Final Results
Henderson TR Pacific Inv. Trust PLC
03 February 2004
HENDERSON TR PACIFIC INVESTMENT TRUST PLC
Unaudited Preliminary Results
for the Year Ended 31 December 2003
2 February 2004
Henderson TR Pacific Investment Trust plc announces preliminary results
for the year ended 31 December 2003.
Henderson TR Pacific Investment Trust plc is a specialist company
seeking capital growth from Pacific region stock markets and economies
excluding Japan and Australasia.
Key Points:
• Good recovery seen in Far East stock markets after early uncertainties
were resolved.
• Thailand and China were the region's star performers in 2003, with the
Trust benefiting from high exposure to both.
• Net Asset Value total return per share up 40.4% at year end, against
the MSCI AC Far East (Free) ex-Japan Index advance of 30.4%.
• Gearing of 17.7% at year end with increased borrowing facility of £30
million fully invested.
* Gearing is defined as borrowings, less cash advances and deposits as at % of
shareholders' funds.
Key Extracts from the Preliminary Statement
(Unaudited) (Audited)
31 December 2003 31 December 2002
Net Asset Value per Ordinary Share 89.3p 64.1p
Share price 85.0p 59.8p
Discount to NAV 4.8% 6.7%
Proposed Final Dividend per Ordinary Share: 1.00p 0.60p
Total Return Performance for 12 Months to 31 December 2003
Net Asset Value (i) 40.4%
Share price (i) 43.9%
MSCI AC Far East (Free) ex-Japan Index (ii) 30.4%
(i) Source: AITC Services Ltd. (net dividends reinvested)
(ii) Source: Thomson Financial, Datastream (gross dividend reinvested)
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HENDERSON TR PACIFIC INVESTMENT TRUST PLC
Unaudited Preliminary Results
for the Year Ended 31 December 2003
Commenting on the results Chairman Iain Dale, said:
'We achieved a positive total return of 40.4%. The company benefited
from a high exposure to Thailand, which outperformed throughout the
year. We were also careful to choose a portfolio which would benefit
from China's significant growth'.
On current market conditions, Mr Dale added:
'The region's economic outlook is dominated by future developments in
China and the global economy. This year Asia should grow strongly
continuing the recovery which began in most countries in 2003. The
Pacific region's stock markets remain at generally attractive levels by
international and historic standards. Overall we remain confident and
excited for the company's future as a specialist investor in this
dynamic region'.
Extracts from the Chairman's Statement
In the event 2003 proved to be a very good year for Asian stock markets
but only after they had fallen further in the first few months of the
year as a poor global economic background and uncertainty over the Iraq
war and the SARS virus caused problems for Asia in particular. The
ensuing recovery was strong and a notable upturn in the US economy
allowed stock markets everywhere to rally.
Performance
The MSCI AC Far East (Free) ex-Japan Index, the nearest yardstick,
achieved a positive total return of 30.4% in sterling terms; in
comparison we achieved a positive total return of 40.4%. The company
benefited from a high exposure to Thailand, which outperformed
throughout the year. We were also careful to choose a portfolio which we
considered would benefit from China's significant growth, whether these
companies were located in China itself or elsewhere. Thailand and China
were the region's star performers over 2003.
Borrowings
The Board decided it was important to have facilities in place in order
to raise exposure to our favoured investments. This ability to 'gear'
the company is a distinct advantage which investment trusts enjoy over
unit trusts and is an important agenda item at each meeting of your
Board. A flexible loan facility amounting to £30 million was negotiated
with ING Bank. It allows us to borrow in various currencies at modest
cost and at a time and duration of our choosing. An initial £20 million
was drawn down first from May 2003 and a further £10 million was agreed
in September and has been subsequently fully invested. The portfolio was
17.7% geared at our year end and we are considering raising the facility
further to £40 million in 2004.
Directors
I am pleased to introduce a new independent director. Hugh Aldous joined
the Board in November 2003. He has had a distinguished career with
accountants RSM Robson Rhodes LLP, where he remains a Partner. Hugh has
good knowledge of emerging markets generally, an understanding of Far
East stock markets and has worked on corporate governance in South China
and Hong Kong. Hugh will offer himself for election at the forthcoming
Annual General Meeting.
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HENDERSON TR PACIFIC INVESTMENT TRUST PLC
Unaudited Preliminary Results
for the Year Ended 31 December 2003
The independent members of the Board greatly value the fact that the
Trust's manager, Michael Watt, is also a director and is committed to
achieving best returns for shareholders. Under the new Combined Code
rules Michael will be required to stand for re-election each year from
2005, but we believe it is appropriate that he do so for the first time
this year. Similarly, Peter Berry, who will have served ten years as a
director this year, but whom, for the reasons stated in the forthcoming
Annual report, the Board regards as fully independent, is proposed for
annual re-election from this year's AGM.
We are very fortunate in the calibre of the directors and balance of the
Board and I commend them to you. Sadly, I will myself retire at the
forthcoming AGM having been a director for thirteen years and Chairman
for the past ten years. This has not been the easiest of times for Far
East stock markets but I am confident that the company is in good shape
and that it will be in sound hands under the guidance of David Robins,
who has agreed to be the new Chairman. I am very grateful to my
colleagues on the Board and the team at Henderson for their great
support over the years and wish David and his team a very successful
future.
Share Repurchases
It is the company's policy to buy back shares for cancellation should
attractive opportunities occur. Only one such purchase was made during
2003. This involved the cancellation of 240,000 shares bought in April
at a price of 50.5p and a discount of 15.1%. Discounts on Far East
investment trusts generally narrowed over the year. Ours was 6.7% at the
start of 2003 and 4.8% at the year end.
Dividends
In accordance with the dividend policy adopted in 2002 a final dividend
of 1.00p has been declared which will be paid in April, this being the
minimum amount required to protect the company's status as an investment
trust. This year the revenue account has been increased by a small,
non-recurring adjustment to the tax charge.
Charitable Contributions
A total of £10,000 was donated in 2003 to Sabakan, a charity for abused
women and children, which we have supported for the last three years.
Sabakan is based in Mindanao, the Philippines' most troubled province.
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HENDERSON TR PACIFIC INVESTMENT TRUST PLC
Unaudited Preliminary Results
for the Year Ended 31 December 2003
Outlook
The region's economic outlook is dominated by future developments in
China and the global economy. While China has a large trading surplus
with the USA it has a large deficit with the rest of the region on which
it relies to satisfy many industrial and consumer requirements. At
present prospects are encouraging with strong growth in China and clear
signs of recovery in the world's large economies. The risk may come next
year if the USA, following the presidential election, tightens both
fiscal and monetary policy and European countries struggle with
overvalued currencies. This year Asia should grow strongly continuing
the recovery which began in most countries in 2003. So far the focus has
been on maintaining export competitiveness so currencies have been held
down in line with the US dollar and foreign exchange reserves have grown
to record levels. We hope policies will change to encourage more broadly
based growth including renewed domestic spending. This will improve the
region's resilience to a setback elsewhere. In the meantime the Pacific
region's stock markets remain at generally attractive levels by
international and historic standards. This can no longer be said of some
leading Chinese companies which have been the object of somewhat
irrational buying by international investors in recent months, but it is
true of the region generally. Overall, we remain confident and excited
for the company's future as a specialist investor in this dynamic
region.
Annual General Meeting
This year's AGM will be held on 5 April 2004 at 12.30 pm. As always I
warmly invite shareholders to attend. After the formal meeting there
will be a presentation by Michael Watt, our Manager. I look forward to
seeing you there.
Iain Dale CBE
2 February 2004
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HENDERSON TR PACIFIC INVESTMENT TRUST PLC
Unaudited Preliminary Results
for the Year Ended 31 December 2003
Statement of Total Return (incorporating the revenue account)
(Unaudited) (Audited)
Year ended 31 December 2003 Year ended 31 December 2002
Revenue Capital Total Revenue Capital Total
£'000 £'000 £'000 £'000 £'000 £'000
Total capital gains/(losses) from - 51,601 51,601 - (29,768) (29,768)
investments
Income from fixed asset investments 4,418 - 4,418 3,551 - 3,551
Other interest receivable and similar income 35 - 35 93 - 93
--------- ---------- ---------- --------- ---------- ----------
Gross revenue and capital gains/(losses) 4,453 51,601 56,054 3,644 (29,768) (26,124)
Management fee (547) (890) (1,437) (621) (1,102) (1,723)
Other administrative expenses (496) - (496) (517) - (517)
-------- ----------- ---------- --------- ----------- ----------
Net return/(loss) on ordinary activities
before interest payable and taxation 3,410 50,711 54,121 2,506 (30,870) (28,364)
Interest payable (72) (218) (290) (132) (395) (527)
---------- ----------- ---------- ---------- ----------- ----------
Net return/(loss) on ordinary activities
before taxation 3,338 50,493 53,831 2,374 (31,265) (28,891)
Taxation on net return/(loss) on ordinary (773) 224 (549) (797) 377 (420)
activities
----------- ---------- ----------- ----------- ---------- -----------
Net return/(loss) on ordinary activities
after taxation 2,565 50,717 53,282 1,577 (30,888) (29,311)
Proposed ordinary dividend:
Final: 1.00p per share (2002: 0.60p) (2,036) - (2,036) (1,223) - (1,223)
---------- ------------ ---------- ---------- ------------ ----------
(2,036) - (2,036) (1,223) - (1,223)
---------- ------------ ---------- ---------- ------------ ----------
Transfer to/(from) reserves 529 50,717 51,246 354 (30,888) (30,534)
====== ======= ======= ====== ======= =======
Return/(loss) per ordinary share (note 1) 1.26p 24.90p 26.16p 0.77p (15.13p) (14.36p)
The revenue columns of this statement represent the profit and loss accounts of
the company.
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HENDERSON TR PACIFIC INVESTMENT TRUST PLC
Unaudited Preliminary Results
for the Year Ended 31 December 2003
Balance Sheet
At 31 December 2003
(Unaudited) (Audited)
31 December 2003 31 December 2002
£'000 £'000
--------------------- --------------------
Fixed asset investments:
Listed at market value - overseas 216,097 133,646
Unlisted at directors' valuation - 146
---------- ----------
216,097 133,792
---------- ----------
Current assets
Debtors 117 177
Bank balances and short term deposits 3,359 5,482
---------- ----------
3,476 5,659
Creditors: amounts falling due within one year (37,835) (8,838)
---------- ----------
Net current liabilities (34,359) (3,179)
---------- ----------
Total net assets 181,738 130,613
====== ======
Capital and reserves
Called up share capital 10,180 10,192
Other reserves 165,749 115,141
Revenue reserve 5,809 5,280
---------- ----------
Equity shareholders' funds 181,738 130,613
====== ======
Net asset value per ordinary share (note 2) 89.3p 64.1p
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HENDERSON TR PACIFIC INVESTMENT TRUST PLC
Unaudited Preliminary Results
for the Year Ended 31 December 2003
Cash Flow Statement
For the year ended 31 December 2003
(Unaudited) (Audited)
Year ended Year ended
31 December 2003 31 December 2002
£'000 £'000 £'000 £'000
-------------- ------------- -------------- ------------
Net cash inflow from operating activities 1,576 533
Servicing of finance
Interest paid (264) (952)
----------- -----------
Net cash outflow from servicing of finance (264) (952)
Taxation
Withholding tax paid (106) (119)
UK income tax recovered - 39
---------- ----------
Net tax paid (106) (80)
Financial investment
Purchases of investments (98,389) (79,699)
Sales of investments 66,353 84,983
------------- -------------
Net cash (outflow)/inflow from financial investment (32,036) 5,284
Equity dividends paid (1,223) (1,020)
Management of liquid resources
Cash withdrawn from short term deposit - 9,133
----------- -----------
Net cash (outflow)/inflow before financing (32,053) 12,898
Financing
Repurchases of ordinary shares (121) (187)
Drawdown/(repayment) of multi-currency loan facility 30,297 (12,206)
----------- -----------
Net cash inflow/(outflow) from financing 30,176 (12,393)
---------- ----------
(Decrease)/increase in cash (1,877) 505
====== ======
Reconciliation of net cash flow to movement in net debt
(Decrease)/increase in cash as above (1,877) 505
Cash inflow from management of liquid resources - (9,133)
Cash (inflow)/outflow from debt financing (30,297) 12,206
---------- ----------
Change in net debt resulting from cash flows (32,174) 3,578
Exchange movements 1,678 1,167
---------- ----------
(30,496) 4,745
Net debt at 1 January (1,664) (6,409)
---------- ----------
Net debt at 31 December (32,160) (1,664)
====== ======
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HENDERSON TR PACIFIC INVESTMENT TRUST PLC
Unaudited Preliminary Results
for the Year Ended 31 December 2003
Notes:
1. Return/(loss) per Ordinary Share
Revenue returns per ordinary share are based on earnings attributable to the ordinary shares of £2,565,000 (year
ended 31 December 2002: £1,577,000) and on the weighted average number of ordinary shares in issue during the
year to 31 December 2003, being 203,680,948 (year ended 31 December 2002: 204,112,811).
Capital gains/(losses) per ordinary share are based on net capital gains/(losses) attributable to the ordinary
shares of £50,717,000 (year ended 31 December 2002: losses of £30,888,000) and on the weighted average number of
ordinary shares in issue during the year, as shown above.
2. Net Asset Value per Ordinary Share
The net asset value per ordinary share is based on net assets attributable to ordinary shares of £181,738,000 (31
December 2002: £130,613,000) and on the 203,603,359 (31 December 2002: 203,843,359) ordinary shares in issue at
31 December 2003.
3. Share Buy-Backs
The company was granted authority to repurchase up to 30,372,660 ordinary shares at the Annual General Meeting
held on 14 April 2003. During the year to 31 December 2003 the company purchased 240,000 ordinary shares for
cancellation at a price of 50.50p per share, a discount of 15.1%, at a cost of £121,000. The net asset value was
enhanced by £21,000.
4. 2002 Accounts
The figures and financial information for the year ended 31 December 2002 are an extract of 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.
5. 2003 Accounts
The preliminary figures for the year ended 31 December 2003 have been extracted from the latest company accounts.
These accounts have not yet been delivered to the Registrar of Companies, nor have the auditors yet reported on
them.
6. Dividend
A final dividend of 1.00p per ordinary share will, if approved by shareholders, be paid on 8 April 2004 to
shareholders recorded on the Register of Members on 12 March 2004. The company's shares go ex-dividend on 10
March 2004.
7. Annual General Meeting
The annual report will be posted to shareholders in March 2004 and thereafter copies will be available at the
registered office at 4 Broadgate, London EC2M 2DA. The Annual General Meeting of the company will be held at 4
Broadgate, London EC2M 2DA on Monday 5 April 2004 at 12.30 pm.
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HENDERSON TR PACIFIC INVESTMENT TRUST PLC
Unaudited Preliminary Results
for the Year Ended 31 December 2003
Stock Market Performance Comparison for the year to 31 December 2003
Local Currency Sterling Adjusted
% %
South Korea 29.2 15.7
Taiwan 32.3 21.9
China 88.9 69.9
Hong Kong 34.9 21.9
Thailand 116.6 111.9
The Philippines 41.6 22.5
Malaysia 22.8 10.5
Singapore 36.4 25.3
Indonesia 62.8 55.6
Geographical Distribution of the Investment Portfolio
As at 31 December 2003 As at 31 December 2002
% %
South Korea 20.7 29.3
Taiwan 20.2 15.4
China 15.9 11.6
Hong Kong 9.5 12.3
Thailand 17.0 11.1
The Philippines 0.6 0.9
Malaysia 8.3 9.7
Singapore 6.6 8.2
Indonesia 0.0 0.0
Vietnam 1.2 1.5
100.0 100.0
==== ====
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HENDERSON TR PACIFIC INVESTMENT TRUST PLC
Unaudited Preliminary Results
for the Year Ended 31 December 2003
Sector Analysis of Investments
As at 31 December 2003 As at 31 December 2002
% %
Consumer Discretionary 14.0 19.7
Consumer Staples 4.2 5.1
Energy 2.3 3.9
Financials and Property 20.4 25.2
Healthcare 0.0 0.0
Industrials and Transport 21.6 10.4
Information Technology 19.9 16.9
Materials 7.5 6.3
Telecommunications Services 5.9 8.3
Utilities 4.2 4.2
100.0 100.0
==== ====
Top 20 Investments as at 31 December 2003
Company Country Sector Value of
Investment
£'000
Samsung Electronics South Korea Information Technology 6,347
Huaneng Power International China Utilities 6,199
Neptune Orient Lines Singapore Industrials and Transport 4,962
CNOOC China Energy 4,910
Hyundai Motor South Korea Consumer Discretionary 4,740
Italian-Thai Development Thailand Industrials and Transport 4,669
Siam Cement Thailand Materials 4,653
Shin Corporation Thailand Telecommunication Services 4,370
Kasikornbank Thailand Financials and Property 4,280
Orient Overseas Hong Kong Industrials and Transport 4,123
LG Chem South Korea Materials 4,122
Sinotrans China Industrials and Transport 3,970
Samsung Fire & Marine South Korea Financials and Property 3,848
Avichina Industry & Technology China Industrials and Transport 3,787
Daewoo Shipbuilding South Korea Industrials and Transport 3,668
Kingboard Chemicals China Information Technology 3,596
Johnson Electric Hong Kong Industrials and Transport 3,580
Noble Group Singapore Financials and Property 3,465
Swire Pacific Hong Kong Financials and Property 3,443
Global Bio-Chem China Consumer Staples 3,418
86,150
====
Total Investments 216,097
====
Top 20 as a percentage of total investments 39.9%
- ENDS -
For further information contact:-
Michael Watt, Director and Manager
Iain Dale, Chairman
Tel: 020 7818 1818
David Hardy
Binns & Co. PR
Tel: 020 7786 9600
or
Vicki Staveacre
Henderson Press Office
Telephone: 020 7818 4222
This information is provided by RNS
The company news service from the London Stock Exchange
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