, we
read all the financial and non-financial information in the annual
report to identify material inconsistencies with the audited
financial statements and to identify any information that is
apparently materially incorrect based on, or materially
inconsistent with, the knowledge acquired by us in the course of
performing the audit. If we become aware of any apparent material
misstatements or inconsistencies we consider the implications for
our report.
Opinion on financial statements
In our opinion the financial statements:
-- give a true and fair view of the state of the Company's
affairs at 30 September 2016 and of the Company's profit for the
year then ended;
-- have been properly prepared in accordance with United Kingdom
Generally Accepted Accounting Practice; and
-- have been prepared in accordance with the requirements of the Companies Act 2006.
Opinion on other matters prescribed by the Companies Act
2006
In our opinion the information given in the Strategic Report and
Directors' Report for the financial year for which the financial
statements are prepared is consistent with the financial
statements.
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters
where the Companies Act 2006 requires us to report to you if, in
our opinion:
-- adequate accounting records have not been kept, or returns
adequate for our audit have not been received from branches not
visited by us; or
-- the financial statements are not in agreement with the accounting records and returns; or
-- certain disclosures of directors' remuneration specified by law are not made; or
-- we have not received all the information and explanations we require for our audit.
Calum Thomson (Senior statutory auditor)
for and on behalf of Deloitte LLP
Chartered Accountants and Statutory Auditor
London, United Kingdom
12 December 2016
Wellcome Trust Finance plc
Statement of Income and Retained Earnings
For the year ended 30 September 2016
Year ended Year ended
30 September 30 September
Note 2016 2015
(restated)
GBP GBP
-------------------------------- ----- ------------- -------------
Turnover 3 42,756,155 41,617,265
Cost of sales (39,242,139) (39,104,315)
Administrative expenses 4 (50,603) (37,055)
Operating profit 3,463,413 2,475,895
Taxation - -
Profit on ordinary activities
after taxation 3,463,413 2,475,895 *
Charitable donation - relating
to current year (3,463,413) (2,475,895) *
Retained profit/(loss) for - -
the financial year
-------------------------------- ----- ------------- -------------
Opening shareholder's funds 137,500,000 137,500,000
Closing shareholder's funds 137,500,000 137,500,000
-------------------------------- ----- ------------- -------------
* Due to a change to the accounting policy for the presentation
of gift aid, the presentation of the Charitable donation of
GBP2,475,895 for the year ending 30 September 2015 has been
restated such that it is now presented as a distribution out of
Profits on ordinary activities after taxation. It had previously
been presented as an expense reducing Profit on ordinary activities
after taxation. The change to the accounting policy was made
following clarified accounting guidance produced by HMRC. This
restatement has meant Profit on ordinary activities after taxation
has increased to GBP2,475,895 in the year ending 30 September 2015
(previously presented as GBPnil). No other amounts have been
amended. This has no impact on the net assets or financial
performance of the Company.
All results are derived from continuing activities.
The Company has no other gains or losses other than the results
for the financial year as set out above, and therefore no separate
Statement of comprehensive income or Statement of changes in equity
have been presented.
The notes form part of these Financial Statements.
Wellcome Trust Finance plc
Balance Sheet
As at 30 September 2016
Year ended Year ended
30 September 30 September
Note 2016 2015
GBP GBP
------------------------------------ ----- -------------- --------------
Fixed assets
Loans to Group undertakings 8 703,398,684 702,977,117
Current assets
Loans to Group undertakings 8 245,500,000 245,500,000
Amounts owed by Group undertakings 4,813,601 1,557,405
Accrued interest on loans 9,936,096 9,936,096
Prepayments 23,229 21,197
Cash at bank and in hand 7,712 70,242
260,280,638 257,084,940
Creditors: amounts falling
due within one year 9 (12,167,582) (9,292,456)
------------------------------------ ----- -------------- --------------
Net current assets 248,113,056 247,792,484
------------------------------------
Total assets less current
liabilities 951,511,740 950,769,601
------------------------------------ ----- -------------- --------------
Creditors: amounts falling
due after more than one
year 9 (814,011,740) (813,269,601)
Net assets 137,500,000 137,500,000
------------------------------------ ----- -------------- --------------
Capital reserves
Called up share capital 11 137,500,000 137,500,000
Profit and loss account - -
Total shareholders' funds 10 137,500,000 137,500,000
------------------------------------ ----- -------------- --------------
The Company has no changes in equity during the year as set out
above and therefore no separate statement of changes in equity has
been presented.
The Financial Statements were approved by the Board of Directors
and authorised for issue on 12 December 2016 and signed on its
behalf by:
Peter Pereira Gray
Director
12 December 2016
Wellcome Trust Finance plc
Notes to the Financial Statements
For the year ended 30 September 2016
1. ACCOUNTING POLICIES
(a) Statement of compliance
The Company is incorporated in the United Kingdom under the
Companies Act. The address of the registered office is given In the
Administrative Details. The nature of the Company's operations and
its principal activities are set out in the strategic report.
The Company is a wholly owned subsidiary of The Wellcome Trust
Limited, as trustee of the Wellcome Trust, and is included in the
Consolidated Financial Statements of the Wellcome Trust, which are
publicly available.
The Financial Statements have been prepared on a going concern
basis as well as in accordance with applicable UK accounting
standards (UK Generally Accepted Accounting Practice), including
Financial Reporting Standard 102 the Financial Reporting Standard
applicable in the United Kingdom and the Republic of Ireland ("FRS
102"). This is the first year that the company has presented its
results under FRS 102. The last financial statements under the UK
GAAP were for the year ended 30 September 2015. The date of
transition to FRS 102 was 1 October 2014. There have been no
changes to the reported financial performance or financial position
as a result of the transition to FRS 102.
The functional and presentational currency of the Company is
considered to be pounds sterling. The majority of transactions are
denominated in pounds sterling.
The Company meets the definition of a qualifying entity under
FRS 102 and has therefore taken advantage of the disclosure
exemptions available to it. Exemptions have been taken in relation
to financial instruments, the presentation of a Statement of Cash
Flows and the Related Party disclosures. The equivalent disclosures
relating to the exemptions have been included in the Consolidated
Financial Statements of the Wellcome Trust.
(b) Summary of significant accounting policies
The principal accounting policies applied in the preparation of
these financial statements are set out below. These policies have
been consistently applied to all years presented, unless otherwise
stated.
Basis of preparation
The financial statements have been prepared under the historical
cost convention. The preparation of financial statements in
conformity with FRS 102 requires the use of certain significant
accounting estimates. It also requires management to exercise its
judgement in the process of applying the Company's accounting
policies. The areas involving a higher degree of judgement or
complexity, or areas where assumptions and estimates are
significant to the financial statements are disclosed in note
2.
Turnover
Turnover is interest derived from loans to Wellcome Trust
Investment Limited Partnership and Wellcome Trust Investments 1
Unlimited, undertakings in the Group, and the Wellcome Trust.
Income is calculated using the effective interest rate method and
is recognised on an accruals basis.
Cost of sales
Expenditure is the effective interest on the Bond liabilities
(as described in Bond Liabilities section below) and is recognised
on an accruals basis.
Gift Aid
Distribution of Gift Aid is equal to estimated taxable profits
of the company at the time of the approval of the financial
statements. The Gift Aid paid within nine months of the balance
sheet date is equal to the estimated taxable profits of the company
at time of payment. Any difference between the Gift Aid donation
accrued and the Gift Aid donation paid is recognised at the time of
payment.
Taxation
Although subject to taxation, the Company does not pay UK
Corporation Tax because its policy is to donate taxable profits as
Gift Aid to the Wellcome Trust. Any foreign tax incurred through
operating overseas is charged as it is incurred.
Subject to the above, current tax, including UK corporation tax
and foreign tax, is provided at amounts expected to be paid (or
recovered) using the tax rates and laws that have been enacted or
substantively enacted by the balance sheet date.
Financial assets and liabilities
The company has chosen to adopt Sections 11 and 12 of FRS 102 in
respect of financial instruments. Financial assets and financial
liabilities are recognised when the Group becomes a party to the
contractual provisions of the instrument.
Financial assets which qualify as basic financial instruments as
laid out in FRS 102 paragraph 11.8, including trade and other
receivables and cash and bank balances, are subsequently valued at
amortised cost and assessed for impairment at the end of each
reporting period.
Financial liabilities and equity instruments are classified
according to the substance of the contractual arrangements entered
into. All financial assets and liabilities are initially measured
at transaction price (including transaction costs), unless the
arrangement constitutes a financing transaction. If an arrangement
constitutes a financing transaction, the financial asset or
financial liability is measured at the present value of the future
payments discounted at a market rate of interest for a similar debt
instrument.
Financial assets and liabilities are only offset in the Balance
Sheet when, and only when, a legally enforceable right exists to
set off the recognised amounts and the Group intends either to
settle on a net basis, or to realise the asset and settle the
liability simultaneously.
Financial assets are derecognised when and only when (a) the
contractual rights to the cash flows from the financial asset
expire or are settled, (b) the company transfers to another party
substantially all of the risks and rewards of ownership of the
financial asset, or (c) the company, despite having retained some,
but not all, significant risks and rewards of ownership, has
transferred control of the asset to another party.
Financial liabilities are derecognised only when the obligation
specified in the contract is discharged, cancelled or expires.
Loans to Group undertakings
The loans to group undertakings are to Wellcome Trust Investment
Limited Partnership, Wellcome Trust Investments 1 Unlimited and the
Wellcome Trust, with fixed redemption value and fixed interest
payments. The loans are not quoted in an active market. The loans
were recognised initially at fair value and after initial
recognition are measured at amortised cost using the effective
interest method.
Bond Liabilities
The Bond liabilities relate to the 30-year corporate bonds
issued by the Company in July 2006 and the 12-year corporate bonds
issued by the Company in May 2009, listed on the London Stock
Exchange (the "Bonds"). The initial measurement of the liability is
equal to the proceeds of issue less all transaction costs directly
attributable to the issue for each Bond. After initial recognition
the liability is measured at amortised cost using the effective
interest method. The Company is not required to, and therefore does
not, recognise any adjustment to fair value in the Balance Sheet
and Statement of Income and Retained Earnings.
Foreign Currencies
Transactions in currencies other than Sterling are recorded at
the rate of exchange prevailing on the dates of the transactions.
At each balance sheet date, recorded monetary assets and
liabilities and balances carried at fair value that are denominated
in foreign currencies are retranslated at the rates prevailing on
the balance sheet date. All realised and unrealised profits and
losses arising on exchange are included in net profit or loss for
the period.
2. SIGNIFICANT ACCOUNTING ESTIMATES AND ASSUMPTIONS
Estimates and judgements are continually evaluated and are based
on historical experience and other factors, including expectations
of future events that are believed to be reasonable under the
circumstances.
The Company has made no significant accounting estimates and
assumptions in the application of the Company's accounting
policies.
3. TURNOVER
2016 2015
GBP GBP
Interest receivable on loans
to Group undertakings 42,756,155 41,617,265
42,756,155 41,617,265
------------------------------ ----------- -----------
Interest receivable on loans to Group undertakings in the UK
(see note 8) is the effective interest on:
-- Loan A to Wellcome Trust Investment Limited Partnership at a fixed rate of 4.75%;
-- Loan (new bond) to Wellcome Trust at fixed rate of 4.80%; and
-- Loan C to Wellcome Trust at fixed rate of 4.00%;
-- Loan D to Wellcome Trust Investments 1 Unlimited at fixed rate of 4.125%.
4. ADMINISTRATIVE EXPENSES
2016 2015
GBP GBP
Auditors' remuneration 12,000 9,348
Rating agency
fees 33,503 22,267
Tax compliance 270 610
Other 4,830 4,830
50,603 37,055
--- --------------------------- ------- -------
Auditor's remuneration is solely in relation to the statutory
audit of the Financial Statements.
5. EMPLOYEE INFORMATION
The Company has no employees. Personnel from the Wellcome Trust
undertake the management and administration of the Company at no
incremental cost to the Wellcome Trust.
6. REMUNERATION OF DIRECTORS
The Directors of the Company received no remuneration from the
Company for their services. There were no Directors for whom
retirement benefits are accruing under a money purchase or defined
benefit scheme. The Company does not issue share options or offer
any long-term incentive schemes, so there were no Directors who
exercised share options during the year or became entitled to
shares under a long-term incentive scheme.
7. TAX ON RESULT ON ORDINARY ACTIVITIES
The profits of the Company for the year will be paid under Gift
Aid to the Wellcome Trust, a charity registered in England under
the UK Charities Act 2011 (registered charity number 210183). There
is no difference between retained profit/(loss) and taxable
profits, so there is no provision required for deferred tax.
2016 2015
GBP GBP
Profit on ordinary
activities before tax 3,463,413 2,475,895
Current tax charge
for the year:
Profit on ordinary activities
multiplied by standard rate 692,683 507,558
of corporation tax in the
UK of 20% (2015: 20.5%)
Tax relief on
gift aid donations (692,683) (507,558)
Total current - -
tax
-------------------------------- ------ ---------- ----------
8. LOANS TO GROUP UNDERTAKINGS
Principal Interest Loan anniversary Amortised Amortised
amount rate date cost cost
per 2016 2015
annum
GBP % GBP GBP
Current
Assets
Loan
A 245,500,000 4.750 25 July 245,500,000 245,500,000
245,500,000 245,500,000 245,500,000
----------- ------------ --------- ----------------- ------------ ------------
Fixed
Assets
Loan (new
bond) 275,000,000 4.800 28 May 272,898,684 272,477,117
Loan
C 280,500,000 4.000 25 July 280,500,000 280,500,000
Loan
D 150,000,000 4.125 25 July 150,000,000 150,000,000
705,500,000 703,398,684 702,977,117
----------- ------------ --------- ----------------- ------------ ------------
Loans to Group undertakings are loans (the "Loans") to Wellcome
Trust Investment Limited Partnership (Loan A), Wellcome Trust (Loan
C and Loan (new bond)) and Wellcome Trust Investments 1 Unlimited
(Loan D). The principal under Loan A is repayable on demand by the
Company. The principal under Loan C and Loan (new bond) is
repayable on agreement between the Company and Wellcome Trust. The
principal under Loan D is repayable on agreement between the
Company and Wellcome Trust Investments 1 Unlimited. The Loans have
an agreed repayment date in 20 years (Loan A, Loan C and Loan D)
and 5 years (Loan (new bond)). Each Loan has a fixed redemption
value equal to the principal amount and a fixed interest rate.
9. CREDITORS
2016 2015
GBP GBP
Accruals and deferred
income 70,278 79,956
Gift Aid due to 2,884,804 -
the Wellcome Trust
Bond liabilities 9,212,500 9,212,500
Total creditors: amounts falling
due within one year 12,167,582 9,292,456
----------------------------------------- ------------ ------------
Bond liabilities 272,890,963 -
Falling due between 272,890,963 -
one and five years
--------------------------------------- ------------ ------------
Bond liabilities 541,120,777 813,269,601
Falling due after
five years 541,120,777 813,269,601
-------------------------------------- ------------ ------------
Total creditors: amounts falling
due after one year 814,011,740 813,269,601
----------------------------------------- ------------ ------------
The Bond liabilities are stated at the amortised cost using the
effective interest method for the GBP550 million 4.625% Guaranteed
Bonds due July 2036 ("GBP550 million Bonds"), issued by the Company
on 25 July 2006, and the GBP275 million 4.750% Guaranteed Bonds due
May 2021 ("GBP275 million Bonds"), issued by the Company on 28 May
2009. The Bond liabilities falling due within one year are the
unpaid coupon interest accrued for the year to 30 September 2016
for each Bond. The interest payment to the Bond holders is at a
fixed rate of 4.625% per annum (GBP550 million Bonds) and 4.750%
per annum (GBP275 million Bonds) and is paid in arrears on 25 July
or 28 May respectively each year until repayment of the Bond
principals.
The obligation of the Company on the Bonds is governed by a
Trust Deed dated 25 July 2006 (GBP550 million Bonds) or 28 May 2009
(GBP275 million Bonds) between the Company, The Wellcome Trust
Limited, as trustee of the Wellcome Trust, and Citicorp Trustee
Company Limited, as the trustee for the holders of the Bonds (the
"Trust Deed" and the "new Trust Deed" respectively). The payment of
all amounts due in respect of the Bonds is unconditionally and
irrevocably guaranteed pursuant to the terms of a guarantee given
by The Wellcome Trust Limited, as trustee of the Wellcome Trust;
the guarantee is part of the Trust Deed and the new Trust Deed.
10. RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS
2016 2015
GBP GBP
As at 1
October 137,500,000 137,500,000
As at 30
September 137,500,000 137,500,000
--------------- ------------------------------ ------------------------------
11. CALLED UP SHARE CAPITAL
2016 2015
Number GBP GBP
Authorised ordinary
shares of GBP1 each 137,500,000 137,500,000 137,500,000
--------------------------- ------------ ----------------------------- -----------------------------
Issued and fully paid
ordinary shares of GBP1
each 137,500,000 137,500,000 137,500,000
---------------------------- ------------ ----------------------------- -----------------------------
12. RELATED PARTY TRANSACTIONS
The Company has taken advantage of the exemption contained in
FRS 102 Section 33 paragraph 33.1A3 "Related Party Disclosures",
which exempts it from disclosing details of transactions with the
Wellcome Trust and its subsidiary undertakings, as the Company and
its related undertakings with whom it may have transactions are
wholly owned subsidiaries of the Wellcome Trust.
13. FINANCIAL INSTRUMENTS
The Company's financial instruments comprise the loans to Group
undertakings and the liability arising from the issue of the Bonds.
The Company's loans are non-derivative financial assets with fixed
payments which are not available for sale. The Bond liability is a
non-derivative financial liability with a fixed redemption value,
fixed interest rate and fixed maturity date. The Company has not
undertaken any trading in financial instruments during the
year.
The financial instruments issued by, or held by, the Company are
Sterling denominated and at fixed interest rates and carry no
foreign exchange risk or interest rate risk.
The key risks relating to the financial instruments held by the
Company are the credit risk and liquidity risk of the
counterparties Wellcome Trust Investment Limited Partnership,
Wellcome Trust Investments 1 Unlimited and the Wellcome Trust in
relation to the loans to Group undertakings. These risks are in
respect of the Wellcome Trust Investment Limited Partnership's,
Wellcome Trust Investments 1 Unlimited's and the Wellcome Trust's
ability to meet the interest and principal payments as they fall
due. The total value exposed to credit risk as at 30 September 2016
is GBP963.7 million (2015: GBP960.0 million), which comprises the
value of the loans to Group undertakings, amounts owed by Group
undertakings, accrued interest on loans and cash at bank and in
hand.
Credit risk exposure of the Company's loans is reduced by the
Company only advancing loans to entities within the Group. Credit
risk exposure of the Company's remaining financial assets is
reduced by stringent selection procedures for any external
counterparties with which the Company transacts.
The following tables detail the maturity of the Company's
undiscounted contractual payments as at 30 September:
Contractual payments falling due within one year
2016 2015
Three Between Total Three Between Total
months three months three
or less months or less months
and one and one
year year
GBP GBP GBP GBP GBP GBP
------------------ --------- ----------- ----------- --------- ----------- -----------
Accruals
and deferred
income 70,278 - 70,278 79,956 - 79,956
Gift Aid
due to the
Wellcome
Trust - 2,884,804 2,884,804 - - -
Bond liabilities - 38,500,000 38,500,000 - 38,500,000 38,500,000
Contractual
payments
falling due
within one
year 70,278 41,384,804 41,455,082 79,956 38,500,000 38,579,956
------------------ --------- ----------- ----------- --------- ----------- -----------
Contractual payments falling due after one year
2016 2015
Between After Total Between After Total
two five two five
and years and years
five five
years years
GBP GBP GBP GBP GBP GBP
------------------ ------------ ------------ -------------- ------------ -------------- --------------
Bond liabilities 429,000,000 931,562,500 1,360,562,500 154,000,000 1,245,062,500 1,399,062,500
Contractual
payments
falling
due after
one year 429,000,000 931,562,500 1,360,562,500 154,000,000 1,245,062,500 1,399,062,500
------------------ ------------ ------------ -------------- ------------ -------------- --------------
Gift Aid payments are made under a Deed of Covenant dated 11
September 2008 which can be terminated by the Company at any
time.
14. COMMITMENTS
The Company has no outstanding commitments at 30 September 2016
(2015: GBPnil).
15. ULTIMATE PARENT UNDERTAKING AND CONTROLLING PARTY
The Company is a company limited by shares. Its sole shareholder
is The Wellcome Trust Limited, as trustee of the Wellcome Trust,
whose place of business is Gibbs Building, 215 Euston Road, London,
United Kingdom. The Company is considered a wholly owned subsidiary
of the Wellcome Trust for accounting purposes and its assets and
liabilities have been consolidated with those of the Wellcome Trust
as required by section 9 of FRS 102.
The ultimate parent undertaking and controlling party is the
Wellcome Trust, which is the parent undertaking of the smallest and
largest group to consolidate these Financial Statements.
Copies of the Wellcome Trust Annual Report and Financial
Statements 2016 are available from the Trust's website
(www.wellcome.ac.uk) or from the company secretary.
Wellcome Trust Finance plc
Administrative Details
As at 30 September 2016
Directors
Nicholas Moakes
Peter Pereira Gray
Daniel Truell
Company Secretary
Susan Wallcraft (resigned 29 April 2016)
Andrew Cossar (appointed 29 April 2016)
Registered Company Number
5857955
Registered Office
Gibbs Building
215 Euston Road
London
NW1 2BE
Independent Auditor
Deloitte LLP
Chartered Accountants and Statutory Auditor
Hill House
1 Little New Street
London
EC4A 3TR
Banker
HSBC Bank plc
31 Holborn Circus
Holborn
London
EC1N 2HR
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR UUVWRNBAUAAA
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