Interim Results

Aberdeen New Dawn Invest Trust PLC 21 December 2007 ABERDEEN NEW DAWN INVESTMENT TRUST PLC HALF-YEARLY FINANCIAL REPORT FOR THE SIX MONTHS ENDED 31 OCTOBER 2007 The investment objective of Aberdeen New Dawn Investment Trust PLC is to provide shareholders with a high level of capital growth through equity investment in the Asia Pacific countries ex. Japan. The following is the unaudited Interim Board Report for the six months ended 31 October 2007. Interim Board Report Background During the six months to 31 October 2007, the net asset value of the Company increased 18.82% to 652.15p, underperforming the benchmark MSCI Asia Pacific ex-Japan Index, which rose by 31.66%. Over the period, the net asset value total return (with dividends reinvested) was 19.98% and the benchmark total return was 33.90%, the share price total return reduced to 11.72% due to the discount widening. In line with normal practice, there will be no interim dividend but we shall recommend a final dividend at our financial year-end. Overview The past six months have seen Asian equities reach new peaks, notwithstanding the increasingly volatile environment. Global stock markets sold off in August, as the turmoil in US credit caused ripples across financial markets. For Asia, however, the jitters proved short-lived as liquidity quickly returned, boosted by an unexpectedly large US interest rate cut. Some valuations in the region now look inflated, notably in China on a p/e of 70 times and across cyclical stocks in general. This follows a near doubling of China's domestic indices over the period. Although earnings quality has improved over the past couple of years, most Chinese companies lack transparency, with an untried management, and a worrying dependency on investment gains for growth. While the mainland market is still effectively closed to foreigners, there is no shortage of China growth proxies, which are listed on the Hong Kong H-share market, the bulk of which are industrials and financials. These have enjoyed correspondingly outsized gains, while recent IPOs have attracted astounding first-day premiums. Your Managers prefer traditional Hong Kong-listed stocks, which have established track records, and are able to extend their successful business models into the mainland. In other markets, investors have focused their attention on industrials and basic materials. South Korea's shipbuilding and steelmaker stocks benefited in particular, while in Singapore, the offshore & marine and shipping sectors led the field. Unfortunately, sectors where our portfolio tends to be well-represented, such as financial (with the exception of China's banks and insurers) and consumer stocks, have been somewhat left behind and this disparity in sector performance has impacted the Company's relative returns. The portfolio continues to be well diversified across the region. There is a bias towards financials under which we have included banks, insurers, property plus conglomerates. There is also a small overweight to consumer staples, as mentioned above. This positioning reflects our confidence in Asia's growing domestic demand story, with asset reflation likely to support consumption. This has been especially notable in India, where rapid economic growth is expanding the middle class. International investors have continued to favour its stock market, in particular large cap industrials. By contrast, banking stocks have suffered from tighter liquidity requirements, after the central bank acted to curb loan demand. Export-oriented industries, such as software services and pharmaceuticals, have also failed to keep pace because of the stronger rupee. Elsewhere, rising property prices in Singapore and Hong Kong have been short-term market catalysts; while in Malaysia, the promise of more public spending ahead of a national election boosted sentiment. In Thailand, the prospect of national elections in December has helped to restore confidence, which has been in short supply during the junta's rule. Portfolio As stated above, the portfolio returned 19.98% in sterling terms, compared with the benchmark's gain of 33.90%. The magnitude of this underperformance is disappointing. However, it is worth reiterating that your Manager's investment approach is one of traditional 'buy and hold', with a close focus on fundamentals and valuations. This strategy has not been rewarded in the current bull market, in which momentum buying has taken over. By and large, investment opportunities have narrowed rather than increased as valuations have become more expensive. Nowhere illustrates this more clearly than the behaviour of the Chinese markets. The underweight there has proved costly for relative performance, as indiscriminate buying propelled the index to record highs. Similarly, Singapore's market rise rested on narrow foundations. We were overweight in this characteristically defensive market, which has lagged the region. Conversely, the underweight to Australia worked to our advantage, as the market was significantly affected by the summer credit turmoil, and failed to recover as swiftly as its counterparts. The shares within the portfolio have a very solid underlying earnings profile and your Manager is confident that these positions will be vindicated once there is a renewed focus on valuations. To alter the investment approach now would undermine the consistency of a proven long term strategy as well as raise questions over timing - just as cyclical stocks may be weakening. In portfolio activity, having not tendered the holdings in Malaysian Oxygen at the original bid price, your Manager entered into constructive dialogue with the offeror, and subsequently accepted a higher offer. Offsetting this, the holding in Malaysia's Bumiputra Commerce was built up. The company is the leading investment bank in Malaysia, and is also a restructuring play. Elsewhere, your Manager took advantage of market volatility to top-slice holdings which have had a strong run. These included Australian construction company Leighton, as well as the portfolio's Chinese holdings China Mobile, Petrochina and Zhejiang Expressway. Against this, the positions in POS Malaysia, and leading Philippine property developer Ayala Land were topped up. In Singapore, the holdings in contract manufacturer Venture and fixed line operator Singapore Telecom were increased. Share Buybacks The Company has started to buy back its shares at a discount to the net asset value per Ordinary share and to hold them in treasury. To date 384,731 shares have been purchased and the Directors will continue to buyback shares as and when such purchases are in shareholders' interests, subject always to prevailing market conditions. Shares will not be reissued or sold from treasury except at asset value or above. Principal Risks and Uncertainties The principal risks and uncertainties faced by the Company fall into seven broad categories: (i) investment and market, (ii) shares, (iii) Ordinary shares, (iv) dividends, (v) borrowings, (vi) foreign exchange and (vii) taxation and exchange controls. Information on each of these areas is given in the Directors' report within the Annual Report and Accounts for the year ended 30 April 2007. Outlook Global equity investors have been nervous in recent weeks, amid further sub-prime writedowns and record oil prices. While the two interest rate cuts by the US Federal Reserve were initially welcomed, their uplifting effects have since faded to be replaced by renewed fears over the health of the US economy. The US consumer appears to be besieged on several fronts, faced with falling home values and rising fuel bills. A sharp slowdown seems inevitable. What this may herald for Asia has yet to be determined. The strength of portfolio inflows reflects a growing belief that the region's momentum has become self-sustaining. The case for this rests largely on continued demand from China and India. But despite the increase in intra-regional trade, the ultimate buyers are still in the West. In the short term, further US interest rate cuts should be positive for Asian equities. However, if global growth slows, asset prices will have to reflect this. Recent market falls, which have been steepest in China, suggest fatigue may be setting in. Besides, inflation has started to rise appreciably. Given this, your Board believes that the portfolio's defensive slant is sensible, as we wait out market developments. Alan Henderson Chairman 21 December 2007 Directors' Responsibility Statement The Directors are responsible for preparing the half-yearly financial report in accordance with applicable law and regulations. The Directors confirm that to the best of their knowledge - • the interim financial statements have been prepared in accordance with Accounting Standards Board's statement 'Half-Yearly Financial Reports'; and • the Interim Board Report includes a fair review of the information required by 4.2.7R and 4.2.8R of the FSA's Disclosure and Transparency Rules. For Aberdeen New Dawn Investment Trust PLC Alan Henderson Chairman 21 December 2007 INCOME STATEMENT Six months ended Six months ended 31 October 2007 31 October 2006 (unaudited) (unaudited) Revenue Capital Total Revenue Capital Total £'000 £'000 £'000 £'000 £'000 £'000 Gains/(losses) on held-at-fair-value - 26,520 26,520 - (2,703) (2,703) investments Income 2,369 - 2,369 2,155 - 2,155 Investment management fee (322) (322) (644) (252) (252) (504) Administrative expenses (305) - (305) (272) (30) (302) Exchange gains/(losses) - 230 230 (36) 357 321 ________ ________ ________ ________ ________ ________ Net return before finance costs and 1,742 26,428 28,170 1,595 (2,628) (1,033) taxation Interest payable and similar charges (91) (91) (182) (95) (95) (190) ________ ________ ________ ________ ________ ________ Net return on ordinary activities before 1,651 26,337 27,988 1,500 (2,723) (1,223) taxation Taxation on ordinary activities (483) 124 (359) (437) 104 (333) ________ ________ ________ ________ ________ ________ Return on ordinary activities after 1,168 26,461 27,629 1,063 (2,619) (1,556) taxation ________ ________ ________ ________ ________ ________ Return per Ordinary share (pence): 4.60 104.23 108.83 4.19 (10.32) (6.13) ________ ________ ________ ________ ________ ________ The total column of this statement represents the profit and loss account of the Company. No Statement of Total Recognised Gains and Losses has been prepared as all gains and losses have been reflected in the Income Statement. All revenue and capital items in the above statement derive from continuing operations. INCOME STATEMENT (Cont'd) Year ended 30 April 2007 (audited) Revenue Capital Total £'000 £'000 £'000 Gains on held-at-fair-value investments - 10,527 10,527 Income 4,027 - 4,027 Investment management fee (536) (536) (1,072) Administrative expenses (552) 15 (537) Exchange (losses)/gains (41) 733 692 ________ ________ ________ Net return before finance costs and taxation 2,898 10,739 13,637 Interest payable and similar charges (189) (189) (378) ________ ________ ________ Net return on ordinary activities before taxation 2,709 10,550 13,259 Taxation on ordinary activities (772) 217 (555) ________ ________ ________ Return on ordinary activities after taxation 1,937 10,767 12,704 ________ ________ ________ Return per Ordinary share (pence): 7.63 42.41 50.04 ________ ________ ________ BALANCE SHEET As at As at As at 31 October 2007 31 October 2006 30 April 2007 (unaudited) (unaudited) (audited) £'000 £'000 £'000 Non-current assets Investments at fair value through profit or loss 169,331 131,759 145,147 ________ ________ ________ Current assets Debtors 733 464 870 Cash at bank and in hand 3,147 723 1,345 ________ ________ ________ 3,880 1,187 2,215 ________ ________ ________ Creditors: amounts falling due within one year Foreign currency loans (6,627) (7,191) (6,822) Other creditors (1,004) (661) (1,047) ________ ________ ________ (7,631) (7,852) (7,869) ________ ________ ________ Net current liabilities (3,751) (6,665) (5,654) ________ ________ ________ Total assets less current liabilities 165,580 125,094 139,493 Provision for liabilities and charges (18) (12) (151) ________ ________ ________ Net assets 165,562 125,082 139,342 ________ ________ ________ Share capital and reserves Called-up share capital 6,347 6,347 6,347 Share premium account 17,955 17,955 17,955 Special reserve 14,138 14,138 14,138 Capital redemption reserve 10,207 10,207 10,207 Capital reserve - realised 22,652 11,978 15,638 Capital reserve - unrealised 89,092 59,919 69,645 Revenue reserve 5,171 4,538 5,412 ________ ________ ________ Equity Shareholders' funds 165,562 125,082 139,342 ________ ________ ________ Net asset value per Ordinary share (pence): 652.15 492.70 548.87 RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS Six months ended 31 October 2007 (unaudited) Share Capital Capital Capital Share premium Special redemption reserve reserve Revenue capital account reserve reserve realised unrealised reserve Total £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 Balance at 30 April 2007 6,347 17,955 14,138 10,207 15,638 69,645 5,412 139,342 Return on ordinary activities after - - - - 7,014 19,447 1,168 27,629 taxation Dividend paid (Final 2007 - 5.55p) - - - - - - (1,409) (1,409) ______ _______ ______ ________ ______ ________ ______ _______ Balance at 31 October 2007 6,347 17,955 14,138 10,207 22,652 89,092 5,171 165,562 ______ _______ ______ ________ ______ ________ ______ _______ Six months ended 31 October 2006 (unaudited) Share Capital Capital Capital Share premium Special redemption Reserve reserve Revenue capital account reserve reserve realised unrealised reserve Total £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 Balance at 30 April 2006 6,347 17,955 14,138 10,207 7,067 67,449 4,744 127,907 Return on ordinary activities after - - - - 4,911 (7,530) 1,063 (1,556) taxation Dividend paid (Final 2006 - 5.0p) - - - - - - (1,269) (1,269) ______ _______ ______ ________ ______ ________ ______ _______ Balance at 31 October 2006 6,347 17,955 14,138 10,207 11,978 59,919 4,538 125,082 ______ _______ ______ ________ ______ ________ ______ _______ Year ended 30 April 2007 (audited) Share Capital Capital Capital Share premium Special redemption reserve reserve Revenue capital account reserve reserve realised unrealised reserve Total £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 Balance at 30 April 2006 6,347 17,955 14,138 10,207 7,067 67,449 4,744 127,907 Return on ordinary activities after - - - - 8,571 2,196 1,937 12,704 taxation Dividend paid (Final 2006 - 5.0p) - - - - - - (1,269) (1,269) ______ _______ ______ ________ ______ ________ ______ _______ Balance at 30 April 2007 6,347 17,955 14,138 10,207 15,638 69,645 5,412 139,342 ______ _______ ______ ________ ______ ________ ______ _______ CASH FLOW STATEMENT Six months ended Six months ended Year ended 31 October 2007 31 October 2006 30 April 2007 (unaudited) (unaudited) (audited) £'000 £'000 £'000 Net return on ordinary activities before finance costs and 28,170 (1,033) 13,637 taxation Adjustment for: (Gains)/losses on investments at fair value through profit or (26,520) 2,703 (10,527) loss Exchange gains charged to capital (230) (357) (733) Decrease/(increase) in accrued income 148 (35) (458) Decrease/(increase) in other debtors 4 - (16) Increase in creditors 5 42 41 Overseas withholding tax suffered (134) (94) (186) Scrip dividends included in investment income (3) (35) (46) ___________ ___________ ___________ Net cash inflow from operating activities 1,440 1,191 1,712 Net cash outflow from servicing of finance (41) (194) (378) Corporation tax paid (154) (182) (316) Net cash inflow from financial investment 1,931 315 747 Equity dividends paid (1,409) (1,269) (1,269) ___________ ___________ ___________ Net cash outflow before use of liquid resources and financing 1,767 (139) 496 Net cash inflow from financing - 20 - ___________ ___________ ___________ Increase/(decrease) in cash 1,767 (119) 496 ___________ ___________ ___________ Reconciliation of net cash flow to movements in net debt Increase/(decrease) in cash as above 1,767 (119) 496 Exchange movements 230 357 733 ___________ ___________ ___________ Movement in net debt in the period 1,997 238 1,229 Opening net debt (5,477) (6,706) (6,706) ___________ ___________ ___________ Closing net debt (3,480) (6,468) (5,477) ___________ ___________ ___________ Represented by: Cash at bank 3,147 723 1,345 Debt falling due within one year (6,627) (7,191) (6,822) ___________ ___________ ___________ (3,480) (6,468) (5,477) ___________ ___________ ___________ Notes to the Accounts 1. Accounting policies (a) Basis of accounting The accounts have been prepared under the historical cost convention, as modified to include the revaluation of investments and in accordance with applicable UK Accounting Standards, with pronouncements on half-yearly reporting issued by the Accounting Standards Board and with the Statement of Recommended Practice for 'Financial Statements of Investment Trust Companies' (December 2005). They have also been prepared on the assumption that approval as an investment trust will continue to be granted. The financial statements and the net asset value per share figures have been prepared in accordance with UK Generally Accepted Accounting Practice ('UK GAAP'). The interim accounts have been prepared using the same accounting policies as the preceding annual accounts. (b) Dividends payable Dividends are recognised in the period in which they are paid. 2. Dividends Ordinary dividends on equity shares deducted from reserves are analysed below: Six months ended Six months ended Year ended 31 October 2007 31 October 2006 30 April 2007 £'000 £'000 £'000 2006 final dividend - 5.00p - 1,269 1,269 2007 final dividend - 5.55p 1,409 - - ___________ ___________ ___________ 1,409 1,269 1,269 ___________ ___________ ___________ In accordance with stated policy no interim dividend has been declared for the period (2006 - nil). Six months ended Six months ended Year ended 31 October 2007 31 October 2006 30 April 2007 3. Return per share p p p Revenue return 4.60 4.19 7.63 Capital return 104.23 (10.32) 42.41 ___________ ___________ ___________ Total return 108.83 (6.13) 50.04 ___________ ___________ ___________ The figures above are based on the following attributable assets: £'000 £'000 £'000 Revenue return 1,168 1,063 1,937 Capital return 26,461 (2,619) 10,767 ___________ ___________ ___________ Total return 27,629 (1,556) 12,704 ___________ ___________ ___________ Weighted average number of Ordinary shares 25,387,133 25,387,133 25,387,133 in issue As at As at As at 4. Net asset value per share 31 October 2007 31 October 2006 30 April 2007 Attributable net assets (£'000) 165,562 125,082 139,342 Number of Ordinary shares in issue 25,387,133 25,387,133 25,387,133 Net asset value per Ordinary share (p) 652.15 492.70 548.87 5. Transaction costs During the six months ended 31 October 2007 expenses were incurred in acquiring or disposing of investments classified as fair value through profit or loss. These have been expensed through capital and are included within gains/(losses) on investments in the Income Statement. The total costs were as follows: Six months ended Six months ended Year ended 31 October 2007 31 October 2006 30 April 2007 £'000 £'000 £'000 Purchases 19 30 55 Sales 17 14 34 ___________ ___________ ___________ 36 44 89 6. The financial information in this report comprises non-statutory accounts within the meaning of Section 240 of the Companies Act 1985. The financial information for the year ended 30 April 2007 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 under Section 235 of the Companies Act 1985. The interim accounts have been prepared using the same accounting policies as the preceding annual accounts. 7. The Half-Yearly Financial Report is unaudited. 8. Related party transactions Mr H Young is a director of Aberdeen Asset Management Asia Limited ('AAM Asia'), which is a subsidiary of Aberdeen Asset Management PLC ('AAM'). AAM Asia has an agreement to provide management services to the Company and AAM has an agreement to provide marketing services to the Company. The management fee is payable monthly in arrears based on an annual amount of 1% of the net asset value of the Company valued monthly. During the period £644,000 (2006 - £504,000) of management fees were paid and payable, with a balance of £228,000 (2006 - £174,000) being payable to AAM Asia at the period end. The investment management fees are charged 50% to revenue and 50% to capital. The marketing fee is based on a current annual amount of £95,000, payable quarterly in arrears. During the period £48,000(2006 - £44,000) of fees were paid and payable, with a balance of £8,000 (2006 - £7,000) being payable to AAM at the period end. 9. The Half-Yearly Financial Report will shortly be available from the Company's website (www.newdawn-trust.co.uk) and will be posted to shareholders in January 2008. 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. For Aberdeen New Dawn Investment Trust PLC Aberdeen Asset Management PLC Secretaries 21 December 2007 Independent Review Report to Aberdeen New Dawn 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 October 2007 which comprises the Income Statement, Balance Sheet, Reconciliation of Movements in Shareholders' funds and the related explanatory notes. 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 the terms of our engagement to assist the company in meeting the requirements of the Disclosure and Transparency Rules ('the DTR') of the UK's Financial Services Authority (' the UK FSA'). Our review has been undertaken so that we might state to the Company those matters we are required to state to it in this report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company for our review work, for this report, or for the conclusions we have reached. 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 DTR of the UK FSA. As disclosed in note 1, the annual financial statements of the Company are prepared in accordance with UK Accounting Standards and applicable law (UK Generally Accepted Accounting Practice). The condensed set of financial statements included in this half-yearly financial report has been prepared in accordance with the Statement Half-Yearly Financial Reports as issued by the UK Accounting Standards Board. 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 UK. 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. Review 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 October 2007 is not prepared, in all material respects, in accordance with the Statement Half-Yearly Financial Reports as issued by the UK Accounting Standards Board and the DTR of the UK FSA. KPMG Audit Plc Chartered Accountants 21 December 2007 Edinburgh This information is provided by RNS The company news service from the London Stock Exchange

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