Half-year Report
14/12/2022 07:00
For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20221214:nRSN5898Ja&default-theme=true
RNS Number : 5898J abrdn New Dawn Invest Trust plc 14 December 2022
ABRDN NEW DAWN INVESTMENT TRUST PLC
HALF-YEARLY FINANCIAL REPORT FOR THE SIX MONTHS ENDED 31 OCTOBER 2022
Legal Entity Identifier: 5493002K00AHWEME3J36
INVESTMENT OBJECTIVE
To provide shareholders with a high level of capital growth through equity
investment in the Asia Pacific countries ex Japan.
BENCHMARK
MSCI All Countries Asia Pacific ex Japan Index (Sterling adjusted)
Performance Highlights
Share price total return(AB) Net asset value total return(AB)
Six months ended 31 October 2022 Six months ended 31 October 2022
-13.5% -12.7%
Year ended 30 April 2022 -11.8% Year ended 30 April 2022 -11.0%
Benchmark total return(B) Ongoing charges(A)
Six months ended 31 October 2022 Forecast year ending 30 April 2023
-13.7% 1.14%
Year ended 30 April 2022 -9.2% Year ended 30 April 2022 1.13%
Revenue return per share Interim dividend per Ordinary share
Six months ended 31 October 2022
3.29p 1.00p
Six months ended 31 October 2021 2.49p Six months ended 31 October 2021 1.00p
(A) Considered to be an Alternative Performance Measure.
(B) Total return represents capital return plus dividends reinvested.
Financial Calendar and Highlights
Payment of interim dividend for the year ended 30 April 2023 10 February 2023
Financial year end 30 April 2023
Expected announcement of results for year ended 30 April 2023 July 2023
Annual General Meeting (London) 4 September 2023
Payment of final dividend for the year ended 30 April 2023 8 September 2023
Financial Highlights
31 October 2022 30 April 2022 % change
Total assets(A) £326,581,000 £380,434,000 -14.2
Total equity shareholders' funds £297,622,000 £346,952,000 -14.2
Share price (mid-market)(B) 244.50p 286.00p -14.5
Net asset value per share (including current year income)(B) 280.90p 325.17p -13.6
Discount to net asset value (including current year income)(BC) 13.0% 12.0%
MSCI AC Asia Pacific ex Japan Index (currency adjusted)(B) 704.58 834.02 -15.5
Net gearing(C) 9.0% 7.7%
Interim dividend per share(D) 1.0p 1.0p -
Ongoing charges ratio(C) 1.14% 1.13%
(A) Total assets which includes current year income, less current liabilities,
before deducting any prior charges.
(B) Percentage change figures are on a capital return basis.
(C) Considered to be an Alternative Performance Measure.
(D) Interim dividend relating to the first six months of the financial year.
For further information, please contact:
Stephanie Hocking
abrdn Fund Managers
Limited
0207 463 6403
Please note that past performance is not necessarily a guide to the future and
that the value of investments and the income from them may fall as well as
rise. Investors may not get back the amount they originally invested.
Chairman's Statement
Highlights
· A volatile six months as markets were impacted by a number of
headwinds.
· The Company's net asset value was down 12.7% in total return
terms, but ahead of the fall in the benchmark MSCI All Countries Asia Pacific
ex Japan Index (in Sterling terms) of 13.7%.
· An unchanged interim dividend for the year of 1.0p per Ordinary
share.
Overview
The six month period under review was volatile as markets were impacted by a
number of factors. Initial optimism as Covid-19 restrictions were lifted in
parts of the region provided a much-needed boost to sectors such as tourism
and travel, but soon other events began to influence sentiment, especially the
rapid tightening of US monetary policy in response to rising inflation. A
sharp increase in commodity prices, caused mainly by the Russia-Ukraine war,
raised fears about the potential impact on corporate profit margins. Rising
interest rates have led to forecasts of a global recession next year, but
inflation in Asia has not been as high as in other parts of the world meaning
that the region may see lower rate increases than elsewhere.
Within Asia, the implementation of China's 'zero-Covid' policy and debt
concerns in the real estate sector became a focus as their impact on the
mainland economy was increasingly apparent. However, the central government
did take action to address these issues with an apparent relaxation of some of
the 'zero-Covid' rules and the introduction of a number of support measures
for the economy.
Towards the end of the period, the Communist Party Congress in China agreed to
give President Xi Jinping an unprecedented third term in office, and he
reinforced his position by installing key allies in the powerful Politburo
Standing Committee. While it is worth highlighting that this could result in
better co-ordination of policies, it also led to concerns about a lack of
checks and balances at the top of the Chinese government.
The news for investors was not all negative over the period, however.
Corporate earnings growth remained relatively healthy and the push for more
renewable energy remained firmly on track. Particularly relevant for the
Company is the move towards localisation, where companies find customers
closer to their base of operations, and a trend towards greater
self-sufficiency. While economic growth overall in China slowed significantly,
there was still an encouraging amount of activity in some sectors.
Results and Dividends
Reflecting these difficult conditions, the Company's net asset value ("NAV")
was down 12.7% in total return terms over the six month period ended 31
October 2022. This compares to a fall of 13.7% in the benchmark MSCI All
Countries Asia Pacific ex Japan Index (in Sterling terms). The share price at
the end of the period was 244.50p, representing a discount to the NAV of
13.0%.
The Board has declared an unchanged interim dividend for the year of 1.0p per
Ordinary share, which will be paid on 10 February 2023 to shareholders on the
register on 6 January 2023 (the relevant ex-dividend date being 5 January
2023). As in previous years, future dividends will depend on the level of
income from the portfolio and the Board will decide on the level of the final
dividend at the time of reviewing the outcome for the financial year.
The portfolio proved more resilient than the wider market, thanks largely to
the Investment Manager's focus on finding quality companies. The financial
holdings made a positive contribution to relative performance, especially the
banking sector in South-East Asia. The companies in that sector include DBS
Group and Oversea-Chinese Banking Corporation in Singapore, and Bank Central
Asia ("BCA") in Indonesia. Rising interest rates were beneficial to those
companies, but the appeal of these banks as investments goes much further than
that. BCA benefits from a stable low-cost deposit base that funds its lending
and DBS offers a very good return on equity thanks to a clear strategy, good
digital infrastructure and the efficiency of its returns. The holdings in all
three companies were increased over the period.
Good stock selection in China made a positive contribution to performance, as
did the underweight position to the market. The latter proved to be a wise
move given the significant weakness in that market over the period. Indeed,
the Investment Manager took advantage of that weakness and selectively bought
shares at more attractive valuations. Renewable energy stocks, including
Sungrow Power Supply, performed well due to expectations that demand for
energy storage systems in China and overseas will be even higher than
previously forecast. The localisation trend was evident in the positive
contribution from medical instruments manufacturer Shenzhen Mindray
Bio-Medical Electronics. The company is one of those in the healthcare sector
to benefit from recent moves by the Chinese authorities to source more
equipment from domestic suppliers. A new position was acquired in Meituan
Dianping, which operates a food delivery and local services app and is seeing
a strong increase in returns. The company is well placed to benefit as the
country moves towards a more service-driven economy and the online penetration
of these services grows.
In challenging market conditions, it is useful to have the flexibility to be
able to invest across a wide range of sectors and countries. Unlike most of
its peers, the Company has the option to invest in Australia and the Board is
pleased to note that this proved beneficial during the period. OZ Minerals
performed well thanks to its focus on copper, which is seen as a play on the
global trend towards electrification. The company's shares were also lifted by
a takeover bid from BHP Group during the period, which was rejected. OZ
Minerals has subsequently received approval for a large copper and nickel
project in Western Australia that makes it an even more appealing takeover
target. BHP has since come back with a revised offer that has the support of
the OZ Minerals board, so this should stand a good chance of going through,
assuming it receives the backing of shareholders.
The portfolio received shares in Woodside Energy through a share distribution
as a consequence of the decision by BHP Group to sell its oil and gas assets
to Woodside; the Investment Manager has since added to the position. Woodside
has benefited from the significant rise in commodity prices but is the only
oil and gas holding in the portfolio. The Investment Manager is conscious that
the company is a big carbon emitter, but it has a very credible, and clear,
carbon reduction strategy. It is also worth noting that, in overall terms, the
Company's own portfolio has a carbon footprint well below that of the
benchmark index.
Investor concerns about the impact of a global economic downturn on the demand
for electronic devices were behind the underperformance of the
export-oriented, technology-heavy markets of Taiwan and South Korea.
Geopolitical tensions between Taiwan and China were also a factor. Taiwan
Semiconductor Manufacturing Company ("TSMC") was not immune from these
concerns, but, in the Investment Manager's view, TSMC has an almost
unassailable position in the sector and remains an attractive investment given
its scale and technological leadership, while its shares already price in many
of the headwinds.
The Indian market proved fairly resilient over the period. The portfolio is
exposed to the country mainly through the Aberdeen Standard SICAV - India
Equity Fund, but not having direct holdings in stocks such as Reliance
Industries and Axis Bank, which have done well, weighed on performance. The
Company would like to be able to invest direct in Indian stocks but progress
with the necessary formalities is slow.
The Investment Manager responded to market events and the changing
macroeconomic outlook by adopting a more defensive approach, reducing cyclical
investments and taking advantage of attractive valuations to initiate
positions in quality companies that they have been monitoring for a while. A
good example of this was the addition of Telkom Indonesia, which dominates the
telecoms sector in its home country and should prove defensive through the
current market uncertainty. Growth is being driven by the greater use of data,
the roll out of 5G services, and the rising penetration of broadband.
A number of positions were sold during the period. A sharp fall in
construction activity led to the sale of the holding in Shenzhen Inovance
Technology. Xero, which is facing a challenging short-term environment in its
key UK market, was also divested along with positions in Hangzhou Tigermed and
Vinamilk.
ESG
Turning to ESG, it is in exactly these types of challenging market conditions
that it becomes even more important for investors to remain vigilant.
Experienced market-watchers say that when the tide goes out, companies reveal
their true colours through their behaviour and priorities. The Investment
Manager has always given a high level of attention to governance issues in the
region, and in recent years has extended its processes for the active
management of environmental and social risks. Resources are in place within
the region to ensure investors' expectations are met. A company's willingness
to engage is a fundamental aspect of the decision-making process for
investment, as can be seen in the case studies on DBS Group and BHP Group
later in this report.
Gearing
At the end of the period, the Company's borrowing facilities amounted to £40
million, comprising a fixed rate loan of £20 million, which matures in
December 2023 (with an interest rate of 2.626%), and a £20 million
multi-currency revolving loan facility maturing in June 2024. An aggregate
Sterling equivalent of £29.0 million was drawn at the period end and gearing
(net of cash) was 9.0% as at 31 October 2022, compared to 7.7% at the
beginning of the period.
Share Buy Backs
In common with other investment trusts, the Company has bought back shares
with the aim of providing a degree of liquidity to the market at times when
the discount to the NAV has widened. It is the view of the Board that this
policy is in the interests of all shareholders. The Board closely monitors the
discount and the operation of the share buy back policy is reviewed at each
Board meeting, as well as considering other options for managing the discount.
During the period, the Company bought back 743,000 Ordinary shares,
representing 0.70% of the issued share capital. These shares were bought back
and held in treasury. The Company's stated policy on treasury shares is that
these can only be re-issued to the market at a premium to the NAV per share at
that time.
Outlook
The combination of rising interest rates, the strong US Dollar, currency
depreciation and an increasingly fragile global economy will continue to
create uncertainty in the months ahead, but Asia is starting from a better
position than many developed economies in the West. A number of countries in
South-East Asia are recovering after their post-Covid-19 re-opening, which
should help to support earnings growth. The resilient performance of the
equity markets in India and Indonesia is another source of optimism, and the
Investment Manager is also seeing potential signs of recovery in South Korea
and Taiwan as the stock markets in those countries recover from significant
selling in the technology sector. In China, the economy should benefit from
any action taken by the government to address flagging growth, such as further
loosening of Covid controls and increasing fiscal support.
Whilst the headwinds experienced in the period are likely to continue to cause
market volatility in the short term, it is important to note that this
potentially creates some good opportunities to invest at more attractive
valuations, and the longer-term advantages of having exposure to growing Asian
economies remain very much in place.
Donald Workman
Chairman
13 December 2022
Interim Management Report
Directors' Responsibility Statement
The Directors are responsible for preparing the Half-Yearly Financial Report
in accordance with applicable laws and regulations. The Directors confirm that
to the best of their knowledge:
- the condensed set of financial statements within the Half-Yearly
Financial Report has been prepared in accordance with Financial Reporting
Standard 104 'Interim Financial Reporting'; and
- the Interim Board Report (constituting the Interim Management
Report) includes a fair review of the information required by rule 4.2.7R of
the Financial Conduct Authority's Disclosure Guidance and Transparency Rules
(being an indication 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 the financial year) and 4.2.8R
(being related party transactions that have taken place during the first six
months of the financial year and that have materially affected the financial
position of the Company during that period, and any changes in the related
party transactions described in the last Annual Report that could do so).
Principal Risks and Uncertainties
The Board regularly reviews the principal risks and uncertainties faced by the
Company together with the mitigating actions it has established to manage the
risks. These are set out within the Strategic Report contained within the
Annual Report for the year ended 30 April 2022 and comprise the following risk
headings:
- Investment strategy and objectives
- Investment management
- Income/dividends
- Financial
- Gearing
- Regulatory
- Operational
- Exogenous risks
In addition to these risks, the Board is conscious of the continuing impact of
the Covid-19 pandemic in China, the war in Ukraine, inflation, increasing
interest rates and volatility in global equity markets. The Board considers
that these are risks that could have further implications for financial
markets.
In all other respects, the Company's principal risks and uncertainties have
not changed materially since the date of the Annual Report and are not
expected to change materially for the remaining six months of the Company's
financial year.
Going Concern
The Company's assets consist substantially of equity shares in companies
listed on recognised stock exchanges and in most circumstances are realisable
within a short timescale. The Board regularly reviews income and expenditure
projections, has set limits for borrowing and reviews compliance with banking
covenants, including the headroom available. The Company has two loan
facilities which expire in December 2023 and June 2024 respectively.
Having taken these factors into account the Directors believe that, after
making enquiries, the Company has adequate resources to continue in
operational existence for the foreseeable future and has the ability to meet
its financial obligations as they fall due for a period of at least twelve
months from the date of approval of this Report. Accordingly, they continue
to adopt the going concern basis of accounting in preparing the financial
statements.
On behalf of the Board
Donald Workman,
Chairman
13 December 2022
Investment Portfolio
As at 31 October 2022
Valuation Total assets
Company Country £'000 %
Aberdeen Standard SICAV - Indian Equity Fund(A) India 52,039 15.9
Taiwan Semiconductor Manufacturing Company Taiwan 21,849 6.7
Samsung Electronics Pref South Korea 17,193 5.3
AIA Group Hong Kong 15,288 4.7
BHP Group Australia 12,247 3.8
DBS Group Holdings Singapore 11,835 3.6
Bank Central Asia Indonesia 10,785 3.3
Tencent Holdings China 10,007 3.0
CSL Australia 9,684 3.0
Oversea-Chinese Banking Corporation Singapore 8,896 2.7
Top ten investments 169,823 52.0
Aberdeen New India Investment Trust(AB) India 7,331 2.2
LG Chem South Korea 6,557 2.0
ASML Netherlands 5,738 1.8
Budweiser Brewing Hong Kong 5,676 1.7
Oz Minerals Australia 5,609 1.7
Cochlear Australia 5,443 1.7
Shenzen Mindray Bio-Medical Electronics - A shares China 5,204 1.6
Woodside Energy(C) Australia 5,174 1.6
Aristocrat Leisure Australia 5,094 1.6
China Tourism Group Duty Free(D) China 5,053 1.5
Top twenty investments 226,702 69.4
Samsung Biologics South Korea 5,051 1.5
Ayala Philippines 4,891 1.5
Land
M.P. Evans Group(B) United Kingdom 4,762 1.5
China Merchants Bank - A shares China 4,721 1.5
LONGi Green Energy Technology - A shares China 4,536 1.4
Hong Kong Exchanges & Clearing Hong Kong 4,358 1.3
Yunnan Energy New Material - A shares China 4,238 1.3
Mobile World Vietnam 4,041 1.2
JD.com China 3,961 1.2
Wuxi Biologics (Cayman) China 3,885 1.2
Top thirty investments 271,146 83.0
Alibaba Group China 3,802 1.2
Kweichow Moutai - A shares China 3,679 1.1
Sungrow Power Supply - A shares China 3,632 1.1
FPT Corporation Vietnam 3,560 1.1
Nari Technology - A shares China 3,497 1.1
Rio Tinto(B) Australia 3,325 1.0
Cisarua Mountain Dairy Indonesia 3,314 1.0
Techtronic Industries Hong Kong 3,229 1.0
abrdn Asia Focus (formerly Aberdeen Standard Asia Focus) (AB) Other Asia 2,716 0.8
Venture Corp Singapore 2,416 0.8
Top forty investments 304,316 93.2
Zhongsheng Group China 2,348 0.7
Sands China Hong Kong 2,242 0.7
China Resources Land China 2,206 0.7
Yonyou Network Technology - A shares China 2,101 0.6
Centre Testing International Group - A shares China 1,908 0.6
Meituan Dianping China 1,861 0.6
John Keells Holdings Sri Lanka 1,856 0.6
Telekom Indonesia Indonesia 1,839 0.5
Kakao South Korea 1,781 0.5
Siam Cement (Foreign) Thailand 1,638 0.5
Top fifty investments 324,096 99.2
GDS - A shares China 1,273 0.4
Total investments 325,369 99.6
Net current assets(E) 1,212 0.4
Total assets(F) 326,581 100.0
(A) Holding also managed by abrdn but not subject to double charging of
management fees.
(B) London Stock Exchange listing.
(C) Holding comprises Australia and United Kingdom listings.
(D) Holding comprises A & H shares.
(E) Excluding short-term bank loans of £8,974,000.
(F) Total assets which includes current year income, less current liabilities,
before deducting any prior charges.
Note: Unless otherwise stated, foreign stock is held and all investments are
equity holdings.
Condensed Statement of Comprehensive Income (unaudited)
Six months ended Six months ended
31 October 2022 31 October 2021
Revenue Capital Total Revenue Capital Total
Notes £'000 £'000 £'000 £'000 £'000 £'000
Losses on investments - (46,168) (46,168) - (5,254) (5,254)
Income 2 4,756 - 4,756 4,076 - 4,076
Management fee (472) (472) (944) (622) (622) (1,244)
Administrative expenses (403) - (403) (380) - (380)
Exchange (losses)/gains - (404) (404) - 67 67
Net return before finance costs and taxation 3,881 (47,044) (43,163) 3,074 (5,809) (2,735)
Finance costs (220) (220) (440) (202) (202) (404)
Return before taxation 3,661 (47,264) (43,603) 2,872 (6,011) (3,139)
Taxation 3 (162) - (162) (169) - (169)
Return after taxation 3,499 (47,264) (43,765) 2,703 (6,011) (3,308)
Return per Ordinary share (pence) 5 3.29 (44.46) (41.17) 2.49 (5.53) (3.04)
The total column of the Condensed Statement of Comprehensive Income represents
the profit and loss account of the Company.
All revenue and capital items in the above statement derive from continuing
operations.
The accompanying notes are an integral part of these condensed set of interim
financial statements.
Condensed Statement of Financial Position (unaudited)
As at As at
31 October 2022 30 April 2022
Notes £'000 £'000
Fixed assets
Investments at fair value through profit or loss 9 325,369 373,697
Current assets
Debtors 1,421 1,907
Cash and short-term deposits 1,372 7,824
2,793 9,731
Creditors: amounts falling due within one year
Loans (8,974) (13,504)
Other creditors (1,581) (2,994)
(10,555) (16,498)
Net current liabilities (7,762) (6,767)
Total assets less current liabilities 317,607 366,930
Non-current creditors
Loans (19,985) (19,978)
Net assets 297,622 346,952
Share capital and reserves
Share capital 5,855 5,855
Share premium account 17,955 17,955
Capital redemption reserve 10,699 10,699
Capital reserve 250,416 299,738
Revenue reserve 12,697 12,705
Equity shareholders' funds 297,622 346,952
Net asset value per Ordinary share (pence) 6 280.90 325.17
The accompanying notes are an integral part of these condensed set of interim
financial statements.
Condensed Statement of Changes in Equity (unaudited)
Six months ended 31 October 2022
Share Capital
Share premium redemption Capital Revenue
capital account reserve reserve reserve Total
Notes £'000 £'000 £'000 £'000 £'000 £'000
Balance at 30 April 2022 5,855 17,955 10,699 299,738 12,705 346,952
Buy back of Ordinary shares for treasury - - - (2,058) - (2,058)
Return after taxation - - - (47,264) 3,499 (43,765)
Dividend paid 4 - - - - (3,507) (3,507)
Balance at 31 October 2022 5,855 17,955 10,699 250,416 12,697 297,622
Six months ended 31 October 2021
Share Capital
Share premium redemption Capital Revenue
capital account reserve reserve reserve Total
Notes £'000 £'000 £'000 £'000 £'000 £'000
Balance at 30 April 2021 5,855 17,955 10,699 355,134 13,362 403,005
Buy back of Ordinary shares for treasury - - - (2,970) - (2,970)
Return after taxation - - - (6,011) 2,703 (3,308)
Dividend paid 4 - - - - (3,587) (3,587)
Balance at 31 October 2021 5,855 17,955 10,699 346,153 12,478 393,140
The accompanying notes are an integral part of these condensed set of interim
financial statements.
Condensed Statement of Cash Flows (unaudited)
Six months ended Six months ended
31 October 2022 31 October 2021
Notes £'000 £'000
Operating activities
Net return before finance costs and taxation (43,163) (2,735)
Adjustment for:
Losses on investments 46,168 5,254
Currency losses/(gains) 404 (67)
Dividend income (4,732) (4,076)
Dividend income received 4,852 4,567
Increase in other debtors (11) (26)
Increase/(decrease) in other creditors 843 (21)
Stock dividends included in investment income - (152)
Overseas withholding tax (164) (225)
Net cash flow from operating activities 4,197 2,519
Investing activities
Purchases of investments (33,092) (39,128)
Sales of investments 33,396 50,870
Net cash from investing activities 304 11,742
Financing activities
Interest paid (426) (395)
Equity dividend paid 4 (3,507) (3,587)
Buyback of Ordinary shares for treasury (2,086) (2,939)
Loan repayment (4,814) -
Net cash used in financing activities (10,833) (6,921)
(Decrease)/Increase in cash (6,332) 7,340
Analysis of changes in cash during the period
Opening balance 7,824 2,364
Effect of exchange rate fluctuations on cash held (120) 142
(Decrease)/Increase in cash as above (6,332) 7,340
Closing balances 1,372 9,846
The accompanying notes are an integral part of these condensed set of interim
financial statements.
Notes to the Financial Statements (unaudited)
For the six months ended 31 October 2022
1. Accounting policies
Basis of accounting. The condensed financial statements have been prepared in
accordance with Financial Reporting Standard 104 'Interim Financial Reporting'
and with the Statement of Recommended Practice for 'Financial Statements of
Investment Trust Companies and Venture Capital Trusts'. They have also been
prepared on a going concern basis and on the assumption that approval as an
investment trust will continue to be granted.
The interim financial statements have been prepared using the same accounting
policies as the preceding annual financial statements.
2. Income
Six months ended Six months ended
31 October 2022 31 October 2021
£'000 £'000
Income from investments
UK dividend income 359 1,038
Overseas dividends 4,373 2,886
Stock dividends - 152
4,732 4,076
Other income
Deposit interest 16 -
Other income 8 -
24 -
Total income 4,756 4,076
3. Taxation
The taxation charge for the period represents withholding tax suffered on
overseas dividend income (31 October 2021 - same).
4. Dividends
Ordinary dividends on equity shares deducted from reserves are analysed below:
Six months ended Six months ended
31 October 2022 31 October 2021
£'000 £'000
2022 final dividend - 3.30p (2021 - 3.30p) 3,507 3,587
An interim dividend of 1.00p (31 October 2021 - 1.00p) per share will be paid
on 10 February 2023 to shareholders on the register on 6 January 2023. The
ex-dividend date will be 5 January 2023.
5. Return per Ordinary share
Six months ended Six months ended
31 October 2022 31 October 2021
p p
Revenue return 3.29 2.49
Capital return (44.46) (5.53)
Total return (41.17) (3.04)
The figures above are based on the following attributable returns:
£'000 £'000
Revenue return 3,499 2,703
Capital return (47,264) (6,011)
Total return (43,765) (3,308)
Weighted average number of Ordinary shares in issue 106,311,234 108,629,299
6. Net asset value per share
As at As at
31 October 2022 30 April 2022
Net assets per Condensed Statement of Financial Position £297,622,000 £346,952,000
Number of Ordinary shares in issue(A) 105,954,348 106,697,348
Net asset value per Ordinary share 280.90p 325.17p
(A) Excluding shares held in treasury.
7. Transaction costs
During the six months ended 31 October 2022 expenses were incurred in
acquiring or disposing of investments classified as fair value through profit
or loss. These have been expensed through capital and are included within
losses on investments in the Condensed Statement of Comprehensive Income. The
total costs were as follows:
Six months ended Six months ended
31 October 2022 31 October 2021
£'000 £'000
Purchases 45 37
Sales 62 63
107 100
8. Analysis of changes in net debt
At At
30 April Currency Cash Non-cash 31 October
2022 differences flows movements 2022
£'000 £'000 £'000 £'000 £'000
Cash and short term deposits 7,824 (120) (6,332) - 1,372
Debt due within one year (13,504) (284) 4,814 - (8,974)
Debt due after more than one year (19,978) - - (7) (19,985)
(25,658) (404) (1,518) (7) (27,587)
At At
30 April Currency Cash Non-cash 31 October
2021 differences flows movements 2021
£'000 £'000 £'000 £'000 £'000
Cash and short term deposits 2,364 142 7,340 - 9,846
Debt due within one year (12,731) (75) - - (12,806)
Debt due after more than one year (19,965) - - (7) (19,972)
(30,332) 67 7,340 (7) (22,932)
A statement reconciling the movement in net funds to the net cash flow has not
been presented as there are no differences from the above analysis.
9. Fair value hierarchy
FRS 102 requires an entity to classify fair value measurements using a fair
value hierarchy that reflects the significance of the inputs used in making
the measurements. The fair value hierarchy has the following classifications:
Level 1: unadjusted quoted prices in an active market for identical assets or
liabilities that the entity can access at the measurement date.
Level 2: inputs other than quoted prices included within Level 1 that are
observable (ie developed using market data) for the asset or liability, either
directly or indirectly.
Level 3: inputs are unobservable (ie for which market data is unavailable) for
the asset or liability.
The financial assets and liabilities measured at fair value in the Condensed
Statement of Financial Position are grouped into the fair value hierarchy at
the reporting date as follows:
Level 1 Level 2 Level 3 Total
As at 31 October 2022 £'000 £'000 £'000 £'000
Financial assets at fair value through profit or loss
Quoted equities 273,330 - - 273,330
Collective investment schemes - 52,039 - 52,039
Total fair value 273,330 52,039 - 325,369
Level 1 Level 2 Level 3 Total
As at 30 April 2022 £'000 £'000 £'000 £'000
Financial assets at fair value through profit or loss
Quoted equities 325,001 - - 325,001
Collective investment schemes - 48,696 - 48,696
Total fair value 325,001 48,696 - 373,697
Quoted equities. The fair value of the Company's investments in quoted
equities has been determined by reference to their quoted bid prices at the
reporting date. Quoted equities included in Fair Value Level 1 are actively
traded on recognised stock exchanges.
Collective investment schemes. The fair value of the Company's investments in
collective investment schemes has been determined by reference to their quoted
net asset values at the reporting date and hence are categorised in Fair Value
Level 2.
10. Share capital
During the six months ended 31 October 2022 the Company purchased 743,000 (31
October 2021 - 927,000; year ended 30 April 2022 - 2,232,000) Ordinary shares
for treasury at a cost of £2,058,000 (31 October 2021 - £2,970,000; 30 April
2022 - £7,008,000).
Subsequent to the period end, the Company has bought back for treasury a
further 135,000 Ordinary shares at a cost of £366,000.
11. Related party transactions and transactions with the Manager
Mr Young is also a director of the Company's Investment Manager, abrdn Asia
Limited, which is a wholly-owned subsidiary of abrdn plc. Management,
promotional activities and secretarial and administration services are
provided to the Company by abrdn Fund Managers Limited ("aFML").
With effect from 1 May 2022, the management fee has been payable monthly in
arrears based on an annual amount of 0.85% up to £350 million and 0.50%
thereafter of the net asset value of the Company valued monthly, previously
0.85% of net assets, with the following provisions for commonly managed funds:
- the Company's investments in Aberdeen Standard SICAV - Indian Equity Fund,
abrdn Asia Focus PLC and Aberdeen New India Investment Trust PLC are excluded
from the calculation of the investment management fee. The total value of
such commonly managed funds at the period end was £62,086,000 (31 October
2021 - £59,176,000).
- the Company receives a rebate from the Manager for the amount of fees in
excess of the above rates charged by the Manager for any commonly managed
fund.
During the period £944,000 (31 October 2021 - £1,244,000) of management fees
were payable, with a balance of £1,120,000 (31 October 2021 - £400,000)
being due to aFML at the period end. Management fees are charged 50% to
revenue and 50% to capital.
The promotional activities fee is based on an annual amount of £196,000 (31
October 2021 - £168,000), payable quarterly in arrears. During the period
£98,000 (31 October 2021 - £84,000) of fees were payable, with a balance of
£65,000 (31 October 2021 - £14,000) being due to aFML at the period end.
12. Segmental information
The Company is engaged in a single segment of business, which is to invest in
equity securities. Accordingly, all significant operating decisions are based
on the Company as one segment.
13. The financial information contained in this Half-Yearly Report does not
constitute statutory accounts as defined in Sections 434-436 of the Companies
Act 2006. The financial information for the six months ended 31 October 2022
and 31 October 2021 has not been audited by the Company's external auditor.
The financial information for the year ended 30 April 2022 has been extracted
from the latest published audited financial statements which have been filed
with the Registrar of Companies. The report of the Independent Auditor on
those accounts contained no qualification or statement under Section 498 (2),
(3) or (4) of the Companies Act 2006.
14. This Half-Yearly Financial Report was approved by the Board on 13 December
2022.
Alternative Performance Measures ("APMs")
Alternative performance measures are numerical measures of the Company's
current, historical or future performance, financial position or cash flows,
other than financial measures defined or specified in the applicable financial
framework. The Company's applicable financial framework includes FRS 102 and
the AIC SORP.
Discount to net asset value per Ordinary share (including current year income)
The amount by which the market price per Ordinary share is lower than the net
asset value per Ordinary share (including current year income), expressed as a
percentage of the net asset value per Ordinary share.
31 October 2022 30 April 2022
Net asset value per Ordinary share (p) a 280.90 325.17
Share price (p) b 244.50 286.00
Discount (a-b)/a 13.0% 12.0%
Net gearing
Net gearing measures total borrowings less cash and cash equivalents divided
by shareholders' funds, expressed as a percentage. Under AIC reporting
guidance cash and cash equivalents includes net amounts due to and from
brokers at the period end as well as cash and short-term deposits.
31 October 2022 30 April 2022
Borrowings (£'000) a 28,959 33,482
Cash (£'000) b 1,372 7,824
Amounts due to brokers (£'000) c 98 2,363
Amounts due from brokers (£'000) d 761 1,141
Shareholders' funds (£'000) e 297,622 346,952
Net gearing (a-b+c-d)/e 9.0% 7.7%
Ongoing charges
The ongoing charges ratio has been calculated in accordance with guidance
issued by the AIC as the total of investment management fees and
administrative expenses and expressed as a percentage of the average daily net
asset values published throughout the year. The ratio for 31 October 2022 is
based on forecast ongoing charges for the year ending 30 April 2023.
31 October 2022 30 April 2022
Investment management fees (£'000) 1,710 2,339
Administrative expenses (£'000) 777 723
Less: non-recurring charges (£'000) (11) -
Ongoing charges (£'000) 2,476 3,062
Average net assets (£'000) 317,738 383,039
Ongoing charges ratio (excluding look-through costs) 0.78% 0.80%
Look-through costs(A) 0.36% 0.33%
Ongoing charges ratio (including look-through costs) 1.14% 1.13%
(A) Calculated in accordance with AIC guidance issued in October 2020 to
include the Company's share of costs of holdings in investment companies on a
look-through basis.
The ongoing charges ratio provided in the Company's Key Information Document
is calculated in line with the PRIIPs regulations, which includes amongst
other things, the cost of borrowings and transaction costs.
Total return
NAV and share price total returns show how the NAV and share price has
performed over a period of time in percentage terms, taking into account both
capital returns and dividends paid to shareholders. Share price and NAV total
returns are monitored against open-ended and closed-ended competitors, and the
Benchmark Index, respectively.
Share
Six months ended 31 October 2022 NAV Price
Opening at 1 May 2022 a 325.17p 286.00p
Closing at 31 October 2022 b 280.90p 244.50p
Price movements c=(b/a)-1 -13.6% -14.5%
Dividend reinvestment(A) d 0.9% 1.0%
Total return c+d -12.7% -13.5%
Share
Year ended 30 April 2022 NAV Price
Opening at 1 May 2021 a 369.97p 328.50p
Closing at 30 April 2022 b 325.17p 286.00p
Price movements c=(b/a)-1 -12.1% -12.9%
Dividend reinvestment(A) d 1.1% 1.1%
Total return c+d -11.0% -11.8%
(A) NAV total return involves investing the net dividend in the NAV of the
Company with debt at fair value on the date on which that dividend goes
ex-dividend. Share price total return involves reinvesting the net dividend in
the share price of the Company on the date on which that dividend goes
ex-dividend.
The Half-yearly Report and Accounts will be posted to shareholders. Copies may
be obtained from the Company Secretary (CEF.CoSec@abrdn.com
(mailto:CEF.CoSec@abrdn.com) ) or from the Company's website,
www.newdawn-trust.co.uk*.
By order of the Board
abrdn Holdings Limited
Company Secretary
13 December 2022
* Neither the Company's website nor the content of any website accessible from
hyperlinks on it (or any other website) is (or is deemed to be) incorporated
into, or forms (or is deemed to form) part of this announcement.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
or visit
www.rns.com (http://www.rns.com/)
.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
. END IR FFAFMDEESEEE