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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Abrdn Asia Focus Plc | LSE:AAS | London | Ordinary Share | GB00BMF19B58 | ORD 5P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 1.00 | 0.35% | 283.00 | 283.00 | 286.00 | 289.00 | 283.00 | 283.00 | 70,226 | 16:08:18 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Unit Inv Tr, Closed-end Mgmt | 45.3M | 35.19M | 0.2249 | 12.58 | 442.78M |
From May 2019 to May 2024
TIDMAAS
RNS Number : 0462D
Aberdeen Asian Smaller Co's Inv Tst
24 April 2017
ABERDEEN ASIAN SMALLER COMPANIES INVESTMENT TRUST PLC
ANNOUNCEMENT OF UNAUDITED HALF YEARLY RESULTS
for the six months ended 31 January 2017
INTERIM BOARD REPORT
Background
I am very pleased to report a good start to the year. On a total return basis the net asset value ("NAV") per Ordinary share increased by 8.9%, outperforming the MSCI AC Asia Pacific ex Japan Small Cap Index's return of 5.1%. The share price rose by 7% to 978.0p although the discount remained stubbornly high at 13.1% to the NAV per share as at 31 January 2017 despite the Company buying back in excess of 500,000 shares during this period. This is in line with the peer group in the market but, nonetheless, disappointing.
The portfolio continues to perform well, with the underlying investments enjoying a very healthy average return on equity of 15.6% and return on assets of 7.5%. Valuations are also reasonable at around 15 times earnings and the average dividend yield of the underlying holdings at 3.0% is a respectable return, given the low interest rate environment. This reflects the policy of Hugh Young and his team in investing in high quality companies with good prospects and strong management.
Overview
In a world of great economic and political uncertainty, the Company's focus on Asian companies with a market capitalisation of less than US$1bn gives the portfolio a certain stability as many of these companies are domestically focused.
The economic growth of the region continues to outpace Europe and the US. The population of the ASEAN economies alone is more than 600 million and, as it is relatively youthful, offers tremendous potential. Combined with the behemoths of China and India, the growing middle classes across the whole region are driving demand for everything from milk to mobile phones and cars. This continuing expansion in consumers' purchasing power which is forecast to continue over many years makes it an ideal place for domestically focused small companies to thrive.
A sounder Chinese economy also buoyed sentiment, given the mainland's economic dominance in Asia. Worries over China's slowing growth, rife at the beginning of last year, receded as the leadership prioritised economic stability ahead of the key Party Congress in late 2017. Besides propping up its economy with fiscal stimulus, Beijing tightened controls to stem capital outflows and imposed new measures to cool the property frenzy which should bode well for the health of the economy longer term.
Portfolio
The Company performed well both in absolute terms and against the small cap index. This was driven largely by the lack of exposure to Korea, which underperformed the region. Sentiment there was affected by a political scandal that saw President Park Geun-hye suspended from office. Already anaemic domestic consumption was further eroded as protracted protests against Park dampened retail activity. Although your Company has currently no investments in Korea, your Manager continues to look for opportunities to invest in the country, which has gained a reputation for its technological expertise.
The heavy exposure to Southeast Asia further boosted returns. In Thailand, the market outpaced most of its regional peers, lifted by political stability following the death of the revered King Bhumibol Adulyadej. While stocks in Indonesia underperformed the region, the companies in our portfolio performed well. A top contributor was local dairy company Ultrajaya Milk, one of our most recent purchases. A market leader in the domestic milk market, Ultrajaya generates good margins and has a net cash balance sheet. With a growing middle class and shifts in local diets, increasing demand for milk and dairy products is expected to boost growth. Indonesia's level of milk consumption of about 13 litres per person remains very low compared to its neighbours such as Malaysia, which consumes almost four times more than the average Indonesian.
Elsewhere, your Company gained from the high exposure to India, which has also contributed to performance over the longer term as small-cap stocks have benefited from improved policies and reforms under Prime Minister Narendra Modi and the central bank's commitment to inflation targeting and monetary policy discipline. The market wobble in late 2016 post-demonetisation was a small setback relative to the longer-term small-cap performance. The move called for scrapping two banknotes that made up almost 90% of all local currency in circulation by the year-end. City Union Bank, a recent introduction to the portfolio, was one of the beneficiaries of the government's demonetisation drive in November, as the move led to a massive scramble to deposit cash into bank accounts before the deadline. The conservatively run regional bank, which operates in the southern Indian state of Tamil Nadu, has steady asset quality and good loan growth.
In Hong Kong, Pacific Basin Shipping rebounded sharply after prolonged weakness in step with the shipping industry cycle. The Hong Kong-based dry bulk carrier remains well placed to benefit from a cyclical recovery, given its size and balance sheet strength. The company had recently raised money through a rights issue with the proceeds being used to buy distressed assets from smaller players who were impacted harder by the cyclical downturn. We had supported this move as the company had also historically proven itself a good manager across business cycles, a decision well justified as the share price has more than doubled since the rights issue.
Against this, the Company's low exposure to China detracted as the mainland market rebounded from a rocky start and ended as the region's best performer. Although there are a number of quality smaller companies emerging in the mainland, Hugh Young and his team continue to find it difficult to invest there, given the opaque regulatory boundaries and governance standards.
Portfolio Activity
Besides the above-mentioned introduction of City Union Bank, your Manager also initiated a position in Aegis Logistics, which handles bulk liquids and LPG. The Indian oil & gas logistics provider has successfully utilised its first-mover advantage to establish a strategic network of terminals close to clients, and is backed by a robust balance sheet, solid operations and good growth potential.
Meanwhile, your Manager's engagement with UK-listed MP Evans proved beneficial. The plantation company, which received a takeover bid from KL Kepong, successfully fought off the unsolicited approach that undervalued its plantations portfolio in Southeast Asia. Its share price rose in response, given MP Evans' commitment to disposing of non-core assets to improve shareholder returns. Your Manager had engaged with the Boards of both players during the attempted takeover and was happy to support MP Evans, given its quality assets and longer-term growth potential.
Corporate actions elsewhere led to the loss of a few holdings such as traditional Chinese medicine retailer Eu Yan Sang and hospitality information system company City E-Solutions. Several stocks - DGB Financial Group, Hung Hing Print Group and Pos Malaysia - were sold over the period in view of their deteriorating prospects. The cash was recycled into more attractive prospects which have been highlighted earlier such as Aegis Logistics, City Union Bank and Pacific Basin.
Share Capital Management and Gearing
During the period, 516,750 Ordinary shares were purchased in the market at a discount to the prevailing ex income NAV and transferred to treasury. Subsequent to the period end a further 257,500 Ordinary shares have been purchased into treasury. Your Board continues to use share buy backs in periods of market uncertainty to both reduce the volatility of any discount as well as modestly enhancing the NAV for shareholders. Conversely, in times of market optimism, shares have been issued to the market at a premium to NAV.
The Company's net gearing at 31 January 2017 was 9.2%. The majority of the gearing is provided by the Convertible Unsecured Loan Stock redeemable in 2019 of which approximately GBP33.0 million remains outstanding. The Company also has a GBP20 million multi-currency loan facility with State Street and $9 million was drawn down under the facility at the period end. The Directors monitor the Company's gearing on a regular basis in accordance with the Company's investment policy and under advice from the Manager.
Aberdeen
You will have seen the announcement of the proposed recommended merger between Aberdeen and Standard Life. This is still subject to a number of regulatory hurdles and the approval of both sets of shareholders.
The Board has made enquiries as to whether this will have any impact on the management of this Company. We have concluded that it will not make a material difference as the equity team in Singapore will be largely unaffected by the merger and the companies share many of the same investment philosophies. We will continue to monitor events as they unfold.
Outlook
As we have previously stated, the case for small companies in Southeast Asia remains a compelling story with considerable opportunities for growth in both the short and medium term. While the markets of Asia cannot be immune from external shocks impacting markets elsewhere in the world, the underlying performance of the portfolio should continue to grow given the quality of the businesses and their domestic focus.
Principal Risks and Uncertainties
The principal risks and uncertainties affecting the Company are set out in detail on pages 9 to 10 of the Annual Report and Financial Statements for the year ended 31 July 2016 and have not changed. They can be summarised under the following headings:
- Investment Strategy and Objectives; - Investment Portfolio and Investment Management Risks; - Financial Obligations; - Financial and Regulatory; - Operational; and, - Investment in Unlisted Securities.
Going Concern
The Company's assets consist of a diverse portfolio of listed equities which in most circumstances are realisable within a short timescale. The Directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the financial statements.
Directors' Responsibility Statement
The Directors are responsible for preparing this half-yearly financial report in accordance with applicable law and regulations. The Directors confirm that to the best of their knowledge:
- the condensed set of financial statements contained within the half-yearly financial report has been prepared in accordance with Financial Reporting Standard 104 (Interim Financial Reporting);
- the Interim Board Report (constituting the interim management report) includes a fair review of the information required by rule 4.2.7R of the UK Listing Authority Disclosure and Transparency Rules (being an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements and a description of the principal risks and uncertainties for the remaining six months of the financial year) and 4.2.8R (being related party transactions that have taken place during the first six months of the financial year and that have materially affected the financial position of the Company during that period; and any changes in the related party transactions described in the last Annual Report that could so do).
Nigel Cayzer
Chairman
21 April 2017
FINANCIAL HIGHLIGHTS
Hot Features
Premium
31 January 31 July % change
2017 2016
Total assets{A} (GBP'000) 448,676 427,725 +4.9
Net asset value per
Ordinary share - basic 1,160.25p 1,068.92p +8.5
Net asset value per
Ordinary share - diluted 1,125.01p 1,042.99p +7.9
Share price (mid) 978.00p 924.00p +5.8
Discount to diluted
net asset value 13.1% 11.4%
{A} Total assets as per the Statement of Financial
Position less current liabilities (excluding prior
charges such as bank loans).
Performance Six months Year
ended ended
31 January 31 July
2017 2016
Net asset value per Ordinary
share - diluted +8.9% +18.4%
Share price +7.0% +19.4%
MSCI AC Asia Pacific ex Japan
Index (currency adjusted) +10.4% +17.6%
MSCI AC Asia Pacific ex Japan
Small Cap Index (currency adjusted) +5.1% +19.1%
{A} Total return represents the capital return
plus dividends reinvested.
Condensed Statement of Comprehensive Income (unaudited)
Six months ended Six months ended
31 January 2017 31 January 2016
Revenue Capital Total Revenue Capital Total
Notes GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Gains/(losses)
on investments - 33,229 33,229 - (20,770) (20,770)
Income 2 5,824 - 5,824 4,175 - 4,175
Exchange losses - (443) (443) - (428) (428)
Investment management
fees (1,766) - (1,766) (2,170) - (2,170)
Administrative
expenses (751) - (751) (709) - (709)
______ ______ ______ ______ ______ ______
Net return before
finance costs and
taxation 3,307 32,786 36,093 1,296 (21,198) (19,902)
Finance costs (664) - (664) (659) - (659)
______ ______ ______ ______ ______ ______
Net return on ordinary
activities before
taxation 2,643 32,786 35,429 637 (21,198) (20,561)
Taxation on ordinary
activities 3 (214) - (214) (174) - (174)
______ ______ ______ ______ ______ ______
Return attributable
to equity shareholders 2,429 32,786 35,215 463 (21,198) (20,735)
______ ______ ______ ______ ______ ______
Return per share
(pence)
Basic 4 6.82 92.12 98.94 1.24 (56.77) (55.53)
______ ______ ______ ______ ______ ______
Diluted 4 n/a 82.86 90.28 n/a n/a n/a
______ ______ ______ ______ ______ ______
The total column of the Condensed Statement of Comprehensive
Income is the profit and loss account of the Company.
A Statement of Total Recognised Gains and Losses
has not been presented as all gains and losses are
recognised in the Condensed Statement of Comprehensive
Income.
All revenue and capital items in the above statement
derive from continuing operations.
Condensed Statement of Financial Position (unaudited)
As at As at
31 January 31 July
2017 2016
(unaudited) (audited)
Notes GBP'000 GBP'000
Non-current assets
Investments at fair value
through profit or loss 445,945 414,812
Current assets
Debtors and prepayments 382 600
Cash and short term deposits 3,642 13,623
______ ______
4,024 14,223
______ ______
Creditors: amounts falling
due within one year
Bank loans 6 (7,154) (11,779)
Other creditors (1,293) (1,310)
______ ______
(8,447) (13,089)
______ ______
Net current (liabilities)/assets (4,423) 1,134
______ ______
Total assets less current
liabilities 441,522 415,946
Non-current liabilities
3.5% Convertible Unsecured
Loan Stock 2019 7 (32,329) (32,211)
______ ______
Net assets 409,193 383,735
______ ______
Capital and reserves
Called-up share capital 8 9,794 9,794
Capital redemption reserve 2,062 2,062
Share premium account 39,668 39,646
Equity component of 3.5% Convertible
Unsecured Loan Stock 2019 7 1,361 1,361
Capital reserve 9 349,270 322,525
Revenue reserve 7,038 8,347
______ ______
Equity shareholders' funds 409,193 383,735
______ ______
Net asset value per share
(pence)
Basic 10 1,160.25 1,068.92
______ ______
Diluted 10 1,125.01 1,042.99
______ ______
Condensed Statement of Changes in Equity (unaudited)
Six months ended
31 January 2017
Capital Share Equity
Share redemption premium Special component Capital Revenue
capital reserve account reserve CULS reserve reserve Total
2019
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 31
July 2016 9,794 2,062 39,646 - 1,361 322,525 8,347 383,735
Purchase of
own shares to
treasury - - - - - (6,041) - (6,041)
Conversion of
3.5% Convertible
Unsecured Loan
Stock (note
7) - - 22 - - - - 22
Return on ordinary
activities after
taxation - - - - - 32,786 2,429 35,215
Dividends paid
(note 5) - - - - - - (3,738) (3,738)
______ ______ ______ ______ ______ ______ ______ ______
Balance at 31
January 2017 9,794 2,062 39,668 - 1,361 349,270 7,038 409,193
______ ______ ______ ______ ______ ______ ______ ______
Six months ended
31 January 2016
Capital Share Equity
Share redemption premium Special component Capital Revenue
capital reserve account reserve CULS reserve reserve Total
2019
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 31
July 2015 9,794 2,062 39,644 10,578 1,361 269,975 10,553 343,967
Purchase of
own shares to
treasury - - - (7,591) - - - (7,591)
Conversion of
3.5% Convertible
Unsecured Loan
Stock (note
7) - - 1 - - - - 1
Return on ordinary
activities after
taxation - - - - - (21,198) 463 (20,735)
Dividends paid
(note 5) - - - - - - (5,601) (5,601)
______ ______ ______ ______ ______ ______ ______ ______
Balance at 31
January 2016 9,794 2,062 39,645 2,987 1,361 248,777 5,415 310,041
______ ______ ______ ______ ______ ______ ______ ______
Condensed Statement of Cash Flows (unaudited)
Six months Six months
ended ended
31 January 31 January
2017 2016
GBP'000 GBP'000
Operating activities
Net return/(loss) on ordinary
activities before finance costs
and taxation 36,093 (19,902)
Adjustments for:
Dividend income (5,786) (4,124)
Interest income - (3)
Dividends received 5,818 4,743
Interest received 2 4
(Gains)/losses on investments (33,229) 20,770
Increase in prepayments (16) (12)
Increase in other debtors (2) -
(Decrease)/increase in accruals (160) 403
Stock dividends included in
investment income (38) (47)
Interest paid (660) (655)
CULS notional interest and
amortisation of issue expenses 140 133
Withholding tax suffered (214) (174)
___________ ___________
Net cash flow from operating
activities 1,948 1,136
Investing activities
Purchases of investments (14,114) (12,176)
Sales of investments 16,589 13,696
___________ ___________
Net cash flow from investing
activities 2,475 1,520
Financing activities
Purchase of own shares to treasury (6,041) (7,591)
(Repayment)/drawdown of loan (4,625) 6,345
Equity dividends paid (note
5) (3,738) (5,601)
___________ ___________
Net cash flow used in financing
activities (14,404) (6,847)
___________ ___________
Decrease in cash and cash equivalents (9,981) (4,191)
___________ ___________
Analysis of changes in cash and cash
equivalents during the period
Opening balance 13,623 6,678
Decrease in cash and cash equivalents
as above (9,981) (4,191)
___________ ___________
Closing balance 3,642 2,487
___________ ___________
Notes to the Financial Statements
For the period ended 31 January 2017
1. Accounting policies
(a) Basis of accounting
The condensed financial statements have been
prepared in accordance with Financial Reporting
Standard 104 (Interim Financial Reporting)
and with the Statement of Recommended Practice
for 'Financial Statements of Investment Trust
Companies and Venture Capital Trusts'. They
have also been prepared on a going concern
basis and on the assumption that approval
as an investment trust will continue to be
granted.
The interim financial statements have been
prepared using the same accounting policies
as the preceding annual financial statements.
Six months Six months
ended ended
31 January 31 January
2017 2016
2. Income GBP'000 GBP'000
Income from investments
Overseas dividends 5,786 4,124
Stock dividends 38 48
___________ ___________
5,824 4,172
___________ ___________
Other income
Deposit interest - 3
___________ ___________
Total income 5,824 4,175
___________ ___________
3. Taxation
The taxation charge for the period represents
withholding tax suffered on overseas dividend
income.
Six months Six months
ended ended
31 January 31 January
2017 2016
4. Return per Ordinary share p p
Basic
Revenue return 6.82 1.24
Capital return 92.12 (56.77)
___________ ___________
Total return 98.94 (55.53)
___________ ___________
The figures above are based
on the following:
Six months Six months
ended ended
31 January 31 January
2017 2016
GBP'000 GBP'000
Revenue return 2,429 463
Capital return 32,786 (21,198)
___________ ___________
Total return 35,215 (20,735)
___________ ___________
Weighted average number
of shares in issue{A} 35,590,006 37,338,757
___________ ___________
Six months Six months
ended ended
31 January 31 January
2017 2016
Diluted{B} p p
Revenue return n/a n/a
Capital return 82.86 n/a
___________ ___________
Total return 90.28 n/a
___________ ___________
The figures above are based
on the following:
GBP'000 GBP'000
Revenue return 2,938 891
Capital return 32,786 (21,198)
___________ ___________
Total return 35,724 (20,307)
___________ ___________
Number of dilutive shares 3,980,142 3,981,065
___________ ___________
Diluted shares in issue{AB} 39,570,148 41,319,822
___________ ___________
{A} Calculated excluding shares held in treasury.
{B} The calculation of the diluted total, revenue
and capital returns per Ordinary share are carried
out in accordance with IAS 33, "Earnings per
Share". For the purpose of calculating total,
revenue and capital returns per Ordinary share,
the number of Ordinary shares used is the weighted
average number used in the basic calculation
plus the number of Ordinary shares deemed to
be issued for no consideration on exercise of
all 3.5% Convertible Unsecured Loan Stock 2019
(CULS). The calculations indicate that the exercise
of CULS would result in an increase in the weighted
average number of Ordinary shares of 3,980,142
(31 January 2016 - 3,981,065) to 39,570,148
(31 January 2016 - 41,319,822) Ordinary shares.
For the period ended 31 January 2017 there was
no dilution to the revenue return per Ordinary
share (31 January 2016 - no dilution to the
revenue, capital and total return per Ordinary
share due to a loss being incurred). Where dilution
occurs, the net returns are adjusted for items
relating to the CULS. Accrued CULS finance costs
for the period and unamortised issues expenses
are reversed. Total earnings for the period
are tested for dilution. Once dilution has been
determined individual revenue and capital earnings
are adjusted.
Six months Six months
ended ended
31 January 31 January
2017 2016
5. Dividends GBP'000 GBP'000
Final dividend for 2016
- 10.50p (2015 - 10.50p) 3,738 3,921
Special dividend for 2016
- Nil (2015 - 4.50p) - 1,680
___________ ___________
3,738 5,601
___________ ___________
6. Bank loan
In June 2014 the Company entered into a GBP20
million multi-currency revolving loan facility
with State Street Bank and Trust Company. The
agreement contains a covenant that total debt
shall not exceed 25% of the adjusted net asset
value of the Company, where total debt is the
sum of total borrowings including loan stock
excluding any liabilities under derivative instruments
which would otherwise be included on the basis
that such a contract or instrument was being
closed out on the date of calculation.
The adjusted net asset value is defined as the
net asset value of the borrower adjusted by
deducting:
* market value of any investments not quoted on an
internationally recognised exchange;
* total market value of investments in Sub-Investment
Grade or Unrated Corporate Bonds;
* amount by which the market value of investments in a
single issuer exceeds 5% of the Net Asset Value;
* amount by which the market value of the largest
twenty holdings exceeds 65% of the Net Asset Value;
* the amount by which market value of investments in
any one country exceeds 25% of the Net Asset Value;
or
* the amount by which market value of investments in
any Sub-Investment Grade Country exceeds 30%.
The Company met this covenant for the period
which the loan was utilised with State Street.
As at 31 January 2017, US$9,000,000 (31 July
2016 - GBP5,000,000 and US$9,000,000) had been
drawn down at a rate of 1.67% (31 July 2016
- 1.40% and 1.40%) which matured on 24 February
2017. At the time of writing the US$9,000,000
bank loan has been rolled over at an interest
rate of 1.88389% until maturity on 24 April
2017.
7. Non-current liabilities - 3.5% Convertible Unsecured
Loan Stock 2019 ("CULS")
Number Liability Equity
of units component component
'000 GBP'000 GBP'000
Balance at beginning of
period 33,041 32,211 1,361
Conversion of CULS into
Ordinary shares (22) (22) -
Notional interest on CULS - 102 -
Amortisation of discount - 38 -
and issue expenses
___________ ___________ ___________
Balance at end of period 33,019 32,329 1,361
___________ ___________ __________
The 3.5% Convertible Unsecured Loan Stock 2019
("CULS") can be converted at the election of
holders into Ordinary shares during the months
of May and November each year throughout their
life until 31 May 2019 at a rate of one Ordinary
share for every 830.0p nominal of CULS. Interest
is paid on the CULS on 31 May and 30 November
each year. 100% of the interest is charged to
revenue in line with the Board's expected long-term
split of returns from the investment portfolio
of the Company.
In the event of a winding-up of the Company
the rights and claims of the Trustee and CULS
holders would be subordinate to the claims of
all creditors in respect of the Company's secured
and unsecured borrowings, under the terms of
the Trust Deed.
During the period ended 31 January 2017 the
holders of GBP21,594 of CULS exercised their
right to convert their holdings into Ordinary
shares. Following the receipt of the exercise
instructions, the Company converted GBP21,594
(31 July 2016 - GBP2,329) nominal amount of
CULS into 2,595 (31 July 2016 - 278) Ordinary
shares.
As at 31 January 2017, there was GBP33,019,220
(31 July 2016 - 33,040,814) nominal amount of
CULS in issue.
8. Called-up share capital
During the six months ended 31 January 2017
an additional 2,595 (31 July 2016 - 278) Ordinary
shares were issued after GBP21,594 (31 July
2016 - GBP2,329) nominal amount of 3.5% Convertible
Unsecured Loan Stock 2019 were converted at
830.0p each. The total consideration received
was GBPnil (31 July 2016 - GBPnil). At the end
of the period there were 39,180,053 (31 July
2016 - 39,177,180) Ordinary shares in issue,
of which 3,912,374 (31 July 2016 - 3,278,124)
were held in treasury.
Subsequent to the period end, a further 257,500
Ordinary shares were bought back to be held
in treasury at a total cost of GBP2,572,000.
9. Capital reserve
The capital reserve reflected in the Condensed
Statement of Financial Position at 31 January
2017 includes gains of GBP211,332,000 (31 July
2016 - gains GBP185,317,000), which relate to
the revaluation of investments held at the reporting
date.
As at As at
10. Net asset value per equity 31 January 31 July
share 2017 2016
Basic
Net assets attributable GBP409,193,000 GBP383,735,000
Number of Ordinary shares in
issue{A} 35,267,679 35,899,334
Net asset value per Ordinary
share 1,160.25p 1,068.92p
___________ ___________
Diluted{B}
Net assets attributable GBP441,522,000 GBP415,946,000
Number of Ordinary shares 39,245,898 39,880,155
Net asset value per Ordinary
share 1,125.01p 1,042.99p
___________ ___________
{A} Excludes shares in issue
held in treasury.
{B} The diluted net asset value per Ordinary
share has been calculated on the assumption that
the GBP33,019,220 (31 July 2016 - GBP33,040,814)
3.5% Convertible Unsecured Loan Stock 2019 ("CULS")
are converted at 830.0p per share, giving a total
of 39,245,898 (31 July 2016 - 39,880,155) Ordinary
shares. Where dilution occurs, the net assets
are adjusted for items relating to the CULS.
Net asset value per share - debt converted
In accordance with the Company's understanding
of the current methodology adopted by the AIC,
convertible bond instruments are deemed to be
'in the money' if the cum income (debt at fair
value) net asset value ("NAV") exceeds the conversion
price of 830.0p per share. In such circumstances
a net asset value is produced and disclosed assuming
the convertible debt is fully converted. At 31
January 2017 the cum income NAV was 1,160.25p
and thus the CULS were 'in the money' (31 July
2016 - 1,068.92p, 'in the money').
11. Transaction costs
During the period expenses were incurred in
acquiring or disposing of investments classified
as fair value though profit or loss. These have
been expensed through capital and are included
within gains/(losses) on investments in the
Condensed Statement of Comprehensive Income.
The total costs were as follows:
Six months Six months
ended ended
31 January 31 January
2017 2016
GBP'000 GBP'000
Purchases 60 32
Sales 32 58
___________ ___________
92 90
___________ ___________
12. Fair value hierarchy
FRS 102 requires an entity to classify fair value
measurements using a fair value hierarchy that
reflects the significance of the inputs used in
making the measurements. The fair value hierarchy
has the following classifications:
Level 1: unadjusted quoted prices in an active
market for identical assets or liabilities that
the entity can access at the measurement date.
Level 2: inputs other than quoted prices included
within Level 1 that are observable (ie developed
using market data) for the asset or liability,
either directly or indirectly.
Level 3: inputs are unobservable (ie for which
market data is unavailable) for the asset or liability.
The financial assets and liabilities measured
at fair value in the Condensed Statement of Financial
Position are grouped into the fair value hierarchy
at the reporting date as follows:
Level Level Level Total
1 2 3
As at 31 January 2017 GBP'000 GBP'000 GBP'000 GBP'000
Financial assets/(liabilities)
at fair value through profit
or loss
Quoted equities 445,945 - - 445,945
CULS (39,541) - - (39,541)
_________ _________ _________ _________
Net fair value 406,404 - - 406,404
_________ _________ _________ _________
Level Level Level Total
1 2 3
As at 31 July 2016 GBP'000 GBP'000 GBP'000 GBP'000
Financial assets/(liabilities)
at fair value through profit
or loss
Quoted equities 414,812 - - 414,812
CULS (38,080) - - (38,080)
_________ _________ _________ _________
Net fair value 376,732 - - 376,732
_________ _________ _________ _________
Quoted equities
The fair value of the Company's investments in
quoted equities has been determined by reference
to their quoted bid prices at the reporting date.
Quoted equities included in Fair Value Level 1
are actively traded on recognised stock exchanges.
13. Related party disclosures
Transactions with the Manager
Mr M J Gilbert and his alternate Director, Mr
H Young are both directors of Aberdeen Asset Management
PLC ('AAM') and its subsidiary Aberdeen Asset
Management Asia Limited ('AAM Asia') which has
been delegated, under an agreement with Aberdeen
Fund Managers Limited ('AFML'), to provide investment
management services to the Company. Neither Mr
Gilbert nor Mr Young are directors of AFML.
The investment management fee is payable monthly
in arrears based on an annual amount of 1.0% (previously
calculated using a rate of 1.2% until July 2016)
calculated on the average net asset value of the
Company over a 24 month period, valued monthly.
The fee is calculated by reference to the value
of the Company's net assets (gross assets less
liabilities excluding the amount of any loan facilities
or overdraft facilities drawn down). During the
period GBP1,766,000 (31 January 2016 - GBP2,170,000)
of investment management fees were charged, with
a balance of GBP611,000 (31 January 2016 - GBP720,000)
being payable to AFML at the period end. Investment
management fees are charged 100% to revenue.
The Company also has a management agreement with
AFML for, inter alia, the provision of both administration
and promotional activities services which are,
in turn, delegated to AAM and Aberdeen Asset Managers
Limited ('AAML') respectively.
The administration fee is payable quarterly in
advance and is based on a current annual amount
of GBP87,000 (31 January 2016 - GBP87,000). During
the period GBP44,000 (31 January 2016 - GBP43,000)
of fees were charged, with a balance of GBP22,000
(31 January 2016 - GBP22,000) payable to AAM at
the period end.
The promotional activities costs are based on
a current annual amount of GBP250,000 (31 January
2016 - GBP250,000), payable quarterly in arrears.
During the period GBP125,000 (31 January 2016
- GBP125,000) of fees were charged, with a balance
of GBP21,000 (31 January 2016 - GBP83,000) being
payable to AAML at the period end.
14. Segmental information
The Company is engaged in a single segment of
business, which is to invest in equity securities.
All of the Company's activities are interrelated,
and each activity is dependent on the others.
Accordingly, all significant operating decisions
are based on the Company as one segment.
15. Half-Yearly Report
The financial information in this Report does
not comprise statutory accounts within the meaning
of Section 434 - 436 of the Companies Act 2006.
The financial information for the year ended
31 July 2016 has been extracted from published
accounts that have been delivered to the Registrar
of Companies and on which the report of the
auditors was unqualified and contained no statement
under Section 498 (2), (3) or (4) of the Companies
Act 2006. The interim accounts have been prepared
using the same accounting policies as the preceding
annual accounts.
Ernst & Young LLP has reviewed the financial
information for the six months ended 31 January
2017 pursuant to the Auditing Practices Board
guidance on Review of Interim Financial Information.
16. This Half-Yearly Report was approved by the
Board and authorised for issue on 21 April 2017.
Copies of the Company's Half Yearly Report for the six months ended 31 January 2017 will be posted to shareholders in April 2017 and will be available thereafter on the Company's website:
www.asian-smaller.co.uk* and from the registered office, Bow Bells House, 1 Bread Street, London EC4M 9HH.
Please note that past performance is not necessarily a guide to the future and that the value of investments and the income from them may fall as well as rise and may be affected by exchange rate movements. Investors may not get back the amount they originally invested.
* Neither the content of the Company's website nor the content of any website accessible from hyperlinks on the Company's website (or any other website) is (or is deemed to be) incorporated into, or forms (or is deemed to form) part of this announcement.
Aberdeen Asset Management PLC
Secretaries
21 April 2017
Independent Review Report to Aberdeen Asian Smaller Companies Investment Trust PLC
Introduction
We have been engaged by the Company to review the condensed set of financial statements in the half-yearly financial report for the six months ended 31 January 2017 which comprises a Condensed Statement of Comprehensive Income, Condensed Statement of Financial Position, Condensed Statement of Changes in Equity, Condensed Statement of Cash Flows and the related Notes 1 to 16. We have read the other information contained in the half-yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.
This report is made solely to the company in accordance with guidance contained in International Standard on Review Engagements 2410 (UK and Ireland) "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Auditing Practices Board. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company, for our work, for this report, or for the conclusions we have formed.
Directors' Responsibilities
The half-yearly financial report is the responsibility of, and has been approved by, the Directors. The Directors are responsible for preparing the half-yearly financial report in accordance with the Disclosure and Transparency Rules of the United Kingdom's Financial Conduct Authority.
As disclosed in note 1, the annual financial statements of the company are prepared in accordance with Financial Reporting Standard 102. The condensed set of financial statements included in this half-yearly financial report has been prepared in accordance with Financial Reporting Standard 104 (Interim Financial Reporting).
Our Responsibility
Our responsibility is to express to the Company a conclusion on the condensed set of financial statements in the half-yearly financial report based on our review.
Scope of Review
We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the six months ended 31 January 2017 is not prepared, in all material respects, in accordance with the Financial Reporting Standard 104 (Interim Financial Reporting) and the Disclosure and Transparency Rules of the United Kingdom's Financial Services Conduct Authority.
Ernst & Young LLP
Edinburgh
21 April 2017
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR PGUCUCUPMGQG
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April 24, 2017 02:00 ET (06:00 GMT)
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