alpha pyrenees trust limited half year report to 30 june... · or “alpha pyrenees”) primarily...

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Half year reportFor the six months ended 30 June 2011 2011

Contents

1 Highlights

2 Trust summary and objective

2 Financial highlights

3 Chairman’s statement

9 Property review

17 Independent review report

19 Condensed consolidated statement of comprehensive income

21 Condensed consolidated balance sheet

23 Condensed consolidated cash flow statement

25 Condensed consolidated statement of changes in equity

27 Notes to the financial statements

35 Directors and Trust information

36 Shareholder information

Alpha Pyrenees Trust Limited 1

•Lease extensions and new leases covering approximately 18,200 square metres achieved since 1 January 2011

•91% of the Trust’s portfolio by value is in France

•French economy has continued to grow in the first half of 2011

•84% of rental income comes from Grade A tenants

•No loan to value covenant tests on any of the Trust’s properties until February 2014; interest cover ratio covenant of 110% (average interest cover in H1 2011 of 168%)

•99% of borrowings are fixed long term at a weighted average interest rate of 5.26% per annum to maturity in February 2015

•Current portfolio valuation yield of 8.4%

•Rental indexation trend improving

•Weighted average lease length of 6.8 years to expiry and 3.5 years to next break

•Adjusted earnings of £2.1 million for the six months to 30 June 2011 (adjusted earnings per share of 1.8p)

•Dividend of 0.9p per share paid for the quarter to 31 March 2011 and a further dividend of 0.9p per share declared for the quarter to 30 June 2011

•NAV (adjusted) of 28.7p per share as at 30 June 2011 (31 December 2010: 34.0p); the change is primarily due to net movements on currency hedges

Highlights

Alpha Pyrenees Trust Limited invests in commercial property in France and Spain with inflation-indexed rents that will provide an income return to investors as well as the potential for capital growth.

91% 91% of the Trust’s portfolio by value is in France

1.8p Total dividend per share paid and declared for the Half Year to 30 June 2011

84% 84% of portfolio income from Grade A tenants

2 Alpha Pyrenees Trust Limited

Objective

Alpha Pyrenees Trust Limited (“the Trust” or “the Company” or “Alpha Pyrenees”) primarily invests in higher-yielding properties in France, focusing on commercial property in the office, industrial, logistics and retail sectors let to tenants with strong covenants.

The Trust seeks to provide shareholders with a regular, secure dividend stream whilst also having the potential for capital growth in the long term from a combination of rent increases (leases are typically indexed to increase in line with inflation) and active asset management.

The Trust seeks to diversify risk by investing in a portfolio spread of properties across different property sectors with a variety of tenants.

Dividends

Dividends are paid quarterly.

Listing

The Trust is a closed-ended Guernsey registered investment company which has been declared under the relevant legislation to be an Authorised Closed-Ended Collective Investment Scheme. Its shares are listed on the Official List of the UK Listing Authority and traded on the London Stock Exchange.

Management

The Trust’s Investment Manager is Alpha Real Capital LLP (“the Investment Manager”). Control of the Trust rests with the non-executive Guernsey-based Board of Directors.

ISA/SIPP status

The Trust’s shares are eligible for Individual Savings Accounts (ISAs) and Self Invested Personal Pensions (SIPPs).

Trust summary and objective

Financial highlights

Half year ending 30 June 2011

Year ending 31 December 2010

Half year ending 30 June 2010

Net asset value (adjusted) (£’000)* 33,740 39,921 40,972

Net asset value per ordinary share (adjusted)* 28.7p 34.0p 34.9p

Net asset value per ordinary share 15.0p 17.1p 12.7p

Earnings per share (adjusted - basic & diluted)** 1.8p 3.6p 1.8p

Earnings per share (basic & diluted) (0.1)p 4.9p 0.1p

Dividend per share (paid) 2.7p 3.6p 2.7p

* The net asset value and net asset value per ordinary share have been adjusted for the fair value mark-to-market revaluation of the interest component of the currency swap, the interest rate swap derivatives and deferred tax provisions; full analysis is given in note 10 to the accounts.

** The adjusted earnings per share includes adjustments for the effect of the fair value mark-to-market revaluation of the properties, currency swap and interest rate swap derivatives, deferred tax provisions, rental guarantee income and foreign exchange gains and losses. A full analysis is given in note 9 to the accounts.


Management emphasis during the period has continued to focus on active asset management within the existing portfolio with particular emphasis on the extension of lease terms and the letting of vacant units to secure the Trust’s income. The Board is pleased to note the important progress achieved on this front, most notably at the Fresnes, Roissy, Ivry and Vitry properties. During the period lease extensions or new leases were achieved on a total of approximately 18,200 square metres representing around 7% of the portfolio by area. Further detail on asset management progress appears in the Property review section.

Despite continuing uncertainty in financial markets, the French economy remains one of the better performing in Europe and leasing take-up has shown some signs of improvement. As tenants become more active the Trust should be in a position to exploit opportunities that have been identified to add value at some of the Trust’s properties. With this in mind the Board believes that it is sensible to conserve available cash for investment in such opportunities.

Results and dividend

Results for the period show adjusted earnings of £2.1 million and adjusted earnings per share of 1.8p (note 9).

The Trust continues to operate in a leasing environment characterised by higher vacancy and generally longer re-leasing periods. The Trust currently has vacant space with an estimated annual rental value of approximately £2.7 million (€3 million) and predicting the timing and level of re-leasing that will be achieved remains difficult. The Trust’s earnings have also been constrained by the strategic decision to retain substantial cash reserves (£15.8 million), which earn a low rate of return at present, in order to maximise the Trust’s future flexibility. The Board has taken into consideration the current market conditions and progress on leasing and other initiatives that are being pursued and has maintained the dividend for the second quarter to 30 June 2011.

The dividend of 0.9p for the second quarter will be payable to the shareholders on the register as of 16 September 2011 and will be paid on 10 October 2011. This brings the total dividend for the period to 30 June 2011 to 1.8p per share. No scrip alternative will be offered for this dividend.

Revaluation and Net Asset Value

Investment properties are included in the balance sheet at an independent valuation of £265.7 million (€295.7 million) providing an average valuation yield across the portfolio of 8.4% as at 30 June 2011.

The portfolio totals approximately 262,000 square metres (approximately 2.8 million square feet) and many of the tenants are well known companies belonging to large groups with strong covenants such as, Alcatel-Lucent, Aldi, BNP Paribas, Carrefour, Credit Lyonnais, GlaxoSmithKline, Husqvarna, Klöckner Group, La Poste, MediaMarkt, McDonalds, Norauto, OCP, Plastic Omnium, Saint Gobain, and Vinci Group. Grade A tenants also include government or quasi-government bodies and together the rent from such tenants accounts for 84% of the Trust’s rental income.

The weighted average lease length within the portfolio is currently 6.8 years to expiry and 3.5 years to the next break.

As at 30 June 2011 the adjusted net asset value per ordinary share is 28.7p (note 10). The change in adjusted net asset value from 31 December 2010 (34.0p per share) is primarily due to net movements on currency hedges.

Chairman’s statementDick Kingston Chairman

The trend in rental indexation continues to improve for both France and Spain.

There are no LTV covenant tests on any of the Trust’s borrowings before February 2014.

4

Alcatel-Lucent Business Park Villarceaux-Nozay, Ile-de-France

Description Business park

Tenants Alcatel-Lucent

Net lettable area 78,800 sqm

Location Villarceaux-Nozay

Nozay is 27 km to the south of Paris and 5 km from Courtaboeuf business park.

The Business Park benefits from good road communications via the A10 motorway from Paris and the RN118 from the west of Paris.


Finance

The Trust has total borrowings of £218.5 million (€243.2 million) as at 30 June 2011 under its facilities with Barclays Bank PLC.

The key features of the Trust’s borrowings are:

• No loan to value (“LTV”) covenant test until February 2014 on any of the Trust’s properties.

• Long term maturities – the French (€221.0 million) and Spanish (€22.2 million) borrowings mature in February 2015.

• 99% of borrowings have interest rates that are fixed to maturity at a weighted average rate of 5.26% per annum.

• Interest cover ratio (“ICR”) covenant is set at 110% - the Trust’s weighted average ICR over the six months to 30 June 2011 was 168%.

• On the LTV test date in February 2014, the Trust’s LTV should not exceed 87.5% on a country portfolio basis (with the exception of the Alcatel-Lucent property, Villarceaux-Nozay, where it should not exceed 85%). The weighted average loan to value covenant is 86.5%. As at 30 June 2011 the Trust has net leverage of 76.3% (taking into account cash of £15.8 million).

• The French and Spanish borrowings are independent and are not cross-collateralised.

The Trust holds £15.8 million of cash and un-mortgaged properties with a value of £7.3 million (€8.1 million) as at 30 June 2011.

Currency hedge instruments are in place that significantly protect the conversion of the shareholders’ original equity back to Sterling.

Chairman’s statement (continued)

Portfolio Summary

Country Property Sqm Description Valuation £m

Valuation €m

France Villarceaux-Nozay 78,800 Business park 112.6 125.3

France Aubervilliers 8,750 Offices 19.3 21.5

France Goussainville 20,500 Warehouse and offices 14.9 16.6

France Champs sur Marne 5,930 Offices 12.6 14.0

France Aubergenville 27,700 Logistics 9.9 11.0

France St Cyr L’Ecole 6,340 Offices 9.3 10.4

France Athis Mons 23,280 Logistics with offices 8.8 9.8

France Gennevilliers 3,330 Offices with light industrial 8.4 9.4

France Mulhouse 5,250 Offices 7.9 8.8

France Evreux 14,130 Logistics with offices 7.5 8.3

France Nîmes 3,100 Offices and retail 7.3 8.1

France Roissy-en-France 7,800 Offices and warehouse 7.0 7.8

France Ivry-sur-Seine 7,420 Warehouse and offices 6.1 6.8

France Fresnes 6,540 Warehouse and offices 5.0 5.6

France Vitry-sur-Seine 5,180 Warehouse and offices 4.8 5.3

Spain Córdoba 16,880 Retail park 15.3 17.0

Spain Zaragoza 9,520 Warehouses 3.4 3.8

Spain Écija 5,950 Shopping centre 2.8 3.1

Spain Alcalá de Guadaíra 5,700 Shopping centre 2.8 3.1

Total 262,100 265.7 295.7

6

Description Offices and retail unit

Tenants include Conseil Général du Gard and France Télécom

Net lettable area 3,100 sqm (including 200 sqm of retail)

Location Nîmes is located in the Languedoc-Rousillon region some 54 km north east of Montpellier.

The property is situated to the south of Nîmes city centre in an area including offices, business park, retail and residential buildings.

The town is accessed by the A9 motorway connecting it with Montpellier and the A54 to Marseille.

Mas Carbonnel Nîmes


Market outlook

• Leasing activity in the French and Spanish markets has remained subdued over the period reflecting economic conditions, although the Trust has achieved lease extensions and new leases on 18,200 square meters (7% of its portfolio) since 1 January 2011.

• Vacancy rates and take-up in our principal occupational markets have stabilised. In the Paris region (Ile-de-France), where the majority of the Trust’s portfolio is situated, office vacancy remains low at 6.7% and significant oversupply appears unlikely in the medium term.

• The Trust’s portfolio with 84% of current income from Grade A tenants is significantly insulated from weaker covenants.

• In France, the annualised construction cost index showed positive growth for the fifth consecutive quarter running at 3.05% in the first quarter of 2011. In Spain, CPI was running at an annualised rate of 3.2% at the end of June 2011.

• The French economy remains one of the better performing in Europe with positive growth in GDP since the second quarter of 2009.

• Valuation yields have stabilised and investment confidence in our principal market continues.

Summary

• The Trust owns a diversified freehold portfolio of properties totalling £265.7 million (€295.7 million) with an average valuation yield of 8.4% at the June valuation.

• The Trust’s leases are subject to annual index-linked rent reviews, which are positive in both markets.

• 84% of the Trust’s rental income comes from Grade A tenants with a strong capacity to pay.

• The Trust’s current average lease length is 6.8 years to expiry and 3.5 years to the next break.

• 99% of borrowings are fixed long term at a weighted average interest rate of 5.26% per annum to maturity in February 2015.

• There are no LTV covenant tests on any of the Trust’s borrowings before February 2014.

• The outlook for property investment in the Trust’s principal market continues to show signs of improving.

• The Trust’s cash reserves of £15.8 million leave it well positioned to redeploy some of the low-returning cash in value added opportunities within the existing portfolio as markets continue to improve and tenant activity increases.

Dick Kingston Chairman 17 August 2011

Chairman’s statement (continued)

Statement of Directors’ Responsibilities

The Directors confirm that this condensed set of financial statements has been prepared in accordance with IAS 34 as adopted by the European Union, and that the interim management report herein includes a fair review of the information required by the United Kingdom’s Financial Services Authority’s Disclosure and Transparency Rules 4.2.7 and 4.2.8.

The Directors of Alpha Pyrenees Trust Limited are listed on page 35 and have been Directors throughout the period.

By order of the Board

Dick Kingston Chairman 17 August 2011

8

Description Offices

Tenants Klöckner Distribution Industrielle (“KDI”), Klöckner Information Services (“KIS”), Duferco, d’Haussy and River Star


Location The property is located in “Seine-Saint-Denis” which is in one of the departments that constitute the 1st periphery adjoining Paris. The property lies within an urban development zone comprising residential, offices, light industrial and retail space and enjoys good transportation links with road access via the A86 motorway and the boulevard Périphérique linking Paris to Aubervilliers.

Aubervilliers Ile-de-France


Portfolio overview

The Trust owns a portfolio of fifteen properties in France and four properties in Spain totalling approximately 262,000 square metres (approximately 2.8 million square feet) of commercial real estate. The properties are generally well let, well located and offer good value accommodation to occupiers. Of the total property portfolio, 91% is invested in France and 9% in Spain in terms of capital value.

The valuation of the portfolio as at 30 June 2011 was approximately £265.7 million (€295.7 million) giving an average valuation yield of 8.4% with the French portfolio producing an average valuation yield of 8.4% and the Spanish portfolio 8.5% respectively. The portfolio as a whole showed a small valuation decline of 0.1% on a Euro like-for-like basis compared to 31 December 2010. This consisted of a decline of 0.2% in the French portfolio and an increase of 0.4% in the Spanish portfolio. The average capital value of the portfolio is approximately £1,013 (€1,128) per square metre (equivalent to £94 per square foot) and the average rental value is approximately £93 (€104) per square metre per annum (equivalent to £8.65 per square foot). Of the overall portfolio, 82% by value is located within the Ile-de-France region around Paris. The portfolio has 67% exposure to the French office and business park sector of which 61% of the total portfolio is in the Ile-de-France region. The reinstatement cost of the portfolio buildings has been assessed at £246 million (€274 million) representing approximately 93% of current value.

The Trust’s portfolio is diversified across business sectors with 67% in offices and business park property, 25% in warehouses and 8% in retail.

The portfolio benefits from strong credit tenants with 84% of its current rent roll secured by leases to Grade A tenants (large international/national companies or public sector). Examples of those categorised as Grade A are given in the Chairman’s statement.

The portfolio also enjoyed a level of average occupancy of 89% measured by rental income as a percentage of potential total income with vacancy representing 11%.

The weighted average lease length as at 30 June 2011 is 6.8 years to expiry and 3.5 years to next break.

Property reviewPaul Cable Fund Manager

Split of capital value by country

91% 67%

9% 8%

25%

89%84%

5%11%

11%

n France

n Spain

Split of capital value by usage

91% 67%

9% 8%

25%

89%84%

5%11%

11%

n Offices and business parks

n Warehouses

n Retail

Split of income by Grade A, B & C of tenants

91% 67%

9% 8%

25%

89%84%

5%11%

11%n A Large international, large national companies or public sector

n B National or large regional companies

n C Medium to small regional or local companies

Occupancy

91% 67%

9% 8%

25%

89%84%

5%11%

11%n Rented

n Vacant

10

Goussainville Ile-de-France

Description Warehouse and offices

Tenants include Maintenance Partner Solutions France, Durag Group, ITS, Hurco, Fuji Machinery, Cabinet Rabec and AMPS

Net lettable area Warehouses 13,150 sqm

Offices 7,350 sqm

Total 20,500 sqm

Location The property is located in the “Val d’Oise” department which is adjoining Paris in the 2nd periphery (2eme couronne).

The property lies within the parc d’activite GIP Charles de Gaulle, which comprises mixed offices and activity / light industrial premises. The property is situated 10 km away from the international airport of Roissy-Charles de Gaulle and benefits from good transport links with SNCF and RER connections. It also enjoys straightforward road access to the A1 motorway linking Paris to Lille.


Asset management reviewThe Investment Manager has continued to concentrate on active asset management and property management initiatives, including investment within the existing portfolio, to secure the Trust’s income and we are pleased to report a number of important achievements since 1 January 2011 in the following areas:

• extending the lease maturity profile of the property portfolio through lease extensions, and,

• letting of vacant units.

More generally, the Trust maintains a close relationship with all its tenants and is in regular discussions to establish their potential needs for lease extensions and building extensions at the properties they occupy.

Strong attention continues to be given to ensuring service charges are spent effectively, the annual level of property costs is closely monitored and additional sources of income are identified.

France

Fresnes – the main tenant, Exapaq, part of the La Poste Group extended the term of their lease on 5,230 square metres of warehouse space. The fixed length of their lease was extended by 7 years through signing a new 9 year lease without breaks with effect from 1 January 2011 at a market rent.

Roissy – OCP Repartition, a leading distributor of pharmaceuticals, extended the term of their lease on a 4,735 square metre logistics unit until June 2014.

Ivry – GTIE Telecoms, part of the Vinci Group extended their lease until December 2014 on 1,350 square metres of offices and Metallerie Marie extended their lease until April 2014 on an 835 square metre light industrial unit.

Vitry – a new 6/9 year lease from 1 April 2011 has been signed with GFF on a 330 square metre vacant light industrial unit and a new 3/6/9 year lease from 15 April 2011 has been signed with SCR on a 360 square metre light industrial unit. Mediapost and Stanbridge extended their respective leases until March 2014 on 895 square metre and 500 square metre light industrial units.

Goussainville – a new 3/6/9 year lease from 1 March 2011 has been signed with Cabinet Rabec on 385 square metres of vacant office space. AMPS extended their lease until November 2013 on 200 square metres of offices.

Mulhouse – BNP Paribas extended their lease until November 2014 on 610 square metres of banking hall and offices.

Nîmes – France Telecom extended their lease until February 2014 on a 215 square metre retail unit.

Spain

Five new leases were signed on the Spanish properties; four units at Écija totaling 290 square metres and one at Alcala on a 40 square metre unit.

Córdoba – Sprinter extended their lease until September 2012 on their 2,000 square metre retail unit.

Écija – Balmont and Imagina Sport extended leases until 2012 on their 115 square metre and 100 square metre retail units.

Property review (continued)

18,200 square metres of lease extensions and new leases achieved since 1 January 2011.

12

Description 13 warehouse units with offices

Tenants Mediapost (La Poste Group), Venticom, GFF, Univers Froid, Societe de Cendres, Maugein Freres, Stanbridge, Go Sport, Celeonet, Alchimica and SCR

Net lettable area Warehouses 3,730 sqm

Offices 1,450 sqm

Total 5,180 sqm

Location Ile-de-France – France

Industrial zone to the north east of Vitry-sur-Seine in the southern inner suburbs of the Ile-de-France.

Vitry-sur-Seine Ile-de-France


Market overview The property markets in France and Spain remain characterised by higher vacancy and longer re-leasing periods reflecting the cautious approach resulting from concerns over the business climate and economy. These trends are more marked in Spain where the economic conditions remain more challenging than in France.

France

After an annual growth of 1.4% in 2010, France showed GDP growth of 0.9% in the first quarter of 2011 but this growth leveled off in the second quarter and GDP is forecast to grow by around 1.5% over 2011. As at June 2011 manufacturing output showed a year-on-year increase of 3.8% but on a slowing trend and household consumption expenditure has slowed over the second quarter. France still benefits from a high household saving rate and low household debt and the economy has been supported by a relatively modest labour market downturn, with the unemployment rate decreasing 0.1% in the first quarter of 2011 to stand at 9.2%. In July 2011 the consumer price index showed a 1.9% increase year-on-year.

Of the total property portfolio, 91% is in France, 82% is in the Ile-de-France and 61% is in Ile-de-France office and business park space.

Despite the economic and financial markets’ uncertainties, the Paris region remains one of Europe’s more stable office markets. In the first half of 2011 take-up in the Ile-de-France increased to 1.1 million square metres which was 3% higher than the same period last year. There was letting activity across different size requirements, business sectors and geographic spread. The financial services and industrial sectors remained the largest in terms of take-up, together accounting for 46%. The information technology, industry and transport, logistics and distribution sectors had a higher share of the take-up than in previous quarters with 20% combined.

The average office rent in Ile-de-France has remained broadly stable year-on-year at €306 per square metre per annum as at 1 July 2011. The slight fall in Central Paris rents in the second quarter is due to the scarcity of properties available that command the highest rents and the consequent lack of comparable transactions. The majority of the remaining market has tended to remain stable.

The office vacancy rate for the Paris region has fallen slightly to 6.7% and the prospect of a future shortage of good quality office space in Paris CBD and La Défense has encouraged the resumption of selective development projects in these areas. The low volume of speculative development in other parts of the Ile-de-France office market means that in the medium term there is little prospect of significant over supply emerging.


Trends in annual office take up in Ile-de-France

sq m

(milli

on)

Q1 Q2 Q3 Q4 Source: CBRichardEllis/Immostat

0

0.5

1.0

1.5

2.0

2.5

3.0

00 01 02 03 04 05 06 07 08 10 1109

80 85 90 95 00 05 Q3’10

Source: INSEEICC Index ICC Trend

500

600700800900

1000110012001300140015001600

Trends in prime Ile-de-France office rents

2006 2008

Average Ile-de-FranceCentre West Western CrescentLa Défense

€/sq

m/a

nnum

Source: CBRichardEllis

200

300

400

500

600

700

800

2007 2010 20112009

80 85 90 95 00 05 Q3’10

Source: INSEEICC Index ICC Trend

500

600700800900

1000110012001300140015001600

14

Description Offices with light industrial

Tenants Husqvarna France

Net lettable area 3,330 sqm (including 700 sqm light industrial)

Location Gennevilliers – France

Established technology park 15 km north of Paris. Excellent road communications via the A86 and A15 motorways and D911. Close to the RER, which runs direct to central Paris, and numerous bus links.

Gennevilliers Ile-de-France


Spain

The Spanish economy is growing gradually with a quarter-on-quarter growth of 0.3% in the first quarter and 0.2% in the second quarter of 2011. As a result the year-on-year growth in GDP was 0.7% in the second quarter of 2011 due primarily to an increase in the exports of goods and services and a slight moderation in imports. However, the unemployment rate has increased to over 21% in the first quarter which continues to have a detrimental effect on household income. In June 2011 the consumer price index showed a 3.2% increase year-on-year which was slightly lower than the 3.6% increase registered in March.

Although there are currently a few tentative signs of stabilisation, with fiscal tightening, Spain still looks set to lag behind its neighbours in the north of the euro-zone and with GDP having shrunk by 0.1% in 2010 it is forecast to grow by a moderate 0.5% in 2011.

Rental Indexation

The trend in rental indexation continues to improve for both France and Spain. The INSEE Construction Cost Index, applicable to the Trust’s leases in France, has shown annualised growth for the last five published quarters as a result of which the annual indexation base as at Q1 2011 increased to 3.05% (1.73% Q4 2010). The Spanish Consumer Price Index, applicable to the Trust’s leases in Spain, was running at an annualised rate of increase of 3.2% as at the end of June 2011.

Paul CableFor and on behalf of the Investment Manager 17 August 2011


Of the total property portfolio, 91% is in France, 82% is in the Ile-de-France and 61% is in Ile-de-France office and business park space.

16

First Millénium Mulhouse

Description Offices

Tenants BNP Paribas, Société d’Equipement de la Région Mulhousienne (“SERM”) and Alten


Location Mulhouse lies in the Alsace region, near the German and Swiss borders, some 115 km south of Strasbourg.

The property is situated to the south east of the city centre in a 14 hectare development zone including office and residential buildings, a 14 screen multiplex cinema and an opera theatre.

The A35 and A36 motorways are less than 1 km away and link to the A6 (Paris-Lyon).

Mulhouse is now linked to Paris by the TGV high speed rail service.


To Alpha Pyrenees Trust Limited

We have been engaged by the Company to review the condensed set of financial statements in the half yearly report for the six months ended 30 June 2011 which comprises the consolidated statement of comprehensive income, consolidated balance sheet, consolidated cash flow statement, consolidated statement of changes in equity and related notes. We have read the other information contained in the half-yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.

Directors’ responsibilities

The half yearly financial report is the responsibility of, and has been approved by, the Directors. The Directors are responsible for preparing the interim financial report in accordance with the Disclosure and Transparency Rules of the United Kingdom’s Financial Services Authority.

As disclosed in note 2, the annual financial statements of the Group are prepared in accordance with IFRSs as adopted by the European Union. The condensed set of financial statements included in this half-yearly financial report have been prepared in accordance with International Accounting Standard 34, ‘Interim Financial Reporting’ as adopted by the European Union.

Our responsibility

Our responsibility is to express to the Company a conclusion on the condensed set of financial statements in the half yearly report based on our review. This report, including the conclusion, has been prepared for, and only for, the Company for the purpose of the Disclosure and Transparency Rules of the Financial Services Authority and for no other purpose. We do not, in producing this report, accept or assume responsibility for any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.

Scope of review

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, ‘Review of Interim Information Performed by the Independent Auditor of the Entity’ issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half yearly financial report for the six months to 30 June 2011 is not prepared, in all material respects, in accordance with International Accounting Standard 34 as adopted by the European Union and the Disclosure and Transparency Rules of the United Kingdom’s Financial Services Authority.

BDO Limited Chartered AccountantsPlace du Pré, Rue du Pré, St Peter Port, Guernsey 17 August 2011

Independent review report

18

Description Warehouse, offices and light industrial

Tenants Exapaq (subsidiary of La Poste), Alphaguard, Exaflor and Anteos

Net lettable area Warehouse 5,230 sqm

Offices 710 sqm

Light industrial 600 sqm

Total 6,540 sqm

Location Ile-de-France – France

Well established industrial zone to the south of Ile-de-France close to the A86 and A6 motorways and well placed for Orly airport.

Fresnes Ile-de-France


For the six months ended 30 June 2011 (unaudited)


Notes

Revenue £’000

Capital £’000

Total £’000

Revenue £’000

Capital £’000

Total £’000

Income

Revenue 3 12,808 - 12,808 12,228 - 12,228

Property operating expenses (2,871) - (2,871) (2,457) - (2,457)

Net rental income 9,937 - 9,937 9,771 - 9,771

Expenses

Net change in losses on revaluation of investment properties

11 - (924) (924) - (2,138) (2,138)

Investment Manager’s fee (1,023) (439) (1,462) (962) (413) (1,375)

Other administration costs (603) - (603) (606) - (606)

Operating profit/(loss) 8,311 (1,363) 6,948 8,203 (2,551) 5,652

Finance income 4 103 6,051 6,154 36 12,798 12,834

Finance costs 5 (6,335) (6,670) (13,005) (6,446) (11,915) (18,361)

Profit/(loss) before taxation 2,079 (1,982) 97 1,793 (1,668) 125

Taxation 7 - (185) (185) - - -

Profit/(loss) for the period 2,079 (2,167) (88) 1,793 (1,668) 125

Other comprehensive income

Foreign exchange gains/(losses) on translation of foreign operations (translation reserve)

- 826 826 - (1,349) (1,349)

Other comprehensive income/(expense) for the period

- 826 826 - (1,349) (1,349)

Total comprehensive income/(expense) for the period

2,079 (1,341) 738 1,793 (3,017) (1,224)

Earnings per share - basic & diluted 9 (0.1)p 0.1p

Adjusted earnings per share - basic & diluted 9 1.8p 1.8p

All items in the above statement derive from continuing operations.

The accompanying notes on pages 27 to 34 are an integral part of this statement.

Condensed consolidated statement of comprehensive income

20

Description Logistics warehouse with offices

Tenant Laboratoire GlaxoSmithKline

Net lettable area 14,130 sqm (including 1,150 sqm offices)

Location Evreux – France

Excellent road communications through N13/A13 motorway providing access to Paris, Caen, Rouen and Le Havre.

Glaxo Logistics Centre Evreux, Normandy


Notes

30 June 2011 (unaudited)

£’000

31 December 2010 (audited)

£’000

Non-current assets

Investment properties 11 265,669 253,502

Current assets

Trade and other receivables 12 17,917 14,425

Cash and cash equivalents 15,794 15,541

33,711 29,966

Total assets 299,380 283,468

Current liabilities

Trade and other payables 13 (7,630) (2,877)

Bank borrowings 14 (1,624) (1,673)

(9,254) (4,550)

Total assets less current liabilities 290,126 278,918

Non-current liabilities

Financial liabilities at fair value through profit or loss 15 (53,195) (50,262)

Bank borrowings 14 (216,293) (205,854)

Rent deposits (2,818) (2,769)

Deferred taxation 7 (185) -

(272,491) (258,885)

Total liabilities (281,745) (263,435)

Net assets 17,635 20,033

Equity

Share capital 16 - -

Share premium account 16 - 2,500

Special reserve 113,131 110,592

Translation reserve 23,487 22,661

Capital reserve (121,755) (119,588)

Revenue reserve 2,772 3,868

Total equity 17,635 20,033

Net asset value per share 10 15.0p 17.1p

Net asset value per share (adjusted) 10 28.7p 34.0p

The half-year financial statements were approved by the Board of Directors and authorised for issue on 17 August 2011.


Condensed consolidated balance sheet

David Jeffreys

Director

Serena Tremlett Director

22

Description Logistics warehouse with offices

Tenants Point P (Saint Gobain Group)

Net lettable area 23,280 sqm (including 1,170 sqm offices)

Location Athis Mons – France

Athis Mons is located 12 km south of Paris and benefits from good communication links via the N7 to the A6, A106 and N104 motorways. Orly Airport is 7 km to the north.

Point P Logistics Centre Athis Mons, Ile-de-France


For the six months ended 30 June 2011

(unaudited)

£’000

For the six months ended 30 June 2010

(unaudited)

£’000

Operating activities

(Loss)/profit for the period (88) 125

Adjustments for:

Net change in losses on revaluation of investment properties 924 2,138

Deferred taxation 185 -

Finance income (6,154) (12,834)

Finance costs 13,005 18,361

Operating cash flows before movements in working capital 7,872 7,790

Movements in working capital:

(Increase)/decrease in operating trade and other receivables (2,015) 1,374

Decrease/(increase) in operating trade and other payables 4,802 (309)

Cash generated from operations 10,659 8,855

Interest received 93 36

Swap interest paid (453) (503)

Bank loan interest paid and costs (5,586) (5,636)

Other finance costs - (165)

Taxation - -

Cash flows from operating activities 4,713 2,587

Investing activities

Capital expenditure (596) (451)

Cash flows from investing activities (596) (451)

Financing activities

Currency swap collateral (paid)/received (1,023) 2,917

Repayment of borrowings (191) (196)

Dividends paid (3,136) (3,173)

Cash flows from financing activities (4,350) (452)

Net (decrease)/increase in cash and cash equivalents (233) 1,684

Cash and cash equivalents at beginning of period 15,541 16,430

Exchange translation movement 486 (1,817)

Cash and cash equivalents at end of period 15,794 16,297


Condensed consolidated cash flow statement

24

Description Offices

Tenants Crédit Lyonnais, Université de Marne la Vallée and Ecole Nationale des Ponts et Chaussées


Location Champs sur Marne – France

Large and well established commercial, scientific and University Zone 17 km east of Paris. Road access via the A4 and N104/A104. Served by the RER linking to Châtelet, central Paris.

Champs Sur Marne Ile-de-France



Share capital

£’000

Share premium

£’000

Special reserve

£’000

Warrant reserve

£’000

Translation reserve

£’000

Capital reserve

£’000

Revenue reserve

£’000

Total reserves

£’000

At 1 January 2011 - 2,500 110,592 - 22,661 (119,588) 3,868 20,033


- - - - 826 (2,167) 2,079 738

Share premium transfer - (2,500) 2,500 - - - - -

Dividends - - - - - - (3,175) (3,175)

Scrip dividend - - 39 - - - - 39

At 30 June 2011 - - 113,131 - 23,487 (121,755) 2,772 17,635


Share capital

£’000

Share premium

£’000

Special reserve

£’000

Warrant reserve

£’000

Translation reserve

£’000

Capital reserve

£’000

Revenue reserve

£’000

Total reserves

£’000

At 1 January 2010 - 2,500 110,462 130 23,571 (121,682) 4,395 19,376


- - - - (1,349) (1,668) 1,793 (1,224)

Dividends - - - - - - (3,173) (3,173)

At 30 June 2010 - 2,500 110,462 130 22,222 (123,350) 3,015 14,979


Condensed consolidated statement of changes in equity

26

Description Retail Park

Tenants MediaMarkt, Sprinter, Dia (Carrefour Group), UCC Cinemas, Norauto, McDonalds, Hogaria, Elefante Azul, VisionLab and El Meson de Bien Comer


Location Córdoba – Spain

Situated approximately 155 km to the north east of Seville.

The park is located 3.5 km from the centre of Córdoba in a retail and residential location close to the A4 motorway and fronting the Avenida de Cadiz, which acts as the main access route into the city.

Connecta Retail Park Córdoba


1. General informationThe Company is a limited liability, closed-ended investment company incorporated in Guernsey, which has been declared under the relevant legislation to be an Authorised Closed-Ended Collective Investment Scheme. The Group comprises the Company and its subsidiaries. The Group invests in commercial property in France and Spain with inflation-indexed rents that will provide an income return to investors as well as potential for capital growth. These financial statements are presented in pounds Sterling as this is the currency in which the funds are raised and in which the investors are seeking a return. The Company’s functional currency is Sterling and the subsidiaries’ currency is Euros. The presentational currency of the Group is Sterling. The period-end exchange rate used is £1:€1.113 (December 2010: £1:€1.168) and the average rate for the period used is £1:€1.152 (June 2010: £1:€1.147).

2. Significant accounting policiesThe unaudited condensed financial information included in the half year report for the six months ended 30 June 2011, have been prepared in accordance with the Disclosure and Transparency Rules of the United Kingdom’s Financial Services Authority and International Accounting Standard (IAS) 34, ‘Interim Financial Reporting’ as adopted by the European Union. The half year report should be read in conjunction with the Group’s Annual Report and Accounts for the year ended 31 December 2010, which have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union.

The same accounting policies and methods of computation are followed in these condensed financial statements as were applied in the preparation of the Group’s financial statements for the year ended 31 December 2010, which are available on the Company’s website (www.alphapyreneestrust.com).

The Directors considered all relevant new standards, amendments and interpretations to existing standards effective for the half year report for the six months ended 30 June 2011: their adoption has not led to any changes in the Groups accounting policies and they had no material impact on the financial statements of the Group.

The interim condensed financial statements are made up from 1 January 2011 to 30 June 2011, and have been prepared under the historical cost convention as modified by the revaluation of investment properties and the mark to market of derivative instruments.

The preparation of the interim condensed financial statements requires Directors to make estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the disclosure of contingent liabilities at the date of the condensed interim financial statements. If in the future such estimates and assumptions, which are based on the Directors’ best judgement at the date of the interim condensed financial statements, deviate from actual circumstances, the original estimates and assumptions will be modified as appropriate in the period in which the circumstances change.

3. Revenue

1 January 2011 to 30 June 2011

£’000


£’000

Rental income 10,734 10,412

Service charge income 2,074 1,816

Total 12,808 12,228

4. Finance Income


£’000


£’000

Bank interest income 103 36

Foreign exchange gain 1,552 -

Net gains on financial liabilities at fair value through profit or loss (note 6) 4,499 12,798

Total 6,154 12,834

Notes to the financial statementsFor the six months ended 30 June 2011


5. Finance costs


£’000


£’000

Interest on bank borrowings 5,568 5,540

Loan fee amortisation 298 326

Foreign exchange loss - 3,614

Net losses on financial liabilities at fair value through profit or loss (note 6) 7,123 8,774

Other charges 16 107

Total 13,005 18,361

6. Net gains and losses on financial assets and liabilities at fair value through profit or loss


£’000


£’000

Net change in unrealised gains and losses on financial assets and liabilities held at fair value through profit or loss

Currency swaps (6,670) 12,798

Interest rate swap 4,499 (8,271)

Net realised gains and losses on financial assets and liabilities held at fair value through profit or loss

Currency swaps – interest received 4,281 4,331

Currency swaps – interest paid (4,734) (4,834)

Net expense from currency swaps (453) (503)

Net (loss)/gain on financial assets and liabilities held at fair value through profit or loss (2,624) 4,024

Disclosed as:

Finance costs (note 5) (7,123) (8,774)

Finance income (note 4) 4,499 12,798

Net (loss)/gain on financial assets and liabilities held at fair value through profit or loss (2,624) 4,024

7. Taxation The Company is exempt from Guernsey taxation on income derived outside Guernsey and bank interest earned in Guernsey. A fixed annual fee of £600 is payable to the States of Guernsey in respect of this exemption. No charge to Guernsey taxation arises on capital gains.

Deferred taxation has been calculated in accordance with IFRS. The Group is currently liable to French income tax at 33.33% and Spanish income tax at 30% arising on the activities of the Group’s operations in France and Spain.

Notes to the financial statements (continued)For the six months ended 30 June 2011


8. Dividends

Dividend reference period Shares

’000

Dividend

per share

Paid

£

Date

Quarter ending 30 September 2010 117,500,000 0.9p 1,057,500 10 January 2011

Quarter ending 31 December 2010 117,627,056 0.9p 1,058,644 26 April 2011

Quarter ending 31 March 2011 117,627,056 0.9p 1,058,644 20 June 2011

Total 3,174,788

For the quarter ended 30 September 2010 a scrip dividend alternative was granted to investors. Shareholders who opted for the scrip dividend alternative (of £39,265) were issued 127,056 new shares at a price of 30.9p each on 10 January 2011. Shareholders who did not opt received a dividend of £1,018,235 (0.9p per share), which was paid on 10 January 2011.

The Directors have resolved to pay a dividend of 0.9p per share for the second quarter taking the total dividend for the period to 30 June 2011 to 1.8p per share. This dividend has not been included as a liability in the half year report.

9. Earnings per shareThe calculation of the basic and diluted earnings per share is based on the following data:


1 January 2010 to 31 December 2010


Earnings after tax per income statement (£’000) (88) 5,797 125

Basic and diluted earnings per share (0.1)p 4.9p 0.1p

Earnings after tax per income statement (£’000) (88) 5,797 125

Revaluation (gains)/losses in investment properties 924 (140) 2,138

Mark to market of currency swaps 6,670 (7,759) (12,798)

Mark to market of interest rate swaps (4,499) 3,194 8,271

Interest rate swap – break costs and other loan restructuring costs - - 30

Investment Manager’s fee (capital) 439 842 413

Deferred taxation 185 - -

Rental guarantee income - 512 355

Foreign exchange (gains)/losses (1,552) 1,769 3,614

Adjusted earnings (£’000) 2,079 4,215 2,148

Adjusted earnings per share 1.8p 3.6p 1.8p

Weighted average number of ordinary shares (000’s) 117,620 117,500 117,500

The adjusted earnings are presented to provide what the Company believes is a more appropriate assessment of the operational income accruing to the Group’s activities. Hence, the Company adjusts basic earnings for income and costs which are not of a recurrent nature or which may be more of a capital nature.



10. Net asset value per share

30 June 2011 31 December 2010

Net asset value (£’000) 17,635 20,033

Net asset value per share 15.0p 17.1p

Net asset value (£’000) 17,635 20,033

Mark to market of currency hedge* 1,046 1,277

Mark to market of interest rate swaps 14,874 18,611

Deferred taxation 185 -

Adjusted net asset value 33,740 39,921

Net asset value per share (adjusted) 28.7p 34.0p

Number of ordinary shares (000’s) 117,627 117,500

* The mark to market of the currency hedge necessarily includes both a movement in relation to currency fluctuation and a movement due to relative future interest rates. For the purpose of providing an adjusted net asset value the element of valuation in relation to the interest rates is included as an adjustment; the intention is to hold the instruments to maturity at which point this element will have unwound.

The adjusted net assets are presented to provide what the Company believes is a more relevant assessment of the Group’s net asset position. The Company has determined that certain fair value and accounting requirements, as adjusted in the above table, may not be realisable in the longer term.

11. Investment properties

30 June 2011

£’000

31 December 2010

£’000

Market value of investment properties at 1 January 253,502 265,408

Subsequent capital expenditure after acquisition 596 908

Fair value adjustment in the period/year (924) 140

Effect of foreign exchange 12,495 (12,954)

Market value of investment properties at 30 June/31 December 265,669 253,502

The fair value of the Group’s investment properties at 31 December 2010 and 30 June 2011 have been arrived at on the basis of valuations carried out at that date by Knight Frank LLP, independent valuers not connected to the Group. The portfolio has been valued on a market value basis as defined by the Royal Institution of Chartered Surveyors Approval and Valuations Standards (“RICS”).

The approved RICS definition of market value is the “estimated amount for which a property should exchange on the date of valuation between a willing buyer and a willing seller in an arm’s length transaction after proper marketing wherein the parties had each acted knowledgeably, prudently and without compulsion.”

12. Trade and other receivables

30 June 2011

£’000

31 December 2010

£’000

Trade receivables 2,861 1,894

Amounts receivable from Property Managing Agents 2,799 2,112

Bank interest receivable 10 4

Prepayments 621 218

Other debtors 11,626 10,197

Total 17,917 14,425

The Directors consider that the carrying amount of trade and other receivables approximates to their fair value.

Included in other debtors is collateral of £10.8 million (€12.0 million) (December 2010: £9.3 million (€10.9 million)) held with Barclays Bank PLC in relation to the currency swap (note 15).



13. Trade and other payables

30 June 2011

£’000

31 December 2010

£’000

Trade creditors 1,577 347

Deferred income 4,099 502

Investment Manager’s fee payable 761 744

VAT payable 250 136

Accruals 943 1,148

Total 7,630 2,877

Trade creditors and accruals primarily comprise amounts outstanding for trade purchases and ongoing costs. The Group has financial risk management policies in place to ensure that all payables are paid within the credit time frame.

The Directors consider that the carrying amount of trade and other payables approximates to their fair value.

14. Bank borrowings

30 June 2011

£’000

31 December 2010

£’000

Current liabilities: interest payable and bank borrowing 1,624 1,673

Non-current liabilities: bank borrowing 216,293 205,854

Total liabilities 217,917 207,527

The borrowings are repayable as follows:

Interest payable 1,624 1,548

On demand or within one year - 125

In the second to fifth years inclusive 216,293 205,854

After five years - -

217,917 207,527

Movement in the Group’s bank borrowings is analysed as follows:


£’000

1 January 2010 to 31 December 2010

£’000

Opening balance 205,979 216,280

Amortisation of finance costs 298 615

Deferred finance cost adjustment - (78)

Repayment of loan (191) (258)

Exchange differences on translation of foreign currencies 10,207 (10,580)

Total 216,293 205,979



15. Financial assets and financial liabilities at fair value through profit or loss

30 June 2011

£’000

31 December 2010

£’000

Non-current assets

Interest rate swaps - -

Non-current liabilities

Currency swap - a (30,045) (24,722)

Currency swap - b (8,276) (6,929)

Interest rate swaps (14,874) (18,611)

(53,195) (50,262)

Total (53,195) (50,262)

Interest rate swapThe Company is required under the financing agreements with Barclays Bank PLC to fix the rate at which it borrows over the duration of each loan. The Company has agreed a fixed interest rate with Barclays Bank PLC at each loan draw-down.

The bank has undertaken a variable to fixed rate swap with a third party. The Company is not party to the swap agreement but via the financing agreement the Company has all the risks and rewards of the swap as should the loan be repaid early the Company would be required to pay the swap break costs or, alternatively accrue a swap benefit as a repayment reduction depending on the value of the underlying swap at that point in time.

The interest rate swaps are valued by reference to the bank’s redemption notice of amounts due if the Company repaid its borrowings at the balance sheet date; the Directors consider this to represent fair value.

Currency swapThe Group uses currency derivatives to hedge significant future foreign currency transactions and cash flows to safeguard the equity investments of shareholders against significant adverse movements between Sterling and Euros.

a) On 13 October 2006, Alpha Pyrenees Trust Finance Company Limited (“Alpha Finance”), a wholly owned subsidiary of the Company, entered into a currency swap with Barclays Bank PLC. Under the terms of this agreement, Alpha Finance will pay Barclays Bank PLC €130.1 million and Barclays Bank PLC will pay Alpha Finance £87.6 million on 16 October 2013. ln addition, there are quarterly periodic payments in February, May, August and October of each year starting on 16 February 2007 and ending 16 October 2013. On these dates Barclays Bank PLC will pay Alpha Finance an amount equal to 7 per cent per annum on £87.6 million and Alpha Finance will pay Barclays Bank PLC an amount equal to 6 per cent per annum on €130.1 million.

b) On 18 January 2007, Alpha Finance entered into a further currency swap with Barclays Bank PLC. Under the terms of this swap, Alpha Finance will pay Barclays Bank PLC €33.0 million and Barclays Bank PLC will pay Alpha Finance £21.6 million on 16 October 2013. In addition, there are quarterly periodic payments in February, May, August and November of each year starting on 16 February 2007 and ending on 16 October 2013. On these dates Barclays Bank PLC will pay Alpha Finance an amount equal to 7 per cent per annum on £21.6 million and Alpha Finance will pay Barclays Bank PLC an amount equal to 5.9725 per cent per annum on €33.0 million.

At 30 June 2011, a total amount of £10.8 million (€12.0 million) (December 2010: £9.3 million (€10.9 million)) is deposited as collateral with Barclays Bank PLC to support both the 13 October 2006 and 18 January 2007 swaps.

The fair value of the currency swap contracts is determined by reference to an applicable valuation model.



16. Share capital The authorised share capital is unlimited. The Company has one class of shares which carry no right to fixed income. All ordinary shares have a nil par value. The number of shares in issue is 117.6 million.

In January 2011, as a result of a scrip dividend offer (note 11), a number of shareholders opted for the alternative which resulted in the issue by the Company of 127,056 new shares at a price of 30.9p each.

There have been no share cancellations during the period.

17. Related party transactionsParties are considered to be related if one party has the ability to control the other party or exercise significant influence over the other party in making financial or operational decisions. Alpha Real Capital LLP is the Investment Manager to the Company under the terms of the Investment Manager Agreement and is thus considered a related party of the Company.

Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation and are not disclosed in this note.

The Investment Manager is entitled to receive a fee from the Group at an annual rate of 1% of the gross assets of the Group, payable quarterly in arrears. The Investment Manager is also entitled to receive an annual performance fee calculated with reference to total shareholder return (“TSR”), whereby the fee is 20% of any excess over an annualised TSR of 12% and then a further 15% of any excess over 20%; the performance fee is subject to a three year high watermark with a minimum threshold of 100 pence. Details of the investment management fees for the current accounting period are shown on the face of the income statement and any balances outstanding are disclosed separately in note 13.

The Directors of the Company received total fees as follows:

Six months ending 30 June 2011

£’000

Year ending 31 December 2010

£’000

Dick Kingston 15,000 30,000

Christopher Bennett 10,000 20,000

David Jeffreys 10,000 20,000

Phillip Rose 10,000 20,000

Serena Tremlett 10,000 20,000

Total 55,000 110,000

The Directors’ interests in the shares of the Company are detailed below:

30 June 2011

shares held

31 December 2010

shares held

Dick Kingston 5,000 5,000

Christopher Bennett - -

David Jeffreys 250,000 250,000

Phillip Rose 1,290,079 1,290,079

Serena Tremlett 23,341 23,341



The following, being partners of the Investment Manager held the following shares in the Company:

30 June 2011

shares held

31 December 2010

shares held

Rockmount Ventures Limited and ARRCO Limited* 21,437,393 20,437,393

Sir John Beckwith 3,472,681 3,472,681

Phillip Rose** 1,290,079 1,290,079

Bradley Bauman 459,289 459,289

Karl Devon-Lowe 24,650 24,650

Ronnie Armist 7,450 7,450

* Rockmount Ventures Limited became a partner in the investment manager on 23 December 2010. Rockmount Ventures Limited is the parent company of ARRCO Limited. The interest attributed to the two corporate partners represents 20,437,393 shares held by a fellow group company, Antler Investment Holdings Limited.

** Phillip Rose is the CEO and a partner of the Investment Manager.

Paul Cable, being the Investment Manager’s Fund Manager responsible for the Trust’s investments, holds 84,918 (31 December 2010: 80,878) shares in Alpha Pyrenees Trust Limited.

Serena Tremlett is also the Managing Director and a major shareholder of Morgan Sharpe Administration Limited, the Company’s administrator and secretary. During the period the Company paid Morgan Sharpe Administration Limited fees of £40,500 (31 December 2010: £89,900).

18. Events after the balance sheet dateThere are no material events after the balance sheet date.


17. Related party transactions (continued)


Directors:

Dick Kingston (Chairman) Christopher Bennett David Jeffreys Phillip Rose Serena Tremlett

Registered office:

Isabelle Chambers Route Isabelle St Peter Port Guernsey

Investment Manager:

Alpha Real Capital LLP 1b Portland Place London W1B 1PN

Administrator and secretary:

Morgan Sharpe Administration Limited Isabelle Chambers Route Isabelle St Peter Port Guernsey GY1 3TX

Joint brokers:

Numis Securities Limited 10 Paternoster Square London EC4M 7LT

Peel Hunt LLP 111 Old Broad Street London EC2U 1PH

Independent valuers:

Knight Frank LLP 55 Baker Street London W1U 8AN

Auditors:

BDO Limited PO Box 180 Place du Pré Rue du Pré Ruette Braye St Peter Port Guernsey GY1 3LL

Tax advisors:

BDO Stoy Hayward LLP 55 Baker Street London W1U 7EU

Deloitte LLP Hill House 1 Little New Street London EC4A 3TR

Legal advisors in Guernsey:

Carey Olsen PO Box 98 Carey House Les Banques St Peter Port Guernsey GY1 4BZ

Legal advisors in the UK:

Norton Rose 3 More London Riverside London SE1 2AQ

Registrar:

Computershare Investor Services (Channel Islands) Limited Ordnance House 31 Pier Road St Helier Jersey JE4 8PW

Directors and Trust information


DividendsOrdinary dividends are paid quarterly. Shareholders who wish to have dividends paid directly into a bank account rather than by cheque to their registered address can complete a mandate form for this purpose. Mandates may be obtained from the Group’s Registrar. Where dividends are paid directly to shareholders’ bank accounts, dividend vouchers are sent directly to shareholders’ registered addresses.

Share priceThe Trust’s Ordinary Shares are listed on the London Stock Exchange.

Change of addressCommunications with shareholders are mailed to the addresses held on the share register. In the event of a change of address or other amendment, please notify the Trust’s Registrar under the signature of the registered holder.

Investment ManagerThe Company is advised by Alpha Real Capital LLP which is authorised and regulated by the Financial Services Authority in the United Kingdom.

Shareholder information

Financial calendar

Financial reporting Reporting/Meeting dates Dividend period Ex-dividend date Record date Payment date

Half Year Report and announcement of dividend

18 August 2011 Quarter ended 30 June 2011

14 September 2011 16 September 2011 10 October 2011

Interim Management Statement (Q3)

17 November 2011 Quarter ended 30 September 2011

7 December 2011 9 December 2011 9 January 2012

Annual Report and Accounts announcement

16 March 2012 Quarter ended 31 December 2011

28 March 2012 30 March 2012 23 April 2012

Annual Report published 30 March 2012

Annual General Meeting 26 April 2012

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