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REINET INVESTMENTS S.C.A - Consolidated unaudited financial results for the six-month period ended 30 September 2013

Release Date: 15/11/2013 08:00
Code(s): REI     PDF:  
Wrap Text
Consolidated unaudited financial results for the six-month period ended 30 September 2013

Reinet Investments S.C.A. Depositary Receipts
issued by Reinet Securities SA
(Incorporated in Switzerland)
ISIN: CH0045793657
Depositary Receipt Code: REI


COMPANY ANNOUNCEMENT FOR IMMEDIATE RELEASE


CONSOLIDATED UNAUDITED FINANCIAL RESULTS FOR THE SIX-MONTH PERIOD ENDED 30 SEPTEMBER 2013


The Board of Reinet Investments Manager S.A. announces the results of Reinet Investments S.C.A. for the six-month period ended 30 September 2013.

--------------------------------------------------------------
Key financial data
- Net asset value at 30 September 2013: Euro 4 024 million (31 March 2013:  Euro 4 023 million)
- Net asset value per ordinary share at 30 September 2013:  Euro 20.54 (31 March 2013: Euro 20.53)
- Sale of 5 million British American Tobacco (BAT) shares in the period realised proceeds of Euro 212 million
- Additional investment of Euro 262 million in Pension Corporation during the period
--------------------------------------------------------------


Reinet Investments S.C.A. (the Company) is a partnership limited by shares incorporated in the Grand Duchy of Luxembourg and having its registered office at 35, boulevard Prince Henri, L-1724 Luxembourg. It is governed by the Luxembourg law on securitisation and in this capacity allows its shareholders to participate indirectly in the portfolio of assets held by its wholly-owned subsidiary Reinet Fund S.C.A., F.I.S. (Reinet Fund or the Fund), a specialised investment fund also incorporated in Luxembourg.  The Companys shares are listed on the Luxembourg Stock Exchange, the primary listing, and its South African Depository Receipts are listed in Johannesburg, the secondary listing.  The Companys shares are included in the 'LuxX' index of the principal shares traded on the Luxembourg exchange. The Company and the Fund together with the Funds subsidiaries are referred to as Reinet.


Reinet Investments S.C.A.
 
Registered office: 35, boulevard Prince Henri, L-1724 Luxembourg, Tel. (+352) 22 42 10, Fax (+352) 22 72 53, Email: mailto:info@reinet.com, website: http://www.reinet.com/
 

BUSINESS REVIEW
 
Consolidated Net Asset Value (NAV)
The NAV of Reinet Investments S.C.A. at 30 September 2013 comprised:
 
+-------------------------+-----------------+------+-------------+------+
|                         |30 September 2013|      |31 March 2013|      |
+-------------------------+-----------------+------+-------------+------+
|                         |           Euro m|     %|       Euro m|     %|
+-------------------------+-----------------+------+-------------+------+
|Listed investments       |                 |      |             |      |
+-------------------------+-----------------+------+-------------+------+
|British American Tobacco |            2 913|  72.4|        3 317|  82.5|
|p.l.c. (1)               |                 |      |             |      |
+-------------------------+-----------------+------+-------------+------+
|Unlisted investments     |                 |      |             |      |
+-------------------------+-----------------+------+-------------+------+
|Private equity and       |              657|  16.3|          549|  13.7|
|related partnerships     |                 |      |             |      |
+-------------------------+-----------------+------+-------------+------+
|Trilantic Capital        |              186|   4.6|          163|   4.0|
|Partners                 |                 |      |             |      |
+-------------------------+-----------------+------+-------------+------+
|Fund IV, Fund V          |                 |      |             |      |
|and related              |                 |      |             |      |
|management companies     |                 |      |             |      |
+-------------------------+-----------------+------+-------------+------+
|Renshaw Bay and          |              153|   3.8|           75|   1.9|
|related investments      |                 |      |             |      |
+-------------------------+-----------------+------+-------------+------+
|Renshaw Bay advisory and |               26|      |           14|      |
|investment management    |                 |      |             |      |
|company                  |                 |      |             |      |
+-------------------------+-----------------+------+-------------+------+
|JPS Credit               |               60|      |           61|      |
|Opportunities Fund       |                 |      |             |      |
+-------------------------+-----------------+------+-------------+------+
|Renshaw Bay Real         |               67|      |            -|      |
|Estate Finance Fund      |                 |      |             |      |
+-------------------------+-----------------+------+-------------+------+
|                         |                 |      |             |      |
+-------------------------+-----------------+------+-------------+------+
|36 South                 |               76|   1.9|           83|   2.1|
|macro/volatility funds   |                 |      |             |      |
+-------------------------+-----------------+------+-------------+------+
|                         |                 |      |             |      |
+-------------------------+-----------------+------+-------------+------+
|Asian private equity     |              109|   2.7|           92|   2.3|
|and portfolio funds      |                 |      |             |      |
+-------------------------+-----------------+------+-------------+------+
|Milestone China          |               80|      |           61|      |
|Opportunities funds,     |                 |      |             |      |
|co-investment and        |                 |      |             |      |
|related opportunities    |                 |      |             |      |
+-------------------------+-----------------+------+-------------+------+
|GEMS                     |                8|      |            8|      |
+-------------------------+-----------------+------+-------------+------+
|Prescient China          |               21|      |           23|      |
|Balanced Fund            |                 |      |             |      |
+-------------------------+-----------------+------+-------------+------+
|                         |                 |      |             |      |
+-------------------------+-----------------+------+-------------+------+
|Specialised private      |              133|   3.3|          136|   3.4|
|equity funds             |                 |      |             |      |
+-------------------------+-----------------+------+-------------+------+
|Vanterra Flex Investments|               46|      |           47|      |
+-------------------------+-----------------+------+-------------+------+
|Vanterra C Change TEM    |               28|      |           37|      |
+-------------------------+-----------------+------+-------------+------+
|NanoDimension Funds and  |               28|      |           25|      |
|co-investment            |                 |      |             |      |
|opportunities            |                 |      |             |      |
+-------------------------+-----------------+------+-------------+------+
|Fountainhead Expert Fund |               23|      |           21|      |
+-------------------------+-----------------+------+-------------+------+
|Other fund investments   |                8|      |            6|      |
+-------------------------+-----------------+------+-------------+------+
|                         |                 |      |             |      |
+-------------------------+-----------------+------+-------------+------+
|Pension Corporation      |              484|  12.0|          134|   3.3|
+-------------------------+-----------------+------+-------------+------+
|US land development      |               99|   2.5|          105|   2.6|
|and mortgages            |                 |      |             |      |
+-------------------------+-----------------+------+-------------+------+
|Jagersfontein and other  |              114|   2.8|          102|   2.5|
|diamond exploration      |                 |      |             |      |
|interests                |                 |      |             |      |
+-------------------------+-----------------+------+-------------+------+
|Other investments        |               24|   0.6|           30|   0.7|
+-------------------------+-----------------+------+-------------+------+
|                         |            4 291| 106.6|        4 237| 105.3|
+-------------------------+-----------------+------+-------------+------+
|Cash and liquid funds    |              229|   5.7|          326|   8.1|
+-------------------------+-----------------+------+-------------+------+
|Bank borrowings and      |                 |      |             |      |
|collar financing         |                 |      |             |      |
+-------------------------+-----------------+------+-------------+------+
|Borrowings               |            (425)|(10.6)|        (435)|(10.8)|
+-------------------------+-----------------+------+-------------+------+
|Derivative               |              (4)| (0.1)|         (11)| (0.3)|
|assets/(liabilities)     |                 |      |             |      |
+-------------------------+-----------------+------+-------------+------+
|Other liabilities        |                 |      |             |      |
+-------------------------+-----------------+------+-------------+------+
|Fees payable and         |             (33)| (0.8)|         (60)| (1.5)|
|other liabilities, net   |                 |      |             |      |
|of other assets          |                 |      |             |      |
+-------------------------+-----------------+------+-------------+------+
|Funding by               |             (20)| (0.5)|         (21)| (0.5)|
|minority partners        |                 |      |             |      |
+-------------------------+-----------------+------+-------------+------+
|                         |            4 038| 100.3|        4 036| 100.3|
+-------------------------+-----------------+------+-------------+------+
|Minority interests       |             (14)| (0.3)|         (13)| (0.3)|
+-------------------------+-----------------+------+-------------+------+
|                         |            4 024| 100.0|        4 023| 100.0|
+-------------------------+-----------------+------+-------------+------+

 
All of the underlying assets are held by Reinet Fund S.C.A., F.I.S. ('Reinet Fund' or the Fund).
 
(1) Of 74.3 million BAT shares held, some 13.7 million shares are subject to put and call options.
 
 
LISTED INVESTMENT IN BRITISH AMERICAN TOBACCO P.L.C. (BAT)
British American Tobacco p.l.c. is a leading tobacco group, employing more than 55 000 people and selling over 200 brands in 180 markets globally.
 
The investment in BAT is Reinets single largest investment position and is kept under constant review, considering the companys performance, the industry outlook, cash flows from dividends, stock market performance, volatility and liquidity. The share price of BAT has increased significantly from around £ 17.00 in October 2008 to £ 32.77 at 30 September 2013, largely driving the growth in Reinets NAV over that period.
 
At 30 September 2013, Reinet held some 74.3 million shares in BAT, representing 3.9 per cent of BATs issued share capital. The value of the investment in BAT in the balance sheet of Reinet was Euro 2 913 million, being 72.4 per cent of Reinets NAV. The BAT share price on the London Stock Exchange decreased over the period under review from £ 35.27 to £ 32.77.
 
During the period under review Reinet sold 5 million BAT shares at an average price of £ 35.88 per share. Aggregate proceeds of this share sale programme amounted to some Euro 212 million. These funds are being utilised to meet Reinets commitments to fund new and existing investment opportunities. In total, Reinet has sold 10 million of its initial holding of 84.3 million BAT shares.
 
Reinet received dividends from BAT during the period amounting to Euro 126 million (£ 106 million), being BATs final 2012 dividend and its 2013 interim dividend. Given the timing of BATs dividend payments, no further dividends from BAT are anticipated during the remainder of Reinets current financial year.
 
Further information on BAT is available at http://www.bat.com
 
UNLISTED INVESTMENTS
Reinet seeks, through a range of investment structures, to build partnerships with other investors, specialised fund managers and entrepreneurs to find and develop opportunities for long-term value creation for its shareholders. In evaluating these opportunities, Reinet applies a minimum hurdle rate of return, taking into account the performance of the investment in BAT.
 
In addition to investments funded since its formation, Reinet is committed to provide further funding of Euro 504 million over the lives of its current investments. Details of the funding commitments outstanding at 30 September 2013 are given in the committed funds table of this report. New commitments during the period under review amounted to Euro 150 million.
 
Unlisted investments are carried at their estimated fair value. In determining fair value, Reinet Fund Manager S.A. (the Fund Manager) relies on audited financial statements of investee companies, management reporting and, where appropriate, valuations provided by third-party experts. Valuations are based on the net asset value of investment funds, discounted cash flow models and the use of comparable valuation multiples for other entities.
 
The table previously shows the value of the 100 per cent investment in Trilantic Capital Partners and United States land development and mortgages. In each case, Reinet co-invests with minority parties. Amounts attributable to minority parties are shown in the table either as 'funding by minority partners' or 'minority interests'.
 
Funding commitments are entered into in various currencies including pounds sterling, US dollars and South African rand and are converted into euro below using 30 September 2013 exchange rates.
 
PRIVATE EQUITY AND RELATED PARTNERSHIPS
Where Reinet invests in funds managed by third parties, its philosophy is to partner with the managers of such funds and to share in fees generated by funds under management. This is the case with funds managed by Trilantic, 36 South, Milestone, Prescient, Renshaw Bay and Vanterra. Under the terms of the Investment Advisory Agreement, Reinet pays no management fee to Reinet Investment Advisors Limited (the Investment Advisor) on such investments except in the case where no fee or a reduced fee below 1 per cent is paid to the third-party manager. In such cases, the aggregate fee payable to the Investment Advisor and the third-party manager is capped at 1 per cent.
 
TRILANTIC CAPITAL PARTNERS
FUND IV
Original commitments: Euro 163 million (EUR commitment and EUR equivalent of USD commitment)
 
Trilantic Capital Partners (Trilantic) is a global private equity firm focused on controlling and significant minority interest investments in North America and Europe. Trilantic employs flexible transaction structures and has a strong record of partnering with family-owned businesses and providing growth capital to management teams. Current investments held in the Fund IV portfolio in the United States include interests in natural gas and oil exploration; aggregates extraction and distribution; sports and casual accessories; soft goods and electronics; electricity transmission component manufacture and supply; and outdoor and fitness accessories. In Europe, Fund IV has interests in gaming machines and video-lotteries; events management; publishing; commodities broking; mobile telephony and high-speed rail equipment manufacture and maintenance.
 
Reinet has a 90 per cent interest in an entity which invests in two funds, Trilantic Capital Partners Fund IV Global L.P., which invests primarily in the United States, and Trilantic Capital Partners Fund IV (Europe) L.P. (together Fund IV).
 
Reinet and its minority partner also invest in the Trilantic Capital Partners management companies (Trilantic Management).
 
The investment in Trilantic Management provides that Reinet and its partner will not pay any management fees or carried interest cost on substantially all of the investments in funds under Trilantic Management. In addition, the agreement provides for Reinet and its partner to receive a share of the carried interest payable to Trilantic Management on the realisation of investments held in the funds, once a hurdle rate has been achieved. This applies to the existing funds and to any future funds to be launched by Trilantic. Reinets share of any carried interest earned by Trilantic Management is 11.25 per cent.
 
As at 30 September 2013, Reinet and its partner have invested the equivalent of Euro 106 million (31 March 2013: Euro 113 million), net of capital repayments, in Trilantic Management and Fund IV. Capital repayments were received during the period under review, as Fund IV continues the process of realising investments.
 
The investment is carried at the estimated fair value of Euro 178 million at 30 September 2013 (31 March 2013: Euro 163 million). The investment in Fund IV is based on unaudited valuation data provided by Trilantic Management as at 30 June 2013. The increase in the valuation is due to increases in unrealised gains on underlying investments. Of the Euro 178 million carrying value, some Euro 160 million is attributable to Reinet, with the balance being attributable to its minority partner.
 
During the period under review, Reinet and its partner earned net carried interest and realised gains amounting to Euro 2 million, before tax, on their share of the investments realised by Fund IV. Total cash proceeds received from Fund IV during the period, being gains, carried interest and repayments of capital, amounted to Euro 8 million.
 
At 30 September 2013, Reinet had remaining commitments of Euro 39 million to invest in Fund IV.
 
FUND V
Original commitment: Euro 76 million (EUR equivalent of USD commitment)
 
Reinet has committed some Euro 74 million to Trilantic Capital Partners V (North America) L.P. (Fund V) together with a commitment of some Euro 2 million to Fund Vs general partner. Fund V will invest principally in North America. Fund V has now completed its fundraising activities and commenced its investment activities in line with the philosophy applied to earlier funds.
 
Under the terms of the original strategic agreement, no management fee or carried interest are payable to Trilantic Management in respect of the funds to be invested in Fund V. Reinet is also entitled to receive a share of any carried interest earned by Trilantic Management on the investments held through Fund V.
 
During the period under review, Reinet invested Euro 8 million in Fund V. The investment is carried at the estimated fair value of Euro 8 million at 30 September 2013 (31 March 2013: Euro nil), based on unaudited valuation data provided by Trilantic Management as at 30 June 2013.
 
At 30 September 2013, Reinet had remaining commitments of Euro 68 million to invest in Fund V.
 
Further information on Trilantic is available at http://www.trilanticpartners.com/
 
RENSHAW BAY AND RELATED INVESTMENTS
RENSHAW BAY ADVISORY AND INVESTMENT MANAGEMENT ENTITY
Original commitments: Euro 26 million (including additional interest acquired during the period) (EUR equivalent of GBP commitment)
 
Reinet has co-invested with Mr William T. Winters and RIT Capital Partners plc in an investment advisory and management business, known as Renshaw Bay. Renshaw Bay is focused on investment opportunities resulting from dislocations and structural changes in capital markets. The business is managed by Mr Winters, a former Co-Chief Executive Officer of JP Morgan Investment Bank.
 
During the period under review, Reinet purchased additional shares in the business from RIT Capital Partners and participated in a capital increase bringing its total holding to 43.5 per cent and reducing RIT Capital Partners holding to 6.5 per cent. Mr Winters and senior management continue to hold 50 per cent of the entity.
 
Reinet has invested Euro 26 million to date in Renshaw Bay (31 March 2013:  Euro 14 million). The investment is carried at the estimated fair value of Euro 26 million at 30 September 2013 (31 March 2013:  Euro 14 million). The current carrying value is based on a recent independent valuation of Renshaw Bay.
 
At 30 September 2013, Reinet had no further commitment to invest in Renshaw Bay.
 
To date, Reinet has also invested in the JPS Credit Opportunities Fund and the Renshaw Bay Real Estate Finance Fund, both opportunities identified and developed by Renshaw Bay. Reinet has also committed to invest Euro 111 million in the Renshaw Bay Structured Finance Opportunity Fund.
 
JPS CREDIT OPPORTUNITIES FUND (CAYMAN) LTD. (JPS CREDIT FUND)
Original commitment: Euro 52 million (EUR equivalent of USD commitment)
 
The investment in JPS Credit Fund, which was the first transaction introduced to Reinet by Renshaw Bay, focuses on liquid opportunities in the credit markets. JPS Credit Fund is managed by JP Morgan Asset Management.
 
JPS Credit Funds investment objective is to achieve attractive risk-adjusted returns through both capital appreciation and current income by taking positions in publicly traded and privately held securities, derivatives and other instruments (including bonds, credit default swaps and index options), primarily in credit and credit-related markets.
 
Reinet invested its full commitment to JPS Credit Fund during the year ended 31 March 2012. The investment is carried at the estimated fair value of Euro 60 million at 30 September 2013 (31 March 2013: Euro 61 million) based on the valuation at that date provided by the fund manager.
 
RENSHAW BAY REAL ESTATE FINANCE FUND
Original commitment: Euro 120 million (EUR equivalent of GBP commitment)
 
In November 2012, Reinet committed to invest Euro 120 million in this fund.
 
The Renshaw Bay Real Estate Finance Fund was created to take advantage of opportunities resulting from a funding gap between the expected demand for commercial real estate finance and its availability from banks, other traditional lenders and equity investors.
 
Reinet has invested Euro 71 million in the fund to date (31 March 2013: Euro 9 million). The investment is carried at the estimated fair value of Euro 67 million at 30 September 2013 (31 March 2013: Euro nil) based on unaudited valuation data provided by the fund manager as at 30 June 2013.
 
Reinet is committed to invest a further Euro 49 million in the fund.
 
Further information on Renshaw Bay is available at http://www.renshawbay.com
 
36 SOUTH GLOBAL MACRO/VOLATILITY FUNDS
Original commitment: Euro 88 million
 
36 South is an absolute return fund manager that specialises in managing global macro/volatility funds. The fund management philosophy is to invest when market estimates of volatility are mis-priced. The volatility may apply to a wide range of underlying asset classes ranging from currencies and interest rates to equities. 36 Souths strategies are designed to perform well in most market environments, but substantially outperform in periods of extreme market movement and volatility.
 
Reinet has co-invested with the 36 South management team in the fund management and distribution companies. Reinet is also an investor in the 36 South funds. The funds are established through an Irish-registered investment fund  36 South Funds plc.
 
Reinets commitment of Euro 88 million to 36 South has been invested in full.
 
The fund investment is carried at its estimated fair value of Euro 68 million based on unaudited capital statements received from the fund manager as at 30 September 2013 (31 March 2013: Euro 71 million) and the fair value of the short-term loan and investment in the fund management companies amounted to Euro 8 million (31 March 2013: Euro 12 million). The investments in total have a fair value of Euro 76 million (31 March 2013: Euro 83 million). The change in value principally reflects movements in the value of the underlying funds.
 
Further information on 36 South is available at http://www.36south.com
 
ASIAN PRIVATE EQUITY AND PORTFOLIO FUNDS
MILESTONE CHINA OPPORTUNITIES FUNDS (MILESTONE), INVESTMENT HOLDINGS AND MANAGEMENT COMPANY PARTICIPATION
Original commitments: Euro 13 million (Milestone II), Euro 74 million (Milestone III) and Euro 60 million (investments and management companies) (EUR equivalent of USD commitments)
 
The Milestone China Opportunities Fund II L.P. (Milestone II) and Fund III L.P. (Milestone III) invest primarily in domestic Chinese high-growth companies seeking expansion or acquisition capital. Milestone funds seek to maximise medium to long-term capital appreciation by making direct investments to acquire minority or majority equity stakes in those companies identified by Milestones investment team. Milestone has a strong track record in helping portfolio companies list on either domestic or foreign stock exchanges. Current areas of investment include: restaurants; B2B and B2C online travel services; bio-technology; branded sportswear; online group buying services; power generation equipment; fashion retailing; and retail pharmacies.
 
Reinet, assumed the participation in Milestone II from Richemont when Reinet was formed in 2008. At 30 September 2013, this investment is estimated to have a fair value of Euro 6 million based on unaudited capital statements received from the fund manager as at 30 June 2013 (31 March 2013: Euro 6 million). The fund is at a mature stage and assets are being realised over the remaining life of the fund. Reinets remaining commitment to Milestone II is Euro 2 million.
 
In June 2011, Reinet entered into an agreement to invest in Milestone III and its general partner and to co-invest, at its option, in certain of Milestone IIIs proposed investments. As at 30 September 2013, capital contributions of Euro 30 million had been made to Milestone III (31 March 2013: Euro 22 million). The investment in the fund together with the co-investment are carried at the estimated fair value of Euro 33 million at 30 September 2013, based on a recent independent valuation (31 March 2013: Euro 20 million).
 
Reinet has also invested in the general partner of Milestone III. The investment is carried at an estimated fair value of Euro 4 million at 30 September 2013, taking into account estimated future discounted cash flows in respect of management fees receivable from the underlying fund.
 
Reinet has invested Euro 27 million in a long-term investment vehicle in partnership with certain of the Milestone general partner principals and other partners, including Remgro Limited. This vehicle will invest in opportunities identified by the Milestone principals. The investment is carried at the estimated fair value of Euro 37 million at 30 September 2013 (31 March 2013: Euro 28 million) based on the unaudited financial statements at that date. The increase in value reflects increases in the value of its underlying listed investments.
 
The investments in Milestone III, its general partner and long-term investments are carried at a total estimated fair value of Euro 74 million as at 30 September 2013 (31 March 2013: Euro 55 million).
 
At 30 September 2013, Reinets remaining commitment to Milestone III and long-term investment opportunities is Euro 49 million.
 
Further information in respect of the Milestone funds is available at http://www.mcmchina.com
 
GENERAL ENTERPRISE MANAGEMENT SERVICES INTERNATIONAL LIMITED (GEMS)
Original commitment: No Reinet commitment; investment assumed from Richemont and fully funded at that time
 
Based in Hong Kong, GEMS operates investment funds focused on the natural resources sector and on growth opportunities. GEMS principal objective is to achieve medium to long-term capital appreciation by investing in a diversified portfolio of equity or equity-linked investments in Asia. GEMS growth funds have made investments in a variety of industries including financial services; consumer/retail; telecommunications and electronics.
 
At the time of its formation in 2008, Reinet assumed the investments in the GEMS II and GEMS III funds that had been made by Richemont. Both funds were fully funded by Richemont and no further investment or commitment has been made by Reinet. At 30 September 2013, GEMS II was in the process of being liquidated with any remaining assets to be held in trust for the investors. GEMS III is now in the divestment stage and it is expected that Reinet will realise the value of the remainder of its investments in due course. At 30 September 2013, the aggregate investment in the GEMS funds is carried at the estimated fair value of Euro 8 million based on a recent independent valuation (31 March 2013: Euro 8 million).
 
Further information on GEMS is available at http://www.gems.com.hk
 
PRESCIENT CHINA BALANCED FUND (PRESCIENT CHINA)
Original commitment: Euro 24 million (EUR equivalent of USD commitment)
 
Prescient China is a fund managed by an Irish subsidiary of Prescient Holdings Limited, a South African-listed fund manager. The fund invests in equities, bonds, cash and derivatives with the objective of generating inflation-beating returns at acceptable risk levels. It invests principally in equities and other instruments listed on the Shanghai and Shenzhen Stock Exchanges.
 
In March 2013, Reinet committed to invest Euro 22 million in Prescient China and Euro 2 million in its management company. Reinet invested its full capital commitment of Euro 22 million in the fund in March 2013. This investment is carried at the estimated fair value of Euro 21 million (31 March 2013: Euro 23 million) based on unaudited valuation statements provided by the fund manager at 30 September 2013. Reinets commitment to invest Euro 2 million in the management company structure remained uncalled at 30 September 2013.
 
Further information on Prescient is available at http://www.prescient.co.za
 
SPECIALISED PRIVATE EQUITY FUNDS
VANTERRA FLEX INVESTMENTS L.P. (VANTERRA)
Original commitment: Euro 74 million (EUR equivalent of USD commitment)
 
Vanterra was established in March 2010 to invest in listed and unlisted funds and to make direct investments in the United States and emerging markets. Vanterra seeks to construct a globally diversified private equity portfolio providing investors with long-term capital appreciation. Vanterra has co-invested alongside Reinet in Trilantic, in the United States land development and mortgages and in Vanterra C Change Transformative Energy & Materials I, L.P. In addition, Vanterra has investments in US healthcare, in a specialist fund in Brazil and in a Spanish high-speed train manufacturer.
 
Reinet is an investor in both Vanterra and in its general partner.
 
As at 30 September 2013, Euro 45 million of committed funds (31 March 2013: Euro 43 million), together with Euro 3 million in respect of expenses (31 March 2013: Euro 3 million) had been invested in the fund. This investment is carried at the estimated fair value of Euro 46 million at 30 September 2013 (31 March 2013: Euro 47 million), based on unaudited financial information as at 30 June 2013.
 
Reinet is committed to invest a further Euro 29 million in Vanterra.
 
VANTERRA C CHANGE TRANSFORMATIVE ENERGY & MATERIALS I, L.P. (VANTERRA C CHANGE TEM)
Original commitment: Euro 48 million (EUR equivalent of USD commitment)
 
Vanterra C Change TEM was established in July 2010 to invest in companies and projects providing products or services that supply cleaner energy; create a more cost-effective building environment through the use of energy efficient technologies; and develop renewable resources as a substitute for fossil and other traditional fuels.
 
Reinet is an investor in Vanterra C Change TEM and in its general partner.
 
As at 30 September 2013, capital contributions of Euro 44 million had been made to the fund (31 March 2013: Euro 41 million). This investment is carried at the estimated fair value of Euro 28 million (31 March 2013: Euro 37 million), based on unaudited financial information as at 30 June 2013.
 
Reinet is committed to invest a further Euro 5 million in Vanterra C Change TEM.
 
Further information on Vanterra is available at http://www.vanterra.com
 
NANODIMENSION FUNDS AND CO-INVESTMENT OPPORTUNITIES
Original commitments: Euro 46 million (EUR commitment and EUR equivalent of USD commitment)
 
NanoDimension Management Limited has established two funds in which Reinet is an investor. The focus of each fund is to invest in and support the growth and commercialisation of nanotechnology, the manipulation of matter at an atomic and molecular level. Areas of investment by the funds include: pharmaceutical and drug delivery structures; optical and electronic switches; and thin film photo-chromatic coatings.
 
Reinet assumed Richemonts initial investment in the first NanoDimension fund and its commitments to that fund and in May 2012 committed a further Euro 41 million to invest in the second NanoDimension fund and to co-invest with the fund in one specific project.
 
At 30 September 2013, the fair value of Reinets investment in the two funds and the co-investment amounted to Euro 28 million (31 March 2013: Euro 25 million). The estimate of fair value is based on valuation statements received from the fund manager as at 30 June 2013 together with an independent valuation of the co-investment. Reinets remaining commitments to the funds amounted to Euro 18 million at 30 September 2013.
 
Further information on NanoDimension is available at http://www.nanodimension.com
 
FOUNTAINHEAD EXPERT FUND
Original commitment: Euro 15 million (EUR equivalent of USD commitment)
 
Fountainhead Expert Fund (Fountainhead) is an absolute return fund investing in a concentrated manner in global equities offering superior potential for capital appreciation and value realisation.
 
In February 2012, Reinet invested Euro 15 million in Fountainhead. The amount invested represents Reinets full commitment to the fund.
 
As at 30 September 2013, the fair value of the investment was Euro 23 million (31 March 2013: Euro 21 million), based on the valuation at that date provided by the fund manager.
 
Further information on Fountainhead is available at http://www.fountainheadpartners.co.za
 
Other Fund Investments
 
This includes small, specialist funds investing in private equity businesses, start-up ventures and listed securities. These investments are valued at their fair value of Euro 8 million at 30 September 2013 (31 March 2013: Euro 6 million), based on valuation statements received from the fund managers.  The listed investment was sold during the period under review, proceeds received amounted to Euro 2 million.
 
PENSION CORPORATION GROUP LIMITED
Original commitment: Euro 479 million (EUR equivalent of GBP commitment)
 
Pension Corporation Group Limiteds wholly-owned subsidiary, Pension Insurance Corporation is one of the UKs leading providers of risk management solutions to defined benefit pension funds. Pension Insurance Corporation is authorised and regulated as an insurance company by the Prudential Regulation Authority in the United Kingdom. It has over £ 8 billion in assets and has insured more than 85 000 pension fund members. Clients include FTSE 100 companies, multinationals and the public sector.
 
In October 2012, Reinet invested an initial Euro 120 million in Pension Corporation Group Limited. The initial investment represents a 16 per cent ordinary shareholding in Pension Corporation Group Limited, a newly-established group holding company. In accordance with its commitment, Reinet invested a further Euro 59 million in Pension Corporation Group Limited in April 2013, and a further Euro 203 million in July 2013, bringing its equity holding to 38 per cent.
 
Reinet is committed to invest a further Euro 90 million in one or several tranches to finance new business over the period to 2017. This will lead to Reinet ultimately having an equity position of 43 per cent in the company. Reinets shareholding in Pension Corporation Group Limited carries at all times voting rights commensurate with its ultimate 43 per cent shareholding.
 
The investment is carried at an estimated fair value of Euro 484 million at 30 September 2013 (31 March 2013: Euro 134 million) based on the results of an independent valuation, taking into account the embedded value at 31 July 2013 and reflecting valuation multiples drawn from industry data.
 
Further information in respect of Pension Corporation is available at http://www.pensioncorporation.com
 
UNITED STATES LAND DEVELOPMENT AND MORTGAGES
Original commitment: Euro 101 million (including increase of Euro 27 million in period) (EUR equivalent of USD commitment)
 
Reinet has co-invested with partners to acquire interests in real estate development projects, usually properties where infrastructure services have been laid but where construction of properties has not yet commenced. It has also invested in mortgage debt on such developments and in specific properties. The investments are principally in Florida, Colorado and North and South Carolina.
 
During the period under review Reinet increased its commitment by Euro 27 million including the provision of a short-term loan to provide additional liquidity alongside its minority partners.
 
At 30 September 2013, Reinet had invested Euro 76 million in these projects (31 March 2013: Euro 78 million). The investment is carried at the estimated fair value of Euro 99 million (31 March 2013: Euro 105 million) of which Euro 83 million is attributable to Reinet and Euro 16 million to its minority partners.
 
The current valuation is based on independent valuations of underlying assets and liabilities as at 30 June 2013. The decrease in the valuation reflects the weakening of the US dollar against the euro during the period.
 
Reinet has a further commitment of Euro 25 million to invest in these investments as of 30 September 2013.
 
JAGERSFONTEIN AND OTHER DIAMOND EXPLORATION INTERESTS
Project cost: Euro 91 million (EUR equivalent of ZAR cost)
 
Reinet is an investor in an entity which extracts diamonds from the waste tailings of mining operations which began over a century ago. The tailings are located at Jagersfontein in South Africa. Developments in terms of gemstone extraction technology since the mines were first excavated mean that there is now the potential to recover stones which were previously treated as waste.
 
Reinets effective interest in the Jagersfontein project is 48 per cent. Other shareholders include a Black Economic Empowerment (BEE) organisation, a local community trust and the parties responsible for the day-to-day operations. The local community trust has been funded by Reinet.
 
Reinet has also invested in a separate project, which has acquired rights to source diamonds on an as yet unexploited site near Kimberley in South Africa.
 
As with the Jagersfontein investment, at the time of making the investment, Reinet entered into agreements to sell a substantial part of its equity holdings in this project to third parties, including local BEE interests. The sales were completed during the period under review resulting in Reinet reducing its effective interest in this project to 49 per cent.
 
As at 30 September 2013, Reinet held equity interests with a fair value of Euro 25 million (31 March 2013: Euro 22 million) in the above investments and had provided loans of Euro 64 million (31 March 2013: Euro 60 million). In addition, Euro 10 million (31 March 2013: Euro 7 million) is receivable from third parties in respect of sales of part of the equity investments and Reinet has accrued income of Euro 15 million (31 March 2013: Euro 13 million) in respect of funding provided to the projects to date.
 
In aggregate, these investments are carried at their estimated fair value of Euro 114 million at 30 September 2013 (31 March 2013: Euro 102 million). The current valuations are prepared by independent experts based on discounted cash flow analyses prepared by management of the projects. Reinet is committed to invest a further Euro 7 million in these projects.
 
The exposure to the South African rand has been substantially hedged by borrowings in that currency and through forward exchange contracts.
 
OTHER INVESTMENTS
This portfolio includes small businesses with significant growth potential as well as interests in businesses which require assistance in restructuring their activities before value can be realised. These assets are valued at their aggregate fair value of Euro 24 million at 30 September 2013 (31 March 2013: Euro 30 million), based on an independent valuation and management analysis of each of the investments. The decrease in value is due to a change in the valuation basis of one of the investments, together with the effect of the weakening of the US dollar against the euro during the period

Committed Funds
The table below summarises Reinets outstanding investment commitments as at 30 September 2013.
 
+-----------------+--------+--------+--------+------+---------+---------+
|                 |As at 31|Exchange| Commit-|      |As at 30 |As at 30 |
+-----------------+--------+--------+--------+------+---------+---------+
|                 |   March|    rate|ments in|      |September|September|
+-----------------+--------+--------+--------+------+---------+---------+
|                 | 2013(1)|effects |  period|Funded|     2013|     2013|
|                 |        |     (2)|        |      |         |         |
+-----------------+--------+--------+--------+------+---------+---------+
|                 |  Euro m|  Euro m|  Euro m|Euro m|   Euro m|        %|
+-----------------+--------+--------+--------+------+---------+---------+
|                 |        |        |        |      |         |         |
+-----------------+--------+--------+--------+------+---------+---------+
|Private equity   |        |        |        |      |         |         |
|and related      |        |        |        |      |         |         |
|partnerships     |        |        |        |      |         |         |
+-----------------+--------+--------+--------+------+---------+---------+
|Trilantic Capital|     121|     (5)|       1|  (10)|      107|     21.2|
|Partners(3)      |        |        |        |      |         |         |
+-----------------+--------+--------+--------+------+---------+---------+
|Renshaw Bay and  |        |        |        |      |         |         |
|related          |        |        |        |      |         |         |
|investments      |        |        |        |      |         |         |
+-----------------+--------+--------+--------+------+---------+---------+
|Renshaw Bay      |       2|       -|      10|  (12)|        -|        -|
|advisory and     |        |        |        |      |         |         |
|investment       |        |        |        |      |         |         |
|management       |        |        |        |      |         |         |
|company          |        |        |        |      |         |         |
+-----------------+--------+--------+--------+------+---------+---------+
|JPS Credit       |       -|       -|       -|     -|        -|        -|
|Opportunities    |        |        |        |      |         |         |
|Fund             |        |        |        |      |         |         |
+-----------------+--------+--------+--------+------+---------+---------+
|Renshaw Bay Real |     118|       -|       -|  (69)|       49|      9.7|
|Estate Finance   |        |        |        |      |         |         |
|Fund             |        |        |        |      |         |         |
+-----------------+--------+--------+--------+------+---------+---------+
|Renshaw Bay      |       -|       -|     111|     -|      111|     22.0|
|Structured       |        |        |        |      |         |         |
|Finance          |        |        |        |      |         |         |
|Opportunity Fund |        |        |        |      |         |         |
+-----------------+--------+--------+--------+------+---------+---------+
|Asian private    |        |        |        |      |         |         |
|equity and       |        |        |        |      |         |         |
|portfolio funds  |        |        |        |      |         |         |
+-----------------+--------+--------+--------+------+---------+---------+
|Milestone China  |      63|     (3)|       -|   (9)|       51|     10.1|
|Opportunities    |        |        |        |      |         |         |
|funds            |        |        |        |      |         |         |
|co-investment and|        |        |        |      |         |         |
|related          |        |        |        |      |         |         |
|opportunities    |        |        |        |      |         |         |
+-----------------+--------+--------+--------+------+---------+---------+
|GEMS             |       -|       -|       -|     -|        -|        -|
+-----------------+--------+--------+--------+------+---------+---------+
|Prescient China  |       2|       -|       -|     -|        2|      0.4|
|Balanced Fund    |        |        |        |      |         |         |
+-----------------+--------+--------+--------+------+---------+---------+
|Specialised      |        |        |        |      |         |         |
|private equity   |        |        |        |      |         |         |
|funds            |        |        |        |      |         |         |
+-----------------+--------+--------+--------+------+---------+---------+
|Vanterra Flex    |      35|     (2)|       -|   (4)|       29|      5.8|
|Investments      |        |        |        |      |         |         |
+-----------------+--------+--------+--------+------+---------+---------+
|Vanterra C       |      10|     (1)|       -|   (4)|        5|      1.0|
|Change TEM       |        |        |        |      |         |         |
+-----------------+--------+--------+--------+------+---------+---------+
|NanoDimension    |      19|     (1)|       -|     -|       18|      3.6|
|funds and        |        |        |        |      |         |         |
|co-investments   |        |        |        |      |         |         |
|opportunities    |        |        |        |      |         |         |
+-----------------+--------+--------+--------+------+---------+---------+
|Other fund       |       4|       -|       -|     -|        4|      0.8|
|investments      |        |        |        |      |         |         |
+-----------------+--------+--------+--------+------+---------+---------+
|Pension          |     356|     (4)|       -| (262)|       90|     17.9|
|Corporation      |        |        |        |      |         |         |
+-----------------+--------+--------+--------+------+---------+---------+
|US land          |       -|       -|      27|   (2)|       25|      5.0|
|development and  |        |        |        |      |         |         |
|mortgages(3)     |        |        |        |      |         |         |
+-----------------+--------+--------+--------+------+---------+---------+
|Jagersfontein and|      22|     (3)|       -|  (12)|        7|      1.3|
|other diamond    |        |        |        |      |         |         |
|exploration      |        |        |        |      |         |         |
|interests        |        |        |        |      |         |         |
+-----------------+--------+--------+--------+------+---------+---------+
|Other investments|      11|       -|       1|   (6)|        6|      1.2|
+-----------------+--------+--------+--------+------+---------+---------+
|                 |     763|    (19)|     150| (390)|      504|    100.0|
+-----------------+--------+--------+--------+------+---------+---------+
(1) Commitments are calculated using 31 March 2013 exchange rates.    

(2) Reflects exchange rate movements between 31 March 2013 and 30 September 2013.

(3) Commitments noted represent only Reinets share of the investments. Additional commitments payable by minority partners amount to Euro 4 million in respect of Trilantic and Euro nil in respect of US land development and mortgages.
 
CASH AND LIQUID FUNDS
Reinet holds cash on deposit principally in European banks.  Interest rates remain exceptionally low in respect of both euro and sterling deposits, the currencies in which the bulk of funds are held.
 
BANK BORROWINGS AND RELATED DERIVATIVE CONTRACTS
Borrowings
In February 2012, in order to meet its on-going commitments, Reinet entered into a £ 300 million medium-term financing facility. At 30 September 2013, the fair value of the borrowing was Euro 355 million (31 March 2013: Euro 356 million).  The transaction incorporates the purchase by Reinet of put options and the sale by Reinet of call options over 13.7 million BAT shares. The unpaid net option premium is payable over the period to 2017 and is carried as a liability at its fair value of Euro 37 million as at 30 September 2013 (31 March 2013: Euro 42 million).
 
Reinet has also borrowed ZAR 443 million to fund its investments in South African projects. At 30 September 2013, the fair value of the borrowing was Euro 33 million (31 March 2013: Euro 37 million).
 
Derivative assets/(Liabilities)  Put and call options and forward exchange contracts
As part of the £ 300 million financing facility, Reinet has purchased put options which provide protection should the value of the BAT shares used to secure the borrowings fall below a certain amount. Reinet has also sold call options over an equal number of BAT shares. Both the put options and the call options are carried at their respective fair values at the balance sheet date. The net derivative liability is carried at its fair value of Euro 4 million at 30 September 2013 (31 March 2013: Euro 15 million).
 
Reinet has entered into forward exchange contracts to sell ZAR 890 million (31 March 2013: ZAR 600 million). Outstanding contracts amounting in total to ZAR 840 million were settled on 30 September 2013 realising a gain of Euro 9 million. New forward exchange contracts to sell ZAR 890 million in one years time were entered into the same date. The net asset in respect of the forward exchange contracts is carried at its fair value of Euro nil at 30 September 2013 (31 March 2013: Euro 4 million).
 
OTHER LIABILITIES
Fees payable and other liabilities, net of other assets
Fees payable and other liabilities comprise principally an accrual of Euro 15 million in respect of the management fee payable at 30 September 2013 (31 March 2013: Euro 15 million), a provision for deferred taxes of Euro 14 million relating to gains arising from the investments in Trilantic Capital Partners and withholding taxes relating to the investment in US land development and mortgages, together with other operating expenses currently payable. No provision has been made in respect of a performance fee as at 30 September 2013 (31 March 2013: Euro 32 million) as the conditions required to pay a fee had not been met at that date. The performance fee and management fee are payable to the Investment Advisor.
 
The management fee for the period under review amounted to Euro 18 million (30 September 2012: Euro 16 million).
 
Funding by minority partners
Reinet invests in certain investments, principally Trilantic Capital Partners and US land development and mortgages, along with minority partners. As capital calls are received, minority partners fund their share by advancing funds to Reinet; as distributions are received from investees, Reinet refunds their pro-rata share to the minority partners. The net amounts received of Euro 20 million (31 March 2013: Euro 21 million), are shown as Funding by minority partners in the table in the business review section.
 
 
SUMMARISED CONSOLIDATED INCOME STATEMENT
+-------------------+------------------+------+-----------------+------+
|                   |Six-month period  |      |Six-month period |      |
|                   |ended             |      |ended            |      |
+-------------------+------------------+------+-----------------+------+
|                   | 30 September 2013|      |30 September 2012|      |
+-------------------+------------------+------+-----------------+------+
|                   |            Euro m|Euro m|           Euro m|Euro m|
+-------------------+------------------+------+-----------------+------+
|Income             |                  |      |                 |      |
+-------------------+------------------+------+-----------------+------+
|BAT dividends      |               126|      |              136|      |
+-------------------+------------------+------+-----------------+------+
|Interest and other |                10|      |                8|      |
|investment income  |                  |      |                 |      |
+-------------------+------------------+------+-----------------+------+
|Realised gains     |                  |      |                 |      |
|on investments     |                  |      |                 |      |
| BAT              |               108|      |                -|      |
| Others           |                 2|      |                3|      |
+-------------------+------------------+------+-----------------+------+
|Realised gains on  |                 9|   255|                -|   147|
|foreign exchange   |                  |      |                 |      |
|contracts          |                  |      |                 |      |
+-------------------+------------------+------+-----------------+------+
|                   |                  |      |                 |      |
+-------------------+------------------+------+-----------------+------+
|Expenses           |                  |      |                 |      |
+-------------------+------------------+------+-----------------+------+
|Performance fee    |                 -|      |              (9)|      |
+-------------------+------------------+------+-----------------+------+
|Management fee     |              (18)|      |             (16)|      |
+-------------------+------------------+------+-----------------+------+
|Operating expenses |               (3)|      |              (2)|      |
|and                |                  |      |                 |      |
|transaction-related|                  |      |                 |      |
|costs              |                  |      |                 |      |
+-------------------+------------------+------+-----------------+------+
|Interest expense   |               (6)|      |              (6)|      |
+-------------------+------------------+------+-----------------+------+
|Tax expense        |               (5)|  (32)|              (7)|  (40)|
+-------------------+------------------+------+-----------------+------+
|Realised investment|                  |   223|                 |   107|
|income, net        |                  |      |                 |      |
|of expenses        |                  |      |                 |      |
+-------------------+------------------+------+-----------------+------+
|                   |                  |      |                 |      |
+-------------------+------------------+------+-----------------+------+
|Fair Value         |                  |      |                 |      |
|Adjustments        |                  |      |                 |      |
+-------------------+------------------+------+-----------------+------+
|BAT                |                  |      |                 |      |
| unrealised (loss)|                  |      |                 |      |
|gain on shares held|             (195)|      |              178|      |
| gain on shares   |                  |      |                 |      |
|sold (1)           |             (106)|      |                -|      |
+-------------------+------------------+------+-----------------+------+
|Other investments  |                70|      |               23|      |
+-------------------+------------------+------+-----------------+------+
|Derivative         |                  |      |                 |      |
|instruments        |                 7|      |              (3)|      |
+-------------------+------------------+------+-----------------+------+
|Borrowings         |                 7| (217)|             (27)|   171|
+-------------------+------------------+------+-----------------+------+
|                   |                  |      |                 |      |
+-------------------+------------------+------+-----------------+------+
|Effect of          |                  |   (4)|                 |    14|
|exchange rate      |                  |      |                 |      |
|changes on         |                  |      |                 |      |
|cash balances      |                  |      |                 |      |
+-------------------+------------------+------+-----------------+------+
|Net profit         |                  |     2|                 |   292|
+-------------------+------------------+------+-----------------+------+
|Minority interest  |                  |   (1)|                 |   (2)|
+-------------------+------------------+------+-----------------+------+
|Profit attributable|                  |     1|                 |   290|
|to the             |                  |      |                 |      |
|shareholders of    |                  |      |                 |      |
|the Company        |                  |      |                 |      |
+-------------------+------------------+------+-----------------+------+
(1) Gain on shares sold represents the reversal of the unrealised gain on 5 million shares as at 31 March 2013.
 
 
INCOME
Dividends received from BAT decreased by 7 per cent from Euro 136 million (£ 110 million) in the period to September 2012 to Euro 126 million (£ 106 million) during the period under review. The decrease is due to the reduced number of BAT shares held, offset by an increase of £ 0.05 per share in the underlying dividends paid by BAT. The dividends received from BAT represent the final 2012 dividend, paid in May 2013, as well as the interim 2013 dividend paid in September 2013.
 
Interest income is earned on bank deposits and on loans advanced to underlying investments.
 
Total realised gains of Euro 119 million includes Euro 108 million in respect of the sale of 5 million BAT shares calculated by reference to the cost of the investment when the BAT shares were first carried at fair value when Reinet was established in 2008, gains of Euro 2 million in respect of investments realised by the Trilantic funds and a gain of Euro 9 million realised on settlement of the forward exchange contracts during the period.
 
EXPENSES
A performance fee may be payable for the year ended 31 March 2014, if certain conditions are met. The provision for the performance fee in respect of the period ended 30 September 2013 amounts to Euro nil (30 September 2012: Euro 9 million).
 
The management fee for the period ended 30 September 2013 amounts to Euro 18 million (30 September 2012: Euro 16 million) with other operating expenses of Euro 1 million in respect of charges from Reinet Investments Manager S.A. (the General Partner), transaction costs and other expenses, including legal and other fees, which amounted to Euro 2 million.
 
Interest expense relates to rand and sterling borrowings.
 
FAIR VALUE ADJUSTMENTS
The investment in the remaining 74 million BAT shares decreased in value by Euro 195 million during the period under review. Of this, Euro 221 million was attributable to the decrease in value of the underlying BAT shares in sterling terms offset by Euro 26 million due to the appreciation of sterling against the euro during the period under review. The sale of 5 million BAT shares resulted in a reversal of the previously recorded unrealised gain in respect of the shares sold of Euro 106 million at 31 March 2013.
 
The unrealised fair value adjustment of Euro 70 million reflects the increase in the fair value of the investments in Pension Corporation, Trilantic and the Milestone investments which are offset by decreases in the value of the investments in US land development and mortgages, Vanterra C Change TEM and Vanterra Flex.
 
The fair value of the collar financing derivative increased by Euro 11 million during the period, reflecting mainly the decrease in the price of the BAT shares underlying the put and call options. The fair value of the forward exchange contracts decreased by Euro 4 million; the contracts were settled on 30 September 2013 realising a gain of Euro 9 million.
 
Borrowings are carried at fair value reflecting the discounted cash flow value of future principal and interest payments taking into account prevailing interest rates.  An unrealised gain of Euro 4 million arose in respect of the rand borrowing due to the weakening of the South African rand during the period. An unrealised gain of Euro 3 million arose in respect of the sterling borrowing. Of this, a loss of Euro 3 million is due to the strengthening of the sterling/euro exchange rate during the period and a gain of Euro 6 million arose due to the effect of higher interest rates used in discounting future cash flows.
 
OTHER CHARGES
The net tax expense of Euro 5 million includes corporate and withholding taxes accrued in respect of gains realised on Trilantic investments, a deferred tax provision in respect of unrealised gains and expected distributions related to Trilantic investments, together with withholding taxes in respect of accrued interest on other US investments.
 
The minority interest expense arises in respect of the minority partners shares in the earnings of the Reinet entities which hold the Trilantic and US land development and mortgages interests, respectively.
 
PROFIT FOR THE PERIOD
Net realised income for the period, reflecting the gains realised on the sale of BAT shares and other income, amounted to Euro 223 million (30 September 2012: Euro 107 million). Net profit attributable to shareholders, taking into account unrealised fair value adjustments, was Euro 1 million. As noted above, the movement in unrealised fair value adjustments reflected the recycling of unrealised gains amounting to Euro 106 million in respect of the 5 million BAT shares sold during the period.
 
DIVIDEND
No dividend is proposed for the interim period. Barring unforeseen developments, the General Partner will consider a dividend for the full year to be funded out of realised income, excluding the proceeds of asset disposals.
 
Shares in issue
The number of shares in issue remained unchanged during the period at 195 942 286. This figure includes 1 000 management shares held by the General Partner.
 
Financial statements
The unaudited interim consolidated financial statements at 30 September 2013, on which this announcement is based, were approved by the Board of the General Partner on 12 November 2013. The printed Reinet Interim Report will be available upon request from early December 2013.
 
Statutory information
 
Primary listing
Reinet Investments S.C.A. shares are listed on the Luxembourg Stock Exchange with the ISIN number LU0383812293. Thomson Reuters code REIT.LU and Bloomberg code REIN.LX. Reinet shares are included in the LuxX index of the principal shares traded on the Luxembourg exchange.
 
Secondary listing
Reinet Investments S.C.A. South African Depository Receipts are traded on the stock exchange in Johannesburg under the ISIN number CH 0045793657. Thomson Reuters code REIJ.J and Bloomberg code REI:SJ.
 

Website: http://www.reinet.com/
 
 
Reinet Investments S.C.A. (the Company) is a partnership limited by shares incorporated in the Grand Duchy of Luxembourg and having its registered office at 35, boulevard Prince Henri, L 1724 Luxembourg. It is governed by the Luxembourg law on securitisation and in this capacity allows its shareholders to participate indirectly in the portfolio of assets held by its wholly-owned subsidiary Reinet Fund S.C.A., F.I.S. (the Fund), a specialised investment fund also incorporated in Luxembourg.
 
Notes for South African editors
 
Acknowledging the interest in Reinets results on the part of South African investors, set out below are key figures from the results expressed in rand.
 
Using the closing euro/rand exchange rate prevailing as at 30 September 2013 of 13.5645, and a rate of 11.8408 as at 31 March 2013.
 
+----------------------------------+-----------------+-------------+
|                                  |30 September 2013|31 March 2013|
+----------------------------------+-----------------+-------------+
|                                  |                 |             |
+----------------------------------+-----------------+-------------+
|Net asset value                   |     ZAR 54 584 m| ZAR 47 636 m|
+----------------------------------+-----------------+-------------+
|                                  |                 |             |
+----------------------------------+-----------------+-------------+
|Net asset value per ordinary share|       ZAR 278.61|   ZAR 243.09|
+----------------------------------+-----------------+-------------+

 
Using the average euro/rand exchange rate for the six-month period ended 30 September 2013 of 12.8125 and an average rate of 10.3770 for the six-month period ended 30 September 2012.
 
+---------------------+-----------------+-----------------+
|                     |30 September 2013|30 September 2012|
+---------------------+-----------------+-----------------+
|                     |                 |                 |
+---------------------+-----------------+-----------------+
|Profit for the period|         ZAR 13 m|      ZAR 3 009 m|
+---------------------+-----------------+-----------------+

 
 
Headline earnings per share
 
To comply with the South African practice of providing Headline earnings per share data, the relevant data is as follows:
 
     
+-----------------------------+-----------------+-----------------+
|                             |30 September 2013|30 September 2012|
+-----------------------------+-----------------+-----------------+
|                             |                 |                 |
+-----------------------------+-----------------+-----------------+
|Unadjusted earnings per share|        Euro 0.01|        Euro 1.48|
+-----------------------------+-----------------+-----------------+
|Headline earnings per share *|        Euro 0.01|        Euro 1.48|
+-----------------------------+-----------------+-----------------+

* There are no dilutive instruments


15 November 2013


Sponsor
RAND MERCHANT BANK (a division of FirstRand Bank Limited)
Date: 15/11/2013 08:00:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
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