Interim Results

Schroder AsiaPacific Fund PLC 02 May 2006 2 May 2006 SCHRODER ASIAPACIFIC FUND PLC Schroder AsiaPacific Fund plc announces its unaudited Interim Results for the period ended 31 March 2006. Unaudited Income Statement For the six months For the six months ended 31 March 2006 ended 31 March 2005 Revenue Capital Total Revenue Capital Total £'000 £'000 £'000 £'000 £'000 £'000 Realised gains on investments - 40,358 40,358 - 18,081 18,081 Exchange (losses)/gains on loans and currency balances - (381) (381) - 814 814 Income 2,641 - 2,641 2,244 - 2,244 Management fees (1,113) - (1,113) (721) - (721) Administrative expenses (159) - (159) (169) - (169) Net return on ordinary activities before finance costs and taxation 1,369 39,977 41,346 1,354 18,895 20,249 Interest payable (545) - (545) (265) - (265) Return on ordinary activities before taxation 824 39,977 40,801 1,089 18,895 19,984 Tax on ordinary activities (246) 645 (399) (328) - (328) Return on ordinary activities after taxation 578 40,622 41,200 761 18,895 19,656 Return per share 0.39p 27.61p 28.00p 0.55p 13.57p 14.12p 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. Reconciliation of Movements in Shareholders' Funds (unaudited) Share Share Capital Share Warrant Warrant Capital Revenue Total capital Premium redemption purchase reserve exercise reserve reserve account reserve reserve reserve £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 Balance at 30 13,920 4 81 110,529 8,702 2 (8,408) 1,936 126,766 September 2004 (restated) Net profit from - - - - - - 18,895 761 19,656 operating activities Dividends - - - - - - - - (1,531) (1,531) accrued at 30 September 2004 Conversion of 2 21 - - (7) 7 - - 23 warrants to ordinary shares (restated) Balance at 31 13,922 25 81 110,529 8,695 9 10,487 1,166 144,914 March 2005 Share Share Capital Share Warrant Warrant Capital Revenue Total capital Premium redemption purchase reserve exercise reserve reserve account reserve reserve reserve £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 Balance at 30 13,920 4 81 110,529 8,702 2 (8,408) 1,936 126,766 September 2004 (restated) Net profit from - - - - - - 42,870 2,748 45,618 operating activities Dividends - - - - - - - - (1,531) (1,531) accrued at 30 September 2004 Conversion of 2 21 - - (7) 7 - - 23 warrants to ordinary shares (restated) Balance at 30 13,922 25 81 110,529 8,695 9 34,462 3,153 170,876 September 2005 -restated (a) Share Share Capital Share Warrant Warrant Capital Revenue Total capital Premium redemption purchase reserve exercise reserve reserve account reserve reserve reserve £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 Balance at 30 13,922 25 81 110,529 8,695 9 34,462 3,153 170,876 September 2005 as restated (a) Less investment - - - - - - (80) - (80) valuation changes Net profit from - - - - - - 40,622 578 41,200 operating activities Dividends - paid - - - - - - - (2,645) (2,645) in respect of 30 September 2005 Conversion of 2,797 25,175 - - (8,695) 8,695 - - 27,972 warrants to ordinary shares - restated Balance at 31 16,719 25,200 81 110,529 - 8,704 75,004 1,086 237,323 March 2006 a) The balance of revenue reserve at 30 September 2005 has increased by £2,645,000 being the final dividend accrued and now added back in accordance with FRS21. Unaudited Balance Sheet 31 March 30 September 2006 2005 £'000 £'000 (restated) Fixed assets Investments held at fair value through profit or 252,885 178,392 loss Current assets Debtors 1,563 3,392 Cash at bank and short-term deposits 6,978 18,125 8,541 21,517 Creditors: amounts falling due within one year (23,948) (28,542) Net current liabilities (15,407) (7,025) Total assets less current liabilities 237,478 171,367 Creditors: amounts falling due after more than one year Provision for liabilities and charges (155) (491) Net assets 237,323 170,876 Capital and reserves Called up share capital 16,719 13,922 Share premium account 25,200 25 Capital redemption reserve 81 81 Share purchase reserve 110,529 110,529 Warrant reserve - 8,695 Warrant exercise reserve 8,704 9 Capital reserve 75,004 34,462 Revenue reserve 1,086 3,153 Total Equity shareholders' funds 237,323 170,876 Net asset value per ordinary share Undiluted 141.95p 122.74p Diluted - 118.94p Unaudited Cash Flow Statement For the six months ended For the year ended 31 March 2006 30 September 2005 £'000 £'000 Net cash inflow from operating activities 825 4,232 Interest paid (540) (663) Tax paid (394) (1,261) Net cash (outflow)/inflow from investing activities (36,428) 3,550 Dividends paid (2,645) (1,531) Net cash (outflow)/inflow before financing (39,182) 4,327 Net cash inflow from financing 27,965 2,681 Net cash (outflow)/inflow (11,217) 7,008 Net debt at beginning of period (4,485) 8,346 Increase in bank loan to finance investments - (2,658) Exchange losses on revaluation of currency balances (381) (489) and cash balances Net debt at period end (16,083) (4,485) Notes Changes in Accounting Policies The interim financial statements have been prepared on the same basis of accounting policies as set out in the most recently published set of financial statements with the following exceptions which have arisen from the adoption of new accounting standard and the Statement of Recommended Practice 'Financial Statements of Investment Trust Companies' ('SORP') issued in January 2003 and revised in December 2005. (a) FRS 26 (Financial Instruments) - The Company has designated its assets and liabilities as being measured at 'fair value through profit or loss'. The fair value of fixed asset investments is deemed to be the bid value of those investments at the close of business on the relevant date. Previously listed investments were valued at mid value. The Company has taken advantage of the exemption under 108(d) of FRS 26 and not restated the results for the year to 30 September 2005 or six months to 31 March 2005. Transaction costs have been included within the capital account. Purchase transaction costs amounted to £98,000 for the period to 31 March 2006 and sales transaction costs amounted to £100,000. (b) FRS 23 (The effects of changes in Foreign Exchange Rates) - The financial statements of a company are presented in the currency of the primary economic environment in which it operates (its functional currency). The functional and presentational currency of this Company is deemed to be sterling and the financial statements presented accordingly. (c) FRS 21 (Events after the Balance Sheet Date) - Dividends paid by the Company are accounted for in the period in which the Company is liable to pay them. Previously, the Company accrued dividends in the period in which the net revenue, to which those dividends related was accounted for. The accounts for the year ended 30 September 2005 have been restated to reflect these changes. There was no impact on the period ended 31 March 2005. The half yearly figures are non-statutory accounts. The balance sheet and income statement for the year ended 30 September 2005 are extracts from the latest published accounts, restated for changes in accounting policy. A copy of the published accounts for that year has been delivered to the Registrar of Companies. The report of the auditors on those accounts was unqualified and did not contain a statement under section 237 (2) or (3) of the Companies Act 1985. Investment Manager's Review During the six months ended 31 March 2006, the total return on the Company's net assets on a fully diluted basis was +22.2%, outperforming the benchmark index, which produced a total return of +17.3%. Regional markets have continued to perform well, supported primarily by external conditions. Global leading indicators of economic activity have continued to rise, as stronger data from Japan and Germany has helped offset the impact of a slowing in consumption and housing in the United States. Meanwhile, although short term rates have continued to rise, the reaction of bond investors reflects a relaxed consensus on inflation. Among the major regional markets, Korea has been the outstanding performer. The information technology companies have been supported by the favourable economic conditions, while domestic consumer cyclicals have been supported by the improvement in household incomes and employment trends. Indonesia and the Philippines were also outstanding features. Indonesia has recovered following the oil crisis of last year, with strong rises in foreign exchange reserves and the currency laying the foundations for lower interest rates later this year. The Philippines saw continued progress on tax reform, and remittances from overseas have remained surprisingly strong. Chinese stocks rallied strongly late in the period, led by the financials and consumption sensitive sectors. Hong Kong has lagged, primarily due to the heavy exposure to financials and real estate which have offered limited earnings growth and suffer from rising interest rates. Malaysia was also disappointing, while Thailand was impacted by rising interest rates, a slowing economy, and political uncertainty following the sale of the Prime Minister's family company to a Singapore investment group. Taiwan managed a respectable performance, but solely due to the high technology content of the index. Domestic stocks, particularly the banks, offered amongst the worst returns in the region amid rising consumer credit provisions, and unease over the President's increasing political isolation. Performance and Portfolio Activity The underlying performance of the portfolio has been strong, and more than sufficient to offset the impact of dilution in the period up to the conversion of outstanding warrants in early February. The gearing has contributed in a period of rising markets, more than justifying the increased servicing costs. Country positioning has been a positive contributor (overweight Indonesia and the Philippines, underweight in Taiwan) as has stock selection, most notably in Hong Kong, but also in the Philippines, Korea and Thailand. We moved rapidly to invest the proceeds from the exercise of the Company's warrants and the portfolio has remained geared throughout the period. In terms of changes in the portfolio, we have reduced exposure to Taiwan reflecting our growing concern over the deteriorating outlook for the domestic economy, and India where fundamentals remain strong, but valuations look increasingly stretched. We have further added to the Philippines as the pace of fiscal reform remains encouraging, and strong remittances from overseas workers are supporting consumption and the property market. Outlook and Policy The outlook for equities in the year ahead is mixed. On the supportive side is the generally robust outlook for growth, and perhaps more importantly the lower reliance upon the US consumer. The recoveries seen in the Japanese and core European economies give a better balance to global activity, while the two large Asian economies of China and India continue to expand rapidly. In China's case, the gradual appreciation of the currency is symptomatic of a broader adjustment towards consumer-led growth, accompanied by a continued momentum in fixed investment. On the minus side, growth in global liquidity is decelerating. The United States has completed most of the monetary tightening required, the peak in the Federal Funds rate has receded, and both Europe and Japan are either raising rates or preparing to do so. Furthermore, Asia is not without its more parochial concerns, including the continued high energy prices, political uncertainty in a number of countries (Thailand, Taiwan, the Philippines), and the sometimes adversarial relationship between regional authorities and foreign investors, as recently highlighted in Korea. However, we continue to take comfort in the region's low valuations relative to the global average at a time when corporate profits are still expanding, balance sheets are strong, and there is increasing evidence of improved corporate governance and shareholder focus. Consequently, the portfolio remains geared. Key overweights remain Singapore, Indonesia, the Philippines and India, while our sectoral focus is upon domestically-oriented sectors such as consumer cyclicals and financials. Schroder Investment Management Limited 2 May 2006 The Interim Report will be mailed to registered shareholders in May 2006 and from the date of release copies of the Interim Report will be made available to the public at the Company's Registered Office at 31 Gresham Street, London EC2V 7QA. Enquiries: John Spedding Schroder Investment Management Limited 2 May 2006 (020 7658 3206) (e-mail john.spedding@schroders.com) This information is provided by RNS The company news service from the London Stock Exchange LLFBQEBZBBL

Companies

Schroder Asia Pacific Fund (SDP)
UK 100
FTSE quotes by TradingView

Latest directors dealings

All directors dealings today