Interim Management Statement

RNS Number : 1774T

Genesis Emerging Markets Fund Ld

15 November 2013

 



Genesis Emerging Markets Fund Limited

 ("the Fund"; "the Company")

Interim Management Statement (unaudited)

for the three-month period ended 30^th September, 2013

This Interim Management Statement relates to the period 1^st July 2013 to 30^th September 2013 and is the Fund's first interim management statement for the financial year ending 30^th June 2014, as required by the UK Listing Authority's Disclosure and Transparency Rule 4.3.

Investment Objective

The investment objective of the Fund is to provide shareholders with a broadly diversified means of investing in developing countries and immature stock markets, and thus to provide access to superior returns offered by high rates of economic and corporate growth, whilst limiting individual country risk.

FINANCIAL POSITION

	As at 30th September 2013 (unaudited)	As at 30th June 2013 (audited)
Total Assets	£749 million	£758 million
Net Asset Value per share	555.3p	561.3p
Share Price	495.5p	554.5p
Share Price Discount	-0.1%	-11.7%
Market Capitalisation	£668.7 million	£748.4 million
Participating preference shares in issue	134,963,060	134,963,060

FINANCIAL PERFORMANCE

Performance to 30th September 2013 in GBP	Q3	1 Year	3 Years*	5 Years*	10 Years*
	%	%	%	%	%
Share Price	11.9	7.6	3.0	13.2	17.7
Net Asset Value	(1.1)	2.9	0.8	11.4	15.8
MSCI EM (TR)	(0.8)	0.9	(1.0)	9.6	13.5

* Annualised rate of return

Fund performance - Genesis' own records.  NAV to NAV.  Net of all expenses, including management fees and tax suffered. Net income reinvested. Index performance - calculated by Genesis based upon index values supplied by MSCI.

TEN LARGEST HOLDINGS (at 30^th September 2013)

	%
Anglo American (South Africa)	5.3
Taiwan Semiconductor (Taiwan)	4.8
Samsung Electronics (South Korea)	4.3
SABMiller (South Africa)	3.7
Tullow Oil (UK/Africa)	2.8
First Quantum Minerals (Zambia)	2.8
Santander Brasil (Brazil)	2.2
Sberbank (Russia)	2.1
Samsung Fire & Marine (South Korea)	2.1
Novatek (Russia)	2.1

GEOGRAPHICAL DIVERSIFICATION (at 30^th September 2013)

	%
Latin America	13.1
Brazil	6.4
Mexico	4.3
Other Latin America	2.4
Asia	48.5
China	13.6
India	11.3
South Korea	9.1
Taiwan	6.5
Thailand	4.6
Indonesia	1.4
Other Asia	1.9
Middle East/Africa	23.6
South Africa	12.1
Zambia	2.8
Nigeria	2.1
Egypt	1.1
Other Middle East/Africa	5.4
Europe/Central Asia	13.2
Russia	7.1
Turkey	2.6
Other Europe/Central Asia	3.5
Cash	1.6

Investment Environment and Outlook

The MSCI EM Index fell 0.8% (in Sterling terms) over the third quarter, despite a gain of 1.8% in September (as the US Federal Reserve - against market expectations - kept its programme of quantitative easing in place).

Against this backdrop, the Company's Net Asset Value per share fell from 561.31p on 30^th June 2013 to 555.33p on 30^th September 2013; a loss of 1.1% over the three-month period.

Perhaps unsurprisingly, some of the stronger returns in recent weeks have come from countries with weak external accounts (such as India and Turkey) which fell sharply in previous months when financing their deficits seemed likely to cost significantly more. However, some economists have taken the opportunity to warn that the unexpected reprieve from higher rates should be seen as an opportunity to implement reforms and raise competitiveness, before global liquidity begins to tighten in earnest.

The IMF's updated World Economic Outlook was published in October. They described global "tensions", with developing economies facing the dual challenges of slowing growth and tighter global financial conditions. The slowing growth reflects both cyclical (e.g. Russia and South Africa) and structural factors (the IMF highlights China and India in particular). The aggregate 2013 GDP growth forecast for emerging markets has come down since April's report from 5.3% to 4.5%, while developed market growth was maintained at 1.2%. In aggregate the outlook remains for faster growth than in developed markets, but a little lower than in recent years.

MATERIAL EVENTS AND COMPANY NEWS

On 9^th September 2013, the Directors announced the appointment of Mr Sujit Banerji to the Board with effect from 31^st October 2013. Mr Banerji acts as an independent advisor on corporate strategy to a number of companies in the finance, and finance-related technology, sectors globally. In 2009 he completed a 33-year career at Citigroup where he had been a Managing Director since 1996, latterly serving as Head of Strategy and Institutional M&A for Europe, the Middle East and Africa. His career at Citi covered a number of regional roles including strategy and corporate finance, and relationships with multinational clients across the MENA region. He has also served as the country and region head for Citi in India, and as the head of the corporate business in Thailand. An Indian national, over the course of his career he has been based in India, Bangladesh and Thailand as well as in Europe, and is currently based in Singapore. He was educated at the University of Poona (Pune) and the University of Bombay (Mumbai).

Also on 9^th September 2013, the Directors announced that Dr Geng Xiao would resign from his position as non-executive Director with effect from 30^th October 2013.

There are no other material events to report from the period 1^st July 2013 to the date of this statement.

In addition to the Annual Report which was sent to investors in September, the Fund has continued its efforts to keep shareholders informed about their investment. On a monthly basis, a factsheet is posted to the Investment Advisor's website - www.giml.co.uk - and is emailed to shareholders.

This Interim Management Statement has been produced solely to provide additional information to shareholders of the Fund to meet the relevant requirements of the UK Listing Authority's Disclosure and Transparency Rules. It should not be relied upon by any other party or for any other purposes other than as stated above. In addition, the views, information and data in this publication should not be deemed as a financial promotion or recommendation.

Other than described above, the Board is not aware of any events during the period from 1^st July 2013 to the date of this statement which would have had a material impact on the financial position of the Company.

Annual General Meeting

The Company's AGM was held on 31^st October 2013. All resolutions were passed.

Issued on behalf of the Board
JPM Administration Services (CI) Limited, Guernsey

Secretary

Date: 15^th November 2013

Enquiries

John Mayne/ William Simmonds - 020 7588 2828

J.P. Morgan Cazenove

Coen Teulings (Chairman) - 020 7201 7200

Genesis Emerging Markets Fund Limited

Jonathan Snow - 020 7201 7200

Genesis

 

END

 

 

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