JPMorgan Asia G&I - Half-Year Report
24/05/2023 07:00
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RNS Number : 4097A JPMorgan Asia Growth & Income PLC 24 May 2023
LONDON STOCK EXCHANGE ANNOUNCEMENT
JPMORGAN ASIA GROWTH AND INCOME PLC
UNAUDITED HALF YEAR RESULTS FOR THE SIX MONTHS ENDED 31ST MARCH 2023
Legal Entity Identifier: 5493006R74BNJSJKCB17
Information disclosed in accordance with DTR 4.2.2
CHAIRMAN'S STATEMENT
Performance
This is my first statement as Chairman of your Company, so I am particularly
glad to report that the Company's return on net assets over the six months
ended 31st March 2023 was +11.4%, while the return to Ordinary shareholders
was +13.2%, reflecting a narrowing of the Company's share price discount to
net asset value ('NAV') over the period. The Company significantly
outperformed its benchmark, the MSCI Asia ex Japan Index, which returned
+4.9%, a result which is consistent with the Company's long-term track record
of absolute returns and outperformance.
Asian markets were buoyed during the review period by China's sudden decision
to abandon its 'zero Covid' policy and to lift all restrictions on activity.
There were also signs of a shift towards a more pro-growth, pro-business
stance by the Chinese authorities, which boosted regional equity markets. The
market rally lifted the performance of your Company, while its outperformance
of the market was the result of the Investment Managers' stock selection
decisions - which stocks to hold, which to overweight and which to avoid.
A market review, an appraisal of performance and portfolio positioning,
together with an assessment of the outlook, can be found in the accompanying
Investment Managers' report.
Continuation Vote
I am pleased to report that, at the Company's Annual General Meeting held in
February 2023, shareholders voted in favour of the Company's continuation as
an investment trust for a further three-year period. My fellow Board members
and I thank shareholders for their ongoing support.
Dividend Policy
In the absence of unforeseen developments, the Company aims to pay regular,
quarterly dividends, each equivalent to 1% of the Company's NAV. Payments are
set based on the NAV on the last business day of each financial quarter, being
the end of December, March, June and September, and are funded from a
combination of revenue and capital reserves.
For the year ended 30th September 2022, dividends paid totalled 16.5 pence
(2021: 19.3 pence). In respect of the following two quarters ended 31st
December 2022 and 31st March 2023 respectively, quarterly dividends of 4.0
pence were paid, totalling 8.0 pence. Two further dividends will be declared
on the first business day after 30th June and 30th September 2023.
Dividends are based upon a percentage of net assets, so the dividend paid to
shareholders will reflect the Company's net assets at the particular quarter
end, and will thus be subject to market fluctuations.
Premium/Discount and Share Capital Management
The discount at which the Company's shares trade narrowed during the review
period, ending at 8.3%, which remains broadly in line with the discounts of
its immediate peers. The Board has utilised the Company's buy back powers over
the period, buying in a total of 2,476,914 shares (representing 2.6% of issued
share capital) and holding them in Treasury. The Board's view is that buy back
activity can help balance the demand for and supply of the Company's shares,
while maintaining underlying liquidity.
Gearing
The Company has in place a multi-currency loan facility with Scotiabank. The
Investment Managers utilise drawdowns from this loan facility to gear the
portfolio during periods when they expect gearing to enhance performance. Over
the reporting period and at the time of writing, the Company was not geared.
Board Succession
Bronwyn Curtis retired as Chair of the Company following the Annual General
Meeting on 15th February 2023. Bronwyn joined the Board in 2013 and served as
a Director for nine years, the latter five as Chair. The Board and the
Company benefited greatly from Bronwyn's counsel, dedication and leadership
during her tenure, and we wish her well for the future.
The Board plans for succession to ensure it retains an appropriate balance of
skills and knowledge. To this end, the Board was pleased to announce the
appointments of Diana Choyleva and Kathryn Matthews with effect from 1st
March and 1st June 2023 respectively. For full details of Diana's and
Kathryn's experience, please refer to the Stock Exchange announcement released
by the Company on 2nd December 2022. Dean Buckley, who joined the Board in
2014, will be retiring at the Company's Annual General Meeting to be held in
February 2024. June Aitken will succeed Dean in the role of Audit Committee
Chair. Following Dean's retirement, the Board will once again comprise
five Directors.
In 2022, the FCA published new rules to encourage companies to be more
transparent about the ethnic and gender diversity of their boards. The rules
take effect for accounting periods starting after 1st April 2022, so the
Company is required to report on these matters in its Annual Report. However,
I am already able to confirm that once June has taken on the role of Audit
Committee Chair, the Company's Board constitution will comply with the FCA's
ethnic and gender diversity guidelines for listed companies. It will also
comply with the recommendations of the Hampton-Alexander Review concerning
female representation on the Board. In the absence of any unforeseen
circumstances, it is the Board's intention that the Company will remain
compliant with these requirements.
Keeping in Touch
The Board and the Investment Managers are also keen to increase dialogue with
the Company's existing shareholders. Investors holding their shares through
online platforms will shortly receive a letter inviting them to sign up to
receive email updates from the Company. These updates will deliver regular
news and views, as well as the latest performance statistics. If shareholders
wish to sign up to receive these communications, please visit
https://tinyurl.com/d95jkrzx or scan the QR code on page 9 of the Company's
Half Year Report for the six months ended 31st March 2023 ('2023 Half Year
Report').
Outlook
The international investment climate remains particularly uncertain. The war
in Ukraine, combined with China's territorial ambitions in relation to Taiwan,
mean global geo-political tensions are at their highest for many decades. On
the economic front, the good news is that last year's aggressive monetary
tightening by the US Federal Reserve and other central banks appears to be
having its desired effect - inflation pressures are slowly subsiding across
the major western economies. The likely pace of interest rate reductions is
unclear. However, it remains to be seen whether high interest rates will
result in at least a mild recession in the US and elsewhere. Recent
instability in some smaller US financial institutions has given investors a
fresh source of concern.
Asian economies are currently faring much better. China, India and other
regional economies are all expected to achieve annual GDP growth of 5% or more
this year, and next, while inflation, although elevated, is less of a concern
than in western countries. The Asian region's longer-term growth prospects are
also positive. Very favourable structural trends such as digitalisation,
urbanisation and the expansion of the middle class should continue to support
rapid productivity increases and economic growth. This vibrant environment is
likely to generate many attractive investment opportunities. In addition,
Asian equity market valuations look appealing compared with both the US and
Europe.
So, in all, there seem to be solid grounds for our Investment Managers
positive view on the outlook for Asian equities. The Board shares their
optimism about the market outlook and the Company's ability to continue
delivering capital gains and an attractive income to shareholders over the
long-term.
On behalf of the Board, I would like to thank you for your continuing support.
Sir Richard Stagg
Chairman
24th May 2023
INVESTMENT MANAGERS' REPORT
Performance
During the period under review, Asian stock markets delivered positive gains.
The Company's benchmark, the MSCI AC Asia ex Japan Index, rose 4.9% (in GBP
terms) in the six months ending March 2023. Your Company decisively
outperformed the benchmark, making a total return on net assets of 11.4%,
thanks to stock selection decisions, notably in China, Hong Kong and India.
This latest result extends the Company's long-term track record of absolute
returns and outperformance. Over the 10 years to end March 2023, the Company
realised an average annualised return of 8.3% in NAV terms, compared to a
benchmark return of 6.2%.
In this report, we will discuss the major market developments during the
review period, recent contributors to performance, current portfolio structure
and the outlook for the remainder of 2023.
The market environment
Investor sentiment improved in the first half of the Company's financial year,
as evidenced by the rise in the Company's benchmark over the six-month period
to 31st March 2023. The main driver of market gains was a significant
improvement in China's economic prospects. This time last year, the outlook
for Chinese growth, and equity markets, was beset by a multitude of woes
including stringent COVID lockdowns, restrictions on the property sector and
internet companies and persistent geo-political risks. While tensions with the
West have since escalated, due to China's territorial claim over Taiwan, the
government's sudden, complete abandonment of its 'zero COVID' policy in
November last year cleared the way for a resumption of normal economic and
social activity and marked a turning point for markets. Investors also
welcomed signs of a more pro-growth stance by Chinese authorities, including
measures to support the property sector, improve access to credit and ease
regulatory restrictions on gaming and internet service companies. The MSCI
China Index rose 7% (in GBP terms) over the review period and the economy is
expected to rebound sharply in 2023.
Over the same period, Taiwanese and South Korea equity markets both rose
nearly 15%, buoyed by an improvement in the outlook for technology stocks.
Taiwan Semiconductor Manufacturing Company (TSMC), the world's leading
semiconductor manufacturer, warned of a shaky start to 2023, with
first quarter 2023 sales forecast to fall 15% quarter-on-quarter, but the
company predicted a second half of the calendar year recovery which it expects
to lift revenues by 5% over the year - welcome news for many who had feared a
more protracted slump in IT spending. This anticipated increase in IT spending
is underpinned by several structural forces, including the trends towards
factory automation and the use of high-performance computing, including
Artificial Intelligence ('AI') applications, along with the increasing
semiconductor content required by electric vehicles.
Both India and Indonesia underperformed over the past six months. The MSCI
India Index fell 14%, primarily due to a significant correction in the Adani
group of listed companies, which came under pressure following a short-seller
report that alleged the group had engaged in accounting fraud and flagged the
high levels of the group's debt. In addition, there was a general rotation out
of the markets that outperformed in 2022, which weighed on both Indian and
Indonesian markets over the period up to the end of March.
The conflict in Ukraine is now in its second year and there is no end in
sight. As Jamie Dimon, Chairman and CEO of JPMorgan Chase, wrote in his 2022
annual letter to shareholders of JP Morgan Chase 'Wars are unpredictable, and
at the start, most predictions about how they will end have been completely
wrong', so it is pointless and possibly risky, in our view, to try to forecast
the outcome. While it drags on, the war will continue to affect global energy
and food supplies, and heighten market volatility, while also forcing a
rethink of many economic and regional alliances.
PERFORMANCE ATTRIBUTION
FOR THE SIX MONTHS ENDED 31ST MARCH 2023
% %
Contributions to total returns
Benchmark return (in sterling terms) 4.9
Stock selection 6.3
Currency effect 0.2
Gearing/Cash 0.1
Investment manager contribution 6.6
Dividend/residual(1) -0.1
Portfolio return 11.4
Management fee/other expenses -0.3
Share buy-back 0.3
Return on net assets 11.4
Return to shareholders(A) 13.2
(1) The dividend/residual arises principally from timing differences
in the treatment of income flows.
(A) Alternative Performance Measure ('APM').
Source: FactSet, JPMAM and Morningstar.
All figures are on a total return basis. Performance attribution analyses how
the portfolio achieved its recorded performance relative to its benchmark.
A glossary of terms and APMs is provided on pages 29 and 30 of the 2023 Half
Year Report.
Major Contributors and Detractors to Performance
The largest contributors to the Company's outperformance over the past six
months resulted from the portfolio's stock selection decisions in a diverse
range of Chinese industries that outperformed the market over the period.
These included overweight allocations to internet conglomerates, property
developers and manufacturers of construction machinery and textiles. Relative
returns were further enhanced by the strong performance of the Company's
positions in several Hong Kong-listed holdings whose fortunes are closely
linked to China. The portfolio was overweight Hong Kong based brewers,
insurance companies and stock exchanges, all of which outperformed. Portfolio
gains were further enhanced by an underweight allocation in India, which fell
sharply, as detailed above.
At the stock level, the largest contributor to returns over the review period
was an overweight position in Tencent, China's internet conglomerate giant.
Tencent is the world's largest vendor of video games. It also operates one of
the biggest social media platforms, along with fintech, advertising and
various other enterprises. The company benefited from the recent easing in
regulatory restrictions on on-line gaming as well as benefiting from the
broader recovery in the economy through the company's payments and online
advertising businesses. Another significant contributor was our overweight
allocation to Hong Kong Exchanges and Clearing Limited (HKEC), which offers
securities trading, clearing, and settlement, depository and market data
services. After a 25% slump in daily market turnover in 2022, signs of better
times ahead boosted HKEC's recent performance - the stock rose nearly 20% over
the review period. One factor supporting the stock was an encouraging recovery
in the IPO market in the second half of 2022, with volumes more than four
times greater than in the first half. We expect HKEC's future growth to be
driven by its Stock Connect franchise, which links mainland China's capital
markets to Hong Kong and international markets. This link has effectively
created one of the world's largest equity markets by market cap and daily
turnover and added around 1,400 stocks to the investable universe.
Other positive contributors to portfolio returns over the review period
included Sany Heavy Industries, China's leading excavator manufacturer, an
out-of-index position in Jiangsu Hengli Hydraulic Co, another Chinese company
exposed to construction machinery and AIA, a pan-Asian insurer headquartered
in Hong Kong. Our decision to avoid exposure to Reliance Industries, an Indian
multinational conglomerate, also contributed to relative returns.
The most significant detractor from returns was Taiwan's Giant Manufacturing,
one of the world's largest makers of bicycles and e-bikes. Demand for both
categories grew quickly during the pandemic, but supply constraints limited
the industry's ability to meet underlying demand. This left manufacturers such
as Giant with excess component inventory, resulting in a deterioration of
working capital and a sharp fall in returns. But despite this near-term
setback, and a mixed outlook for lower-priced traditional bicycles, structural
demand for e-bikes remains strong, and we continue to hold the stock. Other
key detractors were stocks that we did not hold and included India's ICICI
Prudential Life Insurance, which outperformed on the back of strong corporate
earnings results, and Alibaba, which rose with the general re-rating of the
Chinese stock market.
Portfolio Activity over the past six months
Recent market volatility has created opportunities for us to purchase stocks
at more attractive levels. For example, we initiated a position in China's
leading utility company, China Yangtze Power. The company is expanding the
capacity of its existing dams and hydro storage facilities and making marginal
increases in its exposure to renewable energy, and these factors are all
contributing to earnings growth. Yet the company's valuation is still
attractive, and it offers a 4% dividend yield.
We also added to an existing position in Telekom Indonesia, Indonesia's
leading fixed-line telephone and mobile carrier. The company has four main
competitive advantages - a strong balance sheet that should sustain its 4-5%
dividend yield, increasing market share as a result of industry consolidation,
more attractive pricing structures than its competitors and exposure to the
long-term growth in fixed broadband penetration.
Our largest outright sale over the past six months was Alibaba. In our view,
the outlook for the company's core domestic e-commerce business is being
challenged by new competitors, and it is unlikely the company will regain lost
market share. Alibaba announced a restructuring plan to split six of its
major businesses into separately managed entities, with the aim of
incentivizing management to improve execution, but many similar previous
attempts to unlock value have fallen short. We also sold profitable holdings
in Budweiser Brewing Asia and Chinese travel company Trip.com, which both
performed strongly following China's reopening and the associated improvement
in domestic demand.
What investors should expect over the next six months
There is increasing evidence that last year's aggressive monetary tightening
by the US Federal Reserve, the Bank of England and the European Central Bank
is slowing the pace of inflation in these major economies. While this is
certainly welcome news, it has come at the cost of weaker growth, lower
corporate earnings growth and financial instability in parts of the banking
sector, notably in the US, where the emergency buy-out of Californian bank
First Republic is the latest unsettling event.
However, while western economies struggle to contain inflation, avoid
recession and shore-up shaky financial institutions, the picture in Asia is
much brighter. From a top-down perspective, the region boasts large, vibrant,
expanding economies that together account for roughly 40% of the world's GDP,
while from the bottom up, Asian businesses are global leaders in a wide range
of sectors including banking, semiconductor manufacturing, insurance,
healthcare, renewable energy and next generation automotive production.
Asian markets are also benefiting from improving structural trends. As just
one of many examples, in Indonesia, improvements in transport infrastructure
and a visible reduction in traffic congestion in the country's largest cities
have resulted in efficiency gains in transportation, logistics and employment.
Previous estimates valued total costs in these areas at 25-30% of GDP, but
this figure has now dropped to 20%. The Indonesian economy has also benefited
from efforts to add value to its exports. In the past, the country was prone
to the typical boom and bust cycles of commodity-based economies - high
economic growth was driven by exports of unprocessed commodities, which
increased domestic consumption, but higher imports of consumer goods pushed up
the current account deficit and destabilised the currency. However, since
2015, Indonesia has focused on developing more downstream industries which add
value to its raw materials, and create a virtuous cycle that raises selling
prices, profits, wages, living standards and export values, thereby reducing
the current account deficit. Prior to 2020, Indonesia frequently ran a current
account deficit of 2-3% of GDP, but the current account has now shifted into
positive territory.
The long-term growth prospects of Asian economies are clearly very positive
and valuations in many markets across the region are presently attractive. The
MSCI AC Asia ex Japan Index is trading at 1.5x price to book, which is
approximately 5% lower than its average over the last 20 years. Following the
sharp recovery in Chinese and Hong Kong equities, valuations in these markets
are less attractive, and Indian company valuations remain elevated, but South
Korea continues to trade at a substantial discount to its market average.
Despite persistent uncertainties related to the war in Ukraine and regional
geo-political tensions, Asia's powerful combination of strong growth,
innovation, favourable structural trends, and attractive valuations - at least
in some key markets - underpins our belief that Asian equity markets continue
to provide many attractive investment opportunities. We remain confident that
our long experience, both local and global presence and focus on the
fundamental analysis of specific stocks will allow us to keep identifying the
region's best opportunities, ensuring the Company continues to provide our
shareholders with attractive returns, outperformance and a competitive
dividend over the long-term.
Ayaz Ebrahim
Robert Lloyd
Investment Managers
24th May 2023
INTERIM MANAGEMENT REPORT
The Company is required to make the following disclosures in its half year
report:
Principal Risks and Uncertainties
The principal and emerging risks faced by the Company fall into the following
broad categories: investment and strategy, political and economic, operational
risk and cybercrime, climate change and global pandemic. Information on the
principal and emerging risks faced by the Company is given in the business
review section within the 2022 Annual Report and Financial Statements.
Related Parties Transactions
During the first six months of the current financial year, no transactions
with related parties have taken place which have materially affected the
financial position or the performance of the Company during the period.
Going Concern
The Directors believe, having considered the Company's investment objectives,
risk management policies, capital management policies and procedures, nature
of the portfolio (being mainly securities which are readily realisable) and
expenditure projections, that the Company has adequate resources, an
appropriate financial structure and suitable management arrangements in place
to continue in operational existence for the foreseeable future and, more
specifically, that there are no material uncertainties pertaining to the
Company that would prevent its ability to continue in such operational
existence for at least 12 months from the date of the approval of this
half-yearly financial report. For these reasons, they consider there is
reasonable evidence to adopt the going concern basis in preparing the
financial statements. This conclusion also takes into account the Board's
assessment of the impact of heightened market volatility since the COVID-19
outbreak and more recently the Russian invasion of Ukraine, but does not
believe the Company's going concern status is affected.
Continuation votes are held every three years and the next continuation vote
will be put to shareholders at the Annual General Meeting in 2026.
Directors' Responsibilities
The Board of Directors confirms that, to the best of its knowledge:
(i) the condensed set of financial statements contained within the
half yearly financial report has been prepared in accordance with FRS 104
'Interim Financial Reporting' and gives a true and fair view of the state of
affairs of the Company and of the assets, liabilities, financial position and
net return of the Company, as at 31st March 2023, as required by the UK
Listing Authority Disclosure and Transparency Rules 4.2.4R; and
(ii) the interim management report includes a fair review of the
information required by 4.2.7R and 4.2.8R of the UK Listing Authority
Disclosure and Transparency Rules. In order to provide these confirmations,
and in preparing these financial statements, the Directors are required to:
In order to provide these confirmations, and in preparing these financial
statements, the Directors are required to:
• select suitable accounting policies and then apply them
consistently;
• make judgements and accounting estimates that are reasonable
and prudent;
• state whether applicable UK Accounting Standards have been
followed, subject to any material departures disclosed and explained in the
financial statements; and
• prepare the financial statements on the going concern basis
unless it is inappropriate to presume that the Company will continue in
business;
and the Directors confirm that they have done so.
For and on behalf of the Board
Sir Richard Stagg
Chairman
24th May 2023
CONDENSED STATEMENT OF COMPREHENSIVE INCOME
(Unaudited) (Unaudited) (Audited)
Six months ended Six months ended Year ended
31st March 2023 31st March 2022 30th September 2022
Revenue Capital Total Revenue Capital Total Revenue Capital Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
Gains/(losses) on investments
held at fair value through
profit or loss - 37,196 37,196 - (31,212) (31,212) - (75,909) (75,909)
Net foreign currency
(losses)/gains - (90) (90) - 62 62 - 220 220
Income from investments 3,289 - 3,289 2,505 - 2,505 7,882 - 7,882
Interest receivable and
similar income 55 - 55 50 - 50 102 - 102
Gross return/(loss) 3,344 37,106 40,450 2,555 (31,150) (28,595) 7,984 (75,689) (67,705)
Management fee (1,003) - (1,003) (1,260) - (1,260) (2,155) - (2,155)
Other administrative expenses (467) - (467) (337) - (337) (698) - (698)
Net return/(loss) before
finance costs and taxation 1,874 37,106 38,980 958 (31,150) (30,192) 5,131 (75,689) (70,558)
Finance costs (36) - (36) (21) - (21) (43) - (43)
Net return/(loss) before
taxation 1,838 37,106 38,944 937 (31,150) (30,213) 5,088 (75,689) (70,601)
Taxation (charge)/credit (396) 27 (369) 247 (394) (147) (125) (389) (514)
Net return/(loss)
after taxation 1,442 37,133 38,575 1,184 (31,544) (30,360) 4,963 (76,078) (71,115)
Return/(loss) per share (note 3) 1.52p 39.08p 40.60p 1.21p (32.29)p (31.08)p 5.09p (77.95)p (72.86)p
All revenue and capital items in the above statement derive from continuing
operations.
The 'Total' column of this statement is the profit and loss account of the
Company and the 'Revenue' and 'Capital' columns represent
supplementary information prepared under guidance issued by the Association of
Investment Companies.
Net return/(loss) after taxation represents the profit/(loss) for the period
and also the total comprehensive income.
CONDENSED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHS ENDED 31ST MARCH 2023
Called up Exercised Capital
share Share warrant redemption Capital Revenue
capital premium reserve reserve reserves(1) reserve(1) Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
Six months ended 31st March 2023 (Unaudited)
At 30th September 2022 24,449 46,705 977 25,121 261,308 - 358,560
Repurchase of shares into Treasury - - - - (8,343) - (8,343)
Net return/(loss) - - - - 37,133 1,442 38,575
Dividends paid in the period (note 4) - - - - (5,916) (1,442) (7,358)
At 31st March 2023 24,449 46,705 977 25,121 284,182 - 381,434
Six months ended 31st March 2022 (Unaudited)
At 30th September 2021 24,449 46,705 977 25,121 352,948 - 450,200
Repurchase of shares into Treasury - - - - (131) - (131)
Net (loss)/return - - - - (31,544) 1,184 (30,360)
Dividends paid in the period (note 4) - - - - (7,706) (1,184) (8,890)
At 31st March 2022 24,449 46,705 977 25,121 313,567 - 410,819
Year ended 30th September 2022 (Audited)
At 30th September 2021 24,449 46,705 977 25,121 352,948 - 450,200
Repurchase of shares into Treasury - - - - (3,534) - (3,534)
Net (loss)/return - - - - (76,078) 4,963 (71,115)
Dividends paid in the year (note 4) - - - - (12,028) (4,963) (16,991)
At 30th September 2022 24,449 46,705 977 25,121 261,308 - 358,560
1 These reserves form the distributable reserves of the Company and
may be used to fund distributions to investors.
CONDENSED STATEMENT OF FINANCIAL POSITION
(Unaudited) (Unaudited) (Audited)
At At At
31st March 2023 31st March 2022 30th September 2022
£'000 £'000 £'000
Fixed assets
Investments held at fair value through profit or loss 379,850 407,384 358,303
Current assets
Derivative financial assets - - 2
Debtors 5,546 6,322 587
Cash and cash equivalents 8 1,107 454
5,554 7,429 1,043
Creditors: amounts falling due within one year (3,970) (3,993) (786)
Derivative financial liabilities - (1) -
Net current assets 1,584 3,435 257
Total assets less current liabilities 381,434 410,819 358,560
Net assets 381,434 410,819 358,560
Capital and reserves
Called up share capital 24,449 24,449 24,449
Share premium 46,705 46,705 46,705
Exercised warrant reserve 977 977 977
Capital redemption reserve 25,121 25,121 25,121
Capital reserves 284,182 313,567 261,308
Total shareholders' funds 381,434 410,819 358,560
Net asset value per share (note 5) 404.6p 420.5p 370.6p
CONDENSED STATEMENT OF CASH FLOWS
(Unaudited) (Unaudited) (Audited)
Six months ended Six months ended Year ended
31st March 2023 31st March 2022(1) 30th September 2022(1)
£'000 £'000 £'000
Cash flows from operating activities
Net return/(loss) before finance costs and taxation 38,980 (30,192) (70,558)
Adjustment for:
Net gains on investments held at fair value through profit or loss (37,196) 31,212 75,909
Net foreign currency losses/(gains) 90 (62) (220)
Dividend income (3,289) (2,505) (7,882)
Interest income (15) (1) (10)
Realised gain on foreign exchange transactions (122) (160) (166)
Realised exchange (gain)/loss on Liquidity (31) 104 197
Increase in accrued income and other debtors (14) (13) (5)
Decrease in accrued expenses (25) (64) (26)
Net cash used in operating activities (1,622) (1,681) (2,761)
Dividends received 1,647 999 7,007
Interest received 15 1 10
Overseas withholding tax (suffered)/recovered (18) 194 272
Capital gains tax paid 27 - -
Net cash inflow/(outflow) from operating activities 49 (487) 4,528
Purchases of investments and derivatives (84,176) (102,642) (196,879)
Sales of investments and derivatives 97,228 111,963 211,835
Settlement of foreign currency contracts - 40 (4)
Net cash inflow from investing activities 13,052 9,361 14,952
Equity dividends paid (7,358) (8,890) (16,991)
Repurchase of shares into Treasury (8,275) (430) (3,679)
Interest paid (26) (22) (43)
Utilisation of bank overdraft 2,047 - -
Net cash outflow from financing activities (13,612) (9,342) (20,713)
Decrease in cash and cash equivalents (511) (468) (1,233)
Cash and cash equivalents at start of year 454 1,496 1,496
Unrealised gain on foreign currency cash and cash equivalents 65 79 191
Cash and cash equivalents at end of year 8 1,107 454
Cash and cash equivalents consist of:
Cash and short term deposits - 1,100 445
Overdrafts (2,047) - -
Cash held in liquidity fund 8 7 9
Total (2,039) 1,107 454
1 The presentation of the Cash Flow Statement, as permitted under FRS
102, has been changed so as to present the reconciliation of net return/loss
before finance costs to cash inflow/(outflow) from operating activities on the
face of the Cash Flow Statement. Previously, this was shown by way of note.
Other than changes in presentation of the certain cash flow items, there is no
change to the cash flows as presented in previous periods.
RECONCILIATION OF NET DEBT
As at As at
30th September Exchange 31st March
2022 Cash flows movements 2023
£'000 £'000 £'000 £'000
Cash and cash equivalents
Cash 445 (510) 65 -
Overdrafts - (2,047) - (2,047)
Cash equivalents 9 (1) - 8
Total 454 (2,558) 65 (2,039)
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 31ST MARCH 2023
1. Financial statements
The information contained within the financial statements in this 2023 Half
Year Report has not been audited or reviewed by the Company's auditors.
The figures and financial information for the year ended 30th September 2022
are extracted from the latest published financial statements of the Company
and do not constitute statutory accounts for that year. Those financial
statements have been delivered to the Registrar of Companies and include the
report of the auditors which was unqualified and did not contain a statement
under either section 498(2) or 498(3) of the Companies Act 2006.
2. Accounting policies
Basis of accounting
The financial statements have been prepared in accordance with the Companies
Act 2006, FRS 102 'The Financial Reporting Standard applicable in the UK and
Republic of Ireland' of the United Kingdom Generally Accepted Accounting
Practice ('UK GAAP') and with the Statement of Recommended Practice
'Financial Statements of Investment Trust Companies and Venture Capital
Trusts' (the 'SORP') issued by the Association of Investment Companies in July
2022.
FRS 104, 'Interim Financial Reporting', issued by the FRC in March 2015 has
been applied in preparing this condensed set of financial statements for the
six months ended 31st March 2023.
All of the Company's operations are of a continuing nature.
The accounting policies applied to this condensed set of financial statements
are consistent with those applied in the financial statements for the year
ended 30th September 2022.
3. Return/(loss) per share
(Unaudited) (Unaudited) (Audited)
Six months ended Six months ended Year ended
31st March 2023 31st March 2022 30th September 2022
£'000 £'000 £'000
Return per share is based on the following:
Revenue return 1,442 1,184 4,963
Capital return/(loss) 37,133 (31,544) (76,078)
Total return/(loss) 38,575 (30,360) (71,115)
Weighted average number of shares in issue 95,014,494 97,694,197 97,596,359
Revenue return per share 1.52p 1.21p 5.09p
Capital return/(loss) per share 39.08p (32.29)p (77.95)p
Total return/(loss) per share 40.60p (31.08)p (72.86)p
4. Dividends
(Unaudited) (Unaudited) (Audited)
Six months ended Six months ended Year ended
31st March 2023 31st March 2022 30th September 2022
£'000 £'000 £'000
Dividends paid
2022 second quarterly dividend of 4.2p - - 4,494
2022 third quarterly dividend of 4.1p - - 4,396
2022 fourth quarterly dividend of 4.6p (2021: 4.6p) 3,569 4,494 4,103
2023 first quarterly dividend of 4.0p (2022: 4.5p) 3,789 4,396 3,998
Total dividends paid in the period/year 7,358 8,890 16,991
A second interim dividend of 4.0p has been declared for payment on 24th May
2023 for the financial year ending 30th September 2023.
Dividend payments in excess of the revenue amount will be paid out of the
Company's distributable capital reserve.
5. Net asset value per share
(Unaudited) (Unaudited) (Audited)
Six months ended Six months ended Year ended
31st March 2023 31st March 2022 30th September 2022
Net assets (£'000) 381,434 410,819 358,560
Number of shares in issue 94,279,354 97,694,197 96,756,268
Net asset value per share 404.6p 420.5p 370.6p
JPMORGAN FUNDS LIMITED
24th May 2023
For further information, please contact:
Alison Vincent
For and on behalf of
JPMorgan Funds Limited
020 7742 4000
Neither the contents of the Company's website nor the contents of any website
accessible from hyperlinks on the Company's website (or any other website) is
incorporated into, or forms part of, this announcement.
ENDS
A copy of the 2023 Half Year Report will shortly be submitted to the FCA's
National Storage Mechanism and will be available for inspection at
https://data.fca.org.uk/#/nsm/nationalstoragemechanism
(https://secureweb.jpmchase.net/readonly/https:/lnks.gd/l/eyJhbGciOiJIUzI1NiJ9.eyJidWxsZXRpbl9saW5rX2lkIjoxMDIsInVyaSI6ImJwMjpjbGljayIsImJ1bGxldGluX2lkIjoiMjAyMDA0MDUuMTk3NzA4MDEiLCJ1cmwiOiJodHRwczovL2RhdGEuZmNhLm9yZy51ay8jL25zbS9uYXRpb25hbHN0b3JhZ2VtZWNoYW5pc20ifQ.b7Q7NXHGRA8MjB_Ugl8Tv4JxhiU28TbcoNb04FTTMiY/br/77057565556-l)
The 2023 Half Year Report will shortly be available on the Company's website
at www.jpmasiagrowthandincome.co.uk (http://www.jpmasiagrowthandincome.co.uk)
where up-to-date information on the Company, including daily NAV and share
prices, factsheets and portfolio information can also be found.
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. END IR SEIFMDEDSEDI