Interim Results

Pacific Horizon Investment Tst PLC 01 March 2007 PACIFIC HORIZON INVESTMENT TRUST PLC Results for the six months to 31 January 2007 In the six months to 31 January 2007, Pacific Horizon's net asset value per share rose by 16.2%. The MSCI All Country Far East ex Japan Index rose by 13.9% in sterling terms over the same period. • Performance was aided by the Company's holdings of Vietnamese funds, Chinese companies listed in Hong Kong, shipping companies and stock exchanges in Hong Kong and Singapore. • The first, and to date only, investment in India was made in December. As indicated at the time of the AGM, there is no intention to make a substantial investment in the Indian market until valuations become more reasonable • Earnings per share for the six months were 0.58p compared to 0.56p in the first half of the previous year. As in previous years, no interim dividend will be paid. • During the period, the Company's gearing was eliminated in the light of the uncertain short term outlook for the markets of the Asia-Pacific region. • The Managers and Board believe that the longer term outlook is brighter, underpinned by rising prosperity, the growing influence of China and India and a greater focus on creating value for outside shareholders. Pacific Horizon Investment Trust PLC (Pacific Horizon) aims to achieve capital growth through investment in the stockmarkets of the Asia-Pacific region (excluding Japan) and in the stockmarkets of the Indian sub-continent. The Company has total assets of £96 million. Baillie Gifford & Co, the Edinburgh based fund management group with over £49 billion under management and advice, as at 28 February 2007, is appointed as investment managers and secretaries to Pacific Horizon. 1 March 2007 - ends - For further information please contact: Gerald Smith, Manager Pacific Horizon Investment Trust PLC 0131 275 2000 Mike Lord, Director Broadgate Marketing 020 7726 6111 PACIFIC HORIZON INVESTMENT TRUST PLC Interim Report In the six months to 31 January 2007 the net asset value per share rose by 16.2% to 123.69p. Over the same period the MSCI All Country Far East ex Japan Index rose by 13.9% in sterling terms. The best performing market in the region during the Company's half year (all market movements in sterling terms) was that of Vietnam, where the Ho Chi Minh Stock Index rose by 134%. The worst performing market was Thailand, where the principal local index fell by 1.7%. Of the larger markets, the best performer was the Chinese mainland A share market where foreign participation is limited by strict quotas. The Shanghai A Share Index rose by 81% and Chinese shares listed in Hong Kong also performed strongly, the Hang Seng China Enterprises Index gaining a little over 33%. The Indian market rose by almost as much with an increase of nearly 32%. At the other end of the scale the Korean market only gained 1.5%. The Philippine, Malaysian, Singaporean and Indonesian markets were among the better performing markets while Taiwan and the broader Hong Kong market made more modest but still respectable double digit gains. The performance of regional currencies against sterling was mixed. Performance was aided by our holdings of Vietnamese funds, Chinese companies listed in Hong Kong, shipping companies and stock exchanges in Hong Kong and Singapore, but our holdings in oil and gas companies and Korean shipbuilders were a hindrance during the half year. Gearing was eliminated during the period as short term borrowings were repaid. At the AGM in October, shareholders voted in favour of extending the range of permitted investments to include companies in the Indian sub-continent. The first investment in India was made in December, with the purchase of a holding in Reliance Industries but, as indicated at the time of the AGM, there is no intention to make a substantial investment in the Indian market until such time as valuations become more reasonable. Other than the inclusion of India for the first time, there was little change in the geographical distribution of investments. The most notable features being some profit taking in shares listed in Hong Kong and modest additions in Indonesia and Thailand. The most notable feature of the period was the level of activity in Chinese shares. There were a large number of new issues but demand from domestic investors in Hong Kong and mainland China was more than sufficient to absorb the large amount of equity raised and demand from foreign investors was also substantial, helped by the popularity of funds investing in the so-called 'BRIC' countries (Brazil, Russia, India and China). These funds combined with Japanese retail money also helped to support the Indian equity market. The smaller markets of the Asia-Pacific region also benefited from the activities of foreign investors, with Vietnam attracting considerable interest as it is emerging as a major destination for inward investment in export orientated industries. The outlook for the markets of the Asia-Pacific region in the short term is uncertain. Global growth has been strong and represents an important source of profits for companies based in Asia and the presence of investors with large amounts of money seeking high returns is one of the driving forces behind the performance of equity markets. The removal of one of these supports seems likely: either because growth slows, eroding earnings, or interest rates have to rise to control inflation, stemming the flood of money. Within the region, the continued rapid growth of China and emerging inflationary pressures have created upward pressure on currencies and the majority of central banks have attempted to resist this as much as possible. The suppression of exchange rate appreciation is distorting markets and creating longer term difficulties, including the build up of speculative bubbles in property and other assets. There is no obvious reason why this situation cannot persist for some time but it cannot continue indefinitely. Fortunately there are also pockets of reasonable valuation in some of the more out of favour markets and sectors and these are well represented in the portfolio. The longer term outlook is brighter, underpinned by rising prosperity, the growing influence of China and India and a greater focus on creating value for outside shareholders. By Order of the Board Baillie Gifford & Co 28 February 2007 The following is an interim statement for the six months ended 31 January 2007 which has been neither reviewed nor audited by the auditors. This statement is being printed and will be sent to all shareholders on 9 March 2007. Copies will be available for inspection at the Registered Office of the Company or may be obtained on request from the Managers and Secretaries after that date. PACIFIC HORIZON INVESTMENT TRUST PLC INCOME STATEMENT (unaudited) for the six months ended for the six months ended for the year ended 31 January 2007 31 January 2006 31 July 2006 Revenue Capital Total Revenue Capital Total Revenue Capital Total £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 Realised gains on - 7,853 7,853 - 2,277 2,277 - 7,880 7,880 investments Unrealised gains on - 5,687 5,687 - 5,490 5,490 - 5,406 5,406 investments Currency gains - 68 68 - 140 140 - 411 411 Income (note 2) 1,302 - 1,302 1,119 - 1,119 2,887 - 2,887 Investment management (459) - (459) (343) - (343) (765) - (765) fee Other administrative (121) - (121) (102) - (102) (241) - (241) expenses Net return before finance costs and taxation 722 13,608 14,330 674 7,907 8,581 1,881 13,69 15,578 Finance costs of (103) - (103) (75) - (75) (257) - (257) borrowings Return on ordinary activities before taxation 619 13,608 14,227 599 7,907 8,506 1,624 13,697 15,321 Tax on ordinary (172) - (172) (167) - (167) (464) - (464) activities Return on ordinary activities after taxation 447 13,608 14,055 432 7,907 8,339 1,160 13,697 14,857 Return per ordinary share (note 3) 0.58p 17.68p 18.26p 0.56p 10.34p 10.90p 1.51p 17.91p 19.42p Note: Dividend paid per ordinary share (note 4) - - 1.10p The total column of this statement is the profit and loss account of the Company. All revenue and capital items in the above statement derive from continuing operations. A Statement of Total Recognised Gains and Losses is not required as all gains and losses of the Company have been reflected in the above statement. PACIFIC HORIZON INVESTMENT TRUST PLC BALANCE SHEET (unaudited) At 31 January At 31 January At 31 July 2007 2006 2006 £'000 £'000 £'000 FIXED ASSETS Investments held at fair value 94,863 80,796 86,433 CURRENT ASSETS Debtors 834 163 387 Cash and short term deposits 1,534 2,682 2,960 2,368 2,845 3,347 CREDITORS Amounts falling due within one year (note 5) (806) (8,748) (8,334) NET CURRENT ASSETS/(LIABILITIES) 1,562 (5,903) (4,987) TOTAL ASSETS LESS CURRENT LIABILITIES 96,425 74,893 81,446 PROVISIONS FOR LIABILITIES AND CHARGES Deferred taxation (26) (21) (56) 96,399 74,872 81,390 CAPITAL AND RESERVES Called-up share capital 7,794 7,649 7,649 Share premium 2,615 965 965 Special distributable reserve 13,233 13,233 13,233 Capital redemption reserve 17,964 17,964 17,964 Capital reserve - realised 21,488 7,590 13,512 Capital reserve - unrealised 30,777 25,277 25,145 Revenue reserve 2,528 2,194 2,922 EQUITY SHAREHOLDERS' FUNDS 96,399 74,872 81,390 NET ASSET VALUE PER ORDINARY SHARE 123.69p 97.89p 106.41p Ordinary shares in issue (note 6) 77,937,002 76,487,002 76,487,002 PACIFIC HORIZON INVESTMENT TRUST PLC RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS (unaudited) For the six months ended 31 January 2007 Called-up Share Special Capital Capital Capital Revenue Equity share premium distributable redemption reserve - reserve - reserve shareholders' capital reserve reserve realised unrealised funds £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 Shareholders' funds at 1 August 2006 7,649 965 13,233 17,964 13,512 25,145 2,922 81,390 Return on ordinary activities after taxation - - - - 7,976 5,632 447 14,055 Shares issued in the period (note 6) 145 1,650 - - - - - 1,795 Dividends paid during the period (note 4) - - - - - - (841) (841) Shareholders' funds at 31 January 2007 7,794 2,615 13,233 17,964 21,488 30,777 2,528 96,399 For the six months ended 31 January 2006 Called-up Share Special Capital Capital Capital Revenue Equity share premium distributable redemption reserve - reserve - reserve shareholders' capital reserve reserve realised unrealised funds £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 Shareholders' funds at 1 August 2005 7,649 965 13,233 17,964 5,276 19,684 2,603 67,374 Return on ordinary activities after taxation - - - - 2,314 5,593 432 8,339 Dividends paid during the period (note 4) - - - - - - (841) (841) Shareholders' funds at 31 January 2006 7,649 965 13,233 17,964 7,590 25,277 2,194 74,872 For the year ended 31 July 2006 Called-up Share Special Capital Capital Capital Revenue Equity share premium distributable redemption reserve - reserve - reserve shareholders' capital reserve reserve realised unrealised funds £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 Shareholders' funds at 1 August 2005 7,649 965 13,233 17,964 5,276 19,684 2,603 67,374 Return on ordinary activities after taxation - - - - 8,236 5,461 1,160 14,857 Dividends paid during the period (note 4) - - - - - - (841) (841) Shareholders' funds at 31 July 2006 7,649 965 13,233 17,964 13,512 25,145 2,922 81,390 PACIFIC HORIZON INVESTMENT TRUST PLC SUMMARISED CASH FLOW STATEMENT (unaudited) Six months to Six months to Year to 31 January 31 January 31 July 2007 2006 2006 £'000 £'000 £'000 Net cash inflow from operating activities 653 809 1,747 Net cash outflow from servicing of finance (192) (3) (169) Total tax paid - - (337) Net cash inflow/(outflow) from financial investment 4,567 (5,967) (6,175) Equity dividend paid (841) (841) (841) NET CASH INFLOW/(OUTFLOW) BEFORE FINANCING 4,187 (6,002) (5,775) Proceeds from issue of shares 1,795 - - Net cash (outflow)/inflow from bank loans (7,408) 8,031 8,082 (DECREASE)/INCREASE IN CASH (1,426) 2,029 2,307 RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET FUNDS/(DEBT) (Decrease)/increase in cash in the period (1,426) 2,029 2,307 Net cash inflow/(outflow) from bank loans 7,408 (8,031) (8,082) Exchange movement on bank loans 173 104 501 MOVEMENT IN NET FUNDS/(DEBT) IN THE PERIOD 6,155 (5,898) (5,274) Net (debt)/funds at start of the period (4,621) 653 653 NET FUNDS/(DEBT) AT END OF THE PERIOD 1,534 (5,245) (4,621) RECONCILIATION OF NET REVENUE BEFORE FINANCE COSTS AND TAXATION TO NET CASH INFLOW FROM OPERATING ACTIVITIES Net revenue before finance costs and taxation 14,330 8,581 15,578 Gains on investments (13,540) (7,767) (13,286) Currency gains (68) (140) (411) Changes in debtors and creditors 108 147 90 Realised currency (loss)/profit (105) 36 (90) Overseas tax suffered (72) (48) (134) NET CASH INFLOW FROM OPERATING ACTIVITIES 653 809 1,747 PACIFIC HORIZON INVESTMENT TRUST PLC THIRTY LARGEST EQUITY HOLDINGS at 31 January 2007 Market % of value total £'000 assets+ Name Country Business China Infrastructure Machinery Holdings Hong Kong Infrastructure machinery manufacturer 4,478 4.6 CNPC Hong Kong Hong Kong Oil and gas exploration and production 3,600 3.7 Samsung Corporation Korea Construction and trading company 3,513 3.6 Taiwan Semiconductor Manufacturing Taiwan Semiconductor manufacturer 3,265 3.4 Precious Shipping Thailand Shipping company 2,615 2.7 Singapore Exchange Singapore Stock exchange 2,514 2.6 Hon Hai Precision Industries Taiwan Electronic manufacturing service company 2,486 2.6 Li & Fung Hong Kong Supply chain management 2,465 2.6 Bakrie and Brothers Indonesia Infrastructure product supply company 2,421 2.5 Hong Kong Exchanges and Clearing Hong Kong Stock exchange 2,391 2.5 Thoresen Thai Agencies Thailand Shipping company 2,367 2.5 ASM Pacific Technology Hong Kong Semiconductor equipment manufacturer 1,943 2.0 Petrochina China Integrated oil and gas company 1,898 2.0 Samsung Heavy Industries Korea Shipbuilder 1,859 1.9 Vietnam Growth Fund Vietnam Vietnam investment fund 1,848 1.9 Pacific Basin Shipping Hong Kong Shipping company 1,822 1.9 Malaysia International Shipping Corporation Malaysia Marine transport company 1,783 1.9 Ayala Corp Philippines Holding company 1,646 1.7 KS Energy Services Singapore Oil services provider 1,646 1.7 China Oilfield Services China Oil services provider 1,637 1.7 Shun Tak Holdings Hong Kong Diversified Macau based conglomerate 1,518 1.6 Hang Lung Properties Hong Kong Real estate developer 1,498 1.6 Fine Tec Corp Korea Industrial materials manufacturer 1,493 1.5 Unisteel Technology Singapore Electronics equipment manufacturer 1,492 1.5 MobileOne Singapore Wireless telecommunications provider 1,465 1.5 CapitaMall Trust Singapore Property trust 1,447 1.5 Thai Union Frozen Products Thailand Producer and exporter of frozen and 1,292 1.3 canned seafood Daewoo Shipbuilding and Marine Korea Shipbuilder 1,242 1.3 Shanghai Electrical Group China Electronic equipment manufacturer 1,237 1.3 Game Electrical Appliances Hong Kong Consumer electronic retailer 1,210 1.3 62,091 64.4 All stocks are listed overseas. + Total assets less current liabilities and deferred tax, before deduction of bank loans. PACIFIC HORIZON INVESTMENT TRUST PLC DISTRIBUTION OF ASSETS (unaudited) At 31 January At 31 January At 31 July 2007 2006 2006 % % % Equities: Hong Kong and China 32.6 33.0 35.0 Taiwan 14.2 13.2 15.0 Korea 14.0 19.8 14.4 Singapore 12.5 12.2 12.1 Thailand 8.7 6.8 7.9 Indonesia 5.1 5.8 3.6 Malaysia 4.9 5.3 5.3 Vietnam 2.9 - 1.9 Philippines 2.4 1.5 1.9 India 1.1 - - Total equities 98.4 97.6 97.1 Net liquid assets 1.6 2.4 2.9 Total assets + 100.0 100.0 100.0 + Total assets less current liabilities and deferred tax, before deduction of bank loans. PACIFIC HORIZON INVESTMENT TRUST PLC NOTES 1. The financial statements for the six months to 31 January 2007 have been prepared on the basis of the accounting policies set out in the Company's Annual Financial Statements at 31 July 2006. The Interim Report was approved by the Board on 28 February 2007. None of the views expressed in this document should be construed as advice to buy or sell a particular investment. Six months to Six months to Year to 31 January 31 January 31 July 2007 2006 2006 £'000 £'000 £'000 2. Income Income from investments and interest receivable 1,302 1,119 2,887 Other income Nil Nil Nil 3. Return per ordinary share Revenue return 447 432 1,160 Capital return 13,608 7,907 13,697 Return per ordinary share is based on the above totals of revenue and capital and on 76,994,339 (31 January 2006 and 31 July 2006 - 76,487,002) ordinary shares, being the weighted average number of ordinary shares in issue during each period. 4. Dividends Amounts recognised as distributions in the period: Final dividend for the year ended 31 July 2006 of 1.10p (2005 - 1.10p) paid 30 October 2006 841 841 841 No interim dividend will be declared. 5. The Company had no borrowings at 31 January 2007. At 31 January 2006 there were outstanding drawings of HK$55 million (£3,989,000) and US$7 million (£3,938,000) and at 31 July 2006 drawings of HK$110,000,000 (£7,581,000) both drawn down under short term facilities. 6. The Company has authority to allot shares under section 80 of the Companies Act 1985 which was renewed at the Annual General Meeting in October 2006. In the six months to 31 January 2007 a total of 1,450,000 ordinary shares of 10p each fully paid were issued for cash amounting to £1,795,500. At the Extraordinary General Meeting in April 2001 the Company was first granted authority to buy back its ordinary shares (equivalent to 14.99% of its issued share capital at that date). The authority was renewed at the Annual General Meeting in October 2006. In the six months to 31 January 2007 no ordinary shares were bought back. As a result, at 31 January 2007, the Company's authority to buy back shares remains unchanged at 11,465,401 ordinary shares. 7. During the period, transaction costs on purchases amounted to £52,000 (31 January 2006 - £83,000; 31 July 2006 - £128,000) and transaction costs on sales amounted to £58,000 (31 January 2006 - £66,000; 31 July 2006 - £138,000). 8. The financial information contained within this interim report does not constitute statutory accounts as defined in section 240 of the Companies Act 1985. The financial information for the year ended 31 July 2006 has been extracted from the statutory accounts which have been filed with the Registrar of Companies and contain an unqualified Auditors' Report and do not contain a statement under sections 237 (2) or (3) of the Companies Act 1985. This information is provided by RNS The company news service from the London Stock Exchange

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