Secured Income Fund PLC Monthly Net Asset Value, Dividend and Fact Sheet (5173U)
30 July 2020 - 4:00PM
UK Regulatory
TIDMSSIF
RNS Number : 5173U
Secured Income Fund PLC
30 July 2020
30 July 2020
Secured Income Fund plc
Monthly Net Asset Value, Dividend and Fact Sheet
Secured Income Fund plc (LSE: SSIF) (the "Company"), a
specialist secured lending income investment trust, listed in the
UK, is pleased to provide its monthly net asset value ("NAV") and
dividend update in addition to its monthly fact sheet.
Net Asset Value
The Company announces that, as at 30 June 2020, the unaudited
estimated NAV per ordinary share (cum-income) was 86.37 pence.
The NAV total return in June 2020 was -0.81%.
The global economy is still gripped by the uncertainty of the
Covid-19 pandemic and in the UK the approaching Brexit deadline has
created additional volatility. Despite this backdrop, KKV
originated loans continue to perform and we have had no defaults.
Two of our businesses representing 11.7% of the overall portfolio
have outperformed versus budget during this time; they are an Irish
SME loan manager with an exposure to technology businesses
specialising in educational software and another impaired loan,
that is now emerging from pre-pack administration with a healthy
order book, again focussed on technology. Even our loan to a US
medical services provider has maintained loan service despite
offering ancillary services in a sector that we had expected to be
challenged.
In line with guidance provided by the PRA on IFRS 9
provisioning, we have adopted a pragmatic approach to maturity and
amortisation for two of our counterparties who have requested
forbearance during this challenging time, by extending maturity of
their loans by twelve months, representing a carrying value of
27.5% of the portfolio. No impairment has been necessary and this
measure has extended the weighted average life of the portfolio
from 2.58 years to 2.89 years. Our approach to IFRS provisioning
has been consistent since adopting these new principles in July
2018 and was audited during 2019. The Board acknowledges the
rapidly changing circumstances over the wider alternative debt
sector and will review the approach taken during the current audit
process.
Over the last four months, we have impaired our exposure to a US
Peer to Peer manager by a further 75% (of which GBP 571,130.97 was
impaired during June 2020) as the impact of Covid-19 and the time
taken to recover capital on impaired loans has been unsuccessful,
we consider this position to now be classified as a full default.
This resulted in an impairment amounting to 5.7% of the NAV and
leaves the Company with no further expectation of recovery for this
loan. The NAV adjustment also includes reversal of accrued interest
associated with this loan. Despite this measure, our overall level
of default since inception stands at 8.88% with all impairments and
defaults generated from inherited assets. In addition, we have
given a loan extension of six months from 31 July 2020 to the same
company on a promissory note held against the operating company.
Again, Covid-19 has impacted their business and we await the
introduction of a new product line planned for the autumn to give
the company an opportunity to make whole on its debt
obligation.
Following the vote to wind down the Company by shareholders in
June, KKV is committed to managing this process in an expeditious
timeframe without damaging shareholder value or borrower needs. The
Company has ample cash to maintain a dividend and some loan capital
is expected to be returned earlier than scheduled by our venture
debt and fund investments.
Dividend
The Company is pleased to announce the twelfth monthly dividend
for the year ending 30 June 2020:
Dividend amount: 0.583 pence per Ordinary Share
Ex-date: 06 August 2020
Record date: 07 August 2020
Payment date: 28 August 2020
The Company has elected to designate all of the dividends for
the period ended 30 June 2020 as interest distributions to its
shareholders. In doing so, the Company is taking advantage of UK
tax treatment by "streaming" income from interest-bearing
investments into dividends that will be taxed in the hands of
shareholders as interest income.
Fact Sheet
The Company announces that it has today published its monthly
fact sheet to the end of June 2020 which is available to download
from the Company's website.
( https://kkvim.com/secured-income-fund/ )
For further information please contact:
KKV Investment Management Ltd tel: +44 20 7429 2200
Nicola Bird
Catherine Halford Riera
finnCap Ltd. tel: +44 20 7220 0500
Corporate Finance: William Marle
/ Giles Rolls
Sales: Mark Whitfeld
Buchanan Communications tel: +44 20 7466 5000
Charles Ryland / Henry Wilson
Notes to Editor
The Company aims to provide shareholders with attractive
risk-adjusted returns, principally in the form of regular,
sustainable dividends, through investment predominantly in a range
of secured loans and other secured loan-based instruments
originated through a variety of channels and diversified by way of
asset class, geography and duration.
The Company's Investment Manager is KKV Investment Management
Ltd. The principal responsible for managing the portfolio is Dawn
Kendall.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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