Final Results
04 Juin 2003 - 4:52PM
UK Regulatory
RNS Number:9231L
Govett Asian Recovery Trust PLC
04 June 2003
GOVETT ASIAN RECOVERY TRUST PLC
PRELIMINARY ANNOUNCEMENT OF RESULTS
FOR THE YEAR ENDED 31 MARCH 2003
Chairman's Statement
The last year, like the previous two, was difficult and unrewarding for
investors in all equity markets. Asian markets did not escape the sharp falls
witnessed around the world; the MSCI AC Asia Pacific Index, against which the
Trust is benchmarked, fell by 27.2%. Your company's Net Asset Value (NAV) fell
by 33.1% over the same period. The share price fell by 29% as a result of some
closure in the discount to NAV. The company bought back a total of 544,000
shares during this period.
The Trust's underperformance was attributable to stock selection in Korea,
Taiwan and Australia, which offset the impact of good returns in China, Hong
Kong and Thailand. The Japanese portfolio experienced some problems in the first
half of the year but the Trust's focus on mid and small cap holdings paid off in
the second half.
It is now over four and a half years since the launch of the Trust in the
aftermath of the Asian Financial Crisis in 1997/98. The ensuing period has
witnessed unparalleled volatility in global financial markets, of which Asia's
sharp recovery in 1999, the expansion and subsequent bursting of the Internet
bubble in 1999 and 2000, the global recession of 2001 and modest recovery in
2002 and, more recently, the renewed deceleration in global growth have been
only the most obvious milestones.
Economic and financial turbulence in Asia has been matched by political upheaval
- there have been no fewer than 12 changes of political leadership in the
region, in addition to the increased threat of global terrorism following the
September 11th attacks in the U.S. and the night-club bombing in Bali, not to
mention the recent wars in Afghanistan and Iraq. As I write, much of Asia is
gripped by a new crisis in the form of Severe Acute Respiratory Syndrome (SARS).
Confidence has also been shaken by the behaviour of an increasingly bellicose
North Korea. Despite these negative factors, the Trust's NAV has risen by more
than 10% since launch, compared with a gain of 1.1% in the benchmark over the
same period.
Looking ahead, the outlook remains far from clear, and there seems little
likelihood of a significant reduction in market volatility for some time to
come. That said, Asian equities are as cheap as they have ever been, and the
region as a whole, even including some parts of the Japanese corporate sector,
is in better shape than it has been for many years. Your board continue to
believe that Asia is well placed to benefit from a global upturn when it comes.
As you may be aware, Shareholders will have their first opportunity since the
Trust's launch in 1998 to vote on the continuation of the Trust this year. We
shall be writing to you separately to convene an extraordinary general meeting
to be held later in the year for this purpose.
David Price
Chairman
04 June 2003
Govett Asian Recovery Trust PLC
Statement of Total Return (incorporating the revenue account*) for the year
ended 31st March 2003
Year ended Year ended
31st March 2003 31st March 2002
Revenue Capital Total Revenue Capital Total
#000s #000s #000s #000s #000s #000s
Realised & unrealised (losses)/gains - (18,723) (18,723) - 4,646 4,646
on investments
Net foreign currency exchange
differences - (1,064) (1,064) - (159) (159)
Income from investments 774 - 774 886 - 886
Deposit interest 63 - 63 47 - 47
Management fee (372) - (372) (428) - (428)
Other (expenses)/income (253) 133 (120) (322) 24 (298)
Net return/(loss) before finance
costs and taxation 212 (19,654) (19,442) 183 4,511 4,694
Interest payable (146) - (146) (63) - (63)
Return/(loss) on ordinary activities 66 (19,654) (19,588) 120 4,511 4,631
before taxation
Taxation on ordinary activities (68) - (68) (48) (5) (53)
(Loss)/return on ordinary activities
after taxation (2) (19,654) (19,656) 72 4,506 4,578
(Loss)/return per Ordinary share (0.01)p (54.46)p (54.47)p 0.20p 12.45p 12.65p
* The revenue column of this statement represents the revenue account of the
Company.
All items derive from continuing activities.
Govett Asian Recovery Trust PLC
Balance Sheet
As at 31st March 2003 As at 31st March 2002
#000 #000
Fixed asset investments
Listed - Overseas 42,068 68,863
42,068 68,863
Current Assets
Debtors 1,855 256
Cash at bank 674 520
2,529 776
Creditors: amounts falling due within one year (5,541) (10,401)
Net current liabilities (3,012) (9,625)
Provisions for liabilities and charges (110) (110)
Total assets less current liabilities 38,946 59,128
Financed by:
Capital and reserves
Called-up share capital 3,566 3,620
Other reserves
Capital redemption reserve 166 112
Special capital reserve 31,355 31,881
Capital reserve - realised 5,644 15,255
Capital reserve - unrealised (1,516) 8,527
Total other reserves 35,649 55,775
Revenue reserve (269) (267)
Equity shareholders' funds 38,946 59,128
Net asset value per share 109.22p 163.33p
Shares in issue 35,658,077 36,202,077
Govett Asian Recovery Trust PLC
Cash Flow Statement
Year ended Year ended
31st March 2003 31st March 2002
#000 #000
Operating activities
Cash received from investments 626 963
Interest received 62 66
Management fees paid (418) (424)
Directors' fees paid (33) (49)
Other net cash payments (218) (272)
Net cash inflow from operating activities 19 284
Return on investments and servicing of finance (109) (63)
Interest paid
Taxation 41 (5)
Taxation recovered/(paid)
Capital expenditure and financial investment
Purchases of investments (126,141) (103,043)
Sale of investments 132,421 102,317
Loss on closure of hedging transactions (42) (75)
Capital income 94 29
Net cash inflow/(outflow) from capital expenditure and financial 6,332 (772)
investment
Net cash inflow/(outflow) before financing 6,283 (556)
Financing
Shares repurchased (436) -
Decrease in loans (5,195) (2,524)
Net cash outflow from financing (5,631) (2,524)
Increase/(decrease) in cash 652 (3,080)
The Annual General Meeting of the Company will be held at 12 noon on 29 July
2003 at Shackleton House, 4 Battle Bridge Lane, London SE1 2HR. We look forward
to meeting shareholders at the AGM, which will be followed by a brief
presentation.
This preliminary statement, which has been agreed with the auditors, was
approved by the Board on 04 June 2003. It is not the Company's statutory
accounts. The statutory accounts for the year ended 31 March 2003 will be sent
to Shareholders later this month, and will be available to the public at the
registered office of the Company, Shackleton House, 4 Battle Bridge Lane,
London. The statutory accounts for the year ended 31 March 2002 have been
delivered to the Registrar of Companies and received an audit report which was
unqualified and did not contain statements under s237 (2) or (3) of the
Companies Act 1985.
By order of the Board
Govett Secretaries Limited, Secretary
Shackleton House
4 Battle Bridge Lane
London SE1 2HR
Registered in England no: 3582911
04 June 2003
This information is provided by RNS
The company news service from the London Stock Exchange
END
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