Interim Results
Henderson TR Pacific Inv. Trust PLC
04 August 2006
Page 1 of 11
4 August 2006
HENDERSON TR PACIFIC INVESTMENT TRUST PLC
Unaudited Interim Results
for the half year ended 30 June 2006
Henderson TR Pacific Investment Trust plc ('Henderson TR Pacific'), which seeks
a high rate of total return from companies operating primarily in the Pacific
region excluding Japan and Australasia, announces interim results for the half
year ended 30 June 2006.
Henderson TR Pacific is one of the largest investment trusts specialising in
this region.
Highlights:
• The share price increased by 3.0% to 102.5p from 99.5p over six months
• The NAV total return per share rose by 0.6% over the last six months and
by 16.4% over 12 months
• New performance fee arrangements in effect
Financial Highlights
(Unaudited) (Audited) %
30 June 2006 31 December 2005 Change
Net asset value (as per the balance sheet) 112.7p 114.8p -1.8
Net asset value (AITC total return) - - +0.6
Share price 102.5p 99.5p +3.0
Discount 9.1% 13.3% -
Gearing (*) - 10.8% -
Performance to 30 June 2006
Total returns 6 months % 12 months %
Net Asset Value (1) +0.6 +16.4
Share Price (1) +4.8 +21.6
MSCI AC Asia ex-Japan Index (2) -0.1 +21.3
Peer Group (3) +0.7 +21.2
(*) Defined here as borrowings, less cash balances and deposits, as a percentage of shareholders'
funds.
(1) Source: AITC Services Ltd (net income reinvested).
(2) Source: Thomson Financial, Datastream (gross dividends reinvested).
(3) Source: AITC Services Ltd (net income reinvested)
The Company's performance is compared against a group of leading investment trust competitors.
Source: AITC Services Ltd
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Page 2 of 11
HENDERSON TR PACIFIC INVESTMENT TRUST PLC
Unaudited Interim Results
for the half year ended 30 June 2006
Commenting on the results and economic outlook, Chairman, David Robins, said:
Asian economies and companies remain in good health. However, the risk to
exports and corporate earnings is greater today than six months ago. US growth
has started to moderate. It remains our view that this slowdown will be fairly
shallow and relatively short lived.
Extracts from the Chairman's Statement
Background
The Asian markets were broadly flat in sterling terms in the first six months of
the year with very strong performance in the period to May followed by a sharp
correction. This was part of a more general sell-off in emerging markets caused
by growing concern regarding the outlook for inflation and interest rates in the
US and elsewhere. Co-ordinated action by central banks in the US, Japan and
Europe towards more restrictive monetary policies led to a large and sudden
shift in sentiment among investors and a reduction in risk appetite. As the
first half drew to a close, evidence of weaker economic activity in the US led
to a shift in concern about inflation and interest rates to worries about the
outlook for global growth.
Performance
Following the series of actions taken by the Board over the last 12 months and
the appointment of Andrew Beal in September 2005, our Trust outperformed the
Benchmark Index, the MSCI All Countries Asia ex-Japan Index, during the first
six months of the year. The net asset value (total return) increased by 0.6% in
sterling terms compared to a fall of 0.1% for the Benchmark. We recorded
particularly strong performance in China, Singapore and Vietnam as a result of
robust markets and good stock selection. However, stock selection let us down in
South Korea, which was by far the biggest detractor from performance over the
period. As the markets started to weaken in early May we reduced the gearing of
the Trust in anticipation of some further weakness but remain ready to take
advantage of lower prices when we believe the time is right.
Outlook
Asian economies and companies remain in good health. However, the risk to
exports and corporate earnings is greater today than six months ago,
particularly as US growth has clearly started to moderate. Whilst we expect
growth elsewhere in the world to mitigate the impact of a more subdued outlook
for the US, the key risk is that higher commodity prices caused by disruptions
in supply and instability in the Middle East lead to higher than expected
inflation, further rises in US interest rates and a significant fall in US
consumer spending. In the event of an unexpectedly severe slowdown in the US,
estimated returns from Asian equities over the next year would have to be
reduced.
However, it remains our view that the slowdown will be fairly shallow and
relatively short lived. The strength of Asia's fiscal and trade position means
that the region should be able to offset the effect of this modest slowdown by
increasing Government spending and making timely cuts in interest rates. With
the likelihood that regional currencies also stay strong, we would expect the
relative ecomomic strength of the region to underpin equity markets.
David Robins
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Page 3 of 11
HENDERSON TR PACIFIC INVESTMENT TRUST PLC
Unaudited Interim Results
for the half year ended 30 June 2006
Income Statement
for the half year ended 30 June 2006
(Unaudited) (Unaudited) (Audited)
Half year ended Half year ended Half year ended
30 June 2006 30 June 2005 31 December 2005
Revenue Capital Revenue Capital Revenue Capital
return return Total return return Total return return Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
(Losses)/gains from investments - (1,027) (1,027) - 20,815 20,815 - 49,508 49,508
held at fair value through
profit or loss
Income from investments held at 2,863 - 2,863 3,159 - 3,159 6,709 - 6,709
fair value through profit or
loss
Other interest receivable and 105 - 105 42 - 42 102 - 102
similar income
-------- -------- -------- -------- -------- ------- -------- -------- --------
Gross revenue and capital 2,968 (1,027) 1,941 3,201 20,815 24,016 6,811 49,508 56,319
(losses)/gains
Management fee (264) (419) (683) (316) (574) (890) (633) (1,148) (1,781)
Performance fee (note 2) - (683) (683) - - - - - -
Other administrative expenses (332) - (332) (256) - (256) (587) - (587)
-------- -------- -------- ------- -------- -------- -------- ------- -------
Net return/(loss) on ordinary
activities before finance
charges and taxation 2,372 (2,129) 243 2,629 20,241 22,870 5,591 48,360 53,951
Finance charges (97) (290) (387) (44) (131) (175) (85) (255) (340)
-------- -------- -------- --------- --------- -------- ---------- --------- ---------
Net return/(loss) on ordinary 2,275 (2,419) (144) 2,585 20,110 22,695 5,506 48,105 53,611
activities before taxation
Taxation on net return/(loss) on (755) 417 (338) (828) 270 (558) (1,853) 421 (1,432)
ordinary activities
-------- -------- -------- ------- -------- ------- --------- ---------- -------
Net return/(loss) on ordinary 1,520 (2,002) (482) 1,757 20,380 22,137 3,653 48,526 52,179
activities after taxation
===== ===== ===== ===== ===== ===== ====== ====== =====
Return/(loss) per ordinary share 0.82p (1.08)p (0.26)p 0.92p 10.63p 11.55p 1.92p 25.52p 27.44p
(note 3)
The total columns of this statement represent the profit and loss accounts
of the Company.
All revenue and capital items in the above statement derive from continuing
operates
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Page 4 of 11
HENDERSON TR PACIFIC INVESTMENT TRUST PLC
Unaudited Interim Results
for the half year ended 30 June 2006
Reconciliation of Movements in Shareholders' Funds
for the half years ended 30 June 2006 and 2005 and year ended 31 December 2005
Half year ended 30 June 2006
Called
up Capital Other
share redemption Special Capital Revenue
capital reserve reserve reserves reserve Total
£'000 £'000 £'000 £'000 £'000 £'000
At 31 December 2005 9,318 6,588 86,663 101,753 9,630 213,952
Net return from ordinary activities - - - (2,002) 1,520 (482)
Dividend paid in respect of year ended
31 December 2005
(paid 7 April 2006) - - - - (3,448) (3,448)
Write back of dividends over 12 years old - - - - 5 5
-------- --------- -------- --------- -------- -----------
At 30 June 2006 9,318 6,588 86,663 99,751 7,707 210,027
===== ===== ===== ====== ===== ======
Half year ended 30 June 2005 Called
up Capital Other
share redemption Special capital Revenue
capital reserve reserve reserves reserve Total
£'000 £'000 £'000 £'000 £'000 £'000
At 31 December 2004 9,660 6,246 92,410 53,913 8,682 170,911
Adjustment to bid valuation - - - (686) - (686)
Net return from ordinary activities - - - 20,380 1,757 22,137
Dividend paid in respect of year ended
31 December 2004
(paid 20 April 2005) - - - - (2,705) (2,705)
Purchase of own shares (177) 177 (2,827) - - (2,827)
--------- -------- ------- -------- -------- ---------
At 30 June 2005 9,483 6,423 89,583 73,607 7,734 186,830
===== ===== ===== ===== ===== ======
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Page 5 of 11
HENDERSON TR PACIFIC INVESTMENT TRUST PLC
Unaudited Interim Results
for the half year ended 30 June 2006
Year ended 31 December 2005 Called
up Capital Other
share redemption Special capital Revenue
capital reserve reserve reserves reserve Total
£'000 £'000 £'000 £'000 £'000 £'000
At 31 December 2004 9,660 6,246 92,410 53,913 8,682 170,911
Adjustments to bid valuation - - - (686) - (686)
Net return from ordinary activities - - - 48,526 3,653 52,179
Dividend paid in respect of the year ended
31 December 2004
(paid 20 April 2005) - - - - (2,705) (2,705)
Purchase of own shares (342) 342 (5,747) - - (5,747)
-------- -------- -------- --------- --------- ----------
At 31 December 2005 9,318 6,588 86,663 101,753 9,630 213,952
===== ===== ===== ====== ===== ======
The transaction costs incurred on the acquisition and disposal of investments
are included within capital reserve. The purchase transaction costs for the
half year ended 30 June 2006 were £416,000 (half year ended 30 June 2005:
£212,000; year ended 31 December 2005: £541,000). Sales transaction costs for
the half year ended 30 June 2006 were £641,000 (half year ended 30 June 2005:
£417,000; year ended 31 December 2005: £832,000).
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Page 6 of 11
HENDERSON TR PACIFIC INVESTMENT TRUST PLC
Unaudited Interim Results
for the half year ended 30 June 2006
Balance Sheet
As at 30 June 2006
(Unaudited) (Unaudited) (Audited)
At 30 June At 30 June 31 December
2006 2005 2005
£'000 £'000 £'000
Fixed asset investments held at fair value through
profit or loss
Listed at market value - overseas 210,568 179,785 237,730
---------- ---------- ----------
Current assets
Debtors 741 2,138 200
Bank balances and short term deposits 8,314 8,658 803
---------- ---------- ----------
9,055 10,796 1,003
Creditors: amounts falling due within one year (9,518) (3,749) (24,729)
---------- ---------- ----------
Net current (liabilities)/assets (463) 7,047 (23,726)
----------- ----------- -----------
Total assets less current liabilities 210,105 186,832 214,004
Provision for liabilities and charges (78) (2) (52)
---------- ---------- ----------
Total net assets 210,027 186,830 213,952
====== ====== ======
Capital and reserves
Called-up share capital 9,318 9,483 9,318
Capital redemption reserve 6,588 6,423 6,588
Special reserve 86,663 89,583 86,663
Other capital reserves 99,751 73,607 101,753
Revenue reserve 7,707 7,734 9,630
---------- ---------- ----------
Equity shareholders' funds 210,027 186,830 213,952
====== ====== ======
Net asset value per ordinary share (note 4) 112.7p 98.5p 114.8p
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Page 7 of 11
HENDERSON TR PACIFIC INVESTMENT TRUST PLC
Unaudited Interim Results
for the half year ended 30 June 2006
Cash Flow Statement
for the half year ended 30 June 2006
(Unaudited) (Unaudited) (Audited)
Half year Half year Year ended
ended ended 31 December
30 June 2006 30 June 2005 2005
£'000 £'000 £'000
Net cash inflow from operating activities 1,319 1,559 3,043
Interest paid (414) (185) (314)
Net tax paid - - (123)
Net cash inflow/(outflow) from financial investments 24,899 21,332 (8,062)
Equity dividends paid (3,443) (2,705) (2,705)
---------- ---------- ----------
Net cash inflow/(outflow) before financing 22,361 20,001 (8,161)
Net cash (outflow)/inflow from financing (14,535) (16,994) 3,410
---------- ---------- ----------
Increase/(decrease) in cash 7,826 3,007 (4,751)
====== ====== ======
Reconciliation of operating revenue to net cash inflow
from operating activities
Total return before finance charges and taxation 243 22,870 53,951
Less capital return before finance charges and taxation 2,129 (20,241) (48,360)
---------- ------------ -----------
Net revenue before interest payable and taxation 2,372 2,629 5,591
Increase in accrued income (545) (152) (132)
Decrease in other debtors 4 - 74
Increase/(decrease) in creditors 924 (47) 48
Management and performance fee taken to other capital (1,102) (574) (1,148)
reserves
Overseas withholding tax (302) (288) (778)
Taiwanese stock dividends (32) (9) (612)
---------- ---------- ----------
Net cash inflow from operating activities 1,319 1,559 3,043
====== ====== ======
Reconciliation of net cash flow to movement in net cash/
(debt)
Increase/(decrease) in cash as above 7,826 3,007 (4,751)
Decrease/(increase) in debt 14,535 14,167 (9,157)
---------- ---------- ----------
Change in net cash resulting from cash flows 22,361 17,174 (13,908)
Exchange movements 1,267 (176) (688)
---------- ---------- ----------
Movement in net cash during the period 23,628 16,998 (14,596)
Net debt at beginning of the period (23,196) (8,600) (8,600)
---------- ----------- ----------
Net cash/(debt) at the end of the period 432 8,398 (23,196)
====== ====== ======
Represented by:
Cash at bank and short term deposits less bank overdrafts 8,089 8,398 616
Debt falling due within one year (7,657) - (23,812)
---------- ---------- ----------
432 8,398 (23,196)
====== ====== ======
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Page 8 of 11
HENDERSON TR PACIFIC INVESTMENT TRUST PLC
Unaudited Interim Results
for the half year ended 30 June 2006
Notes
1. Accounting policies
The accounts have been prepared under the historical cost convention, modified to include the
revaluation of investments and in accordance with applicable Accounting Standards and with the Statement
of Recommended Practice 'Financial Statements of Investment Trust Companies' ('SORP') dated December
2005. All of the company's operations are of a continuing nature. The same accounting policies used for
the year ended 31 December, have been applied.
2. Performance fee
The Board has prudently assumed that outperformance at the year end could be such that a performance fee
would be paid. As at 30 June 2006 the company's outperformance of the Index would result in a
performance fee of 0.30% at the year end of net assets under management and accordingly an accrual for a
performance fee that would be payable at the year end, based on the net asset value total return as at
30 June 2006, has been included in these accounts. It should be noted that whether a performance fee is
actually paid at the year end will depend on the performance of the Company compared to the Index at the
year end. If a performance fee is paid it could be more or less than the amount shown in these
accounts.
3. Return/(loss) per ordinary share
(Unaudited) (Unaudited)
Half year Half year (Audited)
ended ended Year ended
30 June 30 June 31 December
2006 2005 2005
£'000 £'000 £'000
The return per ordinary share is based on the
following figures:
Revenue return 1,520 1,757 3,653
Capital (loss)/return (2,002) 20,380 48,526
----------- ----------- -----------
Total (482) 22,137 52,179
----------- ----------- ---------------
Weighted average number of ordinary shares in issue 186,353,359 191,640,651 190,186,373
Revenue return per ordinary share 0.82p 0.92p 1.92p
Capital (loss)/return per ordinary share (1.08)p 10.63p 25.52p
---------- ----------- ------------
Total (loss)/return per ordinary share (0.26)p 11.55p 27.44p
====== ====== =======
4. Net asset value per ordinary share and issued share capital
Net asset value per ordinary share is calculated on the basis of shareholders' funds attributable to
ordinary shares divided by the number of ordinary shares in issue at 30 June 2006, being 186,353,359 (30
June 2005: 189,653,359 and 31 December 2005: 186,353,359).
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Page 9 of 11
HENDERSON TR PACIFIC INVESTMENT TRUST PLC
Unaudited Interim Results
for the half year ended 30 June 2006
5. 2005 Accounts
The figures and financial information for the year ended 31 December 2005 are extracted from the latest
published accounts of the Company and do not constitute statutory accounts for that year. Those
accounts have been delivered to the Registrar of Companies and included the report of the auditors
which was unqualified and did not contain a statement under section 237(2) or 237(3) of the Companies
Act 1985.
6. Geographical Distribution of the Investment Portfolio
Appendix 1
As at 30 June As at 31 December
2006 2005
Company Index * Company Index*
South Korea 25.5% 26.2% 30.5% 27.1%
Taiwan 17.4% 20.1% 22.0% 21.0%
China 7.0% 13.7% 9.3% 11.1%
Hong Kong 19.0% 14.5% 15.4% 14.8%
Thailand 4.8% 2.3% 4.0% 2.7%
The Philippines 0.0% 0.7% 0.0% 0.7%
Malaysia 3.9% 3.9% 5.3% 4.2%
Singapore 9.9% 7.3% 9.6% 7.5%
Indonesia 4.2% 2.2% 0.0% 2.0%
India 5.4% 8.9% 2.1% 8.6%
Vietnam 2.9% 0.0% 1.8% 0.0%
Pakistan n/a 0.2% n/a 0.3%
---------- ---------- ----------- ------------
100.0% 100.0% 100.0% 100.0%
====== ====== ====== =======
Sector Analysis of Investments at 30 June 2006
Appendix 2
As at 30 June As at 31 December
2006 2005
Company Index * Company Index*
Consumer Disrectionary 14.0 8.5 4.5 9.2
Consumer Staples 3.5 3.8 2.6 3.5
Energy 7.8 6.7 4.8 6.1
Financials and Property 41.1 28.5 37.7 27.1
Healthcare 0.0 0.7 0.0 0.7
Industrials and Transport 4.5 11.2 15.8 11.0
Information Technology 22.3 22.2 29.4 24.6
Materials 0.1 6.4 1.1 5.8
Telecommunications Services 6.7 7.8 2.6 7.4
Utilities 0.0 4.2 1.5 4.6
-------- -------- ------- -------
100.0% 100.0% 100.0% 100.0%
===== ===== ===== ====
* MSCI AC Asia ex-Japan Index Country Weightings
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Page 10 of 11
HENDERSON TR PACIFIC INVESTMENT TRUST PLC
Unaudited Interim Results
for the half year ended 30 June 2006
APPENDIX 3
List and Valuation of Investments
as at 30 June 2006
% of Market % of Market
Investments Value Investments Value
£'000 £'000
CHINA 7.0 14,790 MALAYSIA 3.9 8,213
China Heartland Fund 103 BumiPutra Commerce 4,051
China Mengniu Dairy 3,224 IOI Corporation 4,162
China Petroleum & Chemical 4,752
Sohu.com 2,743 SINGAPORE 9.9 20,927
Yanzhou Coal Mining 3,968 Banyan Tree 3,384
DBS Group 4,499
Keppel Corporation 4,752
HONG KONG 19.0 39,987 Singapore Airlines 4,777
Cheung Kong 6,440 Singapore Petroleum 3,515
China Mobile 9,686
Esprit 6,430 TAIWAN 17.4 36,682
Henderson Land Development 4,324 AU Optronics 4,603
Polytec Asset Holdings 1,633 Cathay Financial 5,955
Sun Hung Kai Properties 6,056 Chinatrust Financial 4,769
Wharf 5,418 Quanta Computers 4,217
Siliconware Precision 4,364
Taiwan Cement 159
INDIA 5.4 11,379 Taiwan Semiconductor 6,450
Eredene Capital* 2,800 United Micro Electronics 6,165
ICICI Bank 3,831
Tata Motors 4,748 THAILAND 4.8 10,053
Bangkok Bank 4,074
INDONESIA 4.2 8,842 Land & Houses Public 1,743
Bank Mandiri 5,350 True Corp 4,236
P.T Astra International 3,492
VIETNAM 2.9 6,107
SOUTH KOREA 25.5 53,588 Vietnam Enterprise Investment Fund 6,107
Hynix Semiconductor 4,982
Hyundai Department Store 3,426 ------- -----------
Industrial Bank of Korea 4,233 TOTAL INVESTMENTS 100.0 210,568
Kookmin Bank 9,870 ==== ======
LG Electronics 3,577
LG Philips 4,690
Samsung Electro Mechanics 3,820
Samsung Electronics 8,029
Shinhan Financial Group 6,796
SK Corp 4,165
* AIM listed in the UK
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Page 11 of 11
HENDERSON TR PACIFIC INVESTMENT TRUST PLC
Unaudited Interim Results
for the half year ended 30 June 2006
For further information contact:
Andrew Beal
Fund Manager
Tel: 020 7818 4314
David Robins
Chairman
Tel: 020 7818 2966
Sarah Gibbons-Cook
Investor Relations and PR Manager
Henderson Global Investors
Tel: 020 7818 3198
- ENDS -
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