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BlackRock Income and Growth Investment Trust plc

Annual Results Announcement for the year ended 31 October 2015



As at 
31 October 2015 
As at 
31 October 2014 
Net asset value per ordinary share  187.69p  170.68p  +10.0 
 --------   --------   -------- 
– with income reinvested  +13.5 
 --------   --------   -------- 
Ordinary share price (mid-market) 184.25p  167.25p  +10.2 
 --------   --------   -------- 
– with income reinvested  +13.8 
 --------   --------   -------- 
FTSE All-Share Index (total return) 5,541.71  5,380.70  +3.0 
 --------   --------   -------- 
Net assets (1) (£’000) 49,231  45,194  +8.9 
 --------   --------   -------- 
Discount to net asset value  1.8%  2.0% 
 --------   -------- 
1     The change in net assets includes the effect of market movements during the year and the purchase of the Company’s own shares.


Year ended 
31 October 2015 
Year ended 
31 October 2014 
Revenue return per ordinary share  6.68p  5.66p  +18.0 
 --------   --------   -------- 
Net revenue return after taxation (£’000) 1,758  1,524  +15.4 
 --------   --------   -------- 
 --------   --------   -------- 
Interim  2.40p  2.20p  +9.1 
 --------   --------   -------- 
Final  3.60p  3.50p  +2.9 
 --------   --------   -------- 
Total dividends paid and payable  6.00p  5.70p  +5.3 
 --------   --------   -------- 



I am pleased to present the annual report to shareholders of BlackRock Income and Growth Investment Trust plc for the year ended 31 October 2015.


During the period the Company’s net asset value per share (NAV) returned 13.5% and the share price returned 13.8%. By comparison, the Company’s benchmark, the FTSE All-Share Index returned 3.0% (all percentages with income reinvested).

The NAV outperformance relative to the FTSE All-Share Index during the year was due principally to stock selection. Further details of the factors which have contributed to performance are set out in the Investment Manager’s Report.

Since the year end the Company’s NAV has fallen by 4.0% compared with a fall in the benchmark of 5.1% over the same period to the close of business on 13 January 2016.


The Company’s revenue return per share for the year amounted to 6.68 pence compared with 5.66 pence for the previous year, representing an increase of 18.0%. 2.40 pence per share has already been distributed to shareholders during the year by way of an interim dividend. This represented an increase of 9.1% compared to the interim dividend of 2.20 pence per share paid in respect of the year ended 31 October 2014.

The Directors are mindful of shareholders’ desire for income in addition to capital growth and are proposing a final dividend per share of 3.60 pence (2014: 3.50 pence) giving a total for the year of 6.00 pence per share. This represents a 5.3% increase over the prior year (2014: 5.70 pence per share) and reflects the increased level of special dividends generated from the Company’s portfolio during the year. Subject to approval at the Annual General Meeting, the final dividend will be paid on 4 March 2016 to shareholders on the Company’s register at the close of business on 12 February 2016 (ex dividend date is 11 February 2016).


The Directors recognise the importance to investors that the Company’s share price should not trade at a significant discount to NAV, and therefore, in normal market conditions, may use the Company’s share buy back, sale of shares from treasury and share issue powers to ensure that the share price is broadly in line with the underlying NAV. They believe that an ongoing commitment to that discount management policy will continue to enhance the attractiveness of the Company to existing and potential new shareholders and thus its ability to grow over time by increasing the liquidity of the shares and spreading fixed costs over a larger asset base.

The discount management policy works through the use of share buy backs at a narrow discount to NAV and the issue of new shares at or above the estimated NAV per share. The existing authority to buy back up to 14.99% of the Company’s issued share capital (excluding treasury shares) will expire at the conclusion of the 2016 Annual General Meeting and a resolution will be put to shareholders to renew the authority at that meeting. Currently, ordinary shares representing up to 35% of the Company’s issued ordinary share capital can be allotted as new ordinary shares or sold from treasury. It is proposed to renew this authority at the forthcoming Annual General Meeting.

250,000 ordinary shares were purchased and placed in treasury during the year for a total consideration of £448,000 (excluding costs). No shares were issued or sold from treasury. At the date of this report, 20.4% of the Company’s issued share capital is held in treasury.


The Company operates a flexible gearing policy which depends on prevailing market conditions and is subject to a maximum level of 20% of net assets at the time of investment. The maximum gearing used during the year was 2.9% and at 31 October 2015 net gearing was 2.4%.

The Company currently has a two year unsecured sterling revolving credit facility of £4 million with Scotiabank (Ireland) Limited, with a maturity date of 31 October 2016.


The Company’s Annual General Meeting will be held on Wednesday, 24 February 2016 at 12 noon at the offices of BlackRock at 12 Throgmorton Avenue, London EC2N 2DL. Details of the business of the meeting are set out in the Notice of Annual General Meeting on pages 63 to 66 of the Annual Report and Financial Statements. The Portfolio Managers will make a presentation to shareholders on the Company’s progress and the outlook for the year ahead.


After a sustained, if unremarkable, period of economic expansion following the financial crisis the momentum behind economic growth appears to be faltering. Whilst the recent, and long awaited, tightening in US interest rates provides some evidence that the Federal Reserve believes that the US economy can sustain modestly higher rates, elsewhere growth appears to be slowing. Further quantitative easing has been signalled for the Eurozone area. The Chinese economy is in a state of transition as it seeks to move to more domestic consumption and away from government investment in order to stimulate growth. A divergence in interest rates is likely to produce greater volatility in currency markets, with the Eurozone area seeking to avoid another recession and emerging market companies feeling the effect of a stronger US dollar on their dollar denominated borrowings.

In the UK, employment levels and average earnings growth point to a continuing, although potentially fragile, recovery.  The prospect of a referendum on the UK's membership of the European Union adds some uncertainty. Although some sectors, including UK housebuilders, show signs of margin pressure, the UK market continues to offer a broad spectrum of strong companies capable of growing their dividends over time. Your fund manager continues to focus on assembling a portfolio of individual companies which, taken as a whole, should prove capable of growing the Company’s revenue and supporting dividend growth into the future.

Jonathan Cartwright

15 January 2016


The Directors present the Strategic Report of the Company for the year ended 31 October 2015. The aim of the Strategic Report is to provide shareholders with the information required to enable them to assess how the Directors have performed in their duty to promote the success of the Company during the year under review.


BlackRock Income and Growth Investment Trust plc is an investment trust company that has a premium listing on the London Stock Exchange. Its principal activity is portfolio investment. Investment trusts, like unit trusts and OEICs, are pooled investment vehicles which allow exposure to a diversified range of assets through a single investment, thus spreading, although not eliminating investment risk.

Investment trusts, unlike unit trusts, have the ability to borrow for investment purposes and to smooth dividend distributions through revenue reserves. They also enjoy, unlike unit trusts, the benefit of continuous dealing during market hours.

The Company is an Alternative Investment Fund in accordance with the Alternative Investment Fund Managers Directive (AIFMD). BlackRock Fund Managers Limited (the Manager) is the Company’s Alternative Investment Fund Manager. The management of the investment portfolio and the administration of the Company have been contractually delegated to the Manager. The Manager, operating under guidelines determined by the Board, has direct responsibility for decisions relating to the running of the Company and is accountable to the Board for the investment, financial and operating performance of the Company.

Other service providers include the Depositary, BNY Mellon Trust & Depositary (UK) Limited, the fund accountant, Bank of New York Mellon (International) Limited, and the Registrar, Computershare Investor Services PLC (Computershare). Details of the contractual terms with these service providers are set out in the Directors’ Report contained within the Annual Report and Financial Statements.


The Company invests in accordance with the investment objective. The Board is collectively responsible to shareholders for the long term success of the Company and is its governing body. There is a clear division of responsibility between the Board and the Manager. Matters for the Board include setting the Company’s strategy, including its investment objective and policy, setting limits on gearing, capital structure, governance, and appointing and monitoring of the performance of service providers, including the Manager.

The Company’s business model follows that of an externally managed investment trust, therefore the Company does not have any employees and outsources its activities to third party service providers including the Manager which is the principal service provider.


The Company’s objective is to provide growth in capital and income over the long term through investment in a diversified portfolio of principally UK listed equities.


The Company’s policy is that the portfolio will usually consist of approximately 30–60 securities and will only invest in UK securities which include the shares of companies listed, domiciled or carrying out the majority of their business in the UK.

The Company may hold a maximum of 10% of the issued ordinary share capital of any company. No more than 15% of the gross asset value of the Company may be invested in the securities of any one issuer, calculated at the time of any relevant investment. Cash or non-benchmark stocks may not exceed 10% of the net asset value of the Company. Each stock held is subject to a lower limit of 0% and an upper limit of plus 4 percentage points against its weighting in the FTSE All-Share Index (total return) on an ongoing basis, subject to an absolute sector weighting upper limit of 20% of the Company’s net assets at any time.

The Company may deal in derivatives, including options, futures and contracts for difference and derivatives not traded on or under the rules of a recognised or designated investment exchange for the purpose of efficient portfolio management. Derivatives and exchange traded funds may be dealt in only with the prior consent of the Board.

The performance of the Company is measured by reference to the FTSE All-Share Index (the Index) on a total return basis.

The Company achieves an appropriate spread of risk by investing in a diversified portfolio of securities.

No material change will be made to the investment policy without the approval of shareholders by ordinary resolution.


In assembling the Company’s portfolio a relatively concentrated approach to investment is adopted to ensure that the fund manager’s best ideas contribute significantly to returns. We believe that it is the role of the portfolio overall to achieve a premium level of yield rather than every individual company within it. This gives increased flexibility to invest where returns are most attractive. This relatively concentrated approach results in a portfolio which differs substantially from the Index and in any individual year, the returns will vary, sometimes significantly from those of the Index. Over longer periods the objective is to achieve returns greater than the Index.

The foundation of the portfolio, approximately 70% by value, is in high free cash flow companies that can sustain cash generation and pay a growing yield whilst aiming to deliver a double digit total return. Additionally, the fund manager seeks to identify and invest 20% by value of the portfolio in ‘growth’ companies that have significant barriers to entry and scalable business models that enable them to grow consistently. Turnaround companies are also sought, at around 10% by value, which represent those companies that are out of favour by the market, facing temporary challenges with high yields/very low valuations, but with recovery potential. The expected return from this segment, is expected to contribute meaningfully to returns over time.


The appropriate use of gearing can add value and the Company may, from time to time, use borrowings to gear its investment policy. The Board is responsible for the level of gearing in the Company and reviews the position at every meeting. Gearing, including borrowings and gearing through the use of derivatives, (which requires prior Board approval) when aggregated with underwriting participations, will not exceed 20% of the net asset value at the time of investment, drawdown or participation. Any borrowing, except for short term liquidity purposes, is used for investment purposes or to fund the purchase of the Company’s own shares.

The Company has a two year unsecured revolving facility with Scotiabank (Ireland) Limited which will expire on 31 October 2016. At the year end net gearing was 2.4% (2014: net cash 1.6%).


Details of the Company’s performance for the year are given in the Chairman’s Statement. The Investment Manager’s report includes a review of the main developments during the year, together with information on investment activity within the Company’s portfolio.


The Company’s revenue earnings for the year amounted to 6.68p per share (2014: 5.66p per share).

Details of dividends paid and declared in respect of the year together with the Company’s dividend policy, are set out on in the Chairman’s Statement.


A number of performance indicators (KPIs) are used to monitor and assess the Company’s success in achieving its objectives and to measure its progress and performance.

The principal KPIs are described below:


The performance of the portfolio together with the performance of the Company’s net asset value and share price are reviewed at each Board meeting and compared to the return on the Company’s benchmark.

Information on the Company’s performance is given in the performance record and the Chairman’s Statement and Investment Managers’ Report.


At each meeting the Board monitors the level of the Company’s premium or discount to NAV and considers strategies for managing any premium or discount. Further details of the discount policy are provided on page 20 of the Annual Report and Financial Statements.

In the year to 31 October 2015, the Company’s share price to NAV traded in the range of a premium of 2.0% to a discount of 3.5% on a cum income basis.

The Company bought back a total of 250,000 shares during the year and further details are given on page 20 of the Annual Report and Financial Statements. No shares were issued or sold from treasury.


The ongoing charges represent the Company’s management fee and all other recurring operating and investment management expenses, excluding finance costs, expressed as a percentage of average net assets.

The Board reviews the ongoing charges and monitors the expenses incurred by the Company at each meeting. The Board also compares the level of ongoing charges against those of its peers.


Whilst the principal objective is to achieve growth in capital and income relative to the benchmark, the Board also monitors performance relative to a range of competitor funds, particularly those also within the AIC UK Equity Income sector.

Year ended 
31 October 2015 
Year ended 
31 October 2014 
NAV per share (1) 187.69p  170.68p 
Share price (2) 184.25p  167.25p 
Change in benchmark index (3) 3.0%  1.0% 
Discount to net asset value 1.8%  2.0% 
Revenue return per share 6.68p  5.66p 
Ongoing charges (4) 1.0%  1.2% 

1    Calculated in accordance with AIC guidelines.
2    Calculated on a mid to mid basis.
3    FTSE All-Share Index (total return).
4    Ongoing charges represent the Company's management fee and all other recurring operating and investment management expenses, excluding finance costs, expressed as a percentage of average net assets.

The Board also regularly reviews the Company’s performance attribution analysis to understand how performance was achieved. This provides an understanding of how components, such as sector exposure, stock selection and asset allocation, impact performance. Further details are provided in the Investment Manager’s Report.


The Company is exposed to a variety of risks and uncertainties. The Board has in place a robust process to identify, understand and monitor the principal risks of the Company. A core element of this process is the Company’s risk register which identifies the risks facing the Company, the likelihood and potential impact of each risk and the controls established for mitigation. A residual risk rating is calculated for each risk.

The risk register, its method of preparation and the operation of key controls in the Manager’s and third party service providers systems of internal control are reviewed on a regular basis by the Audit Committee. In order to gain a more comprehensive understanding of the Manager’s and other third party service providers’ risk management processes and how these apply to the Company’s business, the Audit Committee periodically receives presentations from BlackRock’s Internal Audit and Risk & Quantitative Analysis teams. Where produced, the Audit Committee also reviews Service Organisation Control (SOC 1) reports from the Company’s service providers.

The current risk register is categorised under the following headings:

-  performance;
-  income/dividend;
-  gearing;
-  regulatory;
-  operational;
-  market; and
-  financial.

The principal risks and uncertainties faced by the Company during the financial year, together with the potential effects, controls and mitigating factors, are set out in the following table.

Principal Risk  Mitigation/Control 
The Board is responsible for:
-     deciding the investment strategy to fulfil the 
      Company’s objective; and
-     for monitoring the performance of the Investment
      Manager and the implementation of the investment
An inappropriate investment strategy may lead to:
-     poor performance compared to the Benchmark Index 
      and the Company’s peer group;
-     a loss of capital; and
-     dissatisfied shareholders.
To manage this risk the Board:
-     regularly reviews the Company’s investment mandate
      and long term strategy;
-     is required to provide prior consent to the use of
      derivatives and exchange traded funds;
-     has set investment restrictions and guidelines which
      the Investment Manager monitors and regularly reports
-     receives from the Investment Manager a regular
      explanation of stock selection decisions, portfolio
      exposure, gearing and any changes in gearing and
      the  rationale for the composition of the investment 
-     monitors the maintenance of an adequate spread of
      investments in order to minimise the risks associated
      with factors specific to particular sectors, based on the
      diversification requirements inherent in the investment
The amount of dividends and future dividend growth will depend on the Company’s underlying portfolio.

Changes in the composition of the portfolio, any change in the tax treatment of the dividends or interest received by the Company may alter the level of dividends received by shareholders.
The Board monitors this risk through the receipt of detailed income forecasts and considers the level of income at each meeting. 
The Company’s investment strategy may involve the use of gearing to enhance investment returns.

Gearing may be generated through borrowing money or increasing levels of market exposure through the use of derivatives. The Company currently has an unsecured revolving facility with Scotiabank (Ireland) Limited and has drawn down £2 million.

The use of gearing exposes the Company to the risk associated with borrowing.

Gearing provides an opportunity for greater returns where the return on the Company’s underlying assets exceeds the cost of borrowing. It is likely to have the opposite effect where the return on the underlying assets is below the cost of borrowings. Consequently, the use of borrowings by the Company may increase the volatility of the NAV.
To manage this risk the Board has limited gearing, including borrowings and gearing through the use of derivatives, to 20% of NAV at the time of investment, drawdown or participation.

The Investment Manager will only use gearing when confident that market conditions and opportunities exist to enhance investment returns. 
The Company has been accepted by HM Revenue & Customs as an investment trust, subject to meeting the relevant eligibility conditions and operating as an investment trust in accordance with sections 1158 and 1159 of the Corporation Tax Act 2010. As such, the Company is exempt from capital gains tax on the profits realised from the sale of its investments.

The Company is required to comply with the provisions of the Companies Act 2006, the Alternative Investment Fund Managers Directive and the UK Listing Rules and Disclosure Rules.

Any breach of the relevant eligibility conditions could lead to the Company losing investment trust status and being subject to corporation tax on capital gains realised within the Company’s portfolio.

Any serious breach could result in the Company and/or the Directors being fined or the subject of criminal proceedings or the suspension of the Company’s shares which would in turn lead to a breach of the Corporation Tax Act 2010. 
The Investment Manager monitors investment movements, the level and type of forecast income and expenditure and the amount of proposed dividends, if any, to ensure that the provisions of Chapter 4 of Part 24 of the Corporation Tax Act 2010 are not breached. The results are reported to the Board at each meeting.

Compliance with the accounting rules affecting investment trusts are also carefully and regularly monitored.
The Company Secretary and the Company’s professional advisers provide regular reports to the Board in respect of compliance with all applicable rules and regulation. 
The Company relies on the services provided by third parties. Accordingly, it is dependent on the control systems of the Manager, BNY Mellon Trust & Depositary (UK) Limited (the Depositary) and the Bank of New York Mellon (International) Limited (the fund accountant), who maintain the Company’s assets, dealing procedures and accounting records. The security of the Company’s assets, dealing procedures, accounting records and adherence to regulatory and legal requirements depend on the effective operation of the systems of these third party service providers.

Disruption to the accounting, payment systems or custody records could prevent the accurate reporting and monitoring of the Company’s financial position. 
Due diligence is undertaken before contracts are entered into with third party service providers. Thereafter, the performance of the provider is subject to regular review and reported to the Board.

Most third party service providers produce Service Organisation Control (SOC 1) reports to provide assurance regarding the effective operation of internal controls as reported on by their reporting accountants. These reports are provided to the Audit Committee.

The Company’s assets are subject to a strict liability regime and in the event of a loss of assets, the Depositary must return assets of an identical type or the corresponding amount, unless able to demonstrate the loss was a result of an event beyond its reasonable control.

The Board reviews the overall performance of the Manager, Investment Manager and all other third party service providers on a regular basis and compliance with the Investment Management Agreement annually.

The Board also considers the business continuity arrangements of the Company’s key service providers. 
Market risk arises from volatility in the prices of the Company’s investments.

There is the potential for the Company to suffer loss through holding investments in the face of negative market movements. 
The Board considers the diversification of the portfolio, asset allocation, stock selection, and levels of gearing on a regular basis and has set investment restrictions and guidelines which are monitored and reported on by the Investment Manager.

The Board monitors the implementation and results of the investment process with the Investment Manager. 
The Company’s investment activities expose it to a variety of financial risks that include interest rate risk.  Details of these risks are disclosed in note 17 of the Annual Report and Financial Statements, together with a summary of the policies for managing these risks. 

As required by the UK Corporate Governance Code (2014 Code), the Board has undertaken a robust assessment of the principal risks facing the Company, including those that would threaten its business model, future performance, solvency or liquidity. Those principal risks have been described in the above table together with an explanation of how they are managed and mitigated. The Board will continue to assess these risks on an ongoing basis.


The Directors have assessed the prospects of the Company over a longer period than the 12 months required by the “Going Concern” provision.

The Board conducted this review for the period up to the AGM in 2021, being a five year period from the date that this annual report will be approved by Shareholders. In making this assessment the Board has considered the following factors:

-  the Company’s principal risks as set out above;

-  the ongoing relevance of the Company’s investment objective in the current environment; and

-  the level of demand for the Company’s shares.

The Company is required to undertake a continuation vote in 2018 and has also reviewed the potential impact that this may have on the Company’s viability. Particular consideration has been given to the following:

-  good communication with major shareholders; at the present time there has been no indication that the continuation vote would not be successful; and

-  at the close of business on 13 January 2016, the Company’s shares were trading at a discount to NAV of 0.1%.

Having considered the above factors, the Board believes that the scheduled continuation vote does not have a detrimental impact on the Company’s viability.

The Board has also considered a number of financial metrics in its assessment, including:

-  the level of ongoing charges, both current and historic;

-  the level at which the shares trade relative to NAV;

-  the level of income generated;

-  future income forecasts; and

-  the liquidity of the portfolio.

The Board has concluded that the Company would be able to meet its ongoing operating costs as they fall due as a consequence of:

-  a liquid portfolio; and

-  overheads which comprise a small percentage of net assets.

Based on the results of their analysis, the Directors have a reasonable expectation that the Company will be able to continue in operation and meet its liabilities as they fall due over the period of their assessment.


The Board’s main focus is the achievement of income and capital growth. The future performance of the Company is dependent upon the success of the investment strategy. The outlook for the Company is discussed in the Chairman’s Statement and in the Investment Manager’s Report.


The Company has no employees and all of its Directors are non-executive, therefore, there are no disclosures to be made in respect of employees.

The Company believes that it is in shareholders’ interests to consider human rights issues, environmental, social and governance factors when selecting and retaining investments. Details of the Company’s policy on socially responsible investment are set out on page 29 of the Annual Report and Financial Statements.


The Company has no greenhouse gas emissions to report from its operations, nor does it have responsibility for any other emissions producing sources under the Companies Act 2006 (Strategic Report and Directors’ Reports) Regulations 2013.


The Directors of the Company on 31 October 2015, all of whom held office throughout the year, are set out in the Governance Structure and Directors’ biographies on page 17 of the Annual Report and Financial Statements.

The Board recognises the importance of having a range of experienced Directors with the right skills and knowledge to enable it to fulfil its obligations. As at 31 October 2015, the Board consisted of four male Directors.

The Company does not have any employees as stated above.

By order of the Board
BlackRock Investment Management (UK) Limited
Company Secretary

15 January 2016


BlackRock Fund Managers Limited (BFM) provided management and administration services to the Company during the period under review. BIM (UK) acts as the Company’s Investment Manager under a delegation agreement with BFM. Further details of the investment management contract are disclosed in the Directors’ Report on page 18 of the Annual Report and Financial Statements.

The investment management fee for the year was £288,000 (2014: £268,000), as disclosed in note 4. At the year end, an amount of £146,000 was outstanding in respect of these fees (2014: £200,000).

The Company held an investment in BlackRock’s Institutional Sterling Liquidity Fund of £869,000 at 31 October 2015 (2014: £2,953,000).

In addition to the above services, BlackRock has provided the Company with marketing services. The total fees paid or payable for these services for the year ended 31 October 2015 amounted to £3,000 including VAT (2014: £38,000). Marketing fees of £49,000 including VAT were outstanding at 31 October 2015 (2014: £38,000).

The Board consists of four non-executive Directors, all of whom are considered to be independent of the Investment Manager by the Board. None of the Directors has a service contract with the Company. For the year ended 31 October 2015, the Chairman received an annual fee of £28,000, the Chairman of the Audit Committee received an annual fee of £22,500 and each of the other Directors received an annual fee of £19,000. No changes will be made for the year ending 31 October 2016.

At 31 October 2015 and 2014, the Directors’ interests in the Company’s Ordinary Shares were as follows:

2015  2014 
J H Cartwright (Chairman) 20,000  20,000 
N R Gold 20,000  20,000 
G M Luckraft –  – 
C R Worsley 487,539*  487,539* 
* Including a non-beneficial interest in 155,500 shares.

The Directors are responsible for preparing the Annual Report and Financial Statements in accordance with applicable law and regulations. Company law requires the Directors to prepare financial statements for each financial year. Under that law they have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards.

Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company as at the end of each financial year and of the profit or loss of the Company for that period.

In preparing these financial statements, the Directors are required to:

-  present fairly the financial position, financial performance and cash flows of the Company;

-  select suitable accounting policies and apply them consistently;

-  present information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable information;

-  make judgements and estimates that are reasonable and prudent;

-  state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

-  prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company’s transactions and disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The Directors are also responsible for preparing the Strategic Report, the Directors’ Report, the Directors’ Remuneration Report, the Corporate Governance Statement and the Report of the Audit Committee in accordance with the Companies Act 2006 and applicable regulations, including the requirements of the Listing Rules and the Disclosure and Transparency Rules. The Directors have delegated responsibility to the Manager for the maintenance and integrity of the Company’s corporate and financial information included on the BlackRock website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

Each of the Directors, whose names are listed on page 17 of the Annual Report and Financial Statements, confirm to the best of their knowledge that:

-  the financial statements, prepared in accordance with applicable accounting standards, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company; and

-  the Strategic Report contained in the Annual Report and Financial Statements includes a fair review of the development and performance of the business and the position of the Company, together with a description of the principal risks and uncertainties that it faces.

The 2014 UK Corporate Governance Code requires Directors to ensure that the Annual Report and Financial Statements are fair, balanced and understandable. In order to reach a conclusion on this matter, the Board has requested that the Audit Committee advise on whether it considers that the Annual Report and Financial Statements fulfils these requirements. The process by which the Audit Committee has reached these conclusions is set out in the Audit Committee’s report on pages 30 to 32 of the Annual Report and Financial Statements. As a result, the Board has concluded that the Annual Report and Financial Statements for the year ended 31 October 2015, taken as a whole, is fair, balanced and understandable and provides the information necessary for shareholders to assess the Company’s position and performance, business model and strategy.

For and on behalf of the Board
Jonathan Cartwright

15 January 2016


The Investment Manager reports that for the year ended 31 October 2015, the Company’s NAV per share returned 13.5% and the share price 13.8%. Over the same period, the FTSE All-Share Index (total return) (the Index) returned 3.0% and the peer group, as measured by the Investment Association UK Income Sector returned 8.1%. (All percentages are in sterling with income reinvested.)


The Index returned 3.0% over the year to 31 October 2015, this was the result of initially strong returns giving way to market weakness over the summer period. The beginning of a quantitative easing bond purchase programme by the European Central Bank had a positive impact on share prices early in the period and the conclusive General Election result provided a boost to UK domestic stocks in May. However, a deterioration in the outlook for economic growth in China and other Emerging Markets, and fears that this would lead to a wider slowdown in global economic growth, precipitated sharp stock market falls. For oil and other commodities, these global demand concerns are occurring against a backdrop of an expansion in supply which further contributed to weaker oil and commodity prices.

Market highlights included strong returns from the consumer services sector, including domestically focussed areas of the market such as housebuilders, real estate, general retailers and non-bank financials. The oil and mining sectors were weak on lower oil and commodity prices, whilst further provisions for past conduct issues impacted the banks sector.


Portfolio performance over the year has been strong in relative and absolute terms, significantly outperforming both the benchmark and the Investment Association UK Income sector. Performance was driven by good stock picking across a wide range of sectors and industries with no single theme dominating. The Company also benefited in relative terms by not holding some of the larger companies that fell such as Glencore, Anglo American and Standard Chartered.

The biggest contributor to performance came from the holding in Carnival, which performed strongly, driven by rising demand and higher on-board spend feeding through to revenue and profit growth, adding to the benefits gained from the lower oil price. Cineworld Group reported full year pre-tax profits which more than doubled, boosted by the purchase of Cinema City International in 2014, and another strong performer was our holding in Domino Printing Sciences which rose significantly as the company received a bid from Japan’s Brother Industries. Howden Joinery Group continued to trade strongly benefiting from a buoyant domestic economy and a leading market position, resulting in further upgrades. Wolseley continued to deliver strong revenue growth, particularly in the USA, and our holding in Friends Life rallied after Aviva agreed to buy the company. Other positive contributors to performance included Imperial Tobacco, RELX (Reed Elsevier), Rentokil Initial, Next, DS Smith and Direct Line Insurance.

Over the year, Rio Tinto underperformed due to commodity price weakness. Ashmore Group’s share price was weak following net outflows in the second quarter of 2015 as emerging market funds continued to be out of favour given currency weakness. The holding in Bodycote fell due to fears over the industrial slowdown.


During the reporting period we purchased new positions in Lloyds Banking Group, Barclays, Hays, Stagecoach, ARM Holdings, Auto Trader Group and DS Smith whilst adding to our holdings in Next, Friends Life (subsequently taken over), Dixons Carphone and Carnival. We reduced our holdings in Imperial Tobacco Group, HSBC Holdings and Wolseley whilst selling our holdings in Prudential, Reckitt Benckiser, Essentra, Compass Group, Burberry Group, Howden Joinery Group and Marks & Spencer Group.


Eurozone economic activity is showing signs of improvement as the European Central Bank starts quantitative easing, whilst in the US the ending of quantitative easing is contributing to uncertainty. We continue to focus on the specific drivers of individual companies and the ability to determine their future rather than relying on a specific macro outcome. Given the outlook for both economic growth and interest rates remains uncertain, we seek those companies that can drive returns through self-help and have a clear strategy to deploy the cashflow they generate. The portfolio is primarily invested in high free cash flow companies that can sustain cash generation and pay a growing dividend yield, but also has exposure to companies with sustainable growth franchises and turnaround situations.

Mark Wharrier and Adam Avigdori
BlackRock Investment Management (UK) Limited

15 January 2016


British American Tobacco: 5.6% (2014: 6.3%) is one of the world’s leading tobacco groups, with more than 200 brands in the portfolio selling in approximately 180 markets worldwide.

AstraZeneca: 4.9% (2014: 5.3%) is a global pharmaceutical company, operating in the research, development, manufacture and marketing of pharmaceutical products, including the areas of cardiovascular and metabolic disease, oncology, respiratory, inflammation and autoimmunity.

Lloyds Banking Group: 4.7% (2014: nil) is a UK-based financial services group, providing a wide range of banking and financial services, focused on personal and commercial customers. Its main business activities are retail, commercial and corporate banking, general insurance, and life, pensions and investment provision.

HSBC Holdings: 4.6% (2014: 6.3%) is one of the world’s largest banking and financial services organisations. Its principal businesses are commercial banking, global banking and markets, retail banking and wealth management. Its international network covers 73 countries and territories worldwide, across Europe, Asia, the Middle East, North Africa, North America and Latin America.

RELX (previously Reed Elsevier): 4.2% (2014: 4.3%) is a global provider of professional information solutions that includes publication of scientific, medical, technical and legal journals.It is also the world’s leading exhibitions, conference and events business.

BT Group: 4.1% (2014: nil) is a communications services company, involved in the provisions of fixed line services, broadband, mobile and television products and services in the United Kingdom and globally. The Company operates in five segments: BT Global Services, BT Business, BT Consumer, BT Wholesale and Openreach.

Wolseley: 4.0% (2014: 4.1%) is a specialist trade distributor of plumbing and heating products and building materials in North America, the United Kingdom and Continental Europe. The company has a network of distribution centres which serve branches for its plumbing and heating businesses.

Royal Dutch Shell ‘B’: 3.5% (2014: 6.8%) is an oil and gas company based in the United Kingdom. The company operates in both, Upstream and Downstream. Upstream is engaged in searching for and recovering crude oil and natural gas, the liquefaction and transportation of gas. Downstream is engaged in manufacturing, distribution and marketing activities for oil products and chemicals.

Legal & General Group: 3.5% (2014: 3.0%) is one of the worlds largest insurance and investment management companies. The company manages over £700 billion in assets for its clients, operating through Insurance, Savings and Investment Management departments.

Aviva: 3.4% (2014: nil) is a provider of long term insurance and savings and fund management products and services. The Company operates across four main areas: long-term insurance and savings business; general insurance; health insurance and fund management.

All percentages reflect the value of the holding as a percentage of total investments.

The percentages in brackets represent the value of the holding as at 31 October 2014.

Together, the ten largest investments represent 42.5% of total investments (ten largest investments as at 31 October 2014: 48.6%).



% of Investments Benchmark
1 Banks 11.9 10.3
2 Support Services 10.3 4.8
3 Travel & Leisure 8.5 4.6
4 Tobacco 7.8 5.2
5 Pharmaceuticals & Biotechnology 7.4 7.8
6 Life Insurance 6.9 4.9
7 Media 6.9 3.8
8 Oil & Gas Producers 6.6 10.6
9 General Retailers 5.7 2.9
10 Financial Services 5.7 2.8
11 Mining 4.9 4.0
12 Fixed Line Telecommunications 4.1 2.1
13 Non-life Insurance 3.9 1.2
14 Food Producers 2.9 0.9
15 Technology Hardware & Equipment 1.7 0.9
16 Cash and Cash Equivalents 1.7 -
17 Industrial Engineering 1.3 0.7
18 General Industrials 1.1 0.7
19 Real Estate Investment Trusts 0.7 2.4

Sources: BlackRock and Datastream.


Number of Investments % value of Investments
< £1m 20 27.8
 £1m to £2m 14 40.1
 £2m to £3m 7 32.1

Source: BlackRock.


Market value £’000  % of investments 
Lloyds Banking Group  2,408   4.7 
HSBC Holdings  2,342   4.6 
Barclays  1,349   2.6 
 --------   -------- 
 6,099   11.9 
 --------   -------- 
Support Services
Wolseley  2,022   4.0 
Rentokil Initial  1,141   2.2 
Hays  939   1.8 
Worldpay Group  609   1.2 
Intertek  551   1.1 
 --------   -------- 
 5,262   10.3 
 --------   -------- 
Travel & Leisure
Carnival  1,457   2.8 
Stagecoach Group  833   1.6 
Cineworld Group  802   1.6 
Intercontinental Hotels Group  676   1.3 
Patisserie Holdings  589   1.2 
 --------   -------- 
 4,357   8.5 
 --------   -------- 
British American Tobacco  2,881   5.6 
Imperial Tobacco Group  1,108   2.2 
 --------   -------- 
 3,989   7.8 
 --------   -------- 
Pharmaceuticals & Biotechnology
AstraZeneca  2,518   4.9 
GlaxoSmithKline  1,262   2.5 
 --------   -------- 
 3,780   7.4 
 --------   -------- 
Life Insurance
Legal & General Group  1,807   3.5 
Aviva  1,752   3.4 
 --------   -------- 
 3,559   6.9 
 --------   -------- 
RELX  2,148   4.2 
Sky  1,383   2.7 
 --------   -------- 
 3,531   6.9 
 --------   -------- 
Oil & Gas Producers
Royal Dutch Shell ‘B’  1,811   3.5 
BP Group  1,597   3.1 
 --------   -------- 
 3,408   6.6 
 --------   -------- 
General Retailers
Next  1,740   3.4 
Dixons Carphone  671   1.3 
Auto Trader Group  538   1.0 
 --------   -------- 
 2,949   5.7 
 --------   -------- 
Financial Services
Hargreaves Lansdown  951   1.9 
John Laing Group  785   1.5 
Ashmore Group  723   1.4 
Provident Financial  486   0.9 
 --------   -------- 
 2,945   5.7 
 --------   -------- 
Rio Tinto  1,625   3.2 
BHP Billiton  864   1.7 
 --------   -------- 
 2,489   4.9 
 --------   -------- 
Fixed Line Telecommunications
BT Group  2,094   4.1 
 --------   -------- 
 2,094   4.1 
 --------   -------- 
Non-life Insurance
Direct Line Insurance  1,102   2.1 
Admiral Group  900   1.8 
 --------   -------- 
 2,002   3.9 
 --------   -------- 
Food Producers
Unilever  1,478   2.9 
 --------   -------- 
 1,478   2.9 
 --------   -------- 
Technology Hardware & Equipment
ARM Holdings  890   1.7 
 --------   -------- 
 890   1.7 
 --------   -------- 
Industrial Engineering
Bodycote  646   1.3 
 --------   -------- 
 646   1.3 
 --------   -------- 
General Industrials
DS Smith  549   1.1 
 --------   -------- 
 549   1.1 
 --------   -------- 
Real Estate Investment Trusts
Hansteen Holdings  361   0.7 
 --------   -------- 
 361   0.7 
 --------   -------- 
 50,388   98.3 
 --------   -------- 
Cash and Cash Equivalents
BlackRock’s Institutional Sterling Liquidity Fund  869   1.7 
 --------   -------- 
 869   1.7 
 --------   -------- 
Total Value of Securities  51,257   100.0 
 ======   ===== 

All investments are in ordinary shares unless otherwise stated.
The total number of holdings as at 31 October 2015 was 41 (31 October 2014: 36).
As at 31 October 2015, the Company did not hold any equity interests representing more than 3% of any company’s share capital.


Gains on investments at fair value through profit or loss –  –  4,534  1,485  4,534  1,485 
Income from investments at fair value through profit or loss 3 2,047  1,881  –  –  2,047  1,881 
Investment management fee 4 (72) (67) (216) (201) (288) (268)
Other operating expenses 5 (207) (283) (4) (4) (211) (287)
Net return before finance costs and taxation 1,768  1,531  4,314  1,280  6,082  2,811 
 --------   --------   --------   --------   --------   -------- 
Finance costs 6 (10) (7) (30) (22) (40) (29)
Return on ordinary activities before taxation 1,758  1,524  4,284  1,258  6,042  2,782 
 --------   --------   --------   --------   --------   -------- 
Taxation –  –  –  –  –  – 
 =====   =====   =====   =====   =====   ===== 
Return on ordinary activities after taxation 8 1,758  1,524  4,284  1,258  6,042  2,782 
    =====   =====   =====   =====   =====   ===== 
Return per ordinary share 8 6.68p  5.66p  16.29p  4.67p  22.97p  10.33p 
    =====   =====   =====   =====   =====   ===== 

The total column of this statement represents the Income Statement of the Company. The supplementary revenue and capital columns are both prepared under guidance published by the Association of Investment Companies (AIC). The Company had no recognised gains or losses other than those disclosed in the Income Statement and accordingly no statement of recognised gains and losses has been presented. All items in the above statement derive from continuing operations. No operations were acquired or discontinued during the year.






For the year ended 31 October 2015
At 31 October 2014 329  14,819  220  23,306  4,398  2,122  45,194 
Return for the year –  –  –  –  4,284  1,758  6,042 
Shares purchased to be held in treasury –  –  –  (449) –  –  (449)
Dividends paid* 7 –  –  –  –  –  (1,556) (1,556)
    --------   --------   --------   --------   --------   --------   -------- 
At 31 October 2015 329  14,819  220  22,857  8,682  2,324  49,231 
    --------   --------   --------   --------   --------   --------   -------- 
For the year ended 31 October 2014
At 31 October 2013 329  14,819  220  24,846  3,140  2,137  45,491 
Return for the year –  –  –  –  1,258  1,524  2,782 
Shares purchased to be held in treasury –  –  –  (1,540) –  –  (1,540)
Dividends paid** 7 –  –  –  –  –  (1,539) (1,539)
    -------   --------   --------   --------   --------   --------   -------- 
At 31 October 2014 329  14,819  220  23,306  4,398  2,122  45,194 
    ====   =====   ====   =====   ====   ====   ===== 

*     Final dividend of 3.50p per share for the year ended 31 October 2014, declared on 8 January 2015 and paid on 6 March 2015, and the interim dividend of 2.40p per share for the six months ended 30 April 2015, declared on 23 June 2015 and paid on 4 September 2015.

**    Final dividend of 3.50p per share for the year ended 31 October 2013, declared on 20 December 2013 and paid on 7 March 2014, and the interim dividend of 2.20p per share for the six months ended 30 April 2014, declared on 25 June 2014 and paid on 5 September 2014.


Fixed assets
Investments held at fair value through profit or loss 51,257  47,419 
    --------   -------- 
Current assets
Debtors 195  103 
Cash at bank 122  110 
 --------   -------- 
317  213 
 --------   -------- 
Creditors – amounts falling due within one year
Bank loan (2,000) (2,000)
Other creditors (343) (438)
 --------   -------- 
(2,343) (2,438)
 --------   -------- 
Net current liabilities (2,026) (2,225)
 --------   -------- 
Net assets 49,231  45,194 
    =====   ===== 
Capital and reserves
Called-up share capital 9 329  329 
Share premium account 10 14,819  14,819 
Capital redemption reserve 10 220  220 
Special reserve 10 22,857  23,306 
Capital reserves 10 8,682  4,398 
Revenue reserve 10 2,324  2,122 
    --------   -------- 
Total equity shareholders’ funds 8 49,231  45,194 
    ======   ====== 
Net asset value per ordinary share 8 187.69p  170.68p 
    ======   ====== 


Net cash inflow from operating activities 5(b) 1,474  1,220 
Returns on investment and servicing of finance
Interest paid (40) (29)
Capital expenditure and financial investment
Purchases of investments (46,219) (50,125)
Proceeds from sales of investments 46,802  51,845 
    --------   -------- 
Net cash inflow from capital expenditure and financial investment 583  1,720 
Equity dividends paid 7 (1,556) (1,539)
    --------   -------- 
Net cash inflow before financing 461  1,372 
Repurchase of ordinary shares (449) (1,540)
    --------   -------- 
Net cash outflow from financing (449) (1,540)
    =====   ===== 
Increase/(decrease) in cash in the year 12  (168)
    =====   ===== 



The Company conducts its business so as to qualify as an investment trust company within the meaning of sub-section 1158 of the Corporation Tax Act 2010.


(a) Basis of preparation

The Company’s financial statements have been prepared under the historical cost convention, modified to include the revaluation of investments, and in accordance with the United Kingdom law and United Kingdom Generally Accepted Accounting Practice (UK GAAP) and the Statement of Recommended Practice – ‘Financial Statements of Investment Trust Companies and Venture Capital Trusts’ ( SORP ) issued in January 2009 by the Association of Investment Companies ( AIC ).

The principal accounting policies adopted by the Company are set out below. The policies have been applied consistently throughout the year and are consistent with those applied in the preceding year. All of the Company’s operations are of a continuing nature. A statement regarding the Company as a going concern is noted in the DIrectors' Report on page 19 of the Annual Report and Financial Statements.

The Company’s financial statements are presented in Sterling, which is the currency of the primary economic environment in which the Company operates. All values are rounded to the nearest thousand pounds (£’000) except where otherwise indicated.

(b) Presentation of Income Statement

In order to reflect better the activities of an investment trust company and in accordance with guidance issued by the AIC, supplementary information which analyses the Income Statement between items of a revenue and capital nature has been presented alongside the Income Statement.

(c) Segmental reporting

The Directors are of the opinion that the Company is engaged in a single segment of business being investment business.

(d) Income

Dividends receivable on equity shares are accounted for on an ex-dividend basis. Where no ex-dividend date is available, dividends receivable on or before the year end are treated as revenue for the year. UK dividends are shown net of tax credits. Provisions are made for dividends not expected to be received.

Special dividends are recognised on an ex-dividend basis and treated as a capital or revenue item depending on the facts and circumstances of each dividend.

Where the Company has elected to receive its dividends in the form of additional shares rather than in cash, the cash equivalent of the dividend is recognised as income. Any excess in the value of the shares received over the amount of the cash dividend is recognised in capital reserves.

Deposit interest receivable is accounted for on an accruals basis. Underwriting commission is recognised when the issue underwritten closes.

(e) Expenses

All expenses are accounted for on an accruals basis. Expenses have been treated as revenue except as follows:

-   expenses including finance costs which are incidental to the acquisition or disposal of investments are included within the book cost of the investments. Details of transaction costs on the purchases and sales of investments are disclosed in note 11 on page 47 of the Annual Report and Financial Statements; and

-   the investment management fee has been allocated 75% to the capital column and 25% to the revenue column of the Income Statement in line with the Board’s expected long-term split of returns, in the form of capital gains and income respectively, from the investment portfolio.

(f) Finance costs

Finance costs are accounted for on an accruals basis. Finance costs are allocated, insofar as they relate to the financing of the Company’s investments, 75% to the capital column and 25% to the revenue column of the Income Statement, in line with the Board’s expected long term split of returns, in the form of capital gains and income respectively, from the investment portfolio.

(g) Taxation

Where expenses are allocated between capital and revenue, any tax relief obtained in respect of those expenses is allocated between capital and revenue on the marginal basis using the Company’s effective rate of corporation tax for the accounting period.

Deferred taxation is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date, where transactions or events that result in an obligation to pay more tax or a right to pay less tax in the future have occurred. Timing differences are differences between the Company’s taxable profits and its results as stated in the financial statements.

A deferred tax asset is recognised when it is more likely than not that the asset will be recoverable. Deferred tax is measured on a non-discounted basis at the rate of corporation tax that is expected to apply when the timing differences are expected to reverse.

(h) Investments held at fair value through profit or loss

As the Company’s business is investing in financial assets with a view to profiting from their total return in the form of increases in fair value, financial assets are designated as held at fair value through profit or loss in accordance with FRS 26 ‘Financial Instruments: Recognition and Measurement’. The Company manages and evaluates the performance of these investments on a fair value basis in accordance with its investment strategy, and information about the investments is provided on this basis to the Board of Directors.

Investments held at fair value through profit or loss are initially recognised at fair value. After initial recognition, these continue to be measured at fair value, which for quoted investments is either the bid price or the last traded price depending on the convention of the exchange on which the investment is listed. Purchases and sales of financial assets are recognised on the trade date, being the date which the Company commits to purchase or sell the assets.

Investment holding gains or losses reflect differences between fair value and book cost and therefore include transaction costs in relation to the purchases or sale of investments. Net gains or losses arising on realisation of investments are taken to capital reserve.

(i) Foreign currency translation

Foreign currency – in accordance with FRS 23 ‘The Effect of Changes in Foreign Currency Exchange Rates’, the Company is required to determine its functional currency, being the currency in which the Company predominately operates. The functional and reporting currency is Sterling, reflecting the primary economic environment in which the Company operates. Transactions in foreign currencies are translated into Sterling at the rates of exchange ruling on the date of the transaction. Foreign currency monetary assets and liabilities are translated into Sterling at the rates of exchange ruling at the Balance Sheet date. Profits and losses thereon are recognised in the capital column of the Income Statement and taken to the capital reserve.

(j) Dividends payable

In accordance with FRS 21 ‘Events After Balance Sheet Date’, the final dividend proposed on ordinary shares is recognised as a liability when approved by shareholders. Interim dividends are recognised only when paid.

(k) Share repurchases

Shares repurchased and subsequently cancelled – share capital is reduced by the nominal value of the shares repurchased, and the capital redemption reserve is correspondingly increased in accordance with section 733 Companies Act 2006. The full cost of the repurchase is charged to the special reserve.

Shares repurchased and held in treasury – the full cost of the repurchase is charged to the special reserve. Where treasury shares are subsequently reissued, any surplus is taken to the share premium account.


Investment income: 
Franked UK listed dividends  2,031  1,841 
Unfranked income from UK investments  – 
Overseas listed dividends  12  18 
 --------   -------- 
Underwriting commission  –  22 
 --------   -------- 
Total income 2,047  1,881 
 =====   ===== 

Special dividends of £113,000 have been recognised in capital (2014: £nil).


2015  2014 
Investment management fee 72  216  288  67  201  268 
 --------   --------   ------   -------   ------   ------ 
72  216  288  67  201  268 
 ====   ====   ===   ====   ===   === 

Under the terms of the investment management agreement with BFM, BFM is entitled to a fee of 0.6% per annum of the Company’s market capitalisation. There is no additional fee for company secretarial and administration services.

Up to 1 July 2014 the Company was subject to a performance related fee. The performance fee was payable for the financial period based on the Company’s net asset value outperformance of the benchmark. The performance fee was calculated by applying 15% of the annualised excess return for a performance period to the performance fee net asset value. The benchmark index, which the Company used for the calculation of the performance fee was the FTSE All-Share Index measured on a total return basis.

At the year end, £146,000 was outstanding in respect of the management fee (2014: £200,000).


(a) Operating expenses 
Custody fee 
Auditor’s remuneration: 
– statutory audit  22  21 
Depositary fee
Directors’ emoluments  95  79 
Marketing fees  38 
Other operating expenses  79  142 
 -------   ------- 
207  283 
 ====   ==== 
Transaction charges – capital 
 ------   ------- 
211  287 
 ====   ==== 
The ongoing charges represent the Company’s management fee and all other recurring operating and investment management expenses, excluding finance costs, expressed as a percentage of average net assets. These figures are unaudited. 1.0%  1.2% 
(b) Reconciliation of net return before finance costs and taxation to net cash flow from operating activities 
Net return before finance costs and taxation  6,082  2,811 
-------- --------
Less: Capital return before finance costs and taxation  (4,314) (1,280)
Net revenue return before finance costs and taxation  1,768  1,531 
Expenses charged to capital (220) (205)
Special dividends credited to capital  113  – 
Increase in debtors  (92) (47)
Decrease in creditors  (95) (59)
 --------   -------- 
Net cash inflow from operating activities  1,474  1,220 
 --------   -------- 


2015 2014 
Interest payable – Sterling bank loan 21  28  22  29 
Bank charges – Sterling bank loan 12  –  –  – 
 -------   -------   -------   -----   -----   ---- 
10  30  40  22  29 
 ====   ====   ====   ===   ===   === 


Dividends paid on equity shares: 
Final dividend of 3.50p per share paid 6 March 2015 (2014: 3.50p – 7 March 2014) 927  952 
Interim dividend of 2.40p per share paid 4 September 2015 (2014: 2.20p – 5 September 2014) 629  587 
 --------   -------- 
1,556  1,539 
 =====   ==== 

The Directors have proposed a final dividend of 3.60p per share in respect of the year ended 31 October 2015. The proposed final dividend will be paid, subject to shareholders’ approval, on 4 March 2016 to shareholders on the Company’s register on 12 February 2016. The final dividend has not been included as a liability in these financial statements as final dividends are only recognised in the financial statements when they have been approved by shareholders, or in the case of interim dividends, recognised when paid to shareholders.

The total dividends payable in respect of the year which form the basis of determining retained income for the purposes of section 1158 of the Corporation Tax Act 2010 and section 833 of the Companies Act 2006, and the amounts proposed, meet the relevant requirements as set out in the legislation.

Dividends paid or proposed on equity shares: 
Interim paid 2.40p per share paid 4 September 2015 (2014: 2.20p) 629  587 
Final proposed 3.60p* per share payable 4 March 2016 (2015: 3.50p) 944  927 
 --------   -------- 
1,573  1,514 
 =====   ==== 
*  Based upon 26,229,268 ordinary shares (excluding treasury shares) in issue.

The proposed final dividend is based on the number of shares in issue at the year end. However, the dividend payable will be based on the number of shares in issue on the record date and will reflect any purchases and cancellations of shares by the Company settled subsequent to the year end.


Revenue and capital returns per share are shown below and have been calculated using the following:

2015  2014 
Net revenue return attributable to ordinary shareholders (£’000) 1,758  1,524 
Net capital return attributable to ordinary shareholders (£’000) 4,284  1,258 
 --------   -------- 
Total return (£’000) 6,042  2,782 
 --------   -------- 
Equity shareholders’ funds (£’000) 49,231  45,194 
 --------   -------- 
The weighted average number of shares in issue during each year, on which the return per share was calculated was: 26,300,501  26,924,569 
 ========   ======== 
The actual number of shares in issue at the end of each year, on which the net asset value per share was calculated was: 26,229,268  26,479,268 
 ========   ======== 


2015  2014 
Return per share
Calculated on weighted average number of shares 6.68  16.29  22.97  5.66  4.67  10.33 
Net asset value per share 187.69*  170.68** 
 --------   ---------- 
Share price 184.25  167.25 
 =====   ====== 
*   The net asset value is based on 26,229,268 ordinary shares in issue. An additional 6,704,664 shares were held in treasury.
**  The net asset value is based on 26,479,268 ordinary shares in issue. An additional 6,454,664 shares were held in treasury.



Allotted, called-up and fully paid share capital comprised:
Ordinary shares of 1p each
 --------------   -------------   ---------------   ------ 
At 31 October 2014 26,479,268  6,454,664  32,933,932  329 
 ---------------   -------------   ---------------   ------ 
Shares purchased and held in treasury (250,000) 250,000  –  – 
 ---------------   -------------   ---------------   ------ 
At 31 October 2015 26,229,268  6,704,664  32,933,932  329 
 =========   ========   ========   ==== 

During the year 250,000 ordinary shares were purchased and held in treasury (2014: 920,000 were purchased and placed in treasury) for a total consideration of £449,000. No shares were cancelled from treasury during the year (2014: nil).




arising on 
investments sold 
*Capital reserves
arising on 
revaluation of 
investments held 

At 1 November 2014 14,819   220  23,306  1,753  2,645  2,122 
 --------   --------   --------   --------   --------   -------- 
Transfer in respect of prior period –  –  –  50  (50) – 
 --------   --------   --------   --------   --------   -------- 
Movement during the year:
 --------   --------   --------   --------   --------   -------- 
Gains on realisation of investments –  –  –  3,990  –  – 
 --------   --------   --------   --------   --------   -------- 
Change in investment holding gains –  –  –  –  431  – 
 --------   --------   --------   --------   --------   -------- 
Purchase of ordinary shares in treasury –  –  (449) –  –  – 
 --------   --------   --------   --------   --------   -------- 
Special dividends charged to capital –  –  –  113  –  – 
 --------   --------   --------   --------   --------   -------- 
Finance costs, investment management and
 other fees charged to capital
–  –  –   (250) –  – 
 --------   --------   --------   --------   --------   -------- 
Return for the year –  –  –  –  –  1,758 
 --------   --------   --------   --------   --------   -------- 
Dividends paid –  –  –  –  –  (1,556)
 --------   --------   --------   --------   --------   -------- 
At 31 October 2015  14,819   220  22,857  5,656  3,026  2,324 
 =====   ====   =====   =====   =====   ===== 

*   Distributable reserves.


Disclosures of the Directors’ interests in the ordinary shares of the Company and fees and expenses payable to the Directors are given in the Directors' Remuneration Report on pages 23 to 25 of the Annual Report and Financial Statements.


There were no contingent liabilities at 31 October 2015 (2014: £nil).


The financial information contained in this announcement does not constitute statutory accounts as defined in the Companies Act 2006. The 2015 Annual Report and Financial Statements will be filed with the Registrar of Companies shortly.

The report of the auditor for the year ended 31 October 2015 contains no qualification or statement under Section 498(2) or (3) of the Companies Act 2006.

This announcement was approved by the Board of Directors on 15 January 2016.


Copies of the Annual Report will be sent to members shortly and will be available from the registered office c/o The Company Secretary, BlackRock Income & Growth Investment Trust plc, 12 Throgmorton Avenue, London EC2N 2DL.


The Annual General Meeting of the Company will be held at 12 Throgmorton Avenue, London EC2N 2DL on Wednesday, 24 February 2016 at 12.00 noon.


The Annual Report will also be available on the BlackRock website at Neither the contents of the Manager’s website nor the contents of any website accessible from hyperlinks on the Manager’s website (or any other website) is incorporated into, or forms part of, this announcement.

For further information, please contact:

Simon White, Managing Director, Closed End Funds, BlackRock Investment Management (UK) Limited
Tel: 020 7743 5284

Julia Wennstrom, Media Relations, BlackRock Investment Management (UK) Limited
Tel: 020 7743 4142

15 January 2016

12 Throgmorton Avenue

Source: PR Newswire (January 15, 2016 - 5:08 AM EST)

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