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RNS

Half-year Report

Released 07:00 05-Oct-2018

RNS Number : 0463D
Witan Pacific Investment Trust PLC
05 October 2018
 

WITAN PACIFIC INVESTMENT TRUST PLC

(the "Company")

 

HALF-YEARLY REPORT AND FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED 31 JULY 2018

 

Witan Pacific Investment Trust plc announces that its 2018 Half Year Report has been published. The full report can be accessed via the Company's website at www.witanpacific.com and will be made available on the National Storage Mechanism website: http://www.morningstar.co.uk/uk/NSM. It will be circulated to shareholders shortly.

 

The Directors have declared an interim dividend of 2.50p per Ordinary share, which will be payable on 29 October 2018 to shareholders whose names appear on the register at the close of business on 19 October 2018 (ex-dividend 18 October 2018).

 

 

FINANCIAL SUMMARY

 

Key data

 

 

31 July 2018   

31 January 2018   

Net asset value ("NAV") per share

380.82p 

386.58p 

Share price1

327.00p 

344.00p 

Discount1

14.1%

11.0%

 

 

Total Return

 

 

6 months

1 year

3 years

5 years

NAV per share¹,2

-0.6%

5.5%

44.2%

51.1%

Share price¹,2

-4.0%

3.9%

40.7%

45.8%

Benchmark3

-0.1%

7.5%

51.6%

66.9%

 

 

Income

 

 

31 July 2018

31 July 2017

% change

Revenue per share

4.71p

3.46p

+36.1%

Interim dividend per share1

2.50p

2.25p

+11.1%

 

Ongoing charges1 (6 months)

 

 

31 July 2018

31 July 2017

Excluding performance fees

0.54%

0.50%

Including performance fees

0.54%

0.50%

 

 

1 Alternative Performance Measure not defined under Generally Accepted Accounting Practice in the UK ("UK GAAP") (for definitions see below).

2 Source: Morningstar.

3 Source: Morningstar. The benchmark for Witan Pacific Investment Trust plc is the MSCI AC Asia Pacific Index.

 

 

 

LONG-TERM PERFORMANCE ANALYSIS

 

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

 

 

Cumulative return

Annualised return

NAV per share¹

242.9%

9.8%

Share price2

238.7%

9.7%

Benchmark2

233.4%

9.6%

 

1 Morningstar/Witan Investment Services. Alternative Performance Measure (see below).

2 Source: Morningstar. Alternative Performance Measure (see below).

 

CHAIR'S STATEMENT

 

SUMMARY

 

§ NAV total return of -0.6%, compared with benchmark -0.1%

 

§ Share price total return of -4.0%

 

§ Revenue per share 4.7p compared with 3.5p over the same period last year.

 

§ Interim dividend increased by 11.1% to 2.50p

 

Performance

During the six months ended 31 July 2018, Witan Pacific's NAV total return per share (capital and income combined) and its benchmark fell marginally by 0.6% and 0.1% respectively. The discount widened during the period, resulting in a fall of 4.0% in the share price on a total return basis.

 

Portfolio managers

Our portfolio managers' performance* over the period was mixed. Matthews Asia outperformed the benchmark with a total return of 1.4%. Robeco (-0.4%) marginally underperformed. Aberdeen was a little further adrift with a total return of -1.5%. Dalton registered a six-month loss of 2.7%. Only Dalton, who were appointed less than 12 months ago to manage 10% of the total portfolio, are currently behind their benchmark since appointment. The Board considers it to be too early to judge their performance.

 

Market background

The period started with a market correction in February affecting the Asia Pacific region alongside other global markets and replacing the recent rally and era of low volatility. Catalysts for this sell off included inflation worries and fears of a faster than expected pace of interest rate rises in the US, as well as heightened perceptions of the risk of trade wars between the US and its major trading partners. Markets generally continued to drift lower over the period, with the strengthening US dollar and higher oil prices having a negative impact. UK-based investors were largely insulated from this decline as Sterling depreciated over the period.

 

The region posted widely divergent results, with Australia leading with a rise of 6.4%. A small, but diverse, group of companies (including healthcare giant CSL) led this market higher. Indonesia was the laggard, falling 11.8% due to concerns over its exposure to higher energy prices, a widening trade deficit and higher debt funding costs. Taiwan, India, Hong Kong and Japan ended the period higher, whereas China, Korea, Singapore and the Philippines all posted losses. This period of consolidation has, at the date of this report, returned the benchmark to the level achieved in October 2017, despite corporate earnings having improved markedly over the period.

 

Japanese equities, which form 38% of our benchmark, gained 2% but were not entirely immune from global trade tensions and gains were also limited by domestic politics with Prime Minister Abe and his cabinet's deteriorating approval rating. The domestic economy continues to benefit from improved fundamentals and stronger exports (especially toward China) and reasonable wage growth. This has led to a moderate hike in inflation expectations and supported corporate earnings growth.

 

China has been the focus of the US trade tariff hikes. However, China's economy is now much less export-driven, so taxes on their shipments may have a more modest impact than commonly perceived. In contrast, domestic consumption accounts for the majority of China's economic growth and more than half of its GDP. Resilient corporate earnings and a relatively stable currency have provided support to stock prices.

 

The performance of industry sectors was also varied with Utilities rising by 11.8%, Energy stocks gaining 9.6% and Healthcare up 8.2%. Financials fell by 3.1% while the Technology sector declined by 2.2%. Asian currencies continued to oscillate, especially against Sterling, as local economic and political news interacted with the ebbs and flows of expectations for Brexit. In general, developed Asian currencies appreciated versus Sterling while emerging Asian currencies suffered in line with other emerging markets around the world.

 

North Korea, which was in the headlines at the start of the year, became a focal point for political analysts as President Trump finally met with Kim Jong-un. This was clearly a momentous occasion, but it is likely to be many months or years before any tangible benefits filter through.

 

Portfolio review

Details of the portfolio's key country and sector allocations, as well as the top twenty investments by size, follow this Statement. The portfolio is the result of the stock selection decisions of our four portfolio managers and, at the period end, was overweight China, Singapore and South Korea, and underweight Japan, Australia and Taiwan.

 

A number of our Chinese holdings made positive contributions despite the weakness in the overall Chinese market. Examples include Shenzhou International (a textile manufacturer), Hua Hong Semiconductor, China Petroleum and China Gas. In Japan, our holdings in Pigeon (a baby product company), Anritsu (electronics and communications) and Hoya (precision optics) did particularly well. Detractors include a long-held position in Minth Group (Chinese auto-parts), Rohm Co (Japanese semiconductor) and BGF Retail (Korean convenience stores). An underweight position in the Chinese internet giants (the so-called BAT stocks) was a net positive (relative to the benchmark) as they underperformed the region over the six-month period.

 

Outlook

Emerging market volatility, escalating trade tensions and geopolitical uncertainty are currently trumping economic growth, earnings growth and corporate governance improvements in influencing market levels in the short term. Exchange rate volatility has also increased and is likely to remain elevated as Brexit negotiations come to a head. Even though the global economy continues to expand at a steady pace, it appears likely that geopolitical uncertainties and shifts in monetary policy are likely to weigh on investor sentiment for a while to come. Meanwhile, earnings continue to improve against a supportive macroeconomic backdrop and governments in Asia are taking the opportunity to engage in reforms that will strengthen their economies and improve corporate business fundamentals in the long term. We expect the volatility in share prices which returned earlier in 2018 after a period of relative calm to continue. This can provide good opportunities for stock pickers such as our portfolio managers.

 

Share repurchases

The share price discount widened over the period. We continue to buy back shares when the discount at which they stand is at an anomalous and substantial level. During the period, the Company purchased 224,884 shares, which has added approximately £120,000 of value (0.2p per share) for shareholders.

 

Dividend

The Board aims to increase the annual dividend per share in real terms over the long term. Annual dividends have increased consistently for over thirteen years at an annualised rate in excess of 13%. I am pleased to report that the revenue earnings per share for the first half increased by 36.1% over the same period last year, due primarily to an increase in dividends paid by our portfolio companies, together with some one-off effects from changes to the manager line-up in September 2017. Witan Pacific also has a healthy revenue reserve amounting to 20p per share which can be used to supplement dividends in leaner years. The Board therefore proposes to pay an interim dividend of 2.50p per share and we are confident that, in the absence of unforeseen circumstances, the final dividend (payable in summer 2019) is likely to result in another full year of dividend growth for our shareholders.

 

 

Susan Platts-Martin

 

Chair

 

4 October 2018

 

 

* Individual manager's performance gross of fees.

 

 

Company Secretary contact details:

 

Link Company Matters Limited

Beaufort House, 51 New North Road

Exeter EX4 4EP

email: WitanPacificInvestmentTrustPlc@linkgroup.co.uk

 
 

PORTFOLIO INFORMATION

 

Portfolio manager performance for the half year ended 31 July 2018 and from appointment to 31 July 2018

 

 

 

 

 

 

Performance

Annualised

performance²

 

Appointment

Managed assets¹

Manager

Benchmark

Manager

Benchmark

 

date

£m

% 

%

%

%

%

Aberdeen

31 May 2005

59.3

24.9

-1.5

-0.1

+11.2

+9.6

Dalton

28 Sept 2017

22.4

9.4

-2.7

-0.1

+0.2

+8.7

Matthews

30 April 2012

96.9

40.6

+1.4

-0.1

+13.5

+11.3

Robeco

28 Sept 2017

59.8

25.1

-0.4

-0.1

+8.7

+8.7

 

Source: BNP Paribas. All performance figures are disclosed on a pre-fee basis.

 

¹ Excluding cash balances held centrally by the Company.

² Since appointment.

  

 

The Company's portfolio by sector analysis as at 31 July 2018

 

Sector

Portfolio %¹

Benchmark %²

Consumer Discretionary

14

12

Consumer Staples

11

7

Energy

4

3

Financials

19

20

Healthcare

4

6

Industrials

8

12

Information Technology

16

21

Materials

7

7

Real Estate

5

5

Telecom Services

5

4

Utilities

3

3

Other

4

-

 

¹ Source: BNP Paribas.

² Source: MSCI.

 

 

Geographical allocation

Country

Portfolio at

31 July 2018¹

Benchmark at

31 July 2018²

Australia

5%

11%

China/Hong Kong

31%

24%

India

6%

5%

Indonesia

2%

1%

Japan

30%

38%

Malaysia

1%

2%

Philippines

1%

1%

Singapore

5%

2%

South Korea

10%

8%

Taiwan

5%

7%

Thailand

2%

1%

Vietnam

2%

-   

 

100%

100%

 

¹ Source: BNP Paribas - Portfolio represents investments excluding cash.

² Source: MSCI.

 

 

TOP TWENTY INVESTMENTS

as at 31 July 2018

 

This period

Company

% of total investments

Value

£'000

1

Taiwan Semiconductor

Taiwan

2.4

5,614

2

Aberdeen Global Indian Equity Fund

India

2.1

4,921

3

Samsung Electronics

South Korea

2.1

4,816

4

China Construction Bank

China

2.0

4,646

5

China Petroleum (Sinopec)

China

1.8

4,277

6

Shenzhou International

China

1.8

4,234

7

HSBC

UK

1.8

4,147

8

Aberdeen Global China A Share Fund

China

1.7

3,950

9

Seven & I Holdings

Japan

1.6

3,833

10

Minth Group

China

1.4

3,187

11

Japan Tobacco

Japan

1.4

3,183

12

Rohm

Japan

1.3

2,941

13

Hyundai Mobis

South Korea

1.2

2,788

14

LG Chemical

South Korea

1.2

2,746

15

United Overseas Bank

Singapore

1.1

2,667

16

China Mobile

Hong Kong

1.1

2,652

17

BHP Billiton

Australia

1.0

2,392

18

China Gas

China

1.0

2,337

19

Nitori Holdings

Japan

1.0

2,331

20

Sumitomo Mitsui Financial

Japan

1.0

2,318

Totals

 

 

30.0

69,980

 

The value of the twenty largest holdings represents 30.0% (31 January 2018: 31.1%) of the Company's total investments. The full portfolio listing is published monthly (with a three-month lag) on the Company's website. The country shown is the country of incorporation or, in the case of funds, the country of risk.

 

 

REGULATORY DISCLOSURES

 

Related party transactions disclosures

During the period to 31 July 2018, related party transactions included dividends paid to Directors in respect of their shareholdings in the Company. Details of Directors' shareholdings and remuneration may be found in the Directors' Remuneration Report on pages 45 to 48 of the Company's Annual Report for the year ended 31 January 2018. 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 business strategy, market conditions, investment performance, reduction in income, operational failures and tax and regulatory changes or breaches. 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 2018 in the corporate review and in the notes to the financial statements.

 

The risks faced by the Company have not changed significantly over the six months to 31 July 2018 and are not expected to change materially in the next 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.

 

 

CONDENSED INCOME STATEMENT

for the half year ended 31 July 2018

 

 

 

(Unaudited)

Half year ended

31 July 2018

(Unaudited)

Half year ended

31 July 2017

(Audited)

Year ended

31 January 2018

 

 

 

Revenue 

return 

Capital 

return 

Total 

Revenue 

return 

Capital 

return 

Total 

Revenue 

return 

Capital 

return 

Total 

 

Note

£'000 

£'000 

£'000 

£'000 

£'000 

£'000 

£'000 

£'000 

£'000 

(Losses)/gains on investments held at fair value through profit or loss

 

(3,997)

(3,997)

20,210

20,210 

33,241 

33,241 

Exchange losses

 

(33)

(33)

(174)

(174)

(344)

(344)

Investment income

2

3,928 

3,928 

3,013 

3,013 

5,740 

5,740 

Management fees

3

(209)

(628)

(837)

(178)

(535)

(713)

(370)

(1,110)

(1,480)

Performance fees

3

Other expenses

 

(437)

(23)

(460)

(433)

(26)

(459)

(879)

(64)

(943)

Net return/(loss) before finance charges and taxation

 

3,282 

(4,681)

(1,399)

2,402 

19,475 

21,877 

4,491 

31,723 

36,214 

Finance charges

 

(1) 

(1) 

Net return/(loss) before taxation

 

3,282 

(4,681)

(1,399)

2,401 

19,475 

21,876 

4,491 

31,723 

36,214 

Taxation

 

(307)

(307)

(195)

(4) 

(199)

(350)

(6)

(356)

Net return/(loss) after taxation

 

2,975 

(4,681)

(1,706)

2,206 

19,471 

21,677 

4,141 

31,717 

35,858 

Return/(loss) per Ordinary share - pence

5

4.71 

(7.41)

(2.70)

3.46 

30.51 

33.97 

6.52 

49.90 

56.42 

                         

 

All revenue and capital items in the above statement derive from continuing operations. The total columns of this statement represent the Income Statement of the Company. The revenue return and capital return 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.

 

 

CONDENSED STATEMENT OF CHANGES IN EQUITY

for the half year ended 31 July 2018

 

 

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 2018 (unaudited)

 

 

 

 

 

 

At 31 January 2018

16,486

5

41,085

175,084 

11,795 

244,455 

Net (loss)/return after taxation and total comprehensive income

-

-

-

(4,681)

2,975 

(1,706)

Purchase of own shares

-

-

-

(738)

(738)

Dividends paid

-

-

-

(2,054)

(2,054)

At 31 July 2018

16,486

5

41,085

169,665 

12,716 

239,957 

 

 

 

 

 

 

 

Half year ended 31 July 2017 (unaudited)

 

 

 

 

 

 

At 31 January 2017

16,486

5

41,085

148,762 

10,697 

217,035 

Net return after taxation and total comprehensive income

-

-

-

19,471 

2,206 

21,677 

Purchase of own shares

-

-

-

(4,917)

(4,917)

Dividends paid

-

-

-

(1,618)

(1,618)

At 31 July 2017

16,486

5

41,085

163,316 

11,285 

232,177 

 

 

 

 

 

 

 

Year ended 31 January 2018 (audited)

 

 

 

 

 

At 31 January 2017

16,486

5

41,085

148,762 

10,697 

217,035

Net return after taxation and total comprehensive income

-

-

-

31,717 

4,141 

35,858 

Purchase of own shares

-

-

-

(5,395)

(5,395)

Dividends paid

-

-

-

(3,043)

(3,043)

At 31 January 2018

16,486

5

41,085

175,084 

11,795 

244,455 

 

 

 

 

CONDENSED BALANCE SHEET

as at 31 July 2018

 

 

 

(Unaudited)

(Unaudited)

(Audited)

 

 

31 July 

31 July 

31 January 

 

 

2018 

2017 

2018 

 

Note

£'000 

£'000 

£'000 

Fixed assets

 

 

 

 

Investments held at fair value through profit or loss

 

233,671 

228,117 

240,565 

Current assets

 

 

 

 

Debtors

 

1,598 

1,276 

1,899 

Cash at bank and in hand

 

6,735 

5,232 

4,392 

 

 

8,333 

6,508 

6,291 

Creditors

 

 

 

 

Amounts falling due within one year

 

(2,047)

(2,448)

(2,401)

 

 

(2,047)

(2,448)

(2,401)

Net current assets

 

6,286 

4,060 

3,890 

Net assets

 

239,957 

232,177 

244,455 

 

 

 

 

 

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

 

169,665 

163,316 

175,084 

Revenue reserve

 

12,716 

11,285 

11,795 

Total shareholders' funds

 

239,957 

232,177 

244,455 

Net asset value per Ordinary share - pence

8

380.82 

366.32 

386.58 

 

 

 

 

 

 

 

NOTES TO THE FINANCIAL STATEMENTS

for the half year ended 31 July 2018

 

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 '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.

 

As an investment fund, the Company has the option, which it has taken, not to present a cash flow statement. A cash flow statement is not required when an investment fund meets all the following conditions: substantially all of the entity's investments are highly liquid and are carried at market value; and where a Statement of Changes in Equity is provided.

 

(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 included in Level 2 in the Fair Value Hierarchy disclosures in note 9 consist of unlisted reportable funds within the portfolio, Aberdeen Global Indian Equity UCITS and Aberdeen Global China A 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 Income Statement 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 Investment income

 

 

(Unaudited)

(Unaudited)

(Audited)

 

Half year

Half year

Year

 

ended

ended

ended

 

31 July

31 July

31 January

 

2018

2017

2018

 

£'000

£'000

£'000

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

 

 

 

Overseas dividends

3,717

2,669

5,204

UK dividends

202

255

426

Scrip dividends

9

89

110

Total income

3,928

3,013

5,740

 

3 Transactions with the managers

On 27 May 2005, the Company appointed Witan Investment Services Limited as Executive Manager. Aberdeen Asset Managers Limited was appointed as portfolio manager on 31 May 2005. In April 2012, the Company appointed Matthews International Capital Management LLC. In September 2017, the Company appointed Robeco Institutional Asset Management B.V. and Dalton Investments LLC.

 

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 0.85% 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).

 

Any provisions included in the Income Statement at 31 July 2018 are calculated on the actual performance of the portfolio manager relative to the benchmark index. The provision assumes that both the benchmark index remains unchanged and that the portfolio manager's assets under management perform in line with the benchmark index to 31 May 2019, being the date the next performance period ends.

 

In addition, provisions are made where necessary for the performance periods ending 31 May 2020 and 31 May 2021, on the assumption that the portfolio manager performs in line with the benchmark to each period end. The total of these provisions amounts to £nil (31 July 2017: £nil and 31 January 2018: £nil).

 

 

(Unaudited)

(Unaudited)

(Audited)

 

Half year 

Half year 

Year 

 

ended 

ended 

ended 

 

31 July 

31 July 

31 January 

 

2018 

2017 

2018 

 

£'000 

£'000 

£'000 

Charged to revenue return:

 

 

 

Management fee1

209 

199 

397 

Management fee rebates2

(21)

(27)

 

209 

178 

370 

Charged to capital return:

 

 

 

Management fee1

628 

597 

1,190 

Management fee rebates2

(62)

(80)

 

628 

535 

1,110 

Total management fees

837 

713 

1,480 

Performance fees charged to capital return

 

1 The management fees stated above include fees paid to Witan Investment Services Limited of £150,000 (six months to 31 July 2017: £144,000 and full year to 31 January 2018: £296,000).

 

2 This figure relates to rebates of management fees associated with the Gavekal Asian Opportunities UCITS. The Company's investment in the Gavekal fund was sold in September 2017.

 

Management fees are charged 75% to capital return and 25% to revenue return.

 

The allocation percentages approximate to the split of historic returns between capital and income, and reflect the Board's expectation of the long-term split of returns in compliance with the Statement of Recommended Practice 'Financial Statements of Investment Trust Companies and Venture Capital Trusts'. Performance fees, when payable, will be charged wholly to the capital account.

 

4 Dividends

An interim dividend of 2.50p per Ordinary share (2017: 2.25p) will be paid on 29 October 2018 to shareholders on the register on 19 October 2018.

 

5 Return per Ordinary share

The total return/(loss) per Ordinary share is based on the net loss attributable to the Ordinary shares of £1,706,000 (half year ended 31 July 2017: gain of £21,677,000; year ended 31 January 2018: gain of £35,858,000) and on 63,175,471 Ordinary shares (half year ended 31 July 2017: 63,819,054; year ended 31 January 2018: 63,560,181), being the weighted average number of shares in issue during the period.

 

The total return can be analysed as follows:

 

(Unaudited)

(Unaudited)

(Audited)

 

Half year 

Half year 

Year 

 

ended 

ended 

ended 

 

31 July 

31 July 

31 January 

 

2018 

2017 

2018 

 

£'000 

£'000 

£'000 

Revenue return

2,975 

2,206 

4,141 

Capital (loss)/return

(4,681)

19,471 

31,717 

Total (loss)/return

(1,706)

21,677 

35,858 

Weighted average number of Ordinary shares in issue during the period

63,175,471 

63,819,054 

63,560,181 

Revenue return per Ordinary share - pence

4.71 

3.46 

6.52 

Capital (loss)/return per Ordinary share - pence

(7.41)

30.51 

49.90 

Total (loss)/return per Ordinary share - pence

(2.70)

33.97 

56.42 

 

The Company does not have any dilutive securities.

 

6 Provisions for liabilities and charges

This represents the estimated performance fees payable for the three-year performance fee periods ending 31 May 2019, 31 May 2020 and 31 May 2021. This accrual is based on actual performance to 31 July 2018 and the assumption that the portfolio manager performs in line with the benchmark from 31 July 2018 to the end of each fee period. Changes in the level of accrual for future performance periods could arise for one of 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 the portfolio manager's contract.

 

7 Share capital

During the half year ended 31 July 2018, 224,884 Ordinary shares were repurchased and held in treasury, at a total cost of £738,000 (half year ended 31 July 2017: 1,624,554 Ordinary shares were repurchased and held in treasury at a total cost of £4,917,000; year ended 31 January 2018: 1,769,293 Ordinary shares were purchased to be held in treasury at a cost of £5,395,000).

 

As at 31 July 2018, there were 65,944,000 Ordinary shares of 25p in issue, of which 2,933,134 were held in treasury. Subsequent to 31 July 2018, a further 440,177 Ordinary shares were repurchased and held in treasury, at a total cost of £1,393,000 . As at 2 October 2018, there were 65,944,000 Ordinary shares of 25p in issue, of which 3,373,311 were held in treasury.

 

8 Net asset value per Ordinary share

Net asset values are based on net assets of £239,957,000 (31 July 2017: £232,177,000 and 31 January 2018: £244,455,000) and on 63,010,866 Ordinary shares in issue as at 31 July 2018 excluding shares held in treasury (31 July 2017: 63,380,489 and 31 January 2018: 63,235,750).

 

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 fair value hierarchy shall have the following classifications:

 

·      Level 1: The 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 (i.e., developed using market data) for the asset or liability, either directly or indirectly.

·      Level 3: Inputs are unobservable (i.e., for which market data is unavailable) for the asset or liability.

 

The financial assets and liabilities measured at fair value in the Balance Sheet are grouped into the fair value hierarchy at the reporting date as follows:

 

 

 

Level 1

Level 2

Level 3

Total

 

 

£'000

£'000

£'000

£'000

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

 

 

 

 

 

As at 31 July 2018

 

 

 

 

 

Equity investments

 

224,800

8,871

-

233,671

Total

 

224,800

8,871

-

233,671

 

 

 

Level 1

Level 2

Level 3

Total

 

 

£'000

£'000

£'000

£'000

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

 

 

 

 

 

As at 31 January 2018

 

 

 

 

 

Equity investments

 

231,508

9,057

-

240,565

Total

 

231,508

9,057

-

240,565

 

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 Aberdeen Global Indian Equity UCITS and Aberdeen Global China A Equity UCITS (31 January 2018: same).

 

10 Results

The results for the half years ended 31 July 2018 and 31 July 2017, 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 2018; 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 2018 have been extracted from those accounts.

 

 

RESPONSIBILITY STATEMENT OF THE DIRECTORS

in respect of the Half Year Report for the six months ended 31 July 2018

 

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 Chair's statement, portfolio information and regulatory disclosures) 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 4 October 2018 and the above responsibility statement was signed on its behalf by:

 

Susan Platts-Martin

Chair

4 October 2018

 

 

DIRECTORS

 

Susan Platts-Martin - Chair

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

Christopher Ralph - Independent Director

Andrew Robson - Independent Director and Chairman of the Audit Committee

Diane Seymour-Williams - Independent Director

 

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

 

 

GLOSSARY

Definitions of Alternative Performance Measures

 

Net asset value per share

This is the value of total assets less all liabilities of the Company. The net asset value, or NAV, per Ordinary share is calculated by dividing this amount by the total number of Ordinary shares in issue (excluding those shares held in treasury).

Net asset value total return

The movement in the net asset value per share adjusted to include the reinvestment of each dividend paid during the respective period's calculation.

Ongoing charge

The ongoing charge reflects those expenses of a type which are likely to recur in the foreseeable future, whether charged to capital or revenue as a collective fund, excluding the costs of acquisition and disposal and gains or losses arising on investments. The calculation is performed in accordance with the guidelines issues by the Association of Investment Companies.

Premium/discount

The amount by which the market price per share is either higher (premium) or lower (discount) than the net asset value per share expressed as a percentage of the net asset value per share.

Share price total return

The movement in Ordinary share price adjusted to include the reinvestment of each dividend paid during the respective period's calculation.

 

 

 

 

Footnote

Source MSCI. The MSCI information may only be used by you as an individual for your personal use, and as a corporate organisation for your internal use and it 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.

 


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Half-year Report - RNS