Half Yr05 Financial Statement

Siam Investment Fund 01 November 2005 SIAM INVESTMENT FUND STATEMENTS OF OPERATIONS FOR THE 6-MONTH PERIODS ENDED 30 SEPTEMBER 2005 AND 2004 US$ Note 2005 2004 Income Interest income 18,379 3,484 Dividend income 103,675 20,116 Net unrealized gain on valuation of investments 101,447 - Net unrealized gain on foreign exchange relating to carrying value of investments - - Net realized gain on sales of investments - 4,077,841 Total income 223,501 4,101,441 Expenses Advisory fees 8.1 250,000 250,000 Administrative expenses 9 157,294 194,310 Net unrealized loss on valuation of investments - 7,672,602 Net unrealized loss on foreign exchange relating to carrying value of investments 584,995 962,934 Net realized loss on sales of investments 835,707 - Net realized loss on foreign exchange 301,310 18,427 Interest expenses - 940 Total expenses 2,129,306 9,099,213 Net income (loss) for the period (1,905,805) (4,997,772) Earnings (loss) per share (0.76) (2.00) The accounting policies and the notes on page 5 to 20 form an integral part of these financial statements. SIAM INVESTMENT FUND BALANCE SHEETS AS AT 30 SEPTEMBER 2005 AND 2004 US$ Notes 2005 2004 Investments - net 4 10,178,877 14,654,200 Current assets Cash at financial institutions 3,465,213 4,329,989 Receivable from sales of investments - - Other current assets 184,629 18,949 Total current assets 3,649,842 4,348,938 Current liabilities Forward contract payable, net (92,456) - Payable from purchase of investments - (101,287) Investment payable - (1,062,289) Accrued expenses (41,276) (42,048) Total current liabilities (133,732) (1,205,624) Net current assets 3,516,110 3,143,315 Net assets 13,694,987 17,797,515 Net assets financed by: Share capital 5 12,500 12,500 Share premium 6 7,487,500 9,987,500 Capital reserve 6,247,115 7,530,078 Revenue reserve (52,128) 267,437 Total shareholders' funds 13,694,987 17,797,515 Net asset value per share 5.48 7.12 For and on behalf of Siam Investment Fund: ................................................................................................. Director The accounting policies and the notes on page 5 to 20 form an integral part of these financial statements. SIAM INVESTMENT FUND STATEMENTS OF CHANGES IN NET ASSETS FOR THE 6-MONTH PERIODS ENDED 30 SEPTEMBER 2005 AND 2004 Share Share Capital Revenue capital premium reserve reserve Total Balance at 1 April 2004 12,500 12,487,500 12,106,200 689,087 25,295,287 Net gain for the period - - - (4,997,772) (4,997,772) Appropriated for: Net unrealized loss on valuation - - (7,672,602) 7,672,602 - of investments Net realized loss on foreign - - (18,427) 18,427 - exchange Net unrealized loss on foreign - - (962,934) 962,934 - exchange relating to carrying value of investments Net realized gain on sales of - - 4,077,842 (4,077,842) - investments Dividend for the period - (2,500,000) - - (2,500,000) Balance at 30 September 2004 12,500 9,987,500 7,530,078 267,437 17,797,515 Balance at 1 April 2005 12,500 7,487,500 7,867,680 233,112 15,600,792 Net loss from operations - - - (1,905,805) (1,905,805) Appropriated for: Net unrealized gain on valuation - - 101,447 (101,447) - of investments Net realized loss on foreign - - (301,310) 301,310 - exchange Net unrealized loss on foreign exchange Net unrealized loss on foreign - - (584,995) 584,995 - exchange relating to carrying value of investments Net realized loss on sales of - - (835,707) 835,707 - investments Dividend for the period - - - - - Balance at 30 September 2005 12,500 7,487,500 6,247,115 (52,128) 13,694,987 The accounting policies and the notes on page 5 to 20 form an integral part of these financial statements. SIAM INVESTMENT FUND STATEMENTS OF CASH FLOWS FOR THE 6-MONTH PERIODS ENDED 30 SEPTEMBER 2005 AND 2004 US$ 2005 2004 Cash flows from operating activities: Net income (loss) for the period (1,905,805) (4,997,772) Unrealized (gain) loss on valuation of investments (101,447) 7,672,602 Unrealized (gain) loss on foreign exchange relating to 584,995 962,934 carrying value of investments Cash provided from operating activities before changes in operating assets and liabilities (1,422,257) 3,637,765 Changes in operating assets and liabilities: Accounts receivable - - Dividend receivable 81,097 - Receivable from sales of investments - 1,009 Other current assets (149,385) (7,648) Investment 3,437,584 (10,507,116) Forward contracts payable, net 92,456 - Dividend payable (2,500,000) (2,500,000) Payable from purchase of investments (337,750) 101,287 Shareholder payable - 1,062,289 Accrued expenses (66,521) 10,502 Total cash provided from operating activities (864,776) (8,201,914) Cash flow from financing activity: Dividend - (2,500,000) Total cash used in operating activities - (2,500,000) Decrease in cash and cash equivalents for period (864,776) (10,701,914) Cash and cash equivalents at beginning of the period 4,329,989 15,031,903 Cash and cash equivalents at end of the period 3,465,213 4,329,989 The accounting policies and the notes on page 5 to 20 form an integral part of these financial statements. SIAM INVESTMENT FUND NOTES TO THE FINANCIAL STATEMENTS AS AT 30 SEPTEMBER 2005 AND 2004 1 Business activities Siam Investment Fund ('the Fund') is a closed-end investment fund and was incorporated as an exempted company with limited liability in the Cayman Islands on 22 February 1996. The Fund obtained a listing for its shares on the London Stock Exchange on 25 April 1996. The Fund's investment objective is to achieve long-term capital appreciation through investments primarily in unlisted companies, joint ventures and projects. Previously, such investments were in the Southeast Asian region; however, following a change in mandate, approved at the shareholders' meeting held on 6 March 1998, the Fund may now invest up to 100% of its capital in listed and unlisted companies in Thailand. 2 Duration The Fund may be dissolved on 31 March 2006. However, with the approval from the holders of at least two-third of the shares of the Fund, at or prior to the annual general meeting in 2006, the term of the Fund may be extended for an additional two years to 31 March 2008. 3 Significant accounting policies a) Basis of preparation The financial statements have been prepared in accordance with and are generally consistent with International Accounting Standards. These require the Fund's Directors to make estimates and assumptions that affect the reported amounts and disclosure in the financial statements. Actual results could differ from these estimates. The financial statements are prepared under the historical cost convention as modified by the revaluation of certain marketable securities and investment properties. b) Cash equivalents The Fund considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. c) Investments All securities for which market quotations are readily available are valued at the closing market prices. Securities for which market quotations are not readily available are valued by the Directors at costs or at a valuation based on third-party transactions in the same or in similar investments or at fair market value taking into consideration the cost of the investments, the quoted prices of investments of comparable publicly traded companies, market conditions, the underlying collateral, financial data and projections of the issuer of any relevant securities, and such other factors as the Directors may deem relevant. Investment transactions are accounted for on the trade date. Realized gains and losses from securities transactions are reported on an identified cost basis. Dividend and interest income is accounted for on an accrual basis. Discounts on securities purchased are amortised over the life of the respective securities. Realized and unrealized gains and losses on investments, including those relating to foreign exchange translation of the original cost of investment into US Dollars at the balance sheet date, are appropriated as capital reserve. d) Foreign currency transactions Transactions denominated in foreign currencies are translated into United States dollars at the rates of exchange ruling on the transaction dates. All assets and liabilities expressed in foreign currencies at the balance sheet date are translated into United States dollars at the rate of exchange ruling at that date. Realized and unrealized gains and losses on translation of foreign currencies relating to the carrying value of investments are charged directly to income statements before being appropriated as the capital reserves. All other realized and unrealized gains and losses on translation of foreign currencies are included in the statement of operations. e) Interest income Interest income is recognised under the accrual basis. For the periods ended 30 September 2005 and 2004, interest income arising from cash and cash equivalents were US$ 18,379 and US$ 3,484, respectively, with no interest income arising from investments. 4 Investments - net US$ 2005 2004 Listed securities, at market value 6,356,132 9,973,159 Unlisted securities, at valuation given by Directors 3,822,745 4,681,041 Investments - net 10,178,877 14,654,200 Cost of investments 16,259,611 20,636,848 The costs of investments shown above and in 4.1 and 4.2 below reflect the costs at the date of acquisition and do not include any subsequent foreign exchange adjustments. An analysis of the Company's investments is as follows: 2005 2004 Industry holding Cost Market holding Cost Market % of net assets value value of the Fund % US$ US$ % US$ US$ 2005 2004 4.1 Listed investments Charoen Pokphand Food Public Co., Ltd. Agribusiness - - - 0.12% 709,072 575,857 - 3.24 Finansa - Warrants Public Co., Ltd. Finance - - - 2.40% 609,017 590,024 - 3.32 Kim Eng Securities (Thailand) Public Co., Ltd. Finance - - - 0.02% 162,113 103,573 - 0.58 TISCO Finance Public Co., Ltd. Finance - - - 0.27% 1,116,929 821,680 - 4.62 Tycoons Worldwide Building & Group (Thailand) Furnishing Public Co., Ltd. Materials 0.49% 947,377 704,836 0.26% 477,008 502,173 5.15 2.82 Millennium Steel Construction Public Co., Ltd. Materials 0.22% 559,218 304,358 - - - 2.22 - The Siam Cement Construction Public Co., Ltd. Materials 0.01% 418,097 427,319 - - - 3.12 - 2005 2004 Industry holding Cost Market holding Cost Market % of net assets value value of the Fund % US$ US$ % US$ US$ 2005 2004 Listed investments (continued) Bangkok Bank Public Co., Ltd. Banking 0.01% 260,100 255,661 - - - 1.87 - Siam Commercial Bank Public Co., Ltd. Banking 0.01% 122,300 125,396 - - - 0.92 - Asian Insulators Energy Public Co., Ltd. Utilities 0.35% 608,285 486,506 - - - 3.55 - Banpu Public Co., Ltd Energy Utilities 0.05% 546,849 568,420 - - - 4.15 - 2005 2004 Industry holding Cost Market holding Cost Market % of net assets value value of the Fund % US$ US$ % US$ US$ 2005 2004 4.1 Listed investments (continued) Hana Microelectronics Electronics Public Co., Ltd. Components 0.09% 378,318 425,410 0.03% 95,194 98,020 3.11 0.55 KCE Electronics Electronics Public Co., Ltd. Components 0.28% 128,514 116,887 - - - 0.85 - Singer Thailand Electronics Public Co., Ltd. Products 0.37% 166,461 101,290 - - - 0.74 - Pranda Jewelry Public Co., Ltd. Fashion - - - 0.62% 254,204 262,343 - 1.47 Pranda Jewelry - Warrant Public Co., Ltd. Fashion 6.24% 583,465 426,102 3.76% 583,465 451,473 3.11 2.54 BOA Apartment Porperty Fund1 Property 0.01% 1,416 1,051 0.01% 1,545 1,238 0.01 0.01 CK. Karnchang Public Co., Ltd. Property 0.14% 514,783 474,799 0.09% 326,906 335,587 3.47 1.89 2005 2004 Industry holding Cost Market holding Cost Market % of net assets value value of the Fund % US$ US$ % US$ US$ 2005 2004 4.1 Listed investments (continued) Golden Land Property development Public Co., Ltd. Property 0.13% 273,863 149,613 0.16% 327,588 220,908 1.09 1.24 Krisda Mahanakorn Public Co., Ltd. Property 0.14% 244,018 57,568 0.72% 1,260,186 712,219 0.42 4.00 Natural Park Public Co., Ltd. Property 1.09% 2,667,821 1,622,029 1.27% 3,112,023 3,225,978 11.84 18.13 Sansiri Public Co., Ltd. Property - - - 0.03% 79,291 40,169 - 0.23 Siam Syntech Construction Public Co., Ltd. Property 0.33% 533,838 108,887 0.33% 533,838 227,233 0.80 1.28 Thoresen Thai Agencies Public Co., Ltd. Transportation - - - 0.08% 426,876 482,858 - 2.71 The Aromatics (Thailand) Chemicals Public Co., Ltd Plastics - - - 0.05% 800,131 772,574 - 4.34 Siam Makro Public co., Ltd Commerce - - - 0.21% 545,710 549,252 - 3.09 Total-listed investments 8,954,723 6,356,132 11,421,096 9,973,159 46.42 56.06 4.2 Unlisted investments 4.2.1 Equity investments 2005 2004 Industry holding Cost Directors' holding Cost Directors' % of net assets valuation valuation of the Fund % US$ US$ % US$ US$ 2005 2004 Northbridge International Communities Ltd. School 6.25% 2,462,569 - 6.25% 2,462,569 - - - G Steel Public Ltd. Steel 0.46% 1,520,144 2,556,611 0.46% 1,520,144 1,448,578 18.67 8.14 (c) Industrials JP-One Asset Ltd. (b) Resources & Energy 6.00% 915,497 876,552 18.33% 2,786,927 2,655,722 6.40 14.92 Manager Media Printing & Group Public Ltd Publishing 2.19% 59,978 - 2.14% 53,697 - - - Samakkhisan (Dokya) Public Ltd Printing & publishing 3.52% 51,550 - 3.52% 51,550 - - - PAE (Thailand) Property Public Co., Ltd. Developer 6.96% 404,350 389,582 6.96% 404,350 386,289 2.84 2.17 (a) Total-unlisted equity investments 5,414,088 3,822,745 7,279,237 4,490,589 27.91 25.23 4.2.2 Debt investments 2005 2004 Industry Cost Directors' Cost Directors' % of net assets holding valuation holding valuation of the Fund % US$ US$ % US$ US$ 2005 2004 Convertible term loan to Monterey Pizza Co., Foods - 1,890,800 - - 1,936,516 190,452 - - Ltd. (d) Total-unlisted debt investments 1,890,800 - 1,936,516 190,452 - - Total-unlisted investments 7,304,888 3,822,745 9,215,752 4,681,041 27.91 25.23 Investment - net 16,259,611 10,178,877 20,636,848 14,654,200 74.33 81.29 (a) PAE (Thailand) Public Company Limited PAE (Thailand) Public Company Limited (PAE) is a construction company which was listed in the Stock Exchange of Thailand. The company was founded in 1964 as a subsidiary of an American company carrying out engineering projects in Thailand. PAE expanded its construction and engineering operations rapidly during 1994-1997. To keep up with the growth, PAE entered into significant foreign currencies loan contracts. As a result of the Baht devaluation in July 1997, liabilities grew substantially from Baht 761 million to Baht 3,249 million while the company was unable to secure any new sizable contract after the Baht crisis. The company, therefore, was unable to service its debts. The management had no choice but to enter the Bank of Thailand CDRAC process in an effort to reach an arrangement with its creditors to restructure its debt. At the end of CDRAC process, PAE decided to file for business reorganization with the Central Bankruptcy Court. The Court granted an order for rehabilitation of PAE on 22 February 2000 and appointed GTT Planners Co., Ltd as the Plan Administrator. The Rehabilitation Plan has been approved and amended several times. The final Rehabilitation Plan was approved by the Central Bankruptcy Court on 15 November 2002. Under this plan, the existing capital of PAE was to be decreased and Free Internet Co Ltd and a group of new investors were to inject the capital funds of Baht 210 million through subscribing to 35 million newly issued shares of PAE at a price of Baht 6 per share on a Baht 10 par value. These funds were to be used as a payment to the priority creditors. On 26 January 2004, a group of new investors including Siam Investment Fund injected capital totaling Baht 210 million by subscribing to 35 million shares. On 28th April 2004 the Central Bankruptcy Court issued their acceptance of the completion of the Rehabilitation Plan of PAE as the decrease and increase in capital and the new shares issued to the investors as well as the payment to the priority creditors, secured creditors and non-secured creditors have been completed. In terms of operations, revenues from sales and construction works for the year 2004 were Baht 155.40 million compared to Baht 127.90 million in 2003 with a net profit of Baht 2.9 billion in 2004 (comprising mostly a gain from debt restructuring). In 2005, PAE will continue to focus on its core construction and telecommunication business. The management expects the company to return to profitability during 2005. This will enable PAE's shares to resume trading under the SET toward the first half of 2006. Siam Investment Fund owns 2.6 million shares of PAE which represents 6.96% holding of the company. The remaining balance is held by a number of individual investors. (b) JP-One Assets Co., Ltd. JP-One Assets Co., Ltd., ('JP-One') was incorporated under the laws of Thailand in November 2003 by Bangkok Aviation Fuel Services Public Company Limited (BAFS), the company which supplies aviation fuel to Bangkok's existing international airport, with the participation of, amongst others, the Fund. JP-One was established to receive the award of a contract for the supply of aviation fuel to the new international airport currently under construction in Bangkok (Suvarnabhumi Airport). BAFS arranged the issue of the shares in JP-One to cover the cost of building a pipeline extension to the new airport. The Fund made the investment in anticipation of the new airport being completed in September 2005, which was the projected timetable at the date of investment. However, it became apparent late in 2004 that construction of the new airport was well behind schedule and that completion of the new airport and its certification by the International Air Transport Association would not be achieved by September 2005. The Fund understands that latest estimates are for a delay of upwards of nine months. In light of that delay, the Fund sold a portion of its stake in JP-One at cost to a related party, FFM, in March 2005. The details are discussed under related party transactions in Note 8.1 (c) G Steel Public Company Limited (Previously Siam Strip Mill Public Company Limited) G Steel, founded in 1995 by Dr. Samsak Leeswadtrakul, is a leading hot-rolled coil (HRC) producer in Thailand with a total capacity of 1.5 million tons per annum. G Steel has one plant located in Rayong Province. Its plant is a compact mill equipped with the most advanced integrated technology starting from liquid steel making, slab casting to hot rolling. Currently, G Steel is the only HRC producer in Thailand operating liquid steel making through Electronic Arc Furnace (EAF). This process results in the overall quality of G Steel's finished HRC being higher than its local competitors. G Steel commercialized in November 1999 and now operates at an approximately 80% utilization rate. In March 2004, G Steel raised Baht 4.3 billion through a private placement of 2.7 billion new shares at Baht 1 par value. The proceeds from this private placement will be used for reducing debt obligations and capital spending for de-bottlenecking and further upstream expansion. Siam Investment Fund subscribed to 37.5 million shares (representing 0.46%) of the enlarged capital) at a price of Baht 1.6 per share through this placement. In September 2005, G Steel raised fund by issuing US$ 150 million senior unsecured notes. The notes will mature after five years from the date of issue with a bullet repayment, and will carry a fixed semi-annual coupon. Standard & Poor's Ratings Services assigned its B+ rating to G Steel. Issue proceeds will be primarily used to fund the Company's capital expenditure for its de-bottleneck program. G Steel plans to be listed on the Stock Exchange of Thailand in late 2005 in order to raise funds for further expansion. (d) Monterey Pizza Co., Ltd. The convertible term loan to Monterey Pizza Co., Ltd. ('Monterey') is denominated in US$ and carries interest at six month US$ LIBOR, payable every six months. The loan is secured by the major shareholders of Monterey and was repayable in full prior to 20 December 1998. As part of the loan agreement, the Fund has the right to convert a portion of the term loan into Monterey Shares equivalent to 250,000 Monterey shares (with par value of Baht 100 per share). Monterey has experienced financial difficulties since 1997. Interest has not been paid when due. The Fund has stopped accruing interest since December 1997. A legal demand for payment of principal and accrued interest has been made to Monterey as well as to 2 directors who have guaranteed the loan. The court ruled in favor of the Fund's demand for Baht 108 million. The defendants have been asked by the court to settle with the Fund. The loan has already been written down to zero in 2003. During the year 2004, the case was finalized by the Thai Appeals Court ruling that the Fund will get payment of Baht 2.5 million (approximately US$63,484) each year for 7 years, totalling Baht 17.5 million (approximately US$444,388). Repayment of the principal amounting US$ 45,716 in 2005 (2004: US$ 63,484) is charged to gain from reversal of bad debt in the statement of operations since the provision for possible loan loss has been provided in full since 2003. Credit risk The Fund may have significant investments in Thailand which may involve greater risk than investments in more developed markets. The prices of such investments may be volatile. The yields of emerging market debt obligations reflect, amongst other matters, perceived credit risk. The consequences of political, social or economic changes in Thailand may have disruptive effects on the market prices of the Fund's investments and the income they generate. Currency risk All of the Fund's equity investments where the investee company is incorporated in Thailand are subject to currency risk as the investee shares are denominated in Thai Baht. Fair values Listed and unlisted investments are stated at market values and Directors' valuations respectively. At 30 September 2005, in the opinion of the Directors, the carrying values of the listed and unlisted investments approximate their fair values. Additional information related to all investments of the Group which account for more than 5% of net assets as at 30 September 2005 is as follows: EPS per Market value/ Cost of latest audited Directors' % of issued investment accounts valuation Investment Industry share capital US$ US$ US$ Equity investments N-Park Property 1.09% 2,667,821 (0.0017) 1,622,029 TYCN Materials 0.49% 947,377 0.03506 704,836 G Steel Steel 0.46% 1,520,144 0.03311 2,556,611 JP-One Energy 6.00% 915,497 (0.0455) 876,552 The Group received dividends from the above investments during the period totaling US$103,675 (2004: US$ 20,116). 5 Share capital US$ 2005 2004 Authorised: 10,000,000 ordinary shares of US$ 0.005 each 50,000 50,000 Issued and fully paid 2,500,000 ordinary shares of US$ 0.005 each 12,500 12,500 6 Share premium US$ 2005 2004 Arising on the issue of 2,500,000 ordinary shares at a premium of US$ 10.295 per share, fully paid 25,737,500 25,737,500 Less: Placement fee (750,000) (750,000) Dividend payment (17,500,000) (15,000,000) 7,487,500 9,987,500 According to the Fund's Memorandum and Articles, no dividend shall be declared or paid other than from the profits or gains resulting from the Fund's business or from the share premium account of the Fund or such other amount as maybe lawfully available for dividend. 7 Net asset value per share The calculation of the net asset value per share is based on the net assets of US$ 13,694,987 (2004: US$ 17,797,515) divided by the number of shares, being 2,500,000. 8 Related party transactions 8.1 Sales of unlisted equity investment In light of the delay of the construction of the new airport which was scheduled for completion by September 2005, which delay would cause a project cost overrun by JP-One, as fully described in Note 4(b) to the financial statements, and a desire on the part of the directors of the Fund to return cash to shareholders, the Fund entered into a sales transaction of its stake in JP-One to Finansa Fund Management Ltd. ('FFM'), its related party, on 29 March 2005. The Fund sold its 12.33% stake in JP-One shares (totaling 740,000 ordinary shares, par value US$ 2.50 each, 85% (US$ 2.125 each) paid-up which equivalent to US$ 1.57 million) to FFM at the cost value of those shares. The Fund's view was that FFM was a ready and willing purchaser and it was unlikely that there would be any other buyer of the JP-One shares, an unlisted company, which could be found prior to the maturity of the Fund. It came to the attention of the Board of Directors of the Fund at a meeting on 22 April 2005 that the sale transaction may have failed fully to comply with the requirements of chapter 11 of the London Stock Exchange Listing Rules concerning related party transactions. The Board of the Fund has investigated and notified the UK Listing Authority (the Financial Services Authority) of this issue and is awaiting a response in that regard. The Board of the Fund, however, has taken such steps, which it believes are appropriate steps to ensure that a lapse in compliance with chapter 11 does not occur in the future. 8.2 Advisory and performance fees Finansa Fund Management Ltd, a related company incorporated in the Cayman Islands, serves as the investment adviser to the Fund and receives the following: (i) a monthly advisory fee in an amount equal to 2% per annum of the contributed capital (defined as the aggregate paid-up share capital of the Fund, inclusive of share premium) of the Fund; and (ii) a performance fee of 20% of the amounts by which distributions to shareholders exceed a cumulative compound rate of return on the Fund's contributed capital of 12% per annum. Advisory fees totaling US$ 250,000 (2004: US$ 250,000) were charged for the period. 8.3 Directors' fees and reimbursements The Fund's Articles of Association provide that the Fund may pay up to an aggregate of US$ 100,000 per year to its Directors. For the period ended 30 September 2005, an amount of US$ 30,000 (2004: US$ 30,000) was approved for payment to the Directors. In addition, the Fund reimburses Directors for travel and out-of-pocket expenses incurred in connection with Board of Directors meetings and meetings of committees of the Board of Directors. 8.4 Directors' interest in contracts of significance Mr. James Marshall is a shareholder of Finansa Public Company Limited, a shareholder in Finansa Fund Management Ltd., ('FFM'), the investment advisor to the Fund. Mr. Marshall is also a director of FFM. 9 Custodial and administrative fees Under a custodial agreement with Citibank, N.A. (Hong Kong Branch) ('Citibank ')., Citibank acts as custodian for the Fund, and is entitled to receive a fee from the Fund, computed and paid monthly in arrears, comprising the following: (i) a fee calculated at a 3.5 - 7.0 basis points per annum of the value of the portion held by the custodian; and (ii) a transaction fee of US$ 35 - US$ 90 per transaction. Under an administrative agreement dated 1 July 2004 with Maples Finance Ltd. ('Maples')., successor to Bank of Butterfield International (Cayman) Ltd for a minimum annual fee of US$ 7,500, Maples acts as administrator of the Fund, and is entitled to receive a fee from the Fund calculated and payable annually in advance in the amount of US$ 7,500 per year. Custodial and administrative fees totaling US$ 2,969 and US$ 3,750, respectively (2004: US$ 3,169 and US$ 3,750, respectively) were charged for the period. 10 Directors The non-executive directors during the period ended 30 September 2005 were as follows: James Marshall M.L. Plaichumpol Kitiyakara Van Huong Nguyen David Roberts Enghug Nontikarn Mungkorn Kriengwatana 11 Interest in shares Shareholders who held an interest of 3% or more in the Fund as of 30 September 2005 were as follows: Shareholder Number of shares Percentage Citivic Nominees Limited 2,500,000 100% (Formerly MGTB Nominees Limited) 12 Taxation The Fund is exempt from Cayman Islands income tax and accordingly its only liability is the payment of an annual registration fee to the government of the Cayman Islands, amounting to US$ 500 per annum. It is possible that the Fund could be assessed for income tax in other jurisdictions. No assessments have been raised and the Directors consider the likelihood of a significant tax liability arising to be remote. This information is provided by RNS The company news service from the London Stock Exchange IR FSUSEFSISELF

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