REG - Ashmore Group Plc - Final Results <Origin Href="QuoteRef">ASHM.L</Origin> - Part 5

AshmoreAnnouncement

29/10/2014 10:59

- Part 5: For the preceding part double click  ID:nRSK3700Rd 

            Indonesia                                                             70.00                                 
 Ashmore Investments (Colombia) SL                           Spain                                                                 100.00                                
 Ashmore Japan Co. Limited                                   Japan                                                                 100.00                                
 Ashmore Investment Consulting (Beijing) Co. Limited         China                                                                 100.00                                
 Ashmore Equities Holding Corporation                        USA                                                                   100.00                                
 Ashmore Equities Investment Management (US) L.L.C.          USA                                                                   62.90                                 
 
 
Consolidated funds 
 
The following investment funds, over which the Group is deemed to have control, have been consolidated into the Group's
results. 
 
 Name                                  Type of fund    Country of incorporation/ formation and principal place of operation  % of net                         
                                                                                                                             assets value held by the Group   
 Ashmore Emerging Markets Equity Fund  Equity          USA                                                                   65.0%                            
 Ashmore Brasil Ações FIC De FIA       Equity          Brazil                                                                69.4%                            
 Ashmore Dana Ekuitas Nusantara        Equity          Indonesia                                                             81.0%                            
 Ashmore Dana Obligasi Nusantara       Local currency  Indonesia                                                             91.5%                            
 Ashmore SICAV Equity Select Fund      Equity          Luxembourg                                                            100.0%                           
 Ashmore SICAV 3 Multi Strategy Fund   Multi-strategy  Luxembourg                                                            83.1%                            
 
 
28) Investments in associates and joint ventures 
 
Associates and joint ventures 
 
The Group held interests in the following associates and joint ventures as at 30 June 2014: 
 
 Name                                  Type           Nature of business     Country of incorporation/  % of equity shares held by the Group  
                                                                             formation and principal                                          
                                                                             place of operation                                               
 VTB-Ashmore Capital Holdings Limited  Associate      Investment management  Russia                     50%                                   
 Everbright Ashmore                    Associate      Investment management  China                      30%                                   
 Central China Securities Co. Limited  Joint venture  Investment management  China                      49%                                   
 
 
The associates and the joint venture are unlisted. 
 
Movements in investments in associates and joint venture during the year were as follows: 
 
                               2014        2013            
                               Associates  Joint ventures  Total  Associates  Joint ventures  Total  
                               £m          £m              £m     £m          £m              £m     
 At the beginning of the year  2.3         9.5             11.8   2.3         -               2.3    
 Additions                     -           -               -      -           9.9             9.9    
 Share of profit               0.2         (2.1)           (1.9)  0.3         (0.4)           (0.1)  
 Distributions                 (0.2)       -               (0.2)  (0.3)       -               (0.3)  
 At the end of the year        2.3         7.4             9.7    2.3         9.5             11.8   
 
 
Associates 
 
The summarised aggregate financial information on associates is shown below. 
 
 Group                                 2014   2013   
                                       £m     £m     
 Total assets                          3.4    4.7    
 Total liabilities                     (1.1)  (1.4)  
 Net assets                            2.3    3.4    
 Group's share of net assets           0.7    1.1    
 Revenue for the year to 30 June 2014  4.6    4.9    
 Profit for the year to 30 June 2014   0.6    1.1    
 Group's share of profit for the year  0.2    0.3    
 
 
The carrying value of the investments in associates include attributable goodwill that arose on acquisition of the
associates. Although the Group's share of net tangible assets of the associates is currently below the aggregate carrying
value of the associates reflected on the consolidated balance sheet, the Group has considered that this position is
temporary. No permanent impairment is believed to exist relating to the associates. 
 
The Group has undrawn capital commitments of £5.1 million (30 June 2013: £6.4 million) to investment funds managed by the
associates. 
 
Further details are provided in note 30. 
 
Joint ventures 
 
During the prior year, the Group entered into an agreement to acquire a 49% interest in a fund management joint venture
with Central China Securities Co. Ltd. in China. Under the terms of the agreement and upon being granted the required
approvals by the China Securities Regulatory Commission and other relevant government authorities, the Group contributed
its share of the initial capitalisation, equivalent to £9.9 million. 
 
Summarised financial information on the Group's share in the joint venture is shown below: 
 
                      2014   2013   
                      £m     £m     
 Current assets       8.7    5.7    
 Non-current assets   0.1    0.1    
 Current liabilities  (1.4)  (0.1)  
 Total equity         7.4    5.7    
                                    
 Income               0.6    0.4    
 Expenses             (2.7)  (0.8)  
 Loss for the year    (2.1)  (0.4)  
 
 
29) Related party transactions 
 
Related parties of the Group include key management personnel, close family members of key management personnel,
subsidiaries, associates, joint ventures, Ashmore Funds, the EBT and the Ashmore Foundation. 
 
Key management personnel - Group and Company 
 
The compensation paid to or payable to key management personnel for employee services is shown below: 
 
 £m                                  2014   2013  
                                     £m     £m    
 Short-term employee benefits        0.9    2.7   
 Defined contribution pension costs  -      -     
 Share-based payment benefits        (0.4)  1.7   
                                     0.5    4.4   
 
 
Share-based payment benefits represent the fair value charge to the statement of comprehensive income of share awards. 
 
During the year, there were no other transactions entered into with key management personnel (FY2012/13: none). Aggregate
key management personnel interests in consolidated funds at 30 June 2014 were £3.3 million (30 June 2013: 3.5 million). 
 
Transactions with subsidiaries - Company 
 
Details of transactions between the Company and its subsidiaries are shown below: 
 
                               2014   2013   
                               £m     £m     
 Transactions during the year                
 Management fees received      45.0   79.1   
 Net dividends received        143.2  196.7  
 Loans given to subsidiaries   40.9   51.3   
 
 
Amounts receivable or payable to subsidiaries are disclosed in notes 18 and 26. 
 
Transactions with Ashmore Funds - Group 
 
During the year, the Group received £158.5 million of gross management fees and performance fees (FY2012/13: £337.0
million) from the 90 funds (FY2012/13: 75 funds) it manages and which are classified as related parties. As at 30 June 2014
the Group had receivables due from funds of £55.3 million (30 June 2013: £57.6 million). 
 
Transactions with the EBT - Group and Company 
 
The EBT, which acts as an agent for the purpose of the employee share-based compensation plans, has been provided a loan
facility to allow it to acquire Ashmore shares in order to satisfy outstanding unvested shares awards. The EBT is included
within the results of the Group and the Company. As at year end the loan outstanding was £137.6 million (30 June 2013:
£112.7 million). 
 
Transaction with the Ashmore Foundation - Group and Company 
 
The Ashmore Foundation is a related party to the Group. The Foundation was set up to provide financial grants to worthwhile
causes within the Emerging Markets countries in which Ashmore operates with a view to giving back into the countries and
communities in which the Group invests and which contribute to Ashmore's income and profitability. The Group donated less
than £0.1 million to the Foundation during the year (FY2012/13: £0.1 million). 
 
30) Commitments 
 
Operating lease commitments 
 
The Group and Company have entered into certain property leases. The leases have no escalation clauses or renewal or
purchase options, and no restrictions imposed on them. The future aggregate minimum lease payments under these
non-cancellable operating leases fall due as follows: 
 
Group 
 
                        2014  2013  
                        £m    £m    
 Within 1 year          2.8   2.9   
 Between 1 and 5 years  8.2   8.5   
 Later than 5 years     5.2   6.7   
                        16.2  18.1  
 
 
Company 
 
                        2014  2013  
                        £m    £m    
 Within 1 year          1.2   1.2   
 Between 1 and 5 years  4.6   4.6   
 Later than 5 years     5.2   6.3   
                        11.0  12.1  
 
 
Operating lease expenses are disclosed in note 11. 
 
Undrawn investment commitments 
 
                                               2014  2013  
                                               £m    £m    
 Ashmore I - FCP Colombia Infrastructure Fund  2.9   4.9   
 Everbright Ashmore China Real Estate Fund     1.6   3.0   
 VTBC-Ashmore Real Estate Partners I, L.P.     3.5   3.4   
 
 
Company 
 
The Company has undrawn loan commitments to other Group entities totalling £84.2 million (30 June 2013: £94.5 million) to
support their investment activities but has no investment commitments of its own (30 June 2013: none). 
 
31) Post-balance sheet events 
 
There were no post-balance sheet events that required adjustment of or disclosure in the financial statements for the year
ended 30 June 2014. 
 
32) Accounting estimates and judgements 
 
Estimates and judgements used in preparing the financial statements are regularly evaluated and are based upon management's
assessment of current and future events. The principal estimates and judgements that have a significant effect on the
carrying amounts of assets and liabilities are discussed below. 
 
Goodwill 
 
The Group tests goodwill and intangible assets annually for impairment. The recoverable amount for goodwill is determined
in reference to the Group's market capitalisation, whereas recoverable amount for intangible assets is determined based
upon value in use calculations prepared on the basis of management's assumptions and estimates. The carrying value of
goodwill and intangible assets on the Group's balance sheet at 30 June 2014 was £72.2 million (30 June 2013: £84.3
million). Management considers that reasonable possible changes in any of the key assumptions applied would not cause the
carrying value of goodwill and intangible assets to materially exceed their recoverable values. 
 
Performance fees 
 
The Group assesses the recognition of performance fees to determine whether receipt of the fees is considered probable and
the amount reliable. The assessment is made using management's judgement of the circumstances relevant to each performance
fee entitlement. 
 
There were no outstanding performance fees receivable at 30 June 2014 (30 June 2013: none). 
 
33) Forward looking statements 
 
It is possible that this document could or may contain forward looking statements that are based on current expectations or
beliefs, as well as assumptions about future events. These forward looking statements can be identified by the fact that
they do not relate only to historical or current facts. Forward looking statements often use words such as anticipate,
target, expect, estimate, intend, plan, goal, believe, will, may, should, would, could or other words of similar meaning. 
 
Undue reliance should not be placed on any such statements because, by their very nature, they are subject to known and
unknown risks and uncertainties and can be affected by other factors that could cause actual results, and the Group's plans
and objectives, to differ materially from those expressed or implied in the forward looking statements. There are several
factors that could cause actual results to differ materially from those expressed or implied in forward looking statements.
Among the factors that could cause actual results to differ materially from those described in the forward looking
statements are changes in the global, political, economic, business, competitive, market and regulatory forces, future
exchange and interest rates, changes in tax rates and future business combinations or dispositions. The Group undertakes no
obligation to revise or update any forward looking statement contained within this document, regardless of whether those
statements are affected as a result of new information, future events or otherwise. 
 
34) Statutory accounts 
 
The financial information set out above does not constitute the Group's statutory accounts for the years ended 30 June 2014
or 2013. Statutory accounts for 2013 have been delivered to the registrar of companies, and those for 2014 will be
delivered in due course. The auditors have reported on those accounts; their reports were (i) unqualified, (ii) did not
include a reference to any matters to which the auditors drew attention by way of emphasis without qualifying their report
and (iii) did not contain a statement under section 498 (2) or (3) of the Companies Act 2006 in respect of the accounts for
2013 or 2014. 
 
This information is provided by RNS
The company news service from the London Stock Exchange