Interim financial statement 2003

Transcription

1 Interim financial statement 2003

2 About Candover Candover* organises and invests principally in large buyouts. Our primary objectives are to achieve above average capital gains from our investments and to earn satisfactory income for our shareholders. We do this by working in partnership with management teams to acquire companies in the UK and continental Europe and build substantial businesses with excellent prospects. *References in this interim financial statement to Candover mean Candover Investments plc and/or, where appropriate, one or more of its subsidiaries. Contents 01 Highlights 02 Chairman s statement 06 Overview of 20 largest investments 08 Review of 20 largest investments 16 Independent review report 17 Group statement of total return 18 Group balance sheet 19 Group cash flow statement 20 Notes

3 Highlights Net revenue return before tax increased 33.3% to 11.2 million (2002: 8.4 million) % Interim dividend increased 12.5% to13.5p (2002: 12.0p) % Total net assets of million or 1043p per share, an increase of 0.3% over the six months to 30th June, 2003 (31st December, 2002: 1040p per share). +0.3% 01 Candover interim financial statement 2003

4 Chairman s statement for the half year ended 30th June, 2003 Introduction S W Curran Chairman Candover and the 2001 Fund invested million (2001 Fund million and Candover 62.4 million) in six new transactions during the period. Disposals by Candover realised 10.1 million and produced gains over cost of 3.5 million. Since June, Camden Motors has been sold to its management team. At 30th June, 2003, the unaudited net assets attributable to the ordinary shares were million compared to million at 30th June, Net assets per share were 1043p compared with 1072p at 30th June, 2002, a decrease of 2.7% (and 1040p at 31st December, 2002, an increase of 0.3%). The increase in net assets per share over the six months to 30th June, 2003 of 0.3% compares with an increase of 4.1% in the FTSE All-Share Index over the same period and a decrease of 12.9% in the FTSE All-Share Index over the full year. Although the first half of the year for the European buyout market generally has been quiet, Candover has had a busy six months in terms of its own investment activity. The combination of low interest rates, stable inflation and continued corporate restructuring has presented us with the opportunity to make some interesting investments in a range of European businesses that enjoy market leading positions. I am confident that the second half of the year sees Candover well positioned to continue to attract further quality deal flow via its team of experienced investment executives based in London, Paris and Düsseldorf. 02 Candover interim financial statement 2003

5 For the latest information visit Investments In January 2003, Candover and the 2001 Fund completed the buyout of Kluwer Academic Publishers (KAP), an international publisher of scientific journals and books from Wolters Kluwer for a total consideration of million. Candover invested 10.3 million and the 2001 Fund 80.0 million in this transaction. In May 2003, Candover announced the acquisition of BertelsmannSpringer, one of the world s leading academic publishers, from Bertelsmann for a consideration of 1.1 billion. Competition clearance to complete the acquisition has been obtained and it is intended to merge the company with KAP. The new merged business entity will be renamed Springer. Completion of this investment is expected during this month. The purchase of the majority shareholding in Ontex also completed in January A public offer for the balance of the shares was then launched in February and this formally concluded at the end of March. Ontex is a leading European producer of hygiene products for the babycare, feminine hygiene and adult healthcare markets. Candover and the 2001 Fund invested 16.2 million and million respectively. In March, Candover co-led the 1.9 billion buyout of Gala, the leading UK provider of high volume, low ticket gambling (bingo and casinos). Candover invested 21.7 million and the 2001 Fund invested million. Also in March, Wellstream, a leading manufacturer of flexible pipe applications for the offshore deepwater oil and gas sector, was acquired in a million transaction. Candover invested 5.5 million and the 2001 Fund invested 43.0 million. In May, Candover completed the million buyout of Equity Trust, the global trust and fiduciary services business, from Insinger de Beaufort. The company provides client services, primarily based around the formation and ongoing administration of onshore and offshore trusts and companies. It has an international and widely spread customer base comprising both private clients and corporate entities. Candover invested 5.5 million and the 2001 Fund invested 43.1 million. 03 Candover interim financial statement 2003

6 Chairman s statement continued In June, Candover and the 2001 Fund invested 3.2 million and 25.1 million respectively in Kabel Deutschland GmbH (KDG). KDG serves ten million customers in Germany, distributing multi-channel TV signals and other digital services. Realisations Net realised gains over cost achieved by Candover and its managed funds in the period amounted to 20.8 million, of which Candover s share was 3.5 million. In January, Airtechnology, formerly a division of Charter plc, was sold to Ametek Inc. with gains over cost for Candover of 0.9 million and 7.9 million for the 1997 Fund. Following a refinancing in March 2003, Bourne Leisure repaid 4.8 million to Candover, representing the balance of our loan stock, and 36.2 million to the 1997 Fund. In June, the residual shares in Detica were sold with gains over cost of 2.4 million for Candover and 9.2 million for the 1994 Fund. In July, Camden Motors was sold to its management. This resulted in gains over cost of 2.9 million for Candover and 10.8 million for the 1994 Fund. Results for six months to 30th June, 2003 The increase in net assets of 1.0 million since 31st December, 2002 was primarily due to the increase in retained earnings, offset by a net decrease of 2.6 million in the valuation of fixed asset investments. This valuation decrease comprised exchange gains on our Euro denominated investments of 3.4 million, downward adjustments of 8.4 million and upward movements of 2.4 million. As a consequence of the 63.2 million total investment by Candover during the period under review, cash and liquid assets have declined from 78.2 million at 31st December, 2002 to 23.0 million at 30th June, The value ascribed to Candover s share of the carried interest in the 1994 Fund was increased from 28.0 million at 31st December, 2002 (128p per share) to 28.6 million (131p per share). Profits before tax for the six months were 11.2 million compared with 8.4 million for the first half of The increase in profits was due to higher income from funds under management as well as income from fixed asset investments. Dividends The Board has decided to raise the interim dividend by 12.5% from 12.0p per share to 13.5p per share. The dividend will be paid on 17th October, 2003 to shareholders on the register at 19th September, Candover interim financial statement 2003

7 Board and staff Prospects As reported at the year end, in March Piers Dennison joined us as Investor Relations Director to oversee our relationships with both existing and potential limited partners in the Candover Funds. Simon Holden joined us earlier this month as an Investment Manager. Simon, who has an engineering degree, worked as a strategy consultant with PricewaterhouseCoopers. Recruitment is also underway for additional investment executives to expand and strengthen the French and German teams. With effect from 30th June, 2003, Peter Neal retired as Company Secretary of Candover and his place has been taken by Alistair Peel. Peter had been with Candover for over twelve years and I would like to thank him for his hard work and his contribution to Candover s progress during that time. On behalf of all those who have worked with Peter, we offer our best wishes for the future. Also with effect from 30th June, 2003, Philip Symonds stepped down as Finance Director and Tian Tan has taken over this role. We are much indebted to Philip for the invaluable contribution he has made during his twenty years with Candover, and we are pleased that he has agreed to continue on a consultancy basis for the time being. The buyout markets during the first half of the year both in the UK and on the Continent were sluggish, reflecting the continuing uncertainties over the strength of economic growth in the US, continental Europe and the UK for However, a pick up in the global economy should see increased activity in the buyout markets in line with merger and acquisition activity generally. We believe that there will be attractive investment opportunities during the coming months and that Candover is well placed to continue to attract the good quality deal flow we have seen in the recent past. S W Curran 8th September, Candover interim financial statement 2003

8 Overview of 20 largest investments The total value of the top 20 investments has increased by 48.6 million (42%) during the first half of the year to million, (31st December, 2002: million). This increase was mainly due to the 62.4 million invested in the six new transactions completed in the period. The interim financial statement for the half year to 30th June, 2003 has been prepared in line with the revised British Venture Capital Association (BVCA) Guidelines on Reporting and Valuation which took effect on 1st August, Valuation basis As a result of the new investments made during the period, 44% of the top 20 investments are valued at cost compared to 24% as at 31st December, The reduction in the percentage of top 20 investments valued on the multiple of earnings basis from 56% to 39% during the period is also primarily a result of the increase in the number of new investments. The reduction in the exposure to quoted stocks is due to the fall in Inveresk s share price and the disposal of our residual shareholding in Detica. Top 20 investments by value 30th June, st December, 2002 Cost 44% 24% Multiple of earnings 39% 23% Cost based on multiple of earnings* 0% 33% Discounted stock market price 10% 19% Net assets 6% 0% Sale price 1% 1% 100% 100% *In accordance with the new BVCA Guidelines, Cost is now only used as a basis of valuation for a limited period after the date of acquisition. Accordingly, in order to conform with the revised Guidelines, some investments, the basis of valuation of which was previously categorised as Cost, have now had their valuation basis recategorised as Multiple of earnings. Sector analysis The portfolio s exposure to both the leisure and media sectors has increased, primarily due to the new transactions made in the period. The reduction in the allocation to the financial and support services sectors is mainly a result of the increase in the value of the other top 20 investments. Top 20 investments by value 30th June, st December, 2002 Industrials 34% 29% Financials 16% 23% Leisure 15% 5% Media 11% 4% Health 10% 17% Retail 7% 9% Support Services 7% 10% Technology 0% 3% 100% 100% 06 Candover interim financial statement 2003

9 Geographical analysis The portfolio is dominated by UK companies, which account for half of the total value of the top 20 investments. Exposure to continental European companies has increased due to the three European deals completed during the half year. The sole listed company in the top 20 investments accounts for the whole of the Americas. Top 20 investments by value 30th June, st December, 2002 United Kingdom 50% 45% Benelux 17% 7% Rest of Europe 12% 17% Americas 10% 19% France 9% 12% Germany 2% 0% 100% 100% Ageing analysis The 2001 Fund has been investing for only 16 months and this is reflected in the fact that 49% of the portfolio of the top 20 investments is less than two years old. The value of companies between three and four years old has decreased by 16 percentage points over the six month period, and this is primarily due to the fall in the share price of our holding in Inveresk. Top 20 investments by value 30th June, st December, 2002 <1 year 39% 14% 1-2 years 10% 9% 2-3 years 13% 16% 3-4 years 26% 42% 4-5 years 4% 2% >5 years 8% 17% 100% 100% 07 Candover interim financial statement 2003

10 Review of 20 largest investments Gala Group Limited (UK, leisure) Date of investment: March 2003 Gala is the UK s leading high volume, low stakes gambling operation. It is the number one bingo operator and the number three casino operator. Candover s investment as at 30th June, 2003 Cost of investment 21,728,000 Directors valuation 21,728,000 % of Candover s net assets 9.5% Basis of valuation Cost Ontex NV (Belgium, industrials) Date of investment: January 2003 Ontex is the leading European manufacturer of retailer branded diapers and feminine hygiene products. It also has an adult healthcare business, which is number three in Europe. Candover s investment as at 30th June, 2003 Cost of investment 25,046,000 ( 16,214,000) Directors valuation 25,046,000 ( 17,429,000) % of Candover s net assets 7.6% Basis of valuation Cost Inveresk Research Group, Inc. (US, health) Date of investment: September 1999 Inveresk Research Group is one of the world s leading contract research organisations for the pharmaceuticals industry and was listed on the NASDAQ exchange in June Cost of investment 75,000 75,000 Directors valuation $26,306,000 ( 16,387,000) $31,699,000 ( 19,690,000) % of Candover s net assets 7.2% 8.7% Basis of valuation 25% discount on market price 25% discount on market price 08 Candover interim financial statement 2003

11 Picard Surgelés S.A. (France, retail) Date of investment: March 2001 Picard is the leading frozen food retailer in France, offering an exclusive range of own-label products. Cost of investment 16,155,000 ( 10,325,000) 16,155,000 ( 10,325,000) Directors valuation 16,155,000 ( 11,242,000) 16,155,000 ( 10,530,000) % of Candover s net assets 4.9% 4.6% Basis of valuation Multiple of earnings Multiple of earnings Clondalkin Group Holdings Limited (Ireland, industrials) Date of investment: October 1999 Clondalkin is a specialist converter of value-added packaging products with manufacturing facilities across Western Europe and the US. Cost of investment 12,507,000 ( 7,987,000) 12,507,000 ( 7,987,000) Directors valuation 15,934,000 ( 11,089,000) 15,934,000 ( 10,386,000) % of Candover s net assets 4.9% 4.6% Basis of valuation Multiple of earnings Multiple of earnings Kluwer Academic Publishers (Netherlands, media) Date of investment: January 2003 KAP publishes academic journals and books, as well as trade publications. Candover s investment as at 30th June, 2003 Cost of investment 15,773,000 ( 10,251,000) Directors valuation 15,773,000 ( 10,976,000) % of Candover s net assets 4.8% Basis of valuation Cost 09 Candover interim financial statement 2003

12 Review of 20 largest investments continued Baxi Group Limited (UK, industrials) Date of investment: December 1996 Baxi is the leading UK boiler and water-heating provider, with a significant European presence. Cost of investment 10,741,000 10,741,000 Directors valuation 10,741,000 10,741,000 % of Candover s net assets 4.7% 4.7% Basis of valuation Multiple of earnings Multiple of earnings SWT (Lux) S.A. (Swissport) (Switzerland, support services) Date of investment: February 2002 Swissport is the second largest airport ground handling agent in the world and operates in 29 countries at 153 airports, servicing over 650 airlines worldwide. Cost of investment 12,151,000 ( 8,456,000) 12,973,000 ( 8,456,000) Directors valuation 13,000,000 ( 9,046,000) 13,908,000 ( 9,065,000) % of Candover s net assets 4.0% 4.0% Basis of valuation Multiple of earnings Cost Pandrol Limited (UK, industrials) Date of investment: December 1999 Pandrol is the world leader in the manufacture of resilient rail fastenings. Cost of investment 8,524,000 8,524,000 Directors valuation 8,524,000 8,524,000 % of Candover s net assets 3.7% 3.8% Basis of valuation Multiple of earnings Multiple of earnings 10 Candover interim financial statement 2003

13 ICG Mezzanine Fund 2000 (UK, financials) Date of investment: July 2000 The Fund is active in providing mezzanine finance throughout Europe. Cost of investment 11,767,000 ( 7,365,000) 13,317,000 ( 8,452,000) Directors valuation 11,767,000 ( 8,188,000) 13,317,000 ( 8,680,000) % of Candover s net assets 3.6% 3.8% Basis of valuation Cost Cost Aspen Insurance Holdings Limited (UK, financials) Date of investment: June 2002 Aspen Insurance is a new insurance and reinsurance business set up in June Cost of investment 7,830,000 7,830,000 Directors valuation 7,830,000 7,830,000 % of Candover s net assets 3.4% 3.5% Basis of valuation Net assets Cost Equity Trust (Channel Islands, financials) Date of investment: May 2003 Equity Trust provides services to private and corporate clients, giving them the means to implement, manage and administer structures that address issues surrounding investment, wealth creation/preservation and tax. Candover s investment as at 30th June, 2003 Cost of investment 7,727,000 ( 5,487,000) Directors valuation 7,727,000 ( 5,377,000) % of Candover s net assets 2.4% Basis of valuation Cost 11 Candover interim financial statement 2003

14 Review of 20 largest investments continued Wellstream Holdings Limited (UK, industrials) Date of investment: March 2003 Wellstream manufactures flexible pipe for the offshore oil and gas market. Candover s investment as at 30th June, 2003 Cost of investment $8,684,000 ( 5,496,000) Directors valuation $8,684,000 ( 5,258,000) % of Candover s net assets 2.3% Basis of valuation Cost Earls Court & Olympia Holdings Limited (UK, media) Date of investment: October 1999 Earls Court & Olympia operates major exhibition venues in London for consumer and trade shows. Cost of investment 3,966,000 3,966,000 Directors valuation 3,966,000 3,966,000 % of Candover s net assets 1.7% 1.7% Basis of valuation Multiple of earnings Multiple of earnings 12 Candover interim financial statement 2003

15 Acertec Holdings Limited (UK, industrials) Date of investment: June 1999 Acertec is a steel engineering business with four main divisions: UK Wire, UK Reinforcement, European Automotive Sub-assemblies and East Asian Reinforcements. Cost of investment 7,455,000 7,043,000 Directors valuation 3,933,000 3,521,000 % of Candover s net assets 1.7% 1.6% Basis of valuation Multiple of earnings Multiple of earnings Ciclad 3 (France, financials) Date of investment: April 2000 Ciclad is an investment company specialising in French buyouts. Cost of investment 7,024,000 ( 4,373,000) 6,524,000 ( 4,030,000) Directors valuation 5,314,000 ( 3,698,000) 5,184,000 ( 3,379,000) % of Candover s net assets 1.6% 1.5% Basis of valuation Multiple of earnings Multiple of earnings 13 Candover interim financial statement 2003

16 Review of 20 largest investments continued Kabel Deutschland GmbH (Germany, media) Date of investment: June 2003 Kabel Deutschland is Europe s largest cable TV company, providing cable signals to ten million homes in Germany. Candover s investment as at 30th June, 2003 Cost of investment 4,429,000 ( 3,164,000) Directors valuation 4,429,000 ( 3,082,000) % of Candover s net assets 1.4% Basis of valuation Cost Camden Motor Group Limited (UK, support services) Date of investment: November 1996 Camden Motors is a distributor of new and used motor vehicles in the UK. The company was sold to its management in July Cost of investment 12,000 12,000 Directors valuation 2,957,000 2,957,000 % of Candover s net assets 1.3% 1.3% Basis of valuation Sale price Multiple of earnings 14 Candover interim financial statement 2003

17 ICG Mezzanine Fund (UK, financials) Date of investment: October 1998 The Fund actively provided mezzanine finance throughout Europe until it became fully invested during the year Cost of investment 2,388,000 2,497,000 Directors valuation 2,111,000 2,497,000 % of Candover s net assets 0.9% 1.1% Basis of valuation Net assets Cost Bourne Leisure Holdings Limited (UK, leisure) Date of investment: October 2000 Bourne Leisure is the UK s largest holiday park operator, with brands including Haven, Butlins and Warner. 60% of the original cost of 8.0 million was repaid out of the proceeds of a refinancing in March Cost of investment 151,000 4,983,000 Directors valuation 1,906,000 4,983,000 % of Candover s net assets 0.8% 2.2% Basis of valuation Multiple of earnings Multiple of earnings 15 Candover interim financial statement 2003

18 Independent review report to the members of Candover Investments plc Introduction We have been instructed by the company to review the financial information for the six months ended 30th June, 2003, which comprises the group statement of total return, group balance sheet, group cash flow statement and the related notes 1 to 4. We have read the other information contained in the interim report which comprises the chairman's statement and overview and review of the 20 largest investments and considered whether they contain any apparent misstatements or material inconsistencies with the financial information. Our responsibilities do not extend to any other information. This report is made solely to the company's members, as a body, in accordance with guidance contained in Auditing Practices Board Bulletin 1999/4 Review of Interim Financial Information. Our review work has been undertaken so that we might state to the company's members those matters we are required to state to them in a review 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 review work, for this report, or for the conclusion we have formed. Directors responsibilities The interim report, including the financial information contained therein, is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the interim report in accordance with the Listing Rules of the Financial Services Authority, which require that the accounting policies and presentation applied to the interim figures should be consistent with those applied in preparing the preceding annual accounts except where any changes, and the reasons for them, are disclosed. Review work performed We conducted our review in accordance with guidance contained in Bulletin 1999/4 Review of Interim Financial Information issued by the Auditing Practices Board for use in the United Kingdom. A review consists principally of making enquiries of management and applying analytical procedures to the financial information and underlying financial data and, based thereon, assessing whether the accounting policies and presentation have been consistently applied unless otherwise disclosed. A review excludes audit procedures such as tests of controls and verification of assets, liabilities and transactions. It is substantially less in scope than an audit performed in accordance with United Kingdom auditing standards and therefore provides a lower level of assurance than an audit. Accordingly, we do not express an audit opinion on the financial information. Review conclusion On the basis of our review we are not aware of any material modifications that should be made to the financial information as presented for the half year ended 30th June, Grant Thornton Chartered Accountants London 8th September, 2003 Notes 1. The maintenance and integrity of the Candover Investments plc website is the responsibility of the directors: the interim review does not involve consideration of these matters and, accordingly, the company s reporting accountants accept no responsibility for any changes that may have occurred to the interim report since they were initially presented on the website. 2. Regulations in the United Kingdom governing the preparation and dissemination of the interim report may differ from legislation in other jurisdictions. 16 Candover interim financial statement 2003

19 Group statement of total return incorporating the revenue account for the half year ended 30th June, 2003 Unaudited 6 months to 6 months to 12 months to 30th June, th June, st December, 2002 Revenue Capital Total Revenue Capital Total Revenue Capital Total Gains/(losses) on investments Realised gains and losses (6,768) (6,768) Unrealised gains and losses (2,551) (2,551) (13,585) (13,585) (11,602) (11,602) Income managed funds (1,715) (1,715) (13,063) (13,063) (18,370) (18,370) Net income 20,419 20,419 29,439 29,439 43,131 43,131 Less: third party interests in managed funds (20,419) (20,419) (29,439) (29,439) (43,121) (43,121) Add: management fees 13,265 13,265 11,306 11,306 24,253 24,253 Net income from managed funds 13,265 13,265 11,306 11,306 24,263 24,263 Income own funds 7,690 7,690 6,819 6,819 13,756 13,756 20,955 20,955 18,125 18,125 38,019 38,019 Administrative expenses (9,727) (3,353) (13,080) (9,700) (2,019) (11,719) (22,754) (5,297) (28,051) Net return before finance costs and taxation 11,228 (5,068) 6,160 8,425 (15,082) (6,657) 15,265 (23,667) (8,402) Interest payable and similar charges (2) (2) (8) (8) Return on ordinary activities before taxation 11,228 (5,068) 6,160 8,423 (15,082) (6,659) 15,257 (23,667) (8,410) Tax on ordinary activities (3,377) 1,006 (2,371) (2,528) 606 (1,922) (3,799) 1,589 (2,210) Return on ordinary activities after taxation 7,851 (4,062) 3,789 5,895 (14,476) (8,581) 11,458 (22,078) (10,620) Interim dividend at 13.5p (2,951) (2,951) (2,659) (2,659) (7,821) (7,821) per share (2002:12.0p) Transfer to reserves 4,900 (4,062) 838 3,236 (14,476) (11,240) 3,637 (22,078) (18,441) Return per ordinary share Basic 35.95p (18.60p) 17.35p 26.55p (65.21p) (38.66p) 51.87p (99.95p) (48.08p) Fully diluted 35.95p (18.60p) 17.35p 26.46p (64.99p) (38.53p) 51.79p (99.79p) (48.00p) 17 Candover interim financial statement 2003

20 Group balance sheet at 30th June, 2003 Unaudited 30th June, th June, st December, Fixed assets Tangible assets 1,192 1,381 1,335 Investments: Managed funds 1,105, , ,446 Less: third party interests in managed funds (1,076,757) (805,510) (697,858) Net investment in managed funds 29,104 30,008 28,588 Other fixed asset investments 168, , , , , ,302 Associated undertakings , , ,376 Current assets Debtors 22,061 42,720 24,280 Investments 14,379 47,030 34,877 Cash at bank 8,583 16,933 43,328 45, , ,485 Creditors: amounts falling due within one year (10,902) (19,248) (18,193) Net current assets 34,121 87,435 84,292 Total assets less current liabilities 232, , ,003 Provisions for liabilities and charges (5,116) (1,805) (5,116) 227, , ,887 Capital and reserves Called up share capital 5,464 5,539 5,453 Share premium account 1,451 1,243 1,306 Capital redemption reserve Capital reserve realised 178, , ,641 Capital reserve unrealised 17,883 26,726 23,075 Revenue reserve 24,022 18,721 19,122 Shareholders funds 227, , , Candover interim financial statement 2003

21 Group cash flow statement for the half year ended 30th June, 2003 Unaudited 6 months to 6 months to 12 months to 30th June, th June, st December, Net cash inflow from operating activities 2,986 8,845 11,068 Returns on investments and servicing of finance Interest paid (2) (8) Taxation UK corporation tax paid (34) (461) (1,308) Capital expenditure and financial investment Purchase of tangible fixed assets (117) (107) (327) Purchase of investments (63,182) (17,495) (25,847) Sale of investments 10,135 22,554 49,958 Sale of tangible fixed assets Sale of associated undertaking 35 Net cash (outflow)/inflow from capital expenditure and financial investment (53,106) 4,978 23,861 Equity dividends paid (5,245) (4,880) (7,542) Management of liquid resources 20,498 (769) 11,571 Financing Issue of shares Share buy back (1,630) (5,233) (Decrease)/increase in cash (34,745) 6,378 32, Candover interim financial statement 2003

22 Notes 1 The interim financial statement is the responsibility of, and has been approved by, the directors. 2 Comparative figures for 31st December, 2002 are taken from the full accounts, which have been delivered to the Registrar of Companies and contain an unqualified audit report. 3 A copy of this statement is being sent to all shareholders and further copies can be obtained from the registered office of the Company, 20 Old Bailey, London EC4M 7LN. 4 Current asset investments comprise holdings in fixed income securities. 20 Candover interim financial statement 2003

23 Candover Investments plc Registered in England and Wales No Registered office 20 Old Bailey London EC4M 7LN Telephone +44 (0) Facsimile +44 (0) website Designed and produced by Carnegie Orr +44 (0)

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