Investeringsselskabet Luxor A/S : 8. juni 2015 Halvårsrapport for 1. halvår 1/10-2014 - 31/3-2015 (offentliggjort på engelsk)

Microsoft Word - fondsb.medd. 31. marts 2015-uk.doc

Investeringsselskabet A

S

Frederiksborggade 50, 1360 København K ⋅Telefon [phone] ⋅Telefax 33 12 41 70 ⋅CVR-nr. 49 63 99 10

Nasdaq OMX Copenhagen A/S Announcement No 6
Nikolaj Plads 6 page 1 of 19
PO Box 1040 date 28 May 2015
DK-1007 Copenhagen K ref. SRL/IK/ls

Half-year Report as at 31 March 2015

The Supervisory Board of Investeringsselskabet Luxor A/S has today adopted the Half-year Report as at 31

March 2015.

Second quarter of the financial year:

• Basic earnings amount to DKK 6.3 million (DKK 0.6 million), which is higher than expected. The im-

provement is primarily attributable to an increase of net financial income of DKK 1.5 million and an im-

provement of net loss/gain on mortgage deeds of DKK 0.3 million. In comparison, basic earnings for the first quarter of the financial year amounted to DKK 4.5 million.

• The Group's results before tax show a profit of DKK 8.6 million (DKK 2.5 million). The results are influ-

enced by positive fair value adjustments on bonds of DKK 46.9 million, realised losses on bonds of DKK

12.4 million and negative fair value adjustments of debt to credit institutions, mortgage credit loans and in- terest swaps of DKK 30.8 million, primarily as a consequence of hedged USD movements. In comparison, results before tax for the first quarter of the financial year showed a loss of DKK 13.3 million.

Half-year, first - second quarters 2014/15:

• Basic earnings for the half-year increased from DKK 3.3 million to DKK 10.8 million. The increase is pri-

marily attributable to an improvement of losses and fair value adjustment of credit risk on mortgage deeds

of DKK 2.5 million and an increase of net financial income of DKK 4.6 million.

• The Group's results before tax for the half-year show a loss of DKK 4.6 million (DKK 7.1 million).

• The net asset value per share in circulation is DKK 359.07 (DKK 406.99) after distribution of DKK 50.00

per share.

Expected profit for the year 2014/15

• The expected profit for the year before tax is adjusted to DKK 5.0 - 9.0 million compared with previously

DKK 2.0 - 6.0 million. The expected profit for the year includes basic earnings of an unchanged DKK 17.0

- 21.0 million.

Change in Company Management

The Supervisory Board has decided to appoint Jannik Rolf Larsen, Manager, as a member of the Executive

Board as at 1 June 2015. At the same time, Jannik Rolf Larsen resigns from the Supervisory Board, see page 8.

This Half-year Report includes:

- Financial Highlights of the Group

- Half-year Report

- Management's Statement

- Consolidated Statement of Comprehensive Income for the Period 1 October 2014 - 31 March 2015

- Consolidated Balance Sheet at 31 March 2015

- Statement of Changes in Equity

- Cash Flow Statement

- Segment Information

- Significant Notes

For additional information concerning this Half-year Report, please contact the undersigned.

Yours faithfully

Investeringsselskabet Luxor A/S

Svend Rolf Larsen

CEO

Investeringsselskabet Luxor A/S HALF-YEAR REPORT page 2 of 19

FINANCIAL HIGHLIGHTS OF THE GROUP

OCTOBER - MARCH

DKK million	2014/15 half-year	2013/14 half-year	2012/13 half-year	2013/14 full year
Key figures
Income..........................................................	17.3	30.7	29.2	59.9
Gross earnings ..............................................	42.9	18.6	16.9	60.4
Profit/loss before tax ....................................	-4.6	7.1	5.5	15.0
Net profit/loss for the period ........................	-3.7	5.4	4.1	11.1
Basic earnings ..............................................	10.8	3.3	0.3	13.8
Assets ...........................................................	913.2	840.4	734.3	888.2
Equity ...........................................................	359.1	407.0	401.4	412.8
Investment in property, plant and
equipment.....................................................	0.1	0.0	0.2	0.0
Profit/loss for analytical purposes:
Net profit/loss for the period (after tax) .......	-3.7	5.4	4.1	11.1
Ratios
Values per DKK 100 share
Earnings per share (EPS) (DKK) ................. Net asset value per share in	-3.70	5.37	4.10	11.15
circulation (DKK) ........................................	359.07	406.99	401.39	412.78
Return on equity in percentage p.a...............	-1.92	2.64	2.05	2.72
Equity share in percentage ...........................	39.32	48.43	54.67	46.47
Share capital
Nominal share capital,
end of period (DKK million) .......................	100.0	100.0	100.0	100.0
Number of shares in
circulation (DKK million)............................	100.0	100.0	100.0	100.0

Official price on the Stock Exchange per DKK 100 share:

Lowest ..........................................................	261	216	185	216
Highest .........................................................	362	240	203	264
End of period................................................	310	240	188	264
Volume of trade on the Stock Exchange, number of shares ..........................................	6,070	10,633	6,177	20,679
Listed on the Stock Exchange, number of shares ..........................................	825,000	825,000	825,000	825,000

The key figures have been calculated in accordance with 'Recommendations and key figures 2015' is- sued by the Danish Society of Financial Analysts. EPS and diluted EPS are in accordance with IAS 33.

HALF-YEAR REPORT

Investeringsselskabet Luxor A/S HALF-YEAR REPORT page 3 of 19
The Group's results before tax show a loss of DKK 4.6 million against a profit of DKK 7.1 million in the previous year. After recognition of tax for the period of DKK -0.9 million (DKK 1.7 million), the results for the period after tax show a loss of DKK 3.7 million (DKK 5.4 million).
Exclusive of fair value adjustments of securities, foreign exchange movements, realised gains on securities and gain on the sale of properties held for resale, basic earnings before tax for the half- year amount to DKK 10.8 million (DKK 3.3 million), which is higher than assumed in the stock ex- change announcement of 24 February 2015.
Compared with the same period last year, basic earnings have improved by DKK 7.5 million, which is primarily attributable to an increase of net financial income of DKK 4.6 million and an improve- ment in losses and fair value adjustment of credit risk on mortgage deeds of DKK 2.5 million. Compared with the first quarter of the financial year, basic earnings have increased by DKK 1.8 million, primarily as a result of an increase of net financial income of DKK 1.5 million and an im- provement of net loss/gain on mortgage deeds of DKK 0.3 million.
Expected basic earnings for the full financial year are maintained in the range of DKK 17.0 - 21.0 million.
The Group's profit for the half-year is in line with the expectations in the stock exchange an- nouncement of 24 February 2015. The expected profit for the year before tax is adjusted to DKK
5.0 - 9.0 million against previously DKK 2.0 - 6.0 million.
The Group's balance sheet, which compared with the same time last year has increased from DKK
840.4 million to DKK 913.2 million, includes the following business areas:

2014/15 DKK million	2013/14 DKK million
Mortgage deeds ..............................	431.9	329.1
Bonds .............................................	234.4	251.3
Shares .............................................	1.7	0.0
Total securities ...............................	668.0	580.4
Investment properties.....................	180.1	179.7
Total ...............................................	848.1	760.1

Below, the individual business areas are described. The financing and the effect of currency hedg- ing as well as currency exposure and hedging of currency risk are described in the section financing and debt.

Mortgage deeds

The fair value of the Group's portfolio of mortgage deeds amounts to DKK 431.9 million (DKK
329.1 million).
Investeringsselskabet Luxor A/S HALF-YEAR REPORT page 4 of 19
The total return on the portfolio of mortgage deeds for the financial period is specified as follows:

2014/15 DKK million	2013/14 DKK million
Interest income .....................................	14.5	11.2
Capital gains, mortgage deeds .............	1.0	0.3
Fair value adjustment ...........................	1.4	1.2
Gross return..........................................	16.9	12.7
Realised and unrealised losses on mortgage deeds, bad debts recovered and gain on sale of properties acquired for the purpose of resale .......................	-4.5	-7.1
12.4	5.6

The Group's portfolio of mortgage deeds is distributed with DKK 287.8 million (DKK 207.4 mil- lion) fixed-interest mortgage deeds and DKK 144.1 million (DKK 121.7 million) floating-rate cibor mortgage deeds.
A significant part of the Group's portfolio of mortgage deeds is still placed in detached houses, freehold flats and summer houses with an average market value per mortgage deed of kDKK 304.2 (kDKK 311.3).
Fixed-interest mortgage deeds and cibor mortgage deeds are measured at fair value. Irrespective of the term to maturity and the present market rate for new mortgage deeds of approx. 7.5% - 9.0% p.a. (7.5% - 9.5% p.a.), the Group's portfolio of fixed-interest mortgage deeds is measured at fair value on the basis of an average effective interest rate of 8.5% p.a. (8.5% p.a.). Fair value adjust- ment of mortgage deeds is a positive DKK 1.4 million (DKK 1.2 million).
Net loss/gain and direct expenses amount to DKK -4.7 million (DKK -7.2 million). The item in- cludes an improvement of adjustment to meet the credit risk on mortgage deeds by DKK 0.8 million (DKK 3.1 million), after which the total fair value adjustment of the credit risk on mortgage deeds amounts to DKK 16.8 million (DKK 21.7 million) corresponding to 3.8% (6.2%) of the portfolio. Bad debts recovered amount to DKK 1.1 million (DKK 0.6 million). Gain on sale of properties ac- quired for the purpose of resale amounts to DKK 0.6 million (DKK 2.1 million), and provisions for losses on properties acquired for the purpose of resale of DKK 2.2 million (DKK 1.7 million) have been reversed. Properties acquired for the purpose of resale have been purchased to secure loans granted by the Group.
Net loss on mortgage deeds for the quarter is lower than expected, and net loss/gain on mortgage deeds for the half-year is in line with expectations.
After the end of the quarter, the Group has entered into an agreement concerning the purchase of a mortgage deed portfolio managed for a third party; consequently, income from the management is no longer included in the item other income.
The purchase supports the Company's strategy of a continued increase of the mortgage deed portfo- lio.

Bonds

Investeringsselskabet Luxor A/S HALF-YEAR REPORT page 5 of 19
The fair value of the Group's portfolio of bonds amounts to DKK 234.4 million (DKK 251.3 mil- lion).
The total return on the portfolio of bonds for the financial period is specified as follows:

2014/15 DKK million	2013/14 DKK million
Interest income .................................................. Realised capital gains on bonds (including foreign exchange) ............................	9.3 -10.1	7.7 2.9
Fair value adjustment ........................................	32.0	-2.0
31.2	8.6

Realised losses on bonds include a realised exchange gain of DKK 6.6 million (DKK -1.6 million).
Fair value adjustments include an unrealised exchange gain of DKK 26.1 million (DKK -2.4 mil- lion) as well as reversed fair value adjustment of bonds sold in the financial period of DKK 13.0 million (DKK -2.7 million).
The portfolio of bonds, primarily in USD, has by and large been hedged with regard to currency fluctuations by means of currency swaps and loans in the same currency.
The financial period saw an increase in the yield spread to government bonds, which resulted in a negative fair value adjustment excluding foreign exchange and reversed write-downs on the sale of bonds.
At 31 March 2015, the portfolio of bonds comprises a total negative fair value adjustment and ex- pected gains on redemptions of up to approx. DKK 7.9 million excluding foreign exchange (approx. DKK 16.6 million excluding foreign exchange), which is expected counterbalanced over the period to maturity of the bonds until 2022/23. The portfolio of bonds is characterised by an over-weight of bonds with a relatively short to medium term to maturity and an average Macaulay duration of ap- prox. 4.2 years (approx. 4.1 years).
Since the closing of the financial period and until 20 May 2015, the Group has seen negative fair value adjustments of bonds of DKK 6.8 million and a realised gain of DKK 3.7 million. The fair value adjustments and realised gain include an exchange loss of DKK 5.8 million. The portfolio of bonds has been hedged with regard to currency fluctuations.

Shares

The fair value of the Group's portfolio of shares amounts to DKK 1.7 million (DKK 0.0 million). The shares were received in connection with a reconstruction of a bond issuer where the Group's portfolio of bonds was converted into shares.
To the extent that corporate bonds in the Parent Company's portfolio are converted into shares, the Supervisory Board has granted authority to maintain the ownership of the listed or unlisted shares for a period until the shares can be sold at a value which, in the opinion of the Parent Company, re- flects the actual value of the share.
Investeringsselskabet Luxor A/S HALF-YEAR REPORT page 6 of 19
Thus, the authority is not an authority to buy shares and build up a share portfolio.
Pursuant to the Danish Act on Alternative Investment Fund Managers, the Parent Company is per- mitted to invest in mortgage deeds, bonds and properties. According to section 15 of the Act, the Parent Company has requested the Danish Financial Supervisory Authority to grant an exemption in respect of the management of shares received in connection with a corporate bond in the portfolio being wholly or partly converted into shares.
The Danish Financial Supervisory Authority has granted the Parent Company such an exemption. Investment properties
The Group's balance sheet includes 5 (5) investment properties with a fair value of DKK 180.1 mil- lion (DKK 179.7 million).
The total return on investment properties for the financial period is specified as follows:

2014/15	2013/14
DKK million	DKK million
Rental income....................................................	7.2	7.6
Direct expenses, investment properties .............	2.8	4.0
4.4	3.6

Properties acquired for the purpose of resale

Properties acquired for the purpose of resale, DKK 14.4 million (DKK 21.3 million), comprise 4 (7)
properties taken over to secure loans granted by the Group. The properties are distributed with DKK
13.4 million on business-related properties and DKK 1.0 million on residential properties.
In the second quarter of the financial year, the Group sold a minor residential property. In the period after 31 March 2015, the Group has sold a minor business property.

Financing and debt

The fair value of the Group's short-term debt to credit institutions amounts to DKK 439.1 million (DKK 334.1 million). After conversion by means of matching forward contracts, the debt is distrib- uted as follows:

Currency	2014/15	2013/14
EUR .............................	8.81%	9.37%
DKK ............................	38.06%	22.56%
USD.............................	50.48%	62.60%
NOK ............................	2.65%	5.47%
100.00%	100.00%

As at 31 March 2015, the Group has pegged the interest rate on a total of DKK 25 million (DKK
25.0 million) with a remaining term of 4.0 years through an interest swap. Fair value adjustment for the period is a negative DKK 0.1 million (DKK -0.1 million).
After 31 March 2015, the Group has pegged the interest rate on a further DKK 25 million for 5 years through an interest swap.
Investeringsselskabet Luxor A/S HALF-YEAR REPORT page 7 of 19
The net movement for the period from exchange adjustments of loans in foreign currencies, forward contracts, securities, etc is a negative DKK 2.5 million (DKK -0.1 million).
Part of the Group's assets is placed in foreign currencies. The Group's total currency exposure in respect of assets and liabilities is distributed as follows:

Currency	31 M Assets	arch 2015 Liabilities	31 M Assets	arch 2014 Liabilities
DKK	73.67%	70.20%	70.78%	69.17%
EUR	0.60%	4.28%	0.35%	3.73%
NOK	1.73%	1.27%	2.69%	2.18%
USD	24.00%	24.25%	26.18%	24.92%
100.00%	100.00%	100.00%	100.00%

Fair value adjustments of mortgage credit institutes for the period, including interest swaps, are a negative DKK 1.8 million (DKK -1.4 million) as a consequence of changes in interest rates. The amount is counterbalanced through current fair value adjustments over the remaining term of the loans/contracts.

Redemption and raising of mortgage credit loans

Investment properties:
At the beginning of the second quarter of the financial year, the Parent Company has:

• raised new mortgage credit loans for DKK 25.3 million. The loans were raised as cibor loans

with expiry in 2025. The interest rate was pegged at the conclusion of the interest swap agree-
ments for the loan principals for the remaining term;

• raised new mortgage credit loans for DKK 21.6 million. The loans were raised as cash loans is-

sued on the basis of 2% bonds with expiry in 2037;

• redeemed DKK 24.4 million cash loans issued on the basis of 1.5% bond loans with expiry in

2024.

Risk relating to equity and market values upon change of parameter

The below table shows the sensitivity of a number of significant balance sheet items at 31 March
2015 and 31 March 2014.

DKK million

Mortgage deeds	1% effective rate of interest	431.9	14.8	329.1	10.7
Bonds	1% effective rate of interest	234.4	9.4	251.3	10.9
Shares	10% change in value	1.7	0.2	0.0	0.0
Investment properties	0.5% yield requirement	180.1	10.8	179.7	11.0
Foreign currency loan	s 10% change in exchange rate	406.1	40.6	229.2	22.9
Securities in foreign
currencies	10% change in value	234.4	23.4	240.8	24.1

Investeringsselskabet Luxor A/S HALF-YEAR REPORT page 8 of 19
It should be added that if the above parameters were to develop negatively due to an increase in in- terest rates, this would be counterbalanced by a certain reduction of the cash value of mortgage credit loans raised.
The Group's financial risks and financial instruments are described in note 37 to the Annual Report;
see the Company's website www.luxor.dk.

Future prospects and post balance sheet events

Considering the results announced and the progress until 20 May 2015 of the third quarter of the fi- nancial year, the expected profit for the year before tax is adjusted to DKK 5.0 - 9.0 million against previously DKK 2.0 - 6.0 million as a result of negative fair value adjustments and realised gains on bonds in the third quarter of the financial year. The expectation presupposes stable conditions as re- gards interest, securities and foreign exchange. Basic earnings are included in the above-mentioned expectations with an unchanged DKK 17.0 - 21.0 million.
In view of the general economic development, estimated basic earnings are subject to some uncer- tainty, including the development in losses and fair value adjustment of credit risk on mortgage deeds.

Change in Company Management

Due to the health situation of Svend Rolf Larsen, CEO, the Supervisory Board has decided to ap- point Jannik Rolf Larsen, Manager, as a member of the Executive Board of Investeringsselskabet Luxor A/S as at 1 June 2015. Jannik Rolf Larsen has been employed by the Company since 1997 and will still have day-to-day responsibility for the Group's mortgage deeds and properties.
Following this, the Executive Board of Investeringsselskabet Luxor A/S consists of Svend Rolf Larsen, CEO, and Jannik Rolf Larsen, Manager. The day-to-day management also includes Ibbi Kaas, CFO.
As a consequence of the Company's corporate governance rules, Jannik Rolf Larsen resigns from the Supervisory Board. Following this, the Supervisory Board consists of the following three mem- bers elected by the General Meeting:

• Casper Moltke (Chairman)

• Steffen Heegaard

• Michael Hedegaard Lyng

The Supervisory Board has decided that Jannik Rolf Larsen's seat on the Supervisory Board is not going to be refilled until the next General Meeting.

Basis of preparation

The Half-year Report has been prepared in accordance with the same accounting policies as the
Annual Report 2013/2014, to which we refer.
The Half-year Report comprises summarised consolidated financial statements of Investerings- selskabet Luxor A/S.
The Half-year Report has been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the EU, including IAS 34 on Interim Reports, and additional Dan- ish disclosure requirements relating to listed companies.
Investeringsselskabet Luxor A/S HALF-YEAR REPORT page 9 of 19

MANAGEMENT'S STATEMENT

The Supervisory and Executive Boards have today considered and adopted the Half-year Report of
Investeringsselskabet Luxor A/S for the period 1 October 2014 - 31 March 2015.
The Half-year Report, which comprises summarised consolidated financial statements of Investe- ringsselskabet Luxor A/S, has been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the EU, including IAS 34 on Interim Reports, and additional Dan- ish disclosure requirements relating to listed companies.
We consider the accounting policies applied appropriate, so that the Half-year Report gives a true and fair view of the assets, liabilities and financial position as at 31 March 2015 of the Group and of the results of the Group's operations and cash flows for the period 1 October 2014 - 31 March 2015.
The Half-year Report has not been audited by the Company's auditor.
Copenhagen, 28 May 2015

Executive Board: Svend Rolf Larsen
Supervisory Board:
Casper Moltke Chairman
Steffen Heegaard	Michael Hedegaard Lyng	Jannik Rolf Larsen

Investeringsselskabet Luxor A/S HALF-YEAR REPORT page 10 of 19

STATEMENT OF COMPREHENSIVE INCOME FOR THE PERIOD

1 OCTOBER 2014 - 31 MARCH 2015

G R O U P G R O U P

Note	1/1 - 31/3 2015 DKK '000	1/1 - 31/3 2014 DKK '000	1/10 2014- 31/3 2015 DKK '000	1/10 2013- 31/3 2014 DKK '000
Income Financial income ................................................	1	-3,605	12,448	9,489	22,484
Rental income .....................................................	3,534	3,824	7,193	7,565
Other income ......................................................	317	324	642	650
Total income .......................................................	246	16,596	17,324	30,699
Net loss/gain and direct expenses ....................... Direct expenses, properties.................................	2	-2,198 1,189	-5,068 1,811	-4,727 2,825	-7,239 3,986
-3,141	9,717	9,772	19,474
Fair value adjustment of financial assets... .........	3	46,788	1,205	33,114	-851
Total gross earnings .........................................	43,647	10,922	42,886	18,623
Financial expenses..............................................	5	31,325	4,937	40,512	4,813
12,322	5,985	2,374	13,810
Other external expenses......................................	952	1,048	1,757	1,731
Staff expenses .....................................................	4	2,660	2,420	5,136	4,819
Depreciation and amortisation............................	63	58	122	117
3,675	3,526	7,015	6,667
Profit/loss before tax.........................................	8,647	2,459	-4,641	7,143
Tax on profit/loss for the period .........................	6	1,952	614	-939	1,776
NET PROFIT/LOSS FOR THE PERIOD .....	6,695	1,845	-3,702	5,367
Earnings per A & B share (EPS) in DKK .......... Earnings per A & B share (EPS) in DKK (diluted value).....................................................	6.7 6.7	1.8 1.8	-3.7 -3.7	5.4 5.4

Investeringsselskabet Luxor A/S HALF-YEAR REPORT page 11 of 19

BALANCE SHEET AT 31 MARCH 2015

ASSETS

G R O U P

31/3 2015 DKK '000	31/3 2014 DKK '000	30/9 2014 DKK '000
Fixed assets
Domicile properties..................................	11,457	11,645	11,551
Fixtures, fittings and equipment...............	352	318	294
Property, plant and equipment .............	11,809	11,963	11,845
Investment properties ............................	180,100	179,700	180,100
Securities ..................................................	668,048	580,400	637,009
Fixed asset investments..........................	668,048	580,400	637,009
Deferred tax..............................................	11,538	12,547	10,599
Non-current assets..................................	871,495	784,610	839,553
Properties acquired for the purpose of resale ........................................................	14,357	21,319	20,647
Other properties held for sale ...................	0	1,813	0
Properties held for sale ..........................	14,357	23,132	20,647
Other receivables......................................	24,491	27,705	25,869
Corporation tax receivable .......................	266	400	213
Forward contracts, currency swaps ..........	245	0	0
Prepayments .............................................	527	571	526
Receivables..............................................	25,529	28,676	26,608
Cash at bank and in hand......................	1,857	4,028	1,394
Current assets .........................................	41,743	55,836	48,649
ASSETS...................................................	913,238	840,446	888,202