Source - RNS
RNS Number : 1360L
Witan Pacific Investment Trust PLC
29 September 2016
 

WITAN PACIFIC INVESTMENT TRUST PLC

(the "Company")

 

HALF-YEARLY REPORT AND FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED 31 JULY 2016

 

Witan Pacific Investment Trust plc announces that its 2016 Half-Yearly Report has been published. The full report will be made available on the National Storage Mechanism website: http://www.morningstar.co.uk/uk/NSM and can be accessed via the Company's website at www.witanpacific.com. It will be circulated to shareholders shortly.

 

 

FINANCIAL SUMMARY

 

Key data

 

 

31 July 2016

31 January 2016

% change

Net Asset Value ("NAV") per share

315.40p

259.27p 

+21.6%

Share price

273.00p

231.00p 

+18.2%

Discount

13.4%

10.9%

 

 

 

Cumulative performance (Total Return)

 

 

6 months

1 year

3 years

5 years

NAV per share*

22.8%

16.1%

21.7%

38.5%

Share price*

19.5%

13.7%

17.8%

39.3%

Benchmark**

22.0%

16.1%

27.8%

41.8%

 

 

Income

 

 

31 July 2016

31 July 2015

% change

Revenue return per share

3.01p

2.84p

+6.0%

Interim dividend per share

2.20p

2.15p

+2.3%

 

Ongoing charges (6 months)

 

 

31 July 2016

Excluding performance fees

0.53%

Including performance fees

0.54%

 

 

* Source: Morningstar/Witan Investment Services. Total returns include dividends reinvested.

** Source: Morningstar. The benchmark for Witan Pacific Investment Trust plc is the MSCI All Country Asia Pacific Index.

 

 

LONG-TERM PERFORMANCE ANALYSIS

 

Total returns since inception of multi-manager structure 31 May 2005

 

 

Cumulative return

Annualised return

NAV per share*

176.8%

9.5%

Share price*

173.8%

9.4%

Benchmark*

155.2%

8.8%

 

* Source: Morningstar/Witan Investment Services. Total returns include dividends reinvested.

 

 

CHAIRMAN'S STATEMENT

 

Summary

 

§ NAV total return of 22.8%, compared with benchmark 22.0%

 

§ Share price total return of 19.5%

 

§ Outperformed in 8 out of the 11 financial years since becoming multi-manager in May 2005

 

§ Interim dividend increased by 2.3% to 2.20p

 

 

Performance and investment approach

The period from 31 January 2016 to 31 July 2016 saw a sharp rise in Witan Pacific's NAV per share: from 259.27p per share to 315.40p. The NAV return per share of 22.8% (capital and income combined) compares with the total return provided by the benchmark of 22%.

 

Following the ups and downs of the last financial year, during which the NAV total return per share declined by 5.6%, this is encouraging news. We are also pleased to be able to increase our dividend per share at the interim stage by 2.3%. The share price total return was not quite as strong as the benchmark return, however, as the discount which stood at 10.9% at the end of January (on a particularly volatile day) increased to 13.4% at the end of July. There was some volatility in the discounts of many of the trusts investing in the Asian region over the six month period.

 

It is worth looking in a bit more detail at this rather startling performance: such moves are unusual. In January and February, the region's stock markets were suffering from considerable uncertainty arising from fears of a very sharp slow down in the Chinese economy. From a low point in mid-February, most of the markets in the region (except for Japan's) recovered somewhat over the next few months, and that recovery has continued into the current half year so far. The recovery saw particularly strong performances from the Philippine, Thai and Hong Kong markets, and from commodity and telecoms stocks in sector terms. However, in local currency terms, the Japanese market fell by 7%.

 

Currency effects were unusually significant given the sharp decline in sterling following the results of the UK referendum on membership of the European Union, and given local currency strength as well. The yen rose by some 25%, transforming a negative return to local investors in the Japanese market into a 17% return to a sterling investor. In aggregate, currency provided considerably more than half the returns from the region as a whole, but some of the individual markets, such as the Philippines and Thailand, provided returns to local investors of over 20%, and recovery in sentiment towards China resulted in returns of around 13% to local investors in China and just under 18% to investors in Hong Kong.

 

Performance analysis

We were pleased to see a continuation of the outperformance of the last two years into the first half of the current financial year. Aberdeen and Matthews both focus on stocks rather than on currencies or macro-economics and therefore can find themselves at variance with markets driven by big-picture influences in the short term. There was some evidence of this as the portfolio underperformed in the market recoveries of March and July. However, overall, Aberdeen outperformed strongly over the first six months of the financial year, following a prolonged period of underperformance. Their portfolio provided a return (before fees) of some 27%, compared with the benchmark's 22%. Mining shares (including Rio Tinto and BHP Billiton) which are owned by Aberdeen rallied after a long period of poor performance. Elsewhere, OCBC, Keyence, Shin-Etsu Chemical and Singapore Technical Engineering also made a notable contribution to Aberdeen's performance. Matthews performed more or less in line over the six month period, having performed very well in relative terms in 2015/16. Gavekal underperformed in relative terms, having outperformed in 2015/16's falling markets.

 

Your Board continues to review its managers carefully and to monitor the combined portfolio which results from their individual activities. We note that there have been no significant changes in the overall positioning of the portfolio, which remains underweight relative to its benchmark in Japanese and Australian equities and overweight in relative terms to Chinese and Hong Kong stocks. It should be noted that these positions are the result generally of individual stock decisions by Aberdeen and Matthews, although Gavekal took a "top down" view to sell their Japanese holdings ahead of the period end. The portfolio as a whole has an emphasis on consumer goods and telecoms, and holds less financial stocks than in the benchmark and is particularly underweight in Japanese and Australian financial companies.

 

In terms of the size of the companies in which we invest, your Company has tended to have a bias away from the very largest companies in the region (again avoiding the Australian financial companies) as your portfolio managers have found more attractive opportunities in medium sized and smaller companies. Approximately 27% of the combined portfolio is in companies with a market capitalisation of less than £6.5bn.

 

We have also amended the figures we present to show the portfolio's geographical allocation to China and Hong Kong as a single entity rather than separately, as previously recorded. An increasing number of Chinese companies (or companies with significant operations in China) are now domiciled and/or listed in Hong Kong and this makes the separation between China and Hong Kong less appropriate. The new China/Hong Kong categorisation therefore includes all portfolio companies which are incorporated in either country as well as Yum! Brands and Qualcomm which, while incorporated in the US, draw a significant proportion of their revenue from the region. Matthews and Aberdeen have both asked us for permission to invest in Chinese "A" shares, which are Chinese domiciled shares quoted in renminbi and listed on the Shanghai and Shenzhen exchanges. After discussion with them and with our custodian, we have granted permission. We would not expect the overall proportion of the portfolio to be invested in Chinese "A" shares to be significant, but the setback in that market has provided some interesting opportunities which we believe our managers are well placed to explore, as they do other opportunities across the region. 

 

The Board

We have continued to make sure we have succession plans in place and we have recruited and refreshed the Board regularly in recent years. I have been a Director of Witan Pacific for more than 12 years, and will retire from the Board and as Chair at the AGM next year. I am pleased to say that Susan Platts-Martin will take over from me as Chair at that point. We are likely to recruit an additional Board member between now and then, on the basis of our analysis of the skills, knowledge and experience required to add value for shareholders.

 

Dividend

The underlying dividend growth from the companies in which Witan Pacific invests has been reasonably robust over the period and the impact of currencies has been mildly positive, in contrast to recent years.  Our managers believe at this stage that dividend growth will continue at reasonable levels over the next year or so, and we therefore consider it appropriate to increase the interim dividend by slightly more than UK inflation as measured by the Consumer Prices Index.

 

Discount

We have continued to buy back shares when the discount at which they stand is at an anomalous and substantial level and have bought back some 478,331 shares over the period, which has added approximately £200,000 of value for shareholders. We have increased the authority given to Witan Investment Services to implement our buyback. We have also extended our marketing activity and are working on a relaunch of the website and rebranding of the Trust's image. We do look very closely at the level of our discount relative to its own history and to other investment companies. It is currently not far adrift from those of other companies in the region but we would hope to see the trend continuing to improve as the merits of the pan regional approach, the reach we can offer through our portfolio managers, and the relatively reduced volatility we provide through diversification are seen to offer value in the hands of shareholders.

 

Outlook

Markets across the world have been strong in so far in 2016. This is perhaps surprising in the face of lacklustre economic growth, weak corporate earnings and political uncertainties ranging from the UK's "Brexit" referendum to the forthcoming US Presidential election. For UK investors, the weakness of sterling has flattered results to some extent, but there has been more enthusiasm for the Asian region than for a while.

 

Asian markets had been under some pressure for several years before 2016 and, whilst uncertainties remain over the Chinese economy's transition to a slower growth rate, regional valuations appear to have reached a point where investors were willing to look for glimmers of hope rather than already discounted faults. Japan, in contrast, has been weak in local terms with the strong yen a double-edged sword - weighing on profit forecasts while boosting returns for foreign investors.

 

Part of the reason for such startling equity returns relates to the global decline in both short and long-term interest rates, which has made the relative valuations of equities look more attractive by comparison. At some stage, the decline in yields, which has reached extreme levels, will start to reverse and those investments borne aloft by abundant liquidity rather than their own intrinsic merits may prove vulnerable. In the succinct words of Warren Buffett, "Only when the tide goes out do you discover who has been swimming naked." Our managers' focus on long-term opportunity, management, valuation and business fundamentals is intended to deliver returns which are not unduly sensitive to shorter-term currents. At the same time, the development of inter-regional economic activity continues and the range of investment opportunities across the region remains of considerable interest.

 

Sarah Bates

 

Chairman

 

28 September 2016

 

 

Company Secretary contact details:

 

Capita Company Secretarial Services Limited:

1st Floor, 40 Dukes Place, London EC3A 7NH

email: [email protected]

 

 

PORTFOLIO INFORMATION

 

Manager performance for the half year ended 31 July 2016 and from appointment to 31 July 2016

 

 

 

 

 

 

Performance

Annualised

performance*

 

Appointment

Managed assets

manager

benchmark

manager

benchmark

 

date

£m

%#

%

%

%

%

Aberdeen

31 May 2005

86.6

42.4

+27.0

+22.0

+11.0

+8.8

Matthews

30 April 2012

96.1

47.0

+21.5

+22.0

+13.5

+10.0

Gavekal

24 April 2012

21.7

10.6

+18.6

+22.0

+10.5

+10.2

 

Manager performance figures are gross of fees.

# Excluding cash balances held centrally by Witan Pacific.

† Returns are adjusted for 1.5% annual management fee charged within the UCITS OEIC, of which 0.75% is rebated to the Company directly outside the fund.

* Since appointment.

Source: BNP Paribas.

 

Geographical allocation

Country

Portfolio at

31 July 2016*

Benchmark at

31 July 2016**

Australia

5%

13%

China/Hong Kong#

29%

20%

India

6%

5%

Indonesia

6%

1%

Japan

28%

40%

Malaysia

1%

2%

The Philippines

3%

1%

Singapore

8%

2%

South Korea

7%

8%

Taiwan

5%

7%

Thailand

1%

1%

Vietnam

1%

0%

 

* Source: BNP Paribas.

** Source: MSCI. (See footnote at the end of this announcement)

# Includes Yum! Brands and Qualcomm which are both incorporated in the US.

 

 

Top twenty investments

as at 31 July 2016

 

This period

Last period*

Company

Country

% of total investments

Value

£'000

1

(1)

Gavekal Asian Opportunities Fund (UCITS)

Asia Pacific

10.8

21,676

2

(2)

Aberdeen Global Indian Equity Fund (UCITS)

India

3.7

7,526

3

(3)

Japan Tobacco

Japan

2.9

5,895

4

(4)

AIA Group

China/Hong Kong

2.6

5,144

5

(5)

Taiwan Semiconductor Manufacturing

Taiwan

2.3

4,559

6

(6)

China Mobile

China/Hong Kong

2.2

4,445

7

(-)

Minth Group

China/Hong Kong

1.9

3,861

8

(19)

Seven & I Holdings

Japan

1.8

3,566

9

(14)

Samsung Electronics

South Korea

1.6

3,210

10

(15)

Singapore Technologies Engineering

Singapore

1.6

3,189

11

(18)

Shin-Etsu Chemical

Japan

1.5

2,949

12

(9)

Shenzhou International

China/Hong Kong

1.5

2,910

13

(8)

Bridgestone Corporation

Japan

1.4

2,902

14

(11)

Oversea-Chinese Banking Corporation

Singapore

1.4

2,836

15

(17)

NTT Docomo

Japan

1.4

2,802

16

(10)

Hoya

Japan

1.3

2,708

17

(-)

KT&G Corporation

South Korea

1.3

2,663

18

(12)

LG Chemical

South Korea

1.3

2,648

19

(16)

BGF Retail

South Korea

1.2

2,481

20

(20)

Swire Pacific

China/Hong Kong

1.2

2,438

Totals

 

 

44.9

90,408

 

                 

 

* The figures in brackets denote their position within the top 20 at the previous year end. The country shown is the country of incorporation.

 

The value of the twenty largest holdings represents 44.9% (31 January 2016: 46.5%) of the Company's total investments. The full portfolio listing is published monthly (with a 3 month lag) on the Company's website.

 

 

 

CONDENSED STATEMENT OF COMPREHENSIVE INCOME

for the half year ended 31 July 2016

 

 

 

(Unaudited)

Half year ended

31 July 2016

(Unaudited)

Half year ended

31 July 2015

(Audited)

Year ended

31 January 2016

 

 

 

Revenue

Capital

Total

Revenue

Capital

Total

Revenue

Capital

Total

 

Notes

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

Gains/(losses) on investments held at fair value through profit or loss

 

36,307 

36,307 

(2,079)

(2,079)

(13,038)

(13,038)

Exchange losses

 

(87)

(87)

(79)

(79)

(123)

(123)

Investment income

2

3,052 

3,052 

2,917 

2,917 

4,782 

4,782 

Management fees

3

(476)

(476)

(420)

(420)

(834)

(834)

Performance fees

3

(7)

(7)

(3)

(3)

Other expenses

 

(364)

(20)

(384)

(444)

(19)

(463)

(807)

(35)

(842)

Net return/(loss) before finance charges and taxation

 

2,212 

36,193 

38,405 

2,053 

(2,180)

(127)

3,141 

(13,196)

(10,055)

Finance charges

 

- 

Net return/(loss) on ordinary activities before taxation

 

2,212 

36,193 

38,405 

2,053 

(2,180)

(127)

3,141 

(13,196)

(10,055)

Taxation on ordinary activities

 

(243)

(243)

(183)

(183)

(305)

(305)

Net return/(loss) on ordinary activities after taxation

 

1,969 

36,193 

38,162 

1,870

(2,180)

(310)

2,836 

(13,196)

(10,360)

Return/(loss) per Ordinary share - pence

5

3.01 

55.27 

58.28 

2.84

(3.31)

(0.47)

4.31 

(20.03)

(15.72)

                         

 

All revenue and capital items in the above statement derive from continuing operations. The total columns of this statement represent the profit and loss account of the Company. The revenue return and capital columns are supplementary to this and are prepared under guidance published by the Association of Investment Companies.

 

The Company had no other comprehensive income, recognised gains or losses other than those disclosed in this statement.

 

There is no material difference between the net return/(loss) on ordinary activities before taxation and the net return/(loss) for the financial periods stated above and their historical costs equivalents.

 

 

 

CONDENSED STATEMENT OF CHANGES IN EQUITY

for the half year ended 31 July 2016

 

 

Called up

Share

Capital

 

 

 

 

share

premium

redemption

Capital

Revenue

 

 

capital

account

reserve

reserves

reserve

Total

 

£'000

£'000

£'000

£'000

£'000

£'000

Half year ended 31 July 2016 (unaudited)

 

 

 

 

 

 

At 31 January 2016

16,486

5

41,085

101,926 

10,886 

170,388 

Net return on ordinary activities after taxation

-

-

-

36,193 

1,969 

38,162 

Dividends paid in respect of year ended 31 January 2016

-

-

-

-  

(1,636)

(1,636)

Purchase of own shares

-

-

-

(1,147)

(1,147)

At 31 July 2016

16,486

5

41,085

136,972 

11,219 

205,767 

 

 

 

 

 

 

 

Half year ended 31 July 2015 (unaudited)

 

 

 

 

 

 

At 31 January 2015

16,486

5

41,085

115,636 

11,068 

184,280 

Net (loss)/return on ordinary activities after taxation

-

-

-

(2,180)

1,870 

(310)

Dividends paid in respect of year ended 31 January 2015

-

-

-

(1,615)

(1,615)

Purchase of own shares

-

-

-

(55)

(55)

At 31 July 2015

16,486

5

41,085

113,401 

11,323 

182,300 

 

 

 

 

 

 

 

Year ended 31 January 2016 (audited)

 

 

 

 

 

 

16,486

5

41,085

115,636 

11,068

184,280 

Net (loss)/return on ordinary activities after taxation

-

-

-

(13,196)

2,836

(10,360)

Dividends paid in respect of year ended 31 January 2015

-

-

-

(1,615)

(1,615)

Dividends paid in respect of year ended 31 January 2016

-

-

-

(1,416)

(1,416)

Refund of unclaimed dividends

-

-

-

13

13 

Purchase of own shares

-

-

-

(514)

-

(514)

At 31 January 2016

16,486

5

41,085

101,926 

10,886

170,388 

 

 

 

 

CONDENSED STATEMENT OF FINANCIAL POSITION

at 31 July 2016

 

 

 

(Unaudited)

(Unaudited)

(Audited)

 

 

31 July

31 July

31 January

 

 

2016

2015

2016

 

Notes

£'000

£'000

£'000

Fixed assets

 

 

 

 

Investments held at fair value through profit or loss

 

201,502 

177,481 

166,251 

Current assets

 

 

 

 

Debtors

 

464 

717 

737 

Cash at bank and in hand

 

5,107 

4,634 

5,412 

 

 

5,571 

5,351 

6,149 

Creditors

 

 

 

 

Amounts falling due within one year

 

(1,299)

(529)

(2,012)

 

 

(1,299)

(529)

(2,012)

Net current assets

 

4,272 

4,822 

4,137 

Total assets less current liabilities

 

205,774 

182,303 

170,388 

Provisions for liabilities and charges

6

 (7)

 (3)

Net assets

 

205,767 

182,300 

170,388 

 

 

 

 

 

Capital and reserves

 

 

 

 

Called up share capital

7

16,486 

16,486 

16,486 

Share premium account

 

Capital redemption reserve

 

41,085 

41,085 

41,085 

Capital reserves

 

136,972 

113,401 

101,926 

Revenue reserve

 

11,219 

11,323 

10,886 

Total shareholders' funds

 

205,767 

182,300 

170,388 

Net Asset Value per Ordinary share - pence

8

315.40 

276.54 

259.27 

 

 

 

 

 

 

 

NOTES TO THE FINANCIAL STATEMENTS

for the half year ended 31 July 2016

 

1 Accounting policies

 

(a) Basis of preparation

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.

 

(b) Valuation of investments

All investments have been designated upon initial recognition as fair value through profit or loss. This is done because all investments are considered to form part of a group of financial assets which is evaluated on a fair value basis, in accordance with the Company's documented investment strategy, and information about the grouping is provided internally on that basis.

 

Investments are recognised and de-recognised at trade date where a purchase or sale is under a contract whose terms require delivery within the timeframe established by the market concerned, and are measured initially at fair value. Subsequent to initial recognition, investments are valued at fair value through profit or loss.

 

Listed investments have been designated by the Board as held at fair value through profit or loss and accordingly are valued at fair value, deemed to be bid market prices for quoted investments. Investments in Level 2 consist of unlisted reportable funds within the portfolio, Gavekal Asian Opportunities UCITS and Aberdeen Global Indian Equity UCITS. These are priced daily using their Net Asset Value, which is the fair value.

 

Changes in the fair value of investments held at fair value through profit or loss and gains and losses on disposal are recognised in the Statement of Comprehensive Income as "Gains or losses on investments held at fair value through profit or loss". Also included within this caption are transaction costs in relation to the purchase or sale of investments, including the difference between the purchase price of an investment and its bid price at the date of purchase. All purchases and sales are accounted for on a trade date basis.

 

2 Income

 

 

(Unaudited)

(Unaudited)

(Audited)

 

Half year

Half year

Year

 

ended

ended

ended

 

31 July

31 July

31 January

 

2016

2015

2016

 

£'000

£'000

£'000

Income from investments held at fair value through profit or loss:

 

 

 

Overseas dividends

2,782

2,377

4,076

UK dividends

166

168

363

Scrip dividends

103

369

334

Other income:

 

 

 

Bank interest

1

3

6

Underwriting commission

-

-

3

Total income

3,052

2,917

4,782

 

3 Transactions with the Managers

 

 

On 27 May 2005, the Company appointed Witan Investment Services Limited as Executive Manager and Aberdeen Asset Managers Limited and Nomura Asset Management U.K. Limited as portfolio managers. In April 2012, the Company appointed Matthews International Capital Management LLC and Gavekal Capital Limited to replace Nomura. Each Management Agreement can be terminated at one month's notice in writing. Each portfolio manager is entitled to a base management fee, at rates between 0.20% and 0.75% per annum, calculated according to the value of the assets under their management; Aberdeen is also entitled to a performance fee based on relative outperformance against the MSCI AC Asia Pacific Index (sterling adjusted total return). The performance fee is calculated according to investment performance over a three year rolling period and is payable at a rate of 15% of the calculated outperformance relative to the benchmark (subject to a cap).

 

The provisions included in the Statement of Comprehensive Income at 31 July 2016 are calculated on the actual performance of Aberdeen relative to the benchmark index. The provision assumes that both the benchmark index remains unchanged and that Aberdeen's assets under management perform in line with the benchmark index to 31 May 2017, being the date the next performance period ends. In addition, provisions have been made for the performance periods ending 31 May 2018 and 31 May 2019, on the assumption that Aberdeen performs in line with the benchmark to each period end. The total of these provisions amounts to £7,000.

 

 

(Unaudited)

(Unaudited)

(Audited)

 

Half year

Half year

Year

 

ended

ended

ended

 

31 July

31 July

31 January

 

2016

2015

2016

 

£'000

£'000

£'000

Charged to the revenue return:

 

 

 

Management fee*

547 

496 

980 

Management fee rebates†

(71)

(76)

(146)

Total management fees

476 

420 

834 

Charged to the capital return:

 

 

 

Performance fees

 

* The management fee stated above includes fees paid to Witan Investment Services Limited of £115,000 (six months to 31 July 2015: £117,000 and full year to 31 January 2016: £224,000).

 

† The figure relates to a rebate of management fees associated with the Gavekal Asian Opportunities UCITS Fund.

 

4 Dividends per Ordinary share

 

An interim dividend of 2.20p per Ordinary share (2016: 2.15p) will be paid on 24 October 2016 to shareholders on the register on 14 October 2016.

 

5 Return/(loss) per Ordinary share

 

The total return per Ordinary share is based on the net gain attributable to the Ordinary shares of £38,162,000 (half year ended 31 July 2015: net loss of £310,000; year ended 31 January 2016: net loss of £10,360,000) and on 65,484,870 Ordinary shares (half year ended 31 July 2015: 65,933,041; year ended 31 January 2016: 65,891,245) being the weighted average number of shares in issue during the period.

 

 

(Unaudited)

(Unaudited)

(Audited)

 

Half year

Half year

Year

 

ended

ended

ended

 

31 July

31 July

31 January

 

2016

2015

2016

Revenue return (£'000)

1,969 

1,870 

2,836 

Capital return/(loss) (£'000)

36,193 

(2,180)

(13,196)

Total return/(loss) (£'000)

38,162 

(310)

(10,360)

Weighted average number of Ordinary shares in issue during the period

65,484,870 

65,933,041   

65,891,245 

Revenue return per Ordinary share - pence

3.01 

2.84 

4.31 

Capital return/(loss) per Ordinary share - pence

55.27 

(3.31)

(20.03)

Total return/(loss) per Ordinary share - pence

58.28 

(0.47)

(15.72)

 

6 Provision for liabilities and charges

 

This represents the estimated performance fees payable for the 3 year performance fee periods ending 31 May 2017, 31 May 2018 and 31 May 2019. This accrual is based on actual performance to 31 July 2016 and the assumption that Aberdeen performs in line with the benchmark from 31 July 2016 to the end of each fee period. Changes in the level of accrual for future performance periods could arise for one of the three principal reasons: a change in the degree of relative performance, the time elapsed (since this would increase the proportion of the rolling three-year performance period to which the performance calculation would be applied) or the termination of Aberdeen's contract.

 

7 Share capital

 

During the half year ended 31 July 2016, 478,331 Ordinary shares were repurchased and held in treasury, at a total cost of £1,147,000 (31 July 2015: 22,478 Ordinary shares were repurchased and held in treasury at a total cost of £55,000 and in the year ended 31 January 2016, 224,978 Ordinary shares were purchased to be held in treasury at a cost of £514,000).

 

As at 31 July 2016 there were 65,944,000 Ordinary shares of 25p in issue of which 703,309 were held in treasury. Subsequent to 31 July 2016, a further 90,040 Ordinary shares were repurchased and held in treasury, at a total cost of £255,000. As at 27 September 2016, there were 65,944,000 Ordinary shares of 25p in issue of which 793,349 were held in treasury.

 

 

8 Net Asset Value per Ordinary share

 

Net asset value per Ordinary share is based on 65,240,691 Ordinary shares of 25p each in issue as at 31 July 2016 excluding shares held in treasury (31 July 2015: 65,921,522 and 31 January 2016: 65,719,022).

 

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 in making the measurements. The Company has early adopted Amendments to FRS 102 - Fair value hierarchy disclosures issued by the Financial Reporting Council in March 2016. The fair value hierarchy shall have 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 Statement of Financial Position are grouped into the fair value hierarchy at the reporting date as follows:

 

 

 

Level 1

Level 2

Level 3

Total

 

Note

£'000

£'000

£'000

£'000

As at 31 July 2016

 

 

 

 

 

Financial assets and financial liabilities at fair value through profit or loss

 

 

 

 

 

Equity investments

(a)

172,301

29,201

-

201,502

Net fair value

 

172,301

29,201

-

201,502

 

 

 

Level 1

Level 2

Level 3

Total

 

Note

£'000

£'000

£'000

£'000

As at 31 January 2016

 

 

 

 

 

Financial assets and financial liabilities at fair value through profit or loss

 

 

 

 

 

Equity investments

(a)

141,375

24,876

-

166,251

Net fair value

 

141,375

24,876

-

166,251

 

The valuation techniques used by the Company are explained in the accounting policies in note 1(b).

 

There were no transfers during the year between Level 1 and Level 2.

 

(a) Quoted equities and preference shares

 

The fair value of the Company's investments in quoted equities and preference shares has been determined by reference to their quoted bid prices at the reporting date. Quoted equities and preference shares included in Fair Value Level 1 are actively traded on recognised stock exchanges.

 

Investments classified as Level 2 are Gavekal Asian Opportunities Fund and Aberdeen Global Indian Equity Fund.

 

10 Results

The results for the half years ended 31 July 2016 and 31 July 2015, which are unaudited and were not reviewed by the auditors, constitute non-statutory accounts within the meaning of Section 435 of the Companies Act 2006. The latest published accounts which have been delivered to the Registrar of Companies are for the year ended 31 January 2016, the report of the Auditor thereon was unqualified and did not contain a statement under Section 498(2) or (3) of the Companies Act 2006. The comparative figures for the year ended 31 January 2016 have been extracted from those accounts.

 

 

REGULATORY DISCLOSURES

 

Related party transactions disclosures

During the period to 31 July 2016, related party transactions included dividends paid to Directors in respect of their shareholdings in the Company. Details of Directors' share holdings and remuneration may be found in the Directors' Remuneration Report on pages 39 to 42 of the Company's Annual Report for the year ended 31 January 2016. The report is available on the Company's website at www.witanpacific.com.

 

There have been no other related party transactions.

 

Principal risks and uncertainties

The Directors have considered the principal risks and uncertainties affecting the Company's position. The principal risks faced by the Company for the remaining six months of the financial year include financial risks relating to markets, liquidity and credit. Market risk includes market price risk, currency risk and interest rate risk. Other risk categories include those relating to investment strategy, investment management resources, regulatory requirements, operational structure and the external economic and financial environment. These risks and the way in which they are managed are described in more detail in the Annual Report for the year ended 31 January 2016 in the corporate review and in the notes to the financial statements. The risks faced by the Company have not changed significantly over the first six months of 2016 and are not expected to change materially in the remaining six months. The report is available on the Company's website at www.witanpacific.com.

 

Going concern

The financial statements continue to be prepared on a going concern basis. The approach used for the Annual Report is applied, including proper consideration of financial and cash flow forecasts and it is believed that the Company has adequate financial resources to continue to operate for the foreseeable future.

 

 

RESPONSIBILITY STATEMENT OF THE DIRECTORS

in respect of the Half Year Report for the six months ended 31 July 2016

 

The Directors confirm, to the best of their knowledge, that this condensed set of financial statements has been prepared in accordance with Financial Reporting Standard 104 (Interim Financial Reporting) and gives a true and fair view of the assets, liabilities, financial position and profit or loss of the Company, and the interim management report (which comprises the Chairman's statement, regulatory disclosures and portfolio information) includes a fair review of the information required by Rules 4.2.7 R and 4.2.8 R of the Disclosure Guidance and Transparency Rules of the United Kingdom Financial Conduct Authority.

 

The names and functions of the Directors of Witan Pacific Investment Trust plc are as listed below.

 

This Half Year Report was approved by the Board on 28 September 2016 and the above responsibility statement was signed on its behalf by:

 

 

Sarah Bates

Chairman

28 September 2016

 

 

DIRECTORS

 

Sarah Bates - Chairman

Dermot McMeekin - Senior Independent Director and Chairman of the Nomination and Remuneration Committee

Andrew Robson - Independent Director and Chairman of the Audit and Management Engagement Committee

Diane Seymour-Williams - Independent Director

Susan Platts-Martin - Independent Director

 

All the Directors are members of both the Audit and Management Engagement Committee and of the Nomination and Remuneration Committee.

 

 

 

Footnote

Source MSCI. The MSCI information may only be used for your internal use, may not be reproduced or redisseminated in any form and may not be used as a basis for or a component of any financial instruments or products or indices. None of the MSCI information is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such. Historical data and analysis should not be taken as an indication or guarantee of any future performance analysis, forecast or prediction. The MSCI information is provided on an "as is" basis and the user of this information assumes the entire risk of any use made of this information. MSCI, each of its affiliates and each other person involved in or related to compiling, computing or creating any MSCI information (collectively, the "MSCI Parties") expressly disclaims all warranties (including, without limitation, any warranties of originality, accuracy, completeness, timeliness, non-infringement, merchantability and fitness for a particular purpose) with respect to this information. Without limiting any of the foregoing, in no event shall any MSCI Party have any liability for any direct, indirect, special, incidental, punitive, consequential (including, without limitation, lost profits) or any other damages. (www.msci.com)

 

 

 

 

 

The content of the Company's web-pages and the content of any website or pages which may be accessed through hyperlinks on the Company's web-pages or this announcement is neither incorporated into nor forms part of the above announcement.

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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