West Perth-based investment company LinQ Resources Fund has increased its net profit for the 2006-07 financial year by 271 per cent to $138.4 million, up from $37.3 million the year before.
West Perth-based investment company LinQ Resources Fund has increased its net profit for the 2006-07 financial year by 271 per cent to $138.4 million, up from $37.3 million the year before.
The full text of a company announcement is pasted below
Full year results to 30 June 2007 15 August 2007 LinQ Resources Fund record full-year result; Profit up 271 per cent to $138.4 million
- Net profit attributable to unitholders increased 271% to $138.4m.
- Earnings per unit of 77.2c representing an earnings yield of 59%.
- Market value of investments increased by 113%.
- Distribution of 8.54 cents per unit, up 14% on 2006 distribution of 7.5 cents.
- Net Tangible Asset backing per unit (NTA) increases by 34% to $1.60 (as at 30 June 2007).
LinQ Resources Fund (ASX:LRF), Australia's leading specialist managed resources fund, today announced a record 271 per cent increase in net profit to $138.4 million for the year ended 30 June 2007 (2006: $37.3 million).
The Fund, which specialises in investing in small to medium-sized resource stocks, delivered the strong result on the back of superior stock selection and innovative use of investor funds.
LinQ achieved earnings per unit of 77 cents, representing an earnings yield of almost 60%
As a result LinQ has declared a final distribution of 8.54 cents per unit, up 14 per cent on the previous year (2006: 7.5 cents).
The Net Tangible Asset backing (NTA) on a post distribution basis of the Fund increased 34 per cent from $1.19 to $1.60 as at 30 June 2007.
Managing Director, Mr Clive Donner, said: "This has been a landmark year for the Fund. Our strategy of concentrating at the smaller end of the resources market to identify value opportunities is continuing to deliver an excellent combination of increasing distribution yield and strong capital growth for unit holders.
"Meanwhile, our use of convertible notes and other mezzanine financing arrangements has been particularly beneficial in creating value for the Fund and at the same time has assisted its investee companies in their value accretion."
Mr Donner said the Fund has a high level of commodity diversification evidenced by its larger positions in companies such as CopperCo, Atlas Iron, Oilex and Riversdale Mining which were particularly strong contributors to the Fund's overall performance.
During the year, LinQ provided a $10 million structured loan facility with options to Oilex to assist it fund the development of its Indian production interests as well as a $5 million subordinated debt facility to help fund the development of CopperCo's Lady Annie copper project. A $5 million convertible note was provided to Vulcan Resources enabling the company to advance work on its Kylylahti copper/cobalt project and its Kuhmo nickel project in Finland.
Mr Donner said "LinQ continues to see a high level of opportunities in the resources sector, despite the recent volatility in markets." He said "the price outlook across most mineral resources continue to remain generally positive with strong global demand for commodities."
"As a result we continue to see opportunities at the small and medium end of the market which we can capitalise on by using our sector and financing expertise".
"The injection of a further $108 million into the Fund through the exercise of over 80% of the options on issue is a strong endorsement of LinQ's strategy and provides the Fund with the capacity to undertake additional investments".
"The deal flow remains strong as we assess a number of opportunities both in Australia and overseas. As a result the Fund is exceptionally well positioned for continued growth," he said.
The full year distribution of 8.54 cents per unit will be paid on 20 August 2007.
