Final Results

RNS Number : 4822J

Schroder AsiaPacific Fund PLC

17 December 2015

 



17 December 2015

ANNUAL REPORT AND ACCOUNTS

Schroder AsiaPacific Fund plc (the "Company") hereby submits its annual financial report for the year ended 30 September 2015 as required by the UK Listing Authority's Disclosure and Transparency Rule 4.1. 

The Company's Annual Report and Accounts for the year ended 30 September 2015 are also being published in hard copy format and an electronic copy will shortly be available to download from the Company's website http://www.schroderasiapacificfund.com.  Please click on the following link to view the document:

The Company has submitted its Annual Report and Accounts to the National Storage Mechanism and it will shortly be available for inspection at www.hemscott.com/nsm.do.

Enquiries:

John Spedding

Schroder Investment Management Limited               

Tel: [phone]

Chairman's Statement

Investment performance

During the year ended 30 September 2015, the Company's net asset value produced a negative total return of 3.3%, again outperforming its benchmark, the MSCI All Countries Asia ex. Japan Index, which produced a negative total return of 6.0% over the same period. The second half of the year witnessed significant declines in Asian stock markets with China the major focus.

More detailed comment on performance, investment policy and outlook may be found in the Manager's Review.

Final dividend

Net revenue after taxation for the year under review increased by 50.6% from £4,749,000 in 2014 to £7,151,000. While part of this increase was due to factors which might not be repeated, including currency movements and a modest rise in gearing levels, the Directors recommend the payment of a final dividend of 4.20 pence per share for the year ended 30 September 2015. If the resolution proposed at the Annual General Meeting to pay a final dividend is passed, the dividend will be paid on 1 February 2016 to shareholders on the Register on 29 December 2015.

Board composition

Your Board continues to consider its balance of skills and experience, its diversity and its long term succession plan. Mr Keith Craig was appointed as a non-executive Director of the Company on 19 May 2015 and his election by shareholders will be proposed at the Annual General Meeting. A summary of his experience and background may be found on page 21 of the 2015 Annual Report.

Having been Chairman of the Company since its launch in 1995, I will retire at the Annual General Meeting on 28 January 2016 and will not seek re-election as a Director. I am pleased to confirm that the Board, after careful consideration, has appointed my fellow Director Nicholas Smith as my successor. There will also be a number of resulting changes to the Board's structure and its Committees. Anthony Fenn will become the Senior Independent Director and Rosemary Morgan will be appointed as chair of the Audit Committee.

Gearing policy

During the year, the Company restructured its borrowings to lower costs whilst maintaining flexibility, replacing its US$75 million revolving credit facility with a £30 million revolving credit facility and a £30 million overdraft. These facilities remain flexible to ensure that they will continue to meet the borrowing needs of the Company. The Company moved from a net cash position at the start of the year to a modest level of gearing of 2.3% at its close. The Company's gearing continues to operate within pre-agreed limits so that net effective gearing does not represent more than 20% of shareholders' funds.

Discount management

At the Company's last Annual General Meeting on 28 January 2015, the Company was given the authority to purchase up to 14.99% of its issued share capital for cancellation. Whilst the Board did not exercise this authority during the year under review, a total of 152,000 Ordinary shares have been purchased for cancellation since the end of the year.  The Board continues to monitor the discount to which the Company's Ordinary shares trade on the market and to consider whether purchases of the Ordinary shares should be made on a regular basis. It therefore proposes that this authority be renewed at the forthcoming Annual General Meeting.

Over the last year, the longer term target maximum discount level was again set at approximately 10% and the discount traded in line with this target. At the beginning of the year, the discount to the income inclusive NAV was 9.8% and, although this had temporarily widened to 12.7% at the end of the year, the average discount was 10.1% over the year. Since the end of the year, the discount has narrowed and currently stands at 9.1%.

The Board continues to believe that it is not necessarily in the best interests of shareholders as a whole to adopt a rigid discount control mechanism that seeks to target a defined maximum discount level regardless of market conditions. Instead the Board continues to follow a more flexible strategy that takes into account the level of discount at which the Company's peer group trades as well as the absolute level of its own discount and prevailing market conditions.

Outlook

November 17th was the twentieth anniversary of the Company's launch. The journey from 1995 has not always been a smooth one in Asia, but it is good to look back and see not only that £1,000 invested at the launch would, after reinvesting dividends, now be worth £3,147, but also that the Company's net asset value has risen materially more than its benchmark. The launch prospectus set your Company's primary investment objective as capital growth and benchmark outperformance, and I am pleased to write that both these objectives have been achieved.

Performance since inception

There have been two other aspects of the last twenty years that I would like to highlight.

First, the launch raised £140 million, whereas today the Company's net assets are £482 million. The larger size has brought the shares better liquidity, enabling larger investors to consider buying them, and achieved a market position that I believe helps promote the Company, to the benefit of all shareholders.

Second, we have had the relatively rare experience in investment trusts of having had the same portfolio manager, Matthew Dobbs, over the entire period. My thanks go to him and his colleagues at Schroders for those twenty years, while expressing the hope that they will offer many more years of solid out performance.

Reminiscing runs the danger of oversimplifying how easy it was to make money, and how much harder it is now. The Manager's Review mentions many of the challenges facing Asia today, and there is little doubt that the uncertainties will be reflected in continued market volatility. I remain confident, however, in the region's considerable economic and corporate strengths - strengths that in many ways are more recognised globally today than they were in 1995 - and look forward to the Company's next twenty years.

Continuation vote

The Articles of Association contain provisions which require the Board to put to shareholders a resolution at the forthcoming Annual General Meeting that the Company continue as an investment trust for a further five years.

As for previous continuation votes, the Board has again undertaken a review of the strategic position of the Company. This review considered the structure of the Company as an investment vehicle, long-term performance in view of the mandate, the promotional activities undertaken on behalf of the Company, and the current prospects for investment in Asia.

Over the five year period ended 31 October 2015, the Company's net asset value produced a total return of 37.7%, significantly out-performing the benchmark Index which produced a total return of only 12.7%, while our share price produced a total return of 36.6%. This is clearly strong performance in view of the investment objective.

The Board believes that the Manager remains well qualified and suitable to manage the portfolio and to assist the Company in meeting its investment objective. The Board considers that the Company remains well placed as an investment vehicle within its peer group and that its long-term investment objectives remain appropriate and the structure beneficial to shareholders.

The Board therefore unanimously recommends that the Company continue as an investment trust, and the Directors intend to vote their shares accordingly.

Annual General Meeting

The Annual General Meeting will be held on Thursday, 28 January 2016 at 12.00 noon and shareholders are encouraged to attend. As in previous years, Matthew Dobbs, on behalf of the Manager, will give a presentation on the prospects for Asia and the Company's investment strategy.

The Hon. Rupert Carington

Chairman

17 December 2015

Manager's Review

The net asset value per share of the Company recorded a total return of -3.3% over the twelve months to end September 2015. This was ahead of the performance of the benchmark, the MSCI All Countries Asia ex. Japan Index, which was down -6.0% over the same period.

The second half of the Company's fiscal year witnessed significant declines in the Asian stockmarkets. The Chinese market was a major focus for investors, with the Shanghai stock market index falling almost 40% from the peak recorded in early June, amid a raft of largely ineffective official interventions to provide support. With Chinese (and indeed regional) growth continuing to slow, and little in the way of positive developments outside the region, no market managed a positive return for the year in local currency terms.

The strength of the US dollar and the anticipation of tightening moves from the US Federal Reserve contributed to the malaise. Lower liquidity and a slowing in Chinese growth proved a lethal combination for commodity prices, and although lower energy and raw material prices are generally beneficial to the Asian economies and consumers, these sectors have been particularly weak over the year.

Commodity exposure has played its part in the poor returns seen in Malaysia and Indonesia. In the former it has been the currency that has borne the brunt of the adjustment required by the negative terms of trade effect from lower oil prices, a collapse in the current account surplus, high foreign ownership of the local bond market and a spreading financial scandal. Indonesian problems have been compounded by stubborn inflationary pressures and political deadlock between the President and the legislature. The resulting policy uncertainty has hampered direct investment from abroad and much needed infrastructure spending.

Greater China markets have generally proved more defensive, aided by resilience of the currencies despite speculation surrounding the future course of the Chinese renminbi. Slowing global demand in information technology impacted the Taiwanese market, although the downside was cushioned somewhat by strong balance sheets, and a good focus on shareholder returns through attractive dividend policies.

Performance and portfolio activity

The Company's relative outperformance was due to both stock selection and country positioning. In terms of stock selection the major contributions to added value came from India, Taiwan (where our focus on information technology stocks helped) and Korea. In terms of country positioning, the key contributions came from the nil weight in Malaysia, the under weightings in Indonesia, Korea, and Singapore and the over weighting of India and Hong Kong. Detractors to relative performance included stock selection in, and the underweighting of, China and the overweight in Thailand.

The main change in portfolio positioning in the year was the addition to China exposure, although the Company remained underweight the benchmark throughout the period. Our additions focused on companies benefiting from niches of growth in China including consumer spending, e-commerce, health care, education and life insurance. We added to a more modest degree to exposure in India (consumption) and Taiwan (information technology). These moves were funded through a modest move from net cash to net gearing, and also sales in Thailand, Korea and Singapore.

Outlook and policy

It is easy to paint a subdued shorter-term picture for Asian equity markets. Regional economic activity continues to slow, deflationary forces remain strong given falling currencies among important trading partners and competitors (Japan, Europe, other emerging markets), consumer confidence generally low (with even the Chinese consumer tending to defer those little luxuries), private capital spending subdued, and little sign of counter-cyclical government investment apart, inevitably, from China.

While investors have derived little comfort from the recent deferral of interest rate rises by the US Federal Reserve, it is important to keep the current situation in proportion. The Asian region continues to generate reasonable levels of growth, external balances generally remain healthy, and exposure to overseas borrowing is far below the levels that proved so problematic in the Asian crisis of the late 1990s. Most governments and central banks in the region enjoy an enviable level of flexibility as regards policy options; if they have not used them it is at least as much due to their caution as it is to any inability to execute.

China remains the key source of risk. Insofar as growth has already slowed markedly, particularly in areas such as real estate, industrial capital spending and luxury consumer spending (partly a function of the anti-corruption campaign), this has already been reflected in the economic and corporate statistics coming out of the region. More difficult to assess is the fallout from the deflation of the undoubted credit bubble that has supported Chinese growth hitherto, particularly in sectors suffering from chronic oversupply.

It is difficult to understate the sensitivity of markets to this process. An otherwise unremarkable adjustment to the renminbi exchange rate in early August triggered violent moves in equity markets, and not just in Asia. However, China does have some important cards in its hand including a current account surplus, ample foreign exchange reserves, high domestic savings and direct control of the banking sector. It remains to be seen, however, if the opportunity is taken for meaningful economic reform shifting the key growth drivers from credit fuelled investment spending to promotion of consumption and the services sector.

Meanwhile, valuations of Asian markets have moved more decisively to a level which, historically, has represented good value. We take some comfort from a portfolio of companies with solid balance sheets, sustainable returns, shareholder focused management and good dividend discipline. With modest levels of gearing, the Company is in a good position to take advantage of any China sourced volatility going forward.

Schroder Investment Management Limited

17 December 2015

Principal risks and uncertainties

The Board is responsible for the Company's system of risk management and internal control and for reviewing its effectiveness. The Board has adopted a detailed matrix of principal risks identifying significant strategic, investment, financial, regulatory, custodial and depositary and service provider risks relevant to the Company's business as an investment trust and has put in place an appropriate monitoring system. This system assists the Board in determining the nature and extent of the significant risks it is willing to take in achieving its strategic objectives. Both the principal risks and the monitoring system are subject to robust review at least annually. The last review took place in November 2015.

Risk assessment includes consideration of the scope and quality of the systems of internal control operating within key service providers, and ensures regular communication of the results of monitoring by such providers to the Board, including the incidence of significant control failings or weaknesses that have been identified at any time and the extent to which they have resulted in unforeseen outcomes or contingencies that may have a material impact on the Company's performance or condition. No significant control failings or weaknesses were identified from the Board's on going risk assessment which has been in place throughout the financial year and up to the date of this report.

Although the Board believes that it has a robust framework of internal control in place this can provide only reasonable, and not absolute, assurance against material financial misstatement or loss and is designed to manage, not eliminate, risk.

A summary of the principal risks and uncertainties faced by the Company, and actions taken to mitigate these risks and uncertainties, is set out below.

Strategy and competitiveness risk

Over time, the Company's investment strategy and asset class may become out of favour with investors or fail to meet their investment objectives, or the Company's cost base could become uncompetitive, particularly in light of open ended alternatives. This may result in a wide discount of the share price to underlying asset value both in absolute terms and compared to the peer group.

In order to mitigate this risk, the Directors periodically review whether the Company's investment remit remains appropriate and monitor the success of the Company in meeting its stated objectives at each Board meeting. The Manager monitors the share price relative to net asset value and the Directors review the marketing and distribution activity undertaken by the Manager and the Corporate Broker at each Board meeting.

The level of fees charged by the Manager and the Company's other service providers is also monitored by the Board and the ongoing competitiveness of management fee levels is considered annually by the Management Engagement Committee and the Board.

Investment management risk

The Manager's investment strategy, if inappropriate, may result in the Company underperforming the market and/or peer group companies.

To mitigate this risk, the Board reviews at each Board meeting the Manager's compliance with the agreed investment restrictions; investment performance and risk against investment objectives and strategy; the portfolio's risk profile; and appropriate strategies to mitigate any negative impact of substantial changes in markets. The Board also receives an annual presentation from the Manager's internal audit function and conducts an annual review of the ongoing suitability of the Manager.

Financial and currency risk

The Company is exposed to the effect of market and currency fluctuations due to the nature of its business. A significant fall in regional equity markets or substantial currency fluctuation could have an adverse impact on the market value of the Company's underlying investments.

To mitigate this risk, the Directors consider the risk profile of the portfolio at each Board meeting and discuss appropriate strategies to mitigate any negative impact of substantial changes in markets or currency with the Manager. The Company invests in underlying assets which are denominated in a range of currencies and therefore has an exposure to changes in the exchange rate between sterling and other currencies, which has the potential to have a significant effect on returns. While the Directors consider the Company's hedging policy on a regular basis, the Company did not engage in currency hedging to reduce the risk of currency fluctuations and the volatility of sterling returns which might result from such currency exposure during the year ended 30 September 2015.

The Manager may invest in put options on indices and equities in the region to protect part of the capital value of the assets against market falls and may use currency hedging as part of its investment strategy.

The Board also monitors the Manager's use of gearing and leverage in accordance with agreed guidelines and restrictions set out in the Company's investment policy. The Company utilises a multi-currency revolving credit facility, currently in the amount of £30 million, and a £30 million multi-currency overdraft, which increases the funds available for investment through borrowing. While this has the potential to enhance investment returns in rising markets, in falling markets the impact could be detrimental to performance.

To mitigate this risk, the Directors keep the Company's gearing under continual review and impose strict restrictions on borrowings. The Company's gearing continues to operate within pre-agreed limits so that it does not exceed 20% of shareholders' funds.

A full analysis of the financial risks facing the Company is set out in note 21 on pages 52 to 56 of the 2015 Annual Report.

Accounting, legal and regulatory risk

In order to continue to qualify as an investment trust, the Company must comply with the requirements of Section 1158 of the Corporation Tax Act 2010. Should the Company not comply with these requirements, it could ultimately lose its investment trust status and capital gains within the Company's portfolio could, as a result, be subject to Capital Gains Tax.

In addition, breaches of the UK Listing Rules, the Companies Act or other regulations with which the Company is required to comply, could lead to a number of detrimental outcomes which could damage the Company's reputation, including suspension from listing on the London Stock Exchange or a qualified audit report.

To mitigate these risks, the Board receives confirmation from the Manager and other key service providers at each Board meeting of compliance with relevant laws and regulations. Shareholder documents and announcements, including the Company's published Half Year and Annual Reports are subject to stringent review processes, and procedures are in place to safeguard against the disclosure of inside information.

Custody and Depositary risk

Safe custody of the Company's assets may be compromised through control failures by the Depositary, including cyber hacking. To mitigate this risk, the Board receives quarterly reports from the Depositary confirming safe custody of the Company's assets, including cash, and portfolio holdings are independently reconciled by the Manager. In addition the existence of assets is subject to annual external audit and  audited internal controls reports covering custodial arrangements are reviewed by the Audit Committee and any concerns investigated.

Service provider risk

The Company has no employees and has delegated certain functions to a number of service providers, principally the Manager, Depositary and Registrar. Failure of controls and poor performance of any service provider could lead to reputational damage or loss. The Board is therefore reliant on the effective operation of the systems of its service providers. To mitigate this risk, the Board considers regular reports from key service providers and monitors the quality of services provided, or the Management Engagement Committee conducts an annual review of services to ensure that they remain appropriate. The Audit Committee also reviews annual audited internal controls reports from its key service providers, which includes confirmation of business continuity arrangements.

Statement of Directors' responsibilities

The Directors are responsible for preparing the Annual Report, the Strategic Report, the Report of the Directors including the Corporate Governance Statement, the Remuneration Report and the financial statements in accordance with applicable law and regulations.

Company law requires the Directors to prepare financial statements for each financial year. Under that law they have prepared the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period. In preparing these financial statements, the Directors are required to:

-    select suitable accounting policies and then apply them consistently;

-    make judgements and accounting estimates that are reasonable and prudent;

-    state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements respectively; and

-    prepare the financial statements on a going concern basis unless it is inappropriate to presume that the Company will continue in business.

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that the financial statements and the Remuneration Report comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Each of the Directors, whose names and functions are set out on page 21 of the 2015 Annual Report, confirms that, to the best of their knowledge:

-    the financial statements, which have been prepared in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law), give a true and fair view of the assets, liabilities, financial position and net return of the Company;

-    the Strategic Report includes a fair review of the development and performance of the business and the position of the Company, together with a description of the principal risks and uncertainties that it faces; and

-    they consider that the Report and Accounts, taken as a whole, is fair, balanced and understandable and provides the information necessary for shareholders to assess the Company's position, performance, business model and strategy.

Going concern

Having assessed the principal risks and the other matters discussed in connection with the Viability Statement, the Directors consider it appropriate to adopt the going concern basis in preparing the accounts.

A statement on the medium term viability of the Company can be found in the Strategic Report on pages 19 and 20 of the 2015 Annual Report.

Income Statement

for the year ended 30 September 2015

		2015			2014
	Revenue	Capital	Total	Revenue	Capital	Total
	£'000	£'000	£'000	£'000	£'000	£'000
(Losses)/gains on investments held at fair value through profit or loss	-	(17,571)	(17,571)	-	42,218	42,218
Loss on derivative contract	-	(55)	(55)	-	-	-
Net foreign currency losses	-	(1,032)	(1,032)	-	(102)	(102)
Income from investments	13,597	-	13,597	10,368	438	10,806
Other interest receivable and similar income	2	-	2	46	-	46
Gross return/(loss)	13,599	(18,658)	(5,059)	10,414	42,554	52,968
Investment management fee	(4,571)	-	(4,571)	(4,224)	-	(4,224)
Administrative expenses	(939)	-	(939)	(898)	-	(898)
Net return/(loss) before finance costs and taxation	8,089	(18,658)	(10,569)	5,292	42,554	47,846
Finance costs	(116)	-	(116)	(93)	-	(93)
Net return/(loss) on ordinary activities before taxation	7,973	(18,658)	(10,685)	5,199	42,554	47,753
Taxation on ordinary activities	(822)	(1,496)	(2,318)	(450)	-	(450)
Net return/(loss) on ordinary activities after taxation	7,151	(20,154)	(13,003)	4,749	42,554	47,303
Return/(loss) per Ordinary share	4.23p	(11.91)p	(7.68)p	2.80p	25.12p	27.92p

The "Total" column of this statement is the profit and loss account of the Company. The "Revenue" and "Capital" columns represent supplementary information prepared under guidance issued by the Association of Investment Companies. The Company has no recognised gains and losses other than those included in the results above and therefore no separate statement of total recognised gains and losses has been presented.

All revenue and capital items in the above statement derive from continuing operations. No operations were acquired or discontinued in the year.

Reconciliation of Movements in Shareholders' Funds

for the year ended 30 September 2015

	Called-up		Capital	Share	Warrant
	share	Share	redemption	purchase	exercise	Capital	Revenue
	capital	premium	reserve	reserve	reserve	reserves	reserve	Total
	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000
At 30 September 2013	16,970	100,956	3,174	37,416	8,704	282,140	5,664	455,024
Repurchase and cancellation of the Company's own Ordinary shares	(47)	-	47	(1,115)	-	-	-	(1,115)
Net return on ordinary activities	-	-	-	-	-	42,554	4,749	47,303
Ordinary dividend paid in the year	-	-	-	-	-	-	(5,685)	(5,685)
At 30 September 2014	16,923	100,956	3,221	36,301	8,704	324,694	4,728	495,527
Net (loss)/return on ordinary activities	-	-	-	-	-	(20,154)	7,151	(13,003)
Ordinary dividend paid in the year	-	-	-	-	-	-	(4,654)	(4,654)
At 30 September 2015	16,923	100,956	3,221	36,301	8,704	304,540	7,225	477,870

Balance Sheet

at 30 September 2015

	2015	2014
	£'000	£'000
Fixed assets
Investments held at fair value through profit or loss	487,181	490,574
Current assets
Debtors	5,128	3,082
Cash at bank and in hand	18,763	12,466
	23,891	15,548
Current liabilities
Creditors: amounts falling due within one year	(33,147)	(10,595)
Derivative financial instrument held at fair value through profit or loss	(55)	-
Net current (liabilities)/assets	(9,311)	4,953
Total assets less current liabilities	477,870	495,527
Net assets	477,870	495,527
Capital and reserves
Called-up share capital	16,923	16,923
Share premium	100,956	100,956
Capital redemption reserve	3,221	3,221
Share purchase reserve	36,301	36,301
Warrant exercise reserve	8,704	8,704
Capital reserves	304,540	324,694
Revenue reserve	7,225	4,728
Total equity shareholders' funds	477,870	495,527
Net asset value per Ordinary share	282.39p	292.82p

Cash Flow Statement

for the year ended 30 September 2015

	2015	2014
	£'000	£'000
Net cash inflow from operating activities	7,841	3,019
Servicing of finance
Interest paid	(109)	(119)
Net cash outflow from servicing of finance	(109)	(119)
Taxation
Overseas taxation paid	(2,272)	(470)
Investment activities
Purchases of investments	(193,830)	(184,337)
Sales of investments	179,898	176,514
Special dividend received allocated to capital	-	438
Net cash outflow from investment activities	(13,932)	(7,385)
Dividend paid	(4,654)	(5,685)
Net cash outflow before financing	(13,126)	(10,640)
Financing
Repurchase and cancellation of the Company's own Ordinary shares	-	(1,115)
Bank loan drawndown/(repaid)	19,116	(11,135)
Net cash inflow/(outflow) from financing	19,116	(12,250)
Net cash inflow/(outflow) in the year	5,990	(22,890)

Notes to the Accounts

1. Accounting Policies

Basis of accounting

The accounts are prepared in accordance with the Companies Act 2006. United Kingdom Generally Accepted Accounting Practice ("UK GAAP") and with the Statement of Recommended Practice "Financial Statements of Investment Trust Companies and Venture Capital Trusts" (the "SORP") issued by the Association of Investment Companies in January 2009. All of the Company's operations are of a continuing nature.

The accounts have been prepared on a going concern basis under the historical cost convention, as modified by the revaluation of investments at fair value.

The policies applied in these accounts are consistent with those applied in the preceding year.

2. Income

	2015	2014
	£'000	£'000
Income from investments:
Overseas dividends	13,164	10,172
UK dividends	384	115
Scrip dividends	49	81
	13,597	10,368
Other interest receivable and similar income:
Stock lending fees	-	31
Deposit interest	2	15
	2	46
Total dividends and interest	13,599	10,414
Capital:
Special dividend allocated to capital	-	438

3. Investment management fee

	2015	2014
	£'000	£'000
Management fee	4,571	4,224

The basis for calculating the investment management fee is set out in the Report of the Directors on page 24 of the 2015 Annual Report.

4. Dividends paid and proposed

	2015	2014
	£'000	£'000
2014 final dividend paid of 2.75p (2013: 3.35p)	4,654	5,685
	2015	2014
	£'000	£'000
2015 final dividend proposed of 4.20p (2014: 2.75p)	7,107	4,654

The proposed final dividend amounting to £7,107,000 (2014: £4,654,000) is the amount used for the basis of determining whether the Company has satisfied the distribution requirements of Section 1158 of the Corporation Tax Act 2010. The revenue available for distribution for the year is £7,151,000 (2014: £4,749,000).

5. Return/(loss) per Ordinary share

	2015	2014
	£'000	£'000
Revenue return	7,151	4,749
Capital (loss)/return	(20,154)	42,554
Total (loss)/return	(13,003)	47,303
Weighted average number of Ordinary shares in issue during the year	169,225,716	169,416,702
Revenue return per share	4.23p	2.80p
Capital (loss)/return per share	(11.91)p	25.12p
Total (loss)/return per share	(7.68)p	27.92p

6. Net asset value per Ordinary share

	2015	2014
Net assets attributable to the Ordinary shareholders (£'000)	477,870	495,527
Ordinary shares in issue at the year end	169,225,716	169,225,716
Net asset value per Ordinary share	282.39p	292.82p

7. Transactions with the Manager

Under the terms of the AlFM Agreement, the Manager is entitled to receive a management fee and a company secretarial fee. Details of the basis of the management fee calculation are given in the Report of the Directors on page 24 of the 2015 Annual Report. Any investments in funds managed or advised by the Manager or any of its associated companies, are excluded from the assets used for the purpose of the calculation and therefore incur no fee.

The management fee payable in respect of the year ended 30 September 2015 amounted to £4,571,000 (2014: £4,224,000), of which £1,069,000 (2014: £1,091,000) was outstanding at the year end. The company secretarial fee payable in respect of the year ended 30 September 2015 amounted to £96,000 (2014: £94,000), of which £25,000 (2014: £24,000) was outstanding at the year end.

No Director of the Company served as a director of any member of the Schroders Group, at any time during the year.

8. Related party transactions

The Company has no related parties other than its Directors. Details of the remuneration payable to Directors are given in the Remuneration Report on page 33 of the 2015 Annual Report and details of Directors' shareholdings are given in the Report of the Directors on page 23 of the 2015 Annual Report.

9. Status of announcement

2014 Financial Information

The figures and financial information for 2014 are extracted from the published Annual Report and Accounts for the year ended 30 September 2014 and do not constitute the statutory accounts for that year. The 2014 Annual Report and Accounts have been delivered to the Registrar of Companies and included the Report of the Independent Auditors which was unqualified and did not contain a statement under either section 498(2) or section 498(3) of the Companies Act 2006.

2015 Financial Information

The figures and financial information for 2015 are extracted from the Annual Report and Accounts for the year ended 30 September 2015 and do not constitute the statutory accounts for the year. The 2015 Annual Report and Accounts include the Report of the Independent Auditors which is unqualified and does not contain a statement under either section 498(2) or section 498(3) of the Companies Act 2006. The 2015 Annual Report and Accounts will be delivered to the Registrar of Companies in due course.

Neither the contents of the Company's website nor the contents of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated into, or forms part of, this announcement.

 

END

 

 

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