HERALD INVESTMENT TRUST plc ANNUAL REPORT ...

COMPANY SUMMARY
COMPANY DATA AT 31 DECEMBER 2010
Total assets† Shareholders’ funds Market capitalisation
£533m £475m £386m
†Before deduction of bank loans and derivative financial instruments
Policy and Objective
Comparative Index
Management Details
Capital Structure
Management Fee
Herald’s objective is to achieve capital appreciation through investments in
smaller quoted companies, in the areas of telecommunications, multimedia
and technology (TMT). Investments may be made across the world.
The business activities of investee companies will include information
technology, broadcasting, printing and publishing and the supply of
equipment and services to these companies.
The Company’s investment policy is contained within the Business Review
on page 22.
The portfolio comparative index against which performance is measured
is 2 /3 Hoare Govett Smaller Companies Index plus AIM (capital gains ex.
investment companies) and 1 /3 Russell 2000 (small cap) Technology Index
(in sterling terms).
Though we consider this comparative index to provide a reasonable base
for measuring the Company’s performance, the portfolio is not modelled
on it and outcomes may diverge widely.
Herald Investment Management Limited (‘HIML’) is the appointed
investment manager to the Company. The management contract can be
terminated at twelve months’ notice. Administration of the Company and
its investments is contracted by HIML to Baillie Gifford & Co, who also act
as Company Secretary.
The Company’s share capital consists of 79,913,283 Ordinary shares of
25p each which are issued and fully paid.
The Company has been granted authority to buy back a limited number of its
own Ordinary shares for cancellation. During the year 1,140,000 Ordinary
shares were bought back for cancellation. The Directors are seeking to
renew this authority at the forthcoming Annual General Meeting.
Herald Investment Management Limited’s annual remuneration is 1.0% of
the Company’s net asset value based on middle market prices, calculated
on a monthly basis payable in arrears.
Wind-Up At the Annual General Meeting of the Company held in April 2010
shareholders voted in favour of the Company continuing to operate as
an investment trust. The next continuation vote is in 2013 and every third
year thereafter.
AIC
The Company is a member of the Association of Investment Companies.
None of the views expressed in this document should be construed as advice to buy or sell a
particular investment.
Investment trusts are UK public listed companies and as such comply with the requirements of the
UK Listing Authority. They are not authorised or regulated by the Financial Services Authority.
HERALD INVESTMENT TRUST plc 1