Interim Results

Atlantis Japan Growth Fund Ld
18 December 2007


ATLANTIS JAPAN GROWTH FUND LIMITED


INTERIM RESULTS ANNOUNCEMENT


The financial information set out in this announcement does not constitute the
Company's statutory accounts for the period ended 31 October 2007.

The accounts for the period ended 31 October 2007 have been finalised on the
basis of the financial information presented by the Directors in this results
announcement.

All references to 'dollars' or '$' throughout this report are to the United
States currency


INVESTMENT MANAGER'S REPORT

PERFORMANCE

For the six-month period ended 31st October, 2007 the Published Company's Net
Asset Value fell 10.9%, to $20.35 per share. By comparison, the large-cap
dominated Topix index declined 1.15% and the Tokyo Second Market was down 6.7%.
The weak performance is explained in part by the Company's significant exposure
to medium-sized and smaller stocks. The Company also had little exposure to
commodity-related stocks, which generally outperformed the market, and heavy
exposure to the retail sector, which underperformed the major indices.


At the end of the period under review, the Company had a total Net Asset Value
of $415.9 million, with borrowings of Y7.5 billion (about $65 million) and cash
of Y404 million, (about $3.5 million). Based on the above, the Company is about
15% leveraged on a net basis. The Company has no foreign exchange hedges,
meaning a strong Yen has a positive impact on NAV in US dollar terms and vice
versa.


Since inception on 10th May, 1996 the NAV per share in US dollar terms is up
105%. This is still well ahead of the Topix, which is down 13% over the same
time frame, and the Tokyo Second Market Index, which has risen 46.9%.


MARKET OUTLOOK

After moving higher from May through mid-July, the Japanese stock market turned
lower as the subprime loan crisis surfaced in the US. After falling through most
of August, the Japanese market stabilised in early September and subsequently
mounted a partial recovery through to the end of October. Underneath the major
indexes such as the TOPIX or Nikkei 225, we saw small and medium-sized stocks
generally rising by less during the spring/early-summer rally but also falling
by less during the mid-summer correction. Money flow statistics show overseas
investors weighing on the market as net sellers during the three-month period
from August to October, though turning around in the final weeks and becoming
net buyers for most of October. Among domestic investors, individuals, trust
funds, and financial institutions were all net sellers during the six-month
period under review. In contrast, domestic corporations were consistent net
buyers, buying back their own shares and also increasing cross-shareholdings in
other corporations. Overseas investors were net buyers during the May-June
period and net sellers during the July-October period.


A look at the fundamentals shows the Japanese economy continuing to expand
during the July-September quarter after contracting during the April-June
quarter. External demand (i.e., exports) and private sector capital spending
were still the main growth drivers, however, only modest growth was registered
by private consumption spending, which accounts for more than 50% of the
economy. Private sector residential investment was a major drag during the
quarter, but it is important to note that the drop here reflects not so much a
lack of interest but rather unforeseen delays in construction permitting
following the introduction of new construction safety codes in June. The impact
of government spending on the economy was basically neutral. Looking ahead, we
anticipate real GDP growth in the range of 1.75-2.0% for the full fiscal year
through March 2008 and, with this, growth in corporate earnings of over 10% this
fiscal year followed by positive growth again next fiscal year.

At this time, we see both positive and negative factors impacting the Japanese
stock market. The new Prime Minister, Yasuo Fukuda, who took office in late
September, has shown interest in continuing the economic reforms begun under
Junichiro Koizumi. Also on the plus side, domestic interest rates are still low
and the monetary environment appears likely to remain accommodative even though
interest rates may rise slowly over the year ahead. Growth in wages and personal
income has been weak, and this, along with inclement weather has generally
inhibited growth in consumption spending by households. Assuming the economy
continues to expand, we would expect consumer spending to slowly pick up steam
going forward. Property prices in larger cities are rising, and this too should
help to bolster investor confidence.


We think the greatest risks to the Japanese economy and stock market are
external, with major risks including the possibility of a further sharp rise in
commodity prices, severe slowdown in the US including further subprime loan
problems, and slowing world economic growth, particularly in China or Southeast
Asia. The Japanese economy itself is not overheated, nor are Japanese
corporations highly geared. Indeed, Japanese companies are in exceedingly good
shape financially and earnings appear likely to continue rising in most cases,
as mentioned above.


The Japanese stock market is also very reasonably priced, in our view. The Tokyo
First Market as of 20th November is trading at about 17x estimated earnings for
this fiscal year and 1.6x book value, while the Tokyo Second Market is trading
at about 15x estimated earnings and slightly under 1x book value. The expected
dividend yields for both the First and Second markets are also slightly higher
than the yield on the benchmark 10-year Japanese government bond. At current
levels, we believe the Tokyo market offers good value for long-term investors,
although in the near term it will probably remain subject to the impact of
external factors as well as the possibility of renewed selling pressure from
overseas investors and domestic individual investors, the two big players in the
Tokyo market.


OUR STRATEGY AND PORTFOLIO

Our investment strategy remains focused on value and growth. This means we
invest in companies that we believe have above-average earnings growth potential
over the longer term and whose stocks are also reasonably priced or, preferably,
undervalued. The manager does not seek to play short-term market themes or fads,
but rather aims to buy and hold companies that offer attractive investment
potential over the medium to longer term, which can mean years in some cases. If
a stock in the portfolio does extremely well in the short term and becomes
overvalued, we may take profits by selling part or all of our position.
Conversely, if a company in the portfolio fails to meet our earnings
expectations or we lose confidence in management, we may exit our position even
if it means taking a loss.


At this time, we are finding many attractive stocks that meet our criteria.
Specifically, in terms of growth, we want to see top-line and bottom-line growth
combined with rising profit margins, positive free cash flow, and an improving
balance sheet. In terms of valuations, we want to see low PERs on future
earnings and, if possible, low price to book ratios as well. We insist on good
management and also like to see the dividends rising over time.


In our daily search for investment candidates, we look at a wide variety of
companies, ranging from big to small across nearly every industry. However, we
are still finding most of the best growth and value combinations among the
medium-sized and smaller companies, as is reflected in the composition of the
portfolio.


While we are buying many small and medium-sized companies, we are careful not to
own too much of any one company since things can and do go wrong from time to
time. If we like the fundamentals of a given sector, we will buy several
companies with similar businesses to spread the risk. For instance, at this time
we find local drug store chains attractive; however, rather than buying just
one, we have several different holdings in this area. This has been a rewarding
strategy.


With regard to sector allocation, we would note that we do not make our stock
selection based on any specific sector weighting targets or guidelines. However,
because we look at many companies in many different industries, we nevertheless
have exposure to a wide range of sectors. At the end of the six-month period
under review, the portfolio is relatively overweight in consumer-related stocks,
service companies, auto parts makers, electronic component manufacturers,
machine tool makers, and real estate-related companies (including REITs). In
contrast, the portfolio has almost no exposure to utilities, fisheries/
agriculture, shipping, iron/steel, airlines, glass/ceramics, and non-ferrous
metals. We hold some cyclical growth stocks but have very limited exposure to
commodity-related stocks, which for the most part are extremely cyclical and
have very poor earnings visibility.


Since we are positive on the outlook for the Japanese economy we have increased
the Company's borrowings by Y1.5 billion, to Y7.5 billion (about $65 million).
This means the Company is about 15% geared on a net basis.


As indicated above, we are bottom-up investors, with our main focus on
individual stock selection. However, we also closely monitor 'big picture'
trends based on our belief that macro-level fundamentals significantly influence
stock market trends over the longer term. Thus, in addition to our intensive
research of individual companies, we also keep a close watch on the economy,
corporate earnings, inflation, interest rates, fiscal and monetary policy,
foreign exchange rates, and trade and current account balances.


The Fund manager is not trying to beat the major indices every quarter or even
every year. Indeed, because our investment strategy is focused on value as well
as growth, we must often buy stocks when they are not popular in order to obtain
the valuation levels we seek. Ultimately, though, we believe our approach will
continue to deliver superior performance for long-term oriented investors.


Atlantis Fund Management (Guernsey) Limited

21st November 2007


DIRECTOR' INTERIM REPORT

The Directors are pleased to present their Interim Report of the Company for the
six month period ended 31st October 2007.


CAPITAL VALUES

At 31st October 2007 the value of net assets available to shareholders was
$413,215,179 (30th April 2007 - $464,980,738) and the Net Asset Value per share
was $20.22 (30th April - $22.75).


COMPANY'S OBJECTIVES, POLICIES AND STRATEGIES IN RESPECT OF FINANCIAL ASSETS

As an investment trust, the Company invests in securities for the long term. The
financial investments held as assets by the Company comprise of equity shares.
As such, the holding of securities, investing activities and financing
associated with the implementation of the investment policy involves certain
inherent risks. Events may occur that could result in either a reduction in the
Company's net assets or a reduction of revenue profits available for
distribution.


Set out below are the principal risks inherent in the Company's activities along
with the actions taken to manage them. The Board reviews and agrees policies for
managing these risks and these policies have remained substantially unchanged
since 30th April 2007.


Market Risk

Market risk arises mainly from uncertainty about future prices of financial
instruments used in the Company's business. It represents the potential loss the
Company might suffer through holding market positions in the face of price
movements.


The market risk is monitored by the Board on a quarterly basis and on a daily
basis by the Investment Manager.


Currency Risk

The Company's results for the period and net assets could be significantly
affected by currency movements as most of the Company's assets are denominated
in yen. In order to reduce this risk the Company may hedge its exposure to the
Japanese currency. The Company did not have any hedging arrangements at the end
of the period.

Interest Rate Risk

The Company finances its operations mainly through its share capital and
retained profits, including realised and unrealised capital profits. Additional
bank borrowings may be used with a view to enhancing capital returns. However,
the Company's Articles of Association provide that borrowing levels should not
exceed 20% of Net Asset Value at the time any borrowing is effected. The level
of borrowing as at 31st October 2007 was 15.8%, while at 30th April 2007 it was
11.7%.


Liquidity Risk and Cashflow Risk

The majority of the Company's assets comprise readily realisable securities,
which can be sold to meet funding commitments as necessary.


INVESTMENT MANAGER

In the opinion of the Directors, in order to achieve the investment objectives
and policies of the Company, and having taken into consideration the performance
of the Company, the continuing appointment of the Investment Manager is in the
interests of the shareholders as a whole.


A more detailed commentary of important events that have occurred during the
period and their impact on these Financial Statements and a description of the
principal risks and uncertainties for the remaining six months of the financial
year is contained in the Investment Manager's Report.


CHANGE OF CUSTODIAN, ADMINISTRATOR, SECRETARY AND PRINCIPAL REGISTRAR

HSBC Securities Services (Guernsey) Limited ceased as secretary, administrator
and principal registrar and HSBC Custody Services (Guernsey) Limited ceased as
custodian of the Company with effect from 31 October 2007. Northern Trust
International Fund Administration Services (Guernsey) Limited has been appointed
as secretary, administrator and principal registrar, and Northern Trust
(Guernsey) Limited as custodian with effect from 1 November 2007.


DIRECTORS' RESPONSIBILITY STATEMENT

We confirm that to the best of our knowledge:


   •the condensed set of financial statements contained within the half
    yearly financial report has been prepared in accordance with IAS 34 'Interim
    Financial Reporting' ;
   •as required by DTR 4.2.7R of the FSA's Disclosure and Transparency Rules,
    the interim management report includes a fair review 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
    financial year; and
   •the interim management report includes a fair review of the information
    concerning related party transactions required by DTR 4.2.8R.


Approved by the Board

12th December 2007


The Interim Results Announcement was approved by the Board of Directors on 6th
December 2007.


Unaudited Income Statement

For the six months ended 31st October 2007

                         01-May-2007 to 31-Oct-2007    01-May 2006 to 31-Oct 2006

                          Revenue   Capital     Total   Revenue   Capital     Total
                            $'000     $'000     $'000     $'000     $'000     $'000
Income
Losses on investments           -  (47,767)  (47,767)         - (118,388) (118,388)
held at fair value
Exchange (loss)/gain         (63)   (2,181)   (2,244)      (35)     1,219     1,184
Investment income           3,281         -     3,281     2,716         -     2,716

                            3,218  (49,948)  (46,730)     2,681 (117,169) (114,488)
Expenses
Investment management       3,333         -     3,333     3,960         -     3,960
fee
Custodian fees                111         -       111       139         -       139
Administration fees           133         -       133       143         -       143
Registrar and transfer         14         -        14        10         -        10
agent fees
Directors' fees and           106         -       106       113         -       113
expenses
Interest expense and          492         -       492       394         -       394
bank charges
Transaction costs               -       473       473         -       475       475
Insurance fees                 31         -        31        37         -        37
Audit fee                      17         -        17        11         -        11
Printing and                   25         -        25        21         -        21
advertising fees
Legal and professional         28         -        28        18         -        18
fees
Listing fees                   25         -        25        23         -        23
Miscellaneous expenses         18         -        18         3         -         3

                            4,333       473     4,806     4,872       475     5,347

Loss before tax           (1,115)  (50,421)  (51,536)   (2,191) (117,644) (119,835)

Taxation                    (230)         -     (230)     (190)         -     (190)

Loss for the period       (1,345)  (50,421)  (51,766)   (2,381) (117,644) (120,025)

Deficit per ordinary                         $(2.533)                      $(5.874)
share


The deficit per ordinary share figure is based on the net deficit for the period
of $51,765,588 ( 2006 - $120,025,318) and on 20,435,627 ordinary shares for each
period, being the weighted average number of ordinary shares in issue during the
period.


Unaudited Statement of Changes in Equity

For the six months ended 31st October 2007

                          For the six month period ended 31st October 2007

                       Ordinary Share    Share    Revenue   Capital
                           Capital      Premium   Reserve   Reserve    Total
                            $'000        $'000     $'000     $'000     $'000

Balance at 1st May                 204   192,650  (20,788)   292,915   464,981
2007

Loss for the period                  -         -  (51,766)         -  (51,766)

Transfer from capital                -         -    50,421  (50,421)         -
reserve

Balance at 31st                    204   192,650  (22,133)   242,494   413,215
October 2007


                          For the six month period ended 31st October 2006

                       Ordinary Share    Share    Revenue   Capital
                           Capital      Premium   Reserve   Reserve    Total
                            $'000        $'000     $'000     $'000     $'000

Balance at 1st May                 204   192,650  (18,178)   431,959   606,635
2006

Loss for the period                  -         - (120,025)         - (120,025)

Transfer from capital                -         -   117,644 (117,644)         -
reserve

Balance at 31st                    204   192,650  (20,559)   314,315   486,610
October 2006


Unaudited Balance Sheet

As at 31st October 2007
                                                       (Unaudited)       (Audited)
                                                         31-Oct-07       30-Apr-07
                                                             $'000           $'000
Non Current Assets
Financial assets at fair value
through profit or loss                                     473,427         515,814

Current Assets
Due from brokers                                               239             798
Dividends and interest receivable                            2,266           3,340
Other receivables                                               35              29
Cash and cash equivalents                                    5,996           2,813

                                                             8,536           6,980
Current Liabilities
Due to brokers                                             (2,723)         (2,634)
Payables and accrued expenses                                (924)           (820)
Loans payable                                             (13,020)               -

                                                          (16,667)         (3,454)
Net Current (Liabilities)/Assets                           (8,131)           3,526

Non Current Liabilities
Loans payable                                             (52,081)        (54,359)

Net Assets                                                 413,215         464,981

Equity
Ordinary share capital                                         204             204
Share premium                                              192,650         192,650
Revenue reserve                                           (22,133)        (20,788)
Capital reserve                                            242,494         292,915

Net Assets Attributable to Equity Shareholders             413,215         464,981

Net Asset Value per Ordinary Share*                         $20.22          $22.75



*Based on the Net Asset Value at the period end divided by the number of shares
in issue: 20,435,627 (30th April 2007 - 20,435,627)


Unaudited Cash Flow Statement

For the six months ended 31st October 2007
                                                                  2007           2006
                                                                 $'000          $'000

Cash outflow from operating activities                           (152)        (1,247)

Investing Activities
Purchase of investments                                      (106,673)      (103,174)
Sale of investments                                            101,941        104,112
Net cash (outflow)/inflow from
investing activities                                           (4,732)            938

Net cash outflow before financing                              (4,884)          (309)

Cash flows from financing activities
Interest paid                                                    (431)          (349)
Net loans drawn-down                                            13,089              -

Net cash inflow/(outflow) from financing                        12,658          (349)
activities

Net increase/(decrease) in cash and cash                         7,774          (658)
equivalents

Exchange movements                                             (4,591)          (207)

Movement in cash and cash equivalents in the                     3,183          (865)
period

Cash and cash equivalents at beginning of                        2,813          2,550
period

Cash and cash equivalents at end of period                       5,996          1,685

Reconciliation of loss for period to net cash
outflow
from operating activities
Net loss before taxation                                      (51,536)      (119,835)
Loss on investments held at fair value                          47,767        118,388
Exchange loss/(gain)                                             2,244        (1,184)
Interest expense                                                   492            394
Decrease in debtors and accrued income                           1,068          1,219
Increase/(decrease) in creditors                                    43           (39)
Taxation                                                         (230)          (190)

                                                                 (152)        (1,247)






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