3rd Quarter Results

M&G Equity Investment Trust P.L.C. Third Interim Results Performance during the period On a net asset value (NAV) basis, each Package Unit produced a negative total return of 27.9% over the nine months to 31 March 2009. This was better than the 28.3% negative total return on the FTSE All-Share Index over the same period despite the detrimental effect of the Company's balance sheet gearing. An amount of £14 million of the outstanding borrowings was repaid at the end of October 2008, reducing the Company's debt to £40 million at the period end, 25.7% of total assets less current liabilities. The Company's revenue earnings per Package Unit were 3.5p. During the review period, the Company declared three quarterly dividends of 1.25p per Income Share, making a total of 3.75p. This represents an increase of 4.2% over the total of 3.6p declared in respect of the same period last year. This rate of increase is well above the March annualised rate of inflation of -0.4% as measured by the Retail Prices Index (RPI). At the period end the Package Unit mid-market price was at a 15.5% discount to the NAV and on a mid-market price basis each Package Unit delivered a negative total return of 36.1%. After the encouraging improvement in performance over six months, the third quarter proved more challenging with the market narrowly focused on recovery and resource stocks, leaving well capitalised and defensive stocks out of favour. Over time, given the protracted nature of the economic crisis, we believe these secure stocks will revive as their valuations are low historically. Income statement (unaudited) For the nine months ended For year ended 31 March 2009 31 March 2008 30 June 2008 Revenue Capital Total Revenue Capital Total Revenue Capital Total £000 £000 £000 £000 £000 £000 £000 £000 £000 -------- -------- ------ -------- -------- ------- -------- ------- -------- Net losses on - (49,324) (49,324) - (44,825) (44,825) - (57,370) (57,370) investments Exchange gains - - - - - - 2 2 Income 7,327 - 7,327 8,919 - 8,919 12,966 - 12,966 Investment (325) (757) (1,082) 109 253 362 94 54 148 management fee Other expenses (172) - (172) (126) - (126) (175) - (175) ------- ------- ------ ------- ------- ------- ------ -------- -------- Net return before finance 6,830 (50,081) (43,251) 8,902 (44,572) (35,670) 12,885 (57,314) (44,429) cost and tax Finance costs: - (8,380) (8,380) - (7,811) (7,811) - (10,491) (10,491) Appropriations Finance costs: (8,479) - (8,479) (7,311) - (7,311) (9,368) - (9,368) Dividends Finance costs: (756) (2,412) (3,168) (903) (2,101) (3,004) (1,211) (2,818) (4,029) Interest payable and similar charges [a] ------- ------- ------ ------- ------- ------- ------ -------- -------- Net return on ordinary (2,405) (60,873) (63,278) 688 (54,484) (53,796) 2,306 (70,623) (68,317) activities before tax Tax on (62) 62 - (243) 243 - (321) 321 - ordinary activities ------- ------- ------ ------- ------- ------- ------ -------- -------- Net return on ordinary (2,467) (60,811) (63,278) (445) (54,241) (53,796) 1,985 (70,302) (68,317) activities after tax ------- ------- ------ ------- ------- ------- ------ -------- -------- Return per Zero Dividend - (18.41)p (18.41)p - 4.54p 4.54p - 6.10p 6.10p Preference Share Revenue earnings / 3.50p (0.10)p 3.40p 4.51p - 4.51p 6.60p - 6.60p return per Income Share Return per - (12.06)p (12.06)p - (31.53)p (31.53)p - (40.89)p (40.89)p Capital Share Total return per Package 3.50p (30.57)p (27.07)p 4.51p (26.99)p (22.48)p 6.60p (34.79)p (28.19)p Unit [a] Finance costs: Interest payable and similar charges for the nine months ended 31 March 2009 includes £648,000 within capital as cost of early partial redemption of Debenture stock. The total column of this statement is the profit and loss account of the Company. The revenue return and capital return columns are supplementary to this and are prepared under guidance published by the Association of Investment Companies. All items in the above statement derive from continuing operations. No operations were acquired or discontinued during the period. A statement of Total Recognised Gains and Losses is not required as all gains and losses of the Company have been reflected in the above statement. Statement of movements in net assets attributable to shareholders (unaudited) For the nine months ended 31.03.09 31.03.08 £000 £000 ---------- ---------- Return on ordinary activities after tax (63,278) (53,796) Finance costs: Appropriations 8,380 7,811 Issue of Package Units (including related 711 - costs) Repurchase of Package Units (including (461) (324) related costs) ---------- ---------- Net movement in net assets attributable (54,648) (46,309) to shareholders Opening net assets attributable to 170,490 229,173 shareholders (all non-equity) ---------- ---------- Closing net assets attributable to 115,842 182,864 shareholders (all non-equity) ---------- ---------- Balance Sheet (unaudited) As at 31.03.09 31.03.08 30.06.08 £000 £000 £000 ------- ------- ------- Fixed assets Portfolio of investments 152,020 232,389 215,977 ------- ------- ------- Current assets Debtors 8,114 5,186 7,138 Cash at bank and short-term deposits 2,116 737 1,797 ------- ------- ------- 10,230 5,923 8,935 ------- ------- ------- Total financial assets 162,250 238,312 224,912 Creditors: Amounts falling due within one (6,435) (1,503) (472) year ------- ------- ------- Total assets less current liabilities 155,815 236,809 224,440 ------- ------- ------- Creditors: Amounts falling due after more (39,973) (53,945) (53,950) than one year ------- ------- ------- Net assets attributable to shareholders 115,842 182,864 170,490 (all non-equity) ------- ------- ------- Net assets attributable to Shareholders (unaudited) As at 31.03.09 31.03.08 30.06.08 £000 £000 £000 ------- ------- ------- Zero Dividend Preference Shareholders 107,646 136,699 138,972 Income Shareholders 8,196 9,296 10,834 Capital Shareholders - 36,869 20,684 -------- ------- -------- Net assets attributable to shareholders 115,842 182,864 170,490 (all non-equity) -------- -------- -------- The net assets attributable to shareholders have been calculated in accordance with the Company's Articles of Association and the net asset values (per share) applicable to each class of shareholding as shown below. Each class of the Company's shares meets the definition of a liability and therefore the Company has no equity shares. This does not affect the rights and benefits of each class. The Condensed Financial Statements have been prepared in accordance with the Statement: Half Yearly Financial Reports issued by the Accounting Standards Board. As at 31.03.09 31.03.08 30.06.08 Net asset value per Zero Dividend 62.71p 79.52p 81.08p Preference Share Net asset value per Income Share 4.77p 5.41p 6.32p Net asset value per Capital Share - 21.45p 12.07p Net asset value per Package Unit 67.48p 106.38p 99.47p Cash flow statement (unaudited) For the nine months For the year ended ended 31.03.09 31.03.08 30.06.08 £000 £000 £000 £000 £000 £000 -------- -------- ------ -------- -------- ------- Net cash 9,619 6,093 10,054 inflow from operating activities Servicing of finance Dividends paid (8,479) (7,311) (9,368) (non-equity) Annual (3) monitoring fee paid Bank interest - (3) (3) paid Interest paid (1,894) (1,993) (3,983) on Debenture Stock ------- ------ ------- (10,376) (9,307) (13,354) Financial investment Capital 705 432 432 distributions Purchase of (42,027) (61,052) (80,214) investments Sale of 56,796 63,394 84,233 investments ------- ------ ------- 15,474 2,774 4,451 Financing Partial (14,000) - - redemption of Debenture Stock Cost of early (648) - - partial redemption of Debenture Stock Issue of 711 - - Package Units (including related costs) Repurchase of (461) (324) (857) Package Units (including relating costs) (14,398) (324) (857) ------- ------- ------- Net increase / 319 (764) 294 (decrease) in cash ------- ------- ------- J. P. McClelland Secretary 19 May 2009 ---END OF MESSAGE--- This announcement was originally distributed by Hugin. The issuer is solely responsible for the content of this announcement.