Lon.Fin.&Inv.Grp.
Annual Financial
Report
London Finance
& Investment Group P.L.C. (‘Lonfin’ or the ‘Company’)
Annual Report and
Accounts and Annual General Meeting
The Company announces that, in accordance with Listing Rule
9.6.1., the following documents have today been submitted to the UK
Listing Authority and will shortly be available for inspection via
the National Storage Mechanism at www.hemscott.com/nsm.do:
- Annual Report and Accounts for the year ended
30th June 2016 (‘the Annual Report and Accounts
2016’);
- Notice of Annual General Meeting (included within the Annual
Report and Accounts 2016) of the Company to be held at 11.00 am on 30th November 2016 at 6 Middle Street, London EC1A 7JA; and
- Form of Proxy for the 2016 Annual General Meeting (included
within the Annual Report and Accounts 2016).
The above documents have been posted to shareholders. The Annual
Report and Accounts 2016 and Notice of Annual General Meeting are
also available on the website of City Group P.L.C., the Company
Secretary, at www.city-group.com.
The Company's financial statements and information on important
events that have occurred during the financial year and their
impact on the financial statements were included in the Company’s
preliminary announcement released on 30th September
2016. That information, together with the information set out
below, extracted from the Annual Report and Accounts 2016,
constitutes the material required by Disclosure and Transparency
Rule 6.3.5. which is to be communicated to the media in full
unedited text through a Regulatory Information Service. This
announcement is not a substitute for reading the full Annual Report
and Accounts 2016. Page and note references in the text below
refer to page numbers and notes in the Annual Report and Accounts
2016.
Appendix
Business Environment, Financial
Instruments & Principal Risks and Uncertainties
The financial instruments of the Group, in addition to its
investments, comprise cash and borrowings to finance those
investments.
As an investment company our principal risks and uncertainties
arise from the Group’s financial instruments, and are:
Stock market volatility and economic
uncertainty
The Company’s investment performance will be affected by general
economic and market conditions. Although the Company cannot predict
the level of growth in the global economy, as with most businesses,
it believes a period of weak market growth will have an adverse
effect on its investments. Volatility relating to the Company’s
investments, including movements in interest rates and returns from
equity and other investments will impact upon the value of the
Group’s investment portfolio.
Possible volatility of share prices
of investments
A number of factors outside the control of the Company may
impact the share price performance of its investments. Such factors
could include investor sentiment, local and international stock
market conditions, divergence of results from analysts’
expectations, changes in earnings estimates by analysts and changes
in political and economic sentiment. Exchange rate movements
will contribute to the volatility of prices of foreign stocks.
Dividend income
The ability of the companies that we invest in to pay dividends
to shareholders depends upon their profitability, cash flow and the
extent to which, as a matter of law, they have sufficient
distributable reserves from which any proposed dividends may be
paid and the willingness of the boards of such companies to pay.
There can be no guarantee that the companies we invest in will be
able to sustain their dividend policies in the future.
Ability to make strategic
investments
There are limited opportunities for the Company to make
strategic investments and therefore there is no guarantee that the
Company will be able to do so at a price the directors believes
will represent fair value.
Liquidity of equity investments in
strategic investments
Strategic investments may be made in the equity of “small cap”
companies, both listed and unlisted. There is a risk that due to
the low level of liquidity in the equity of these strategic
investments the Company may not be able to realise its investment,
either at all, or at a price the Company believes reflects fair
value.
The depth and overlap of experience of directors means that
there is no key-man dependency. Note 20 on page 26 sets out
the policies of the Board, which have remained substantially
unchanged for the year under review, for managing risks associated
with its financial instruments.
In addition, the Company is exposed to investment risk arising
from the selection of investments which it mitigates by drawing on
the investment experience of its directors.
The Board does not consider that there is any further
information relating to environmental matters, employees, social,
community and human rights issues that it is necessary to report
for an understanding of the development, performance or position of
the Company’s business.
Related Party Disclosures
Lonfin and its wholly owned subsidiary, Lonfin Investments
Limited, owns 43.8% of its associated company, Western Selection
PLC (‘Western’), of which Mr. D.C.
Marshall, Mr L.H. Marshall,
Mr. J. M. Robotham and Mr. E.J Beale
are directors. Mr. D.C.
Marshall and Mr. J. M.
Robotham's shareholdings in Lonfin are set out in the
accompanying Directors’ Report.
Lonfin and Western hold shares in Finsbury Food Group Plc and
Northbridge Industrial Services Plc respectively. Mr.
D.C. Marshall is a director of
Northbridge Industrial Services plc and Mr. E. J. Beale is a director of Finsbury Food Group
Plc.
Mr. D. C. Marshall and Mr.
L. H. Marshall are directors and Mr.
E.J. Beale is the non-executive
Chairman of Marshall Monteagle PLC and Mr D. C. Marshall and Mr J.
M. Robotham are shareholders in Marshall Monteagle PLC which
in turn is a substantial shareholder in Halogen Holdings PLC.
Mr. D. C. Marshall is Chairman of
Halogen Holdings PLC and Mr L. H.
Marshall and Mr. E. J. Beale
are directors of Halogen Holdings PLC.
Lonfin and Western own City Group PLC (‘City Group’) in the
ratio 51.4% and 48.6% respectively. City Group provides
offices and company secretarial and administrative services to
various companies in the UK and abroad most of which are associated
with Lonfin and Western including all of the above companies.
City Group operates as a shared service centre and does not seek
to make a profit from the provision of its standard services to
these related parties. The various company secretarial,
accounting, and directors’ fees received by City Group from those
companies, their associates and subsidiaries, total £255,000 (2015
- £204,000) for the year under review. At the reporting date
the aggregate balance due in respect of fees invoiced was £85,000
(2015 - £194,000) and no fees have been paid in advance (2015 -
nil). Settlement is within normal credit terms.
As disclosed in Notes 12 and 13, the Company was owed £6,000
from City Group on current account and it owed City Group £45,000
for fees. The Company was also owed £3,758,000 by Lonfin
Investments Limited as disclosed in Note 10.
Other than as disclosed above, no director was interested in any
contract between the directors, the Company and any other related
party that subsisted during or at the end of the financial
year.
Statement of
Directors’ Responsibilities in Respect of the Accounts
As set out above, the following responsibility statement is
repeated here solely for the purpose of complying with Disclosure
and Transparency Rule 6.3.5. This statement relates to and is
extracted from page 37 of the Annual Report and Accounts 2016.
Responsibility is for the full Annual Report and Accounts 2016 not
the extracted information presented in this announcement or the
preliminary announcement released on 30th September
2016.
The directors are responsible for preparing the 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 elected to prepare the financial statements in
accordance with International Financial Reporting Standards (IFRSs)
as adopted by the European Union. 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;
- prepare financial statements in accordance with IFRSs as
adopted by the European Union
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.
Each of the directors whose names and functions are listed on
page 1 confirms that to the best of each person’s knowledge and
belief:
- the financial statements, prepared in accordance with IFRSs as
adopted by the EU, give a true and fair view of the assets,
liabilities, financial position and profit of the Group and the
Company; and
- the Directors’ Report contained in the Annual Report includes a
fair review of the development and performance of the business and
the position of the Group and the Company, together with a
description of the principle risks and uncertainties that they
face.
- Considers that the Annual Report, taken as a whole, is fair,
balanced and understandable and provides the information necessary
for shareholders to assess the Company’s performance, business
model and strategy.
Enquiries to:
London Finance & Investment Group
P.L.C.:
020 7796 9060