Interim Results
26 Novembre 2003 - 5:36PM
UK Regulatory
GOVETT ASIAN RECOVERY TRUST PLC
Interim Results for the six months to 30th September 2003 (unaudited)
CHAIRMAN'S STATEMENT
I am pleased to report that in the six months to 30th September 2003 your
Company's Net Asset Value per Ordinary share rose by 35.1% to 147.5p, compared
with an increase of 26.8% in the Company's benchmark, the MSCI All Countries
Asia Pacific Index in sterling terms. The share price benefited from both this
underlying performance and a narrowing of the discount in the period, rising
41.0% to 134p on 30th September.
Markets throughout the region have been buoyed by the fact that Asian economies
are improving, helped by a pick-up in the US and strong interest from overseas
investors. Japan recovered significantly, boosted by firm export growth and a
sharp recovery in private sector capital spending. Other markets showing strong
growth included Thailand and Indonesia, where markets surged as signs of a
strong economic recovery attracted interest from overseas investors, Taiwan,
following a recovery in global demand for semiconductors, and Hong Kong, where
equities were bolstered by rapid economic growth in mainland China.
The Company has appointed Gartmore Investment Limited as Manager to the Company
with effect from 17th November 2003. This followed the announcement by Allied
Irish Banks, p.l.c. of the intended sale of certain of the management contracts
of Govett Investment Management Limited to Gartmore Investment Management plc.
Your Board is confident that Gartmore, with its worldwide resources and
considerable experience in managing portfolios across Asia, will meet the
Company's investment objectives.
Following the appointment of Gartmore, Noel McEvoy, who is also Chairman and
Chief Executive Officer of Govett Investment Management Limited, resigned as a
Director of your Company. I would like to thank Noel, on behalf of the Company,
for his contribution to the Board.
Our new Manager is confident that economic activity in the Pan-Pacific region
will continue to expand over the rest of the financial year, bolstered by
China's robust growth and the continued benefit to exports from the ongoing
recovery in the global economy. This should provide a positive influence on
markets, although recent rallies could trigger some profit-taking in the short
term.
I will be writing to shareholders separately to outline plans for the future of
your Company.
David Price
Chairman
STATEMENT OF TOTAL RETURN Six months to 30th September 2003
Revenue Capital Total
�'000 �'000 �'000
Realised & unrealised gains/(losses) on - 13,662 13,662
investments
Net foreign currency exchange differences - (137) (137)
Income from investments 410 - 410
Deposit interest 9 - 9
Investment management fee (191) (123) (314)
Other (expenses)/income (94) 16 (78)
---------- ---------- ----------
Net return/(loss) before finance costs and 134 13,418 13,552
taxation
Interest payable (134) - (134)
---------- ---------- ----------
Return/(loss) on ordinary activities - 13,418 13,418
before taxation
Tax on ordinary activities (20) 251 231
---------- ---------- ----------
(Loss)/return on ordinary activities after (20) 13,669 13,649
taxation
======= ======= =======
(Loss)/(return) per Ordinary share (pence) (0.1)p 38.4p 38.3p
======= ======= =======
STATEMENT OF TOTAL RETURN (Comparative) Six months to 30th September 2002
Revenue Capital Total
�'000 �'000 �'000
Realised & unrealised gains/(losses) on - (12,974) (12,974)
investments
Net foreign currency exchange differences - (1,194) (1,194)
Income from investments 354 - 354
Deposit interest 44 - 44
Investment management fee (204) - (204)
Other (expenses)/income (131) 35 (96)
---------- ---------- ----------
Net return/(loss) before finance costs and 63 (14,133) (14,070)
taxation
Interest payable (57) - (57)
---------- ---------- ----------
Return/(loss) on ordinary activities 6 (14,133) (14,127)
before taxation
Tax on ordinary activities (33) - (33)
---------- ---------- ----------
(Loss)/return on ordinary activities after (27) (14,133) (14,160)
taxation
======= ======= =======
(Loss)/(return) per Ordinary share (pence) (0.1)p (39.0)p (39.1)p
======= ======= =======
The above figures are unaudited.
The revenue column above represents the Revenue Account of the Company.
All the revenue and capital items in the above statement derive from continuing
activities.
BALANCE SHEET At 30th September At 31st March
2003 2003
�'000 �'000
Fixed asset investments
Quoted - overseas 52,794 42,068
Current assets
Debtors 4,066 1,855
Cash at bank 4,303 674
------- -------
8,369 2,529
Creditors: amounts falling due within one (8,619) (5,541)
year
------- -------
Net current liabilities (250) (3,012)
Provisions for liabilities and charges - (110)
------- -------
Total assets less current liabilities 52,544 38,946
===== =====
Financed by:
Capital and reserves
Called-up share capital 3,561 3,566
Other reserves:
Capital redemption reserve 171 166
Special capital reserve 31,304 31,355
Capital reserve - realised 8,456 5,644
Capital reserve - unrealised 9,341 (1,516)
------- -------
Total other reserves 49,272 35,649
Revenue reserve (289) (269)
------- -------
Equity shareholders' funds 52,544 38,946
===== =====
Net asset value per share 147.5p 109.2p
===== =====
CASH FLOW STATEMENT Six months to Six months to
30th September 30th September
2003 2002
�'000 �'000
Operating activities
Investment income received 549 394
Deposit interest received 10 45
Investment management fees paid (163) (240)
Directors' fees paid (19) (24)
Other cash payments (91) (163)
------- -------
Net cash inflow from operating activities 286 12
------- -------
Return on investments and servicing of
finance
Interest paid (153) (57)
------- -------
Taxation
Taxation recovered 251 8
------- -------
Capital expenditure and financial
investment
Purchase of investments (36,956) (83,034)
Sale of investments 39,444 88,692
Indian balances excluded (391) -
Capital income 49 56
------- -------
Net cash inflow from investment activities 2,146 5,714
------- -------
Net cash inflow before financing 2,530 5,677
------- -------
Financing
Shares repurchased (51) -
Increase/(decrease) in loans 1,150 (5,511)
------- -------
Net cash inflow/(outflow) from financing 1,099 (5,511)
------- -------
Increase in cash 3,629 166
===== =====
Notes:
1. The financial information contained in this Interim Statement is unaudited
and does not constitute accounts as defined in Section 240 of the Companies Act
1985.
The financial information for the year ended 31st March 2003 has been extracted
from the latest published audited financial statements, which have been filed
with the Registrar of Companies. The Report of the Auditors on those accounts
contained no qualification or statement under Section 237(2) or (3) of the
Companies Act 1985
2. There have been no changes in accounting policies since 31st March 2003.
3. Total Return per Ordinary share has been calculated on the return to equity
shareholders of �13,649,000 (2002: negative �14,160,000) and 35,631,575 shares
(2002: 36,202, 077), being the weighted average number of Ordinary shares in
issue during the period.
4. The Net Asset Value per Ordinary share is calculated on net assets of �
52,544,000 (31st March 2003: �38,946,000) and 35,608,077 shares in issue at
30th September 2003 (31st March 2003: 35,658,077).
5. Contingent Liabilities: Cash balances held in India amounting, at 30th
September 2003, to the equivalent of �391,000 are currently blocked pending
resolution of an action by an agency of the Indian Government in relation to a
closed investment transaction. Additionally, as an extension of this action,
regulatory action in India may be initiated against various parties including
this company which, inter alia, may seek to repatriate investment proceeds from
the UK. These issues affect some 20 foreign institutional investors. The
Company has ceased to recognise any value in these balances for the purpose of
these accounts.
The Company is defending itself strenuously against this potential action. The
Company has commenced proceedings in the Indian High Court seeking an order
lifting the blocking order imposed on the Company's bank account and, as an
interim protective measure, a direction that the blocked funds should not be
taken arbitrarily. These proceedings are continuing.
INTERIM REPORT
The Interim Report for the six months to 30th September 2003 will be posted to
shareholders shortly. Copies will also be available from the offices of
Gartmore Investment Limited, Gartmore House, 8 Fenchurch Place, London EC3M
4PB.
Gartmore Investment Limited
Secretaries
26th November 2003
END