Last checked at 
12 Aug 2020 07:00
ABERDEEN ASIAN INCOME FUND LIMITED
Legal Entity Identifier: 549300U76MLZF5F8MN87
Â
UNAUDITED HALF YEARLY REPORT
FOR THE SIX MONTHS ENDED 30 JUNE 2020
Â
Interim Board Report - Chairman's Statement
Â
Background
Over the six months ended 30 June 2020, the Company's net asset value (NAV) fell by 6.5% in sterling terms, compared to the MSCI All Countries Asia Pacific ex Japan High Dividend Yield Index's 7.0% decline over the same period and the MSCI All Countries Asia Pacific ex Japan Index, which increased by 0.8%. It is notable that the MSCI All Countries Asia Pacific ex Japan Index rise was largely driven by lower yielding growth stocks, and this is indicated in the relative resilience in your Company's NAV against the high yield index. Your Company's share price at the period end was 184p which represented a discount of 12.3% to the NAV per share. During the period, two dividend payments totalling 4.5p per share were distributed to shareholders. This represented an annualised dividend yield of 5.0%.
Â
The first six months of 2020 was one of the most challenging ever for markets worldwide, Asia included, as the onset of Covid-19 not only disrupted economic activity, but also life as we know it. Investor anxiety over lockdown measures and the impact of Covid-19 on economies saw financial markets plunge to a trough in March. As assets fell to attractive levels, risk appetite returned somewhat. Sentiment was also boosted by strong support from both governments and central banks to help businesses and individuals and alleviate the liquidity squeeze. Towards the period end, strict social distancing forced infection rates down, allowing governments to ease some of their lockdowns. The nascent recovery in economic activity revived investor sentiment. Although markets rebounded from their March lows, they remained below their January highs, reflecting understandable caution given the ongoing uncertainty.
Â
Overview
The review period started on a positive note in January, as the US and China reached a phase-one trade deal. The optimism, however, was short-lived. A localised virus outbreak in China evolved rapidly into a global pandemic, causing widespread lockdowns as governments grappled with rising death tolls. Markets plummeted, while oil and other commodity prices collapsed on fears over the repercussions of the ensuing demand destruction.
Â
In the latter part of the period, the rebound in stock markets was swift as investors piled back in to take advantage of low valuations, and on hopes of better days ahead as economies started to re-open. Emerging from the crisis first was China. Its leading indicator for manufacturing (PMI) rose above the key 50-point level indicating expansion, while most other Asian economies also saw similar PMI rebounds. Economic data elsewhere also appeared to improve, and US growth delivered consistent upside surprises since May. In addition, oil producers averted a much-feared supply glut, with inventories falling amid improving demand.
Â
As the situation was still precarious, with some countries facing a resurgence in new infections after dismantling some of the more draconian measures, businesses were understandably cautious. Companies prioritised the conserving of cash. Some raised capital to shore up their balance sheets, while others cut spending and slashed overheads. Many also suspended dividend payments, some of their own accord, while others at the behest of their regulators. In the UK, for example, the financial regulator intervened to suspend dividend payments by banks, such as HSBC. In Asia, the Monetary Authority of Singapore gave banks more leeway with regulatory requirements to enable them to boost lending to help tide businesses over, whereas REITs received deadline extensions for distributing their income.
Â
In my view, these mandated dividend suspensions or postponements are different from financially-driven decisions to cut payouts. These deferrals should allow banks and companies to strengthen their reserves during the difficult period. Moreover, your Manager had anticipated such regulatory recommendations, particularly in the banking sector, and therefore repositioned the portfolio accordingly over the period.
Â
Performance Review
As a result of the pandemic, your Company's performance was materially affected. In particular, it was impacted by its light exposure to China, as the mainland market was the first to re-open following months of lockdown. Performance was also reined in by the lack of exposure to Chinese internet stocks, such as Tencent and Alibaba that surged on the back of growing online demand for their services amid the lockdown. Your Company does not hold these names as they do not boast much of a yield. This was partially offset by the portfolio's holding in Yum China, which recovered due to better operational resilience than the market initially feared, buoyed in part by increased demand in its delivery business.
Â
Your Manager also took the opportunity of the earlier sell-off in China to add selectively to positions - notably, China's largest insurance company, Ping An Insurance, where the firm's growth trajectory and income generation ability make its investment case attractive from both yield and capital appreciation standpoints. Additionally, your Manager's engagement with Ping An Insurance on environmental, social, and governance (ESG) issues has been encouraging. Since 2017, your Manager has continued to work with the insurer on a raft of issues, such as shareholding structure, risk management, cybersecurity, human capital management, work culture, as well as bribery and corruption defences. I am pleased to share that as a result of this work, Ping An Insurance has received two ESG rating upgrades in a year by external ratings provider, MSCI, and now commands an "A" rating.
Â
Meanwhile, income-driven markets, such as Singapore and Hong Kong, also weighed on performance, particularly from the portfolio's holdings in the financial sector. Lenders, such as Singapore-based DBS Group and Hong Kong-based HSBC, were doubly hurt by concerns that lower interest rates would compress margins, as well as expectations of dividend suspensions to shore up capital.
Â
On a more positive note, in anticipation of this weakness, your Manager took deliberate measures to protect the portfolio by lowering the weight of certain banks, while retaining active positions where the outlook was more resilient. A good example is the portfolio's position in Hong Kong retailer Convenience Retail Asia, as it kept generating cash flow by quickly adapting its in-store products to suit the changing spending patterns during a tumultuous half year. This allowed the company to pay out a much welcomed special cash dividend in May.
Â
Your Manager also used this opportunity to invest in companies that stand to benefit when the tide turns. To this end, two new holdings were added to the portfolio from the property sector in Singapore - CapitaLand, which offers diversified exposure across various real estate segments globally, and its subsidiary, CapitaLand Mall Trust, a retail-focused REIT with a suite of local downtown and suburban malls. The REIT subsequently announced its merger with CapitaLand's office unit to form a combined entity of well-located properties across the island state. Both new additions share robust income profiles and stable yields. Your Manager has followed the group closely over the years and is confident in its management.
Â
Your Company's exposure to technology and telecommunications companies in Korea and Taiwan contributed positively to performance. Both sectors emerged relatively unscathed from the worst of the pandemic, thanks to increased demand for electronic equipment and data stemming from the need to work-from-home, as well as other pandemic-induced trends. Notably, Taiwan's e-commerce retailer momo.com and Taiwan Mobile benefited as the lockdowns compelled a higher usage of data and online resources. In particular, momo.com re-rated significantly since January as online shopping boomed on the back of a larger proportion of the population sheltering. During this turbulent period, your Manager remained engaged with the portfolio's underlying companies, discussing their business continuity plans and readiness to overcome the current disruption. It was reassuring to see that most of your portfolio's holdings have undertaken strategic reviews and adopted processes to weather the storm. For instance, Samsung Electronics had to halt output at one of its Korean plants after a worker contracted Covid-19. Your Manager engaged with management to understand the implications of such a disruption and was reassured that the impact would be minimal and that no shipments would be delayed on account of this. Additionally, an expected change in its shareholder returns policy lifted the price of its preference shares that your Company holds. Your Manager continues to see value in the company, especially its chip business, and the continued playing out of this thesis has manifested well in the tech giant's strong contribution to performance this year.
Â
Meanwhile, your Manager took advantage of the indiscriminate selling to invest in long-researched, quality stocks with good dividend yields that had been too expensive previously to introduce to the portfolio. Among these was Power Grid Corporation of India, the national power transmission utility with countrywide networks. It benefits from government investments in electric power infrastructure and alternative energy sources. The public-sector enterprise is prudently managed and has healthy operational cash flow, backed by a sturdy balance sheet. Your Manager also initiated APA Group, an Australian natural-gas infrastructure company with defensive cash flows and earnings, buttressed by long-term contracts and a diversified customer-base. Its unique proposition of an integrated network of gas pipelines allows it to provide flexibility to its customers, while generating ample cash flow to return capital to shareholders, as well as invest for future growth.
While your Manager made the most of opportunities to add to the portfolio, a vigilant eye has also been kept on those whose income streams have become riskier and whose investment cases have waned. In addition to those already mentioned, your Manager exited Woodside Petroleum following the collapse in oil prices. While Woodside has a solid balance sheet and is among the best-managed in the region, a protracted low oil-price environment could weigh substantially on its expansion plans, something that management has already started to defer. Elsewhere, your Manager sold Swire Pacific in view of the difficult trading environment constraining its ability to distribute income. Another holding that was sold was Japan Tobacco, because your Manager believed that future dividends would be impaired by broader challenges faced by the entire industry.
Dividends
On 22 July 2020, your Board declared a second quarterly interim dividend of 2.25p per Ordinary share in respect of the year ending 31 December 2020, which will be paid on 21 August 2020 to shareholders on the register on 31 July 2020. The first two quarterly dividends, covering the six months to 30 June 2020 therefore total 4.5p (2019 - 4.5p). As indicated at the time, in light of the ongoing Covid-19 pandemic, the level of the remaining two dividends for 2020 will be considered at each quarter end, at which point an announcement will be made by the Company. The Board is mindful of the Company's objective of growing dividends over time and is keen to retain its 'AIC Dividend Hero' status therefore, if appropriate, it will consider using the Company's healthy revenue reserves built up over the past decade where necessary. Any decision as to whether revenue reserves will be utilised (and by how much) will be taken at the time of each dividend declaration
Â
Gearing and Share Repurchases
During the period, the Company renewed its £40,000,000 revolving credit facility (the "Facility") with Scotiabank Europe PLC ("Scotia") for 1 year. The Facility is in addition to the existing £10,000,000 fixed rate term loan facility with Scotia, which is due to mature in March 2021. HKD73.5 million, USD19.0m and GBP4.9mhas been drawn down under the Facility at all-in annualised rates of 1.6%, 1.5% and 1.4% respectively. Taking account of the existing £10,000,000 fixed rate loan, the Company's total gearing currently amounts to the equivalent of £38.0 million and net gearing of 8.8%.
Â
Over the first half of the year, the Ordinary shares have continued to trade at a discount to the NAV and the Company has been active in the market when the discount (excluding income) has exceeded 5% with a view to minimising volatility due to a widening discount. During the period under review, your Company bought 632,285 shares for treasury and subsequent to the period end a further 400,157 Ordinary shares have been purchased for treasury. At the time of writing the latest NAV per share is 211.0p and the share price is 186.25p representing a discount to NAV of 11.7%.
Â
Outlook
While we have seen a rally in the second quarter of 2020, we have to be mindful of the disconnect between stock prices and corporate and economic fundamentals. We have yet to see a significant improvement in macro data and earnings that would justify valuations at these levels. I would not be surprised if markets reverse again. Governments are still walking the tight rope of having to re-open economies, while trying to avoid a resurgence in Covid-19 infections. Several countries have already changed direction, even though they know that a re-imposition of containment measures would stymie the fragile economic recovery. For example, at the time of writing, the state of Victoria in Australia has just re-instated strict lockdown measures in the wake of a significant rise in infections. However, we expect continued fiscal and monetary measures to help support economies and markets.
Â
Broader geopolitical risks further complicate matters, with tensions between China and the US a recurring theme. The rift started with trade but has since broadened to other areas. This is most evident in the technology domain, where the US wants to restrict China's global ambitions by limiting access to US technology. Your Manager is mindful of the potential repercussions, which could disrupt smartphone supply chains and delay the rollout of 5G networks. We also have an eye on the US presidential elections in November, which is shaping up to be an open race and with the outcome having significant bearing on foreign policy.
Â
In such a climate, it is no surprise that the outlook for corporate earnings has worsened. Many companies have lowered their profit forecasts, with dividend and capital spending being cut in certain cases. More recently, however, your Manager has been detecting marginally more positive updates among our holdings, even though the overall outlook is still muted and most still expect conditions to remain challenging through the rest of 2020.
Amid the uncertainty, it bears reminding that Asia continues to be well positioned as the powerhouse of global growth. For one, we have the spending power of consumers in two of the world's most populous nations - China and India.
The region is also at the forefront of many exciting and emerging technological advances, such as vehicle electrification, Internet of Things and cloud computing. The region has the potential to offer investors good returns for many more years to come.
Â
Your Manager's focus remains on investing in good quality, market leading companies that are tapped into Asia's structural growth. Their defensive traits, such as balance sheet strength, visible revenue streams and healthy profit margins, should enable them to ride out the current crisis, while continuing to pay out a decent dividend. Moreover, your Manager continues to evaluate the new trends that have emerged during the pandemic, such as e-commerce and online activity, alongside longer-term tectonic shifts, such as rising demand in Asia for healthcare and infrastructure.
Â
While your Manager is mindful that dividends will come under pressure in the short term, I remain confident that your Company is positioned well to continue delivering sustainable returns and generating healthy income in the long run.
Â
Charles ClarkeChairman11 August 2020
Â
Â
Â
Interim Board Report - Disclosures
Â
Principal Risk Factors
The principal risks and uncertainties affecting the Company are set out in detail on pages 22 to 24 of the Annual Report and Financial Statements for the year ended 31 December 2019 and have not changed.
Â
The risks outlined below are those risks that the Directors considered at the date of this Half Yearly Report to be material but are not the only risks relating to the Company or its shares. If any of the adverse events described below actually occur, the Company's financial condition, performance and prospects and the price of its shares could be materially adversely affected and shareholders may lose all or part of their investment. Additional risks which were not known to the Directors at the date of this Half Yearly Report, or that the Directors considered at the date of this Report to be immaterial, may also have an effect on the Company's financial condition, performance and prospects and the price of the shares.
Â
If shareholders are in any doubt as to the consequences of their acquiring, holding or disposing of shares in the Company or whether an investment in the Company is suitable for them, they should consult their stockbroker, bank manager, solicitor, accountant or other independent financial adviser authorised under the Financial Securities and Markets Act 2000 (as amended by the Financial Services Act 2012) or, in the case of prospective investors outside the United Kingdom, another appropriately authorised independent financial adviser.
Â
The risks can be summarised under the following headings:
Â
· Investment strategy and objectives;
· Investment portfolio, investment management;
· Financial obligations;
· Financial and regulatory;
· Operational; and,
· Income and dividend risk.
The Board has reviewed the risks related to the Covid-19 pandemic. Covid-19 is continuing to affect the value of the Company's investments due to the disruption of supply chains and demand for products and services, increased costs and potential cash flow issues. The pandemic has significantly impacted world stock markets as well as creating uncertainty around future dividend payments. However, the Board notes the Manager's robust and disciplined investment process which continues to focus on long-term company fundamentals including balance sheet strength and deliverability of sustainable earnings growth. The pandemic has also impacted the Company's third party service providers, with business continuity and home working plans having been implemented. The Board, through the Manager, has been closely monitoring all third party service arrangements and is pleased to report that it has not seen any reduction in the level of service provided to the Company to date.
Â
An explanation of other risks relating to the Company's investment activities, specifically market price, liquidity and credit risk, and a note of how these risks are managed, are contained in note 18 on pages 81 to 89 of the Annual Report for the year ended 31 December 2019.
Â
Going Concern
In accordance with the Financial Reporting Council's Guidance on Risk Management, Internal Control and Related Financial and Business Reporting, the Directors have undertaken a rigorous review and consider that there are no material uncertainties and that the adoption of the going concern basis of accounting is appropriate. This review included the additional risks relating to the ongoing Covid-19 pandemic and where appropriate, action taken by the Manager and Company's service providers in relation to those risks. The Company's assets consist of a diverse portfolio of listed equities which in most circumstances are realisable within a very short timescale. The Directors believe that the Company has adequate financial resources to continue its operational existence for the foreseeable future and at least 12 months from the date of this Half Yearly Report. Accordingly, the Directors continue to adopt the going concern basis in preparing these financial statements.
Â
Directors' Responsibility Statement
The Directors are responsible for preparing this Half Yearly Financial Report in accordance with applicable law and regulations. The Directors confirm that to the best of their knowledge:
Â
· the condensed set of interim financial statements contained within the Half Yearly Financial Report which have been prepared in accordance with IAS 34 "Interim Financial Reporting", give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company; and
· the Half-Yearly Board Report includes a fair review of the information required by rule 4.2.7R of the Disclosure and Transparency Rules (being an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed set of Financial Statements and a description of the principal risks and uncertainties for the remaining six months of the financial year); and
· the Half-Yearly Board Report includes a fair review of the information required by 4.2.8R (being related party transactions that have taken place during the first six months of the financial year and that have materially affected the financial position of the Company during that period; and any changes in the related party transactions described in the last Annual Report that could do so).
For and on behalf of the Board of Aberdeen Asian Income Fund Limited
Â
Charles Clarke,Chairman11 August 2020
Â
Â
Â
Condensed Statement of Comprehensive Income
Â
Â
Six months ended | Â Six months ended | Â Year ended | |||||||||||||
30 June 2020 | 30 June 2019 | Â 31 December 2019 | |||||||||||||
 (unaudited) |  (unaudited) |  (audited) | |||||||||||||
 Revenue |  Capital |  Total |  Revenue |  Capital |  Total |  Revenue |  Capital |  Total | |||||||
 £'000 |  £'000 |  £'000 |  £'000 |  £'000 |  £'000 |  £'000 |  £'000 |  £'000 | |||||||
 Investment income | |||||||||||||||
Dividend income | 8,792 | - | 8,792 | 10,187 | - | 10,187 | 20,516 | - | 20,516 | ||||||
Interest income on investments held at fair value through profit or loss | 170 | - | 170 | 205 | - | 205 | 406 | - | 406 | ||||||
Traded option premiums | 29 | - | 29 | 44 | - | 44 | 74 | - | 74 | ||||||
Total revenue | 8,991 | - | 8,991 | 10,436 | - | 10,436 | 20,996 | - | 20,996 | ||||||
(Losses)/gains on investments held at fair value through profit or loss | - | (30,035) | (30,035) | - | 43,152 | 43,152 | - | 24,759 | 24,759 | ||||||
Net currency (losses)/gains | - | (2,182) | (2,182) | - | (107) | (107) | - | 934 | 934 | ||||||
8,991 | (32,217) | (23,226) | 10,436 | 43,045 | 53,481 | 20,996 | 25,693 | 46,689 | |||||||
Expenses | |||||||||||||||
Investment management fee (note 10) | (632) | (947) | (1,579) | (672) | (1,008) | (1,680) | (1,372) | (2,059) | (3,431) | ||||||
Other operating expenses (note 5) | (428) | - | (428) | (489) | - | (489) | (951) | - | (951) | ||||||
Total operating expenses | (1,060) | (947) | (2,007) | (1,161) | 1,008 | (2,169) | (2,323) | (2,059) | (4,382) | ||||||
Profit/(loss) before finance costs and taxation | 7,931 | (33,164) | (25,233) | 9,275 | 42,037 | 51,312 | 18,673 | 23,634 | 42,307 | ||||||
Finance costs | (191) | (287) | (478) | (203) | (305) | (508) | (429) | (643) | (1,072) | ||||||
Profit/(loss) before tax | 7,740 | (33,451) | (25,711) | 9,072 | 41,732 | 50,804 | 18,244 | 22,991 | 41,235 | ||||||
Tax expense | (713) | 48 | (665) | (630) | (47) | (677) | (1,470) | (68) | (1,538) | ||||||
Profit/(loss) for the period | 7,027 | (33,403) | (26,376) | 8,442 | 41,685 | 50,127 | 16,774 | 22,923 | 39,697 | ||||||
Earnings per Ordinary share (pence) (note 3) | 3.97 | (18.86) | (14.89) | 4.73 | 23.37 | 28.10 | 9.42 | 12.87 | 22.29 | ||||||
The Company does not have any income or expense that is not included in profit/(loss) for the period, and therefore the "Profit/(loss) for the period" is also the "Total comprehensive income for the period". | |||||||||||||||
The total columns of this statement represent the Condensed Statement of Comprehensive Income, prepared in accordance with IFRS. The revenue and capital columns are supplementary to this and are prepared under guidance published by the Association of Investment Companies. All items in the above statement derive from continuing operations. | |||||||||||||||
All of the profit/(loss) and total comprehensive income is attributable to the equity holders of Aberdeen Asian Income Fund Limited. There are no non-controlling interests. | |||||||||||||||
The accompanying notes are an integral part of the financial statements. | |||||||||||||||
Condensed Balance Sheet
Â
As at | As at | As at | ||||
 30 June 2020 |  30 June 2019 |  31 December 2019 | ||||
(unaudited) | (unaudited) | (audited) | ||||
Notes | £'000 | £'000 | £'000 | |||
Non-current assets | ||||||
Investments held at fair value through profit or loss | 398,961 | 451,205 | 435,984 | |||
Current assets | ||||||
Cash and cash equivalents | 5,727 | 7,702 | 3,458 | |||
Other receivables | 1,706 | 2,252 | 1,568 | |||
7,433 | 9,954 | 5,026 | ||||
Creditors: amounts falling due within one year | ||||||
Bank loans | 8 | (37,982) | (26,996) | (25,990) | ||
Other payables | (1,073) | (1,562) | (1,618) | |||
(39,055) | (28,558) | (27,608) | ||||
Net current liabilities | (31,622) | (18,604) | (22,582) | |||
Creditors: amounts falling due after more than one year | ||||||
Deferred tax liability on Indian capital gains | (19) | - | - | |||
Bank loan | 8 | - | (9,998) | (9,999) | ||
(19) | (9,998) | (9,999) | ||||
Net assets | 367,320 | 422,603 | 403,403 | |||
Stated capital and reserves | ||||||
Stated capital | 9 | 194,933 | 194,933 | 194,933 | ||
Capital redemption reserve | 1,560 | 1,560 | 1,560 | |||
Capital reserve | 156,721 | 210,939 | 191,412 | |||
Revenue reserve | 14,106 | 15,171 | 15,498 | |||
Equity shareholders' funds | 367,320 | 422,603 | 403,403 | |||
Net asset value per Ordinary share (pence) | 4 | 207.57 | 237.48 | 227.15 | ||
The accompanying notes are an integral part of the financial statements. | ||||||
Â
Condensed Statement of Changes in Equity
Â
Six months ended 30 June 2020 (unaudited) | |||||||||
 Capital | |||||||||
 Stated |  redemption |  Capital |  Revenue | ||||||
 capital |  reserve |  reserve |  reserve |  Total | |||||
 £'000 |  £'000 |  £'000 |  £'000 |  £'000 | |||||
 Opening balance | 194,933 | 1,560 | 191,412 | 15,498 | 403,403 | ||||
 Buyback of Ordinary shares for treasury | - | - | (1,288) | - | (1,288) | ||||
 (Loss)/profit for the period | - | - | (33,403) | 7,027 | (26,376) | ||||
 Dividends paid (note 6) | - | - | - | (8,419) | (8,419) | ||||
 Balance at 30 June 2020 | 194,933 | 1,560 | 156,721 | 14,106 | 367,320 | ||||
Six months ended 30 June 2019 (unaudited) | |||||||||
 Capital | |||||||||
 Stated |  redemption |  Capital |  Revenue | ||||||
 capital |  reserve |  reserve |  reserve |  Total | |||||
 £'000 |  £'000 |  £'000 |  £'000 |  £'000 | |||||
 Opening balance | 194,933 | 1,560 | 170,680 | 15,026 | 382,199 | ||||
 Buyback of Ordinary shares for treasury | - | - | (1,426) | - | (1,426) | ||||
 Profit for the period | - | - | 41,685 | 8,442 | 50,127 | ||||
 Dividends paid (note 6) | - | - | - | (8,297) | (8,297) | ||||
 Balance at 30 June 2019 | 194,933 | 1,560 | 210,939 | 15,171 | 422,603 | ||||
Year ended 31 December 2019 (audited) | |||||||||
 Capital | |||||||||
 Stated |  redemption |  Capital |  Revenue | ||||||
 capital |  reserve |  reserve |  reserve |  Total | |||||
 £'000 |  £'000 |  £'000 |  £'000 |  £'000 | |||||
 Opening balance | 194,933 | 1,560 | 170,680 | 15,026 | 382,199 | ||||
 Buyback of Ordinary shares for treasury | - | - | (2,191) | - | (2,191) | ||||
 Profit for the year | - | - | 22,923 | 16,774 | 39,697 | ||||
 Dividends paid (note 6) | - | - | - | (16,302) | (16,302) | ||||
 Balance at 31 December 2019 | 194,933 | 1,560 | 191,412 | 15,498 | 403,403 | ||||
The revenue reserve represents the amount of the Company's reserves distributable by way of dividend. | |||||||||
The stated capital in accordance with Companies (Jersey) Law 1991 Article 39A is £260,822,000 (30 June 2019 - £260,822,000; 31 December 2019 - £260,822,000). These amounts include proceeds arising from the issue of shares by the Company, but excludes the cost of shares purchased for cancellation or treasury by the Company. | |||||||||
The accompanying notes are an integral part of the financial statements. | |||||||||
Â
Â
Â
Condensed Cash Flow Statement
Â
Six months ended | Six months ended | Year ended | |
 30 June 2020 |  30 June 2019 |  31 December 2019 | |
(unaudited) | (unaudited) | (audited) | |
£'000 | £'000 | £'000 | |
Cash flows from operating activities | |||
Dividend income received | 8,653 | 8,696 | 19,104 |
Interest income received | 170 | 188 | 423 |
Derivative income received | 29 | 44 | 74 |
Investment management fee paid | (1,982) | (1,703) | (3,409) |
Other cash expenses | (425) | (485) | (890) |
Cash generated from operations | 6,445 | 6,740 | 15,302 |
Interest paid | (490) | (400) | (1,094) |
Overseas taxation paid | (756) | (519) | (1,402) |
Net cash inflows from operating activities | 5,199 | 5,821 | 12,806 |
Cash flows from investing activities | |||
Purchases of investments | (37,411) | (30,386) | (63,113) |
Sales of investments | 44,430 | 38,435 | 68,617 |
Net cash inflow from investing activities | 7,019 | 8,049 | 5,504 |
Cash flows from financing activities | |||
Purchase of own shares for treasury | (1,343) | (1,455) | (2,166) |
Dividends paid | (8,419) | (8,297) | (16,302) |
Net cash outflow from financing activities | (9,762) | (9,752) | (18,468) |
Net increase/(decrease) in cash and cash equivalents | 2,456 | 4,118 | (158) |
Cash and cash equivalents at the start of the period | 3,458 | 3,622 | 3,622 |
Foreign exchange | (187) | (38) | (6) |
Cash and cash equivalents at the end of the period | 5,727 | 7,702 | 3,458 |
 The accompanying notes are an integral part of the financial statements. | |||
Â
Â
Notes to the Financial Statements
Â
1. | Accounting policies - basis of preparation. The Annual Report is prepared in accordance with International Financial Reporting Standards (IFRS), as issued by the International Accounting Standards Board (IASB), and interpretations issued by the International Financial Reporting Interpretations Committee of the IASB (IFRIC). The condensed Half Yearly Report has been prepared in accordance with International Accounting Standards (IAS) 34 - 'Interim Financial Reporting' and should be read in conjunction with the Annual Report for the year ended 31 December 2019. | ||
The financial statements have been prepared on a going concern basis. In accordance with the Financial Reporting Council's guidance on 'Going Concern and Liquidity Risk' the Directors have undertaken a review of the Company's assets and liabilities. The Company's assets primarily consist of a diverse portfolio of listed equity shares which, in most circumstances, are realisable within a very short timescale. | |||
The condensed interim financial statements have been prepared using the same accounting policies as the preceding annual financial statements. | |||
During the period the following standards, amendments to standards and new interpretations became effective. The adoption of these standards and amendments did not have a material impact on the financial statements: | |||
Standards | |||
IAS 1 and IAS 8 Amendments | Definition of Material | 1 January 2020 | |
IAS 1, 8, 34, 37, 38 and IFRS 2, 3, 6, 14 | Amendment to references to the conceptual framework | 1 January 2020 | |
IAS 41 Amendment (AI 2018-20) | Taxation in fair value measurements | 1 January 2020 | |
IFRS 3 Amendment | Definition of a Business | 1 January 2020 | |
IFRS 3 Amendment | Reference to the Conceptual Framework | 1 January 2020 | |
IFRS 9 Amendment (AI 2018-20) | Fees in the '10 per cent' test for derecognition of financial liabilities | 1 January 2020 | |
IFRS 9, IAS 39 and IFRS 7 Amendments | Interest Rate Benchmark Reform | 1 January 2020 | |
Interpretations | |||
IFRIC 12, 19, 20, 22 and SIC 32 | Amendment to references to the conceptual framework | 1 January 2020 | |
Â
2. | Segmental information. For management purposes, the Company is organised into one main operating segment, which invests in equity securities and debt instruments. All of the Company's activities are interrelated, and each activity is dependent on the others. Accordingly, all significant operating decisions are based upon analysis of the Company as one segment. The financial results from this segment are equivalent to the financial statements of the Company as a whole. |
Â
3. | Earnings per Ordinary share | |||
Six months ended | Six months ended | Year ended | ||
 30 June 2020 |  30 June 2019 |  31 December 2019 | ||
(unaudited) | (unaudited) | (audited) | ||
p | p | p | ||
Revenue return | 3.97 | 4.73 | 9.42 | |
Capital return | (18.86) | 23.37 | 12.87 | |
Total return | (14.89) | 28.10 | 22.29 | |
The figures above are based on the following: | ||||
Six months ended | Six months ended | Year ended | ||
 30 June 2020 |  30 June 2019 |  31 December 2019 | ||
(unaudited) | (unaudited) | (audited) | ||
£'000 | £'000 | £'000 | ||
Revenue return | 7,027 | 8,442 | 16,774 | |
Capital return | (33,403) | 41,685 | 22,923 | |
Total return | (26,376) | 50,127 | 39,697 | |
Weighted average number of Ordinary shares in issue | 177,136,644 | 178,366,183 | 178,087,642 |
Â
4. | Net asset value per share | |||
Ordinary shares. The basic net asset value per Ordinary share and the net asset values attributable to Ordinary shareholders at the period end calculated in accordance with the Articles of Association were as follows: | ||||
As at | As at | As at | ||
 30 June 2020 |  30 June 2019 |  31 December 2019 | ||
(unaudited) | (unaudited) | (audited) | ||
Attributable net assets (£'000) | 367,320 | 422,603 | 403,403 | |
Number of Ordinary shares in issue (excluding shares in issue held in treasury) | 176,959,690 | 177,953,298 | 177,591,975 | |
Net asset value per Ordinary share (p) | 207.57 | 237.48 | 227.15 | |
Â
5. | Other operating expenses (revenue) | |||
Six months ended | Â Six months ended | Â Year ended | ||
 30 June 2020 |  30 June 2019 |  31 December 2019 | ||
(unaudited) | (unaudited) | (audited) | ||
£'000 | £'000 | £'000 | ||
Directors' fees | 77 | 77 | 154 | |
Secretarial and administration fees | - | 67 | 134 | |
Promotional activities | 103 | 103 | 206 | |
Auditor's remuneration: | ||||
- statutory audit | 20 | 18 | 37 | |
Custodian charges | 65 | 60 | 126 | |
Other | 163 | 164 | 294 | |
428 | 489 | 951 |
Â
6. | Dividends on equity shares | |||
Six months ended | Six months ended | Year ended | ||
 30 June 2020 |  30 June 2019 |  31 December 2019 | ||
(unaudited) | (unaudited) | (audited) | ||
£'000 | £'000 | £'000 | ||
Amounts recognised as distributions to equity holders in the period: | ||||
Second interim dividend 2019 - 2.25p per Ordinary share | - | - | 4,005 | |
Third interim dividend 2019 - 2.25p per Ordinary share | - | - | 4,000 | |
Fourth interim dividend for 2019 - 2.50p per Ordinary share (2018 - 2.40p) | 4,436 | 4,286 | 4,286 | |
First interim dividend for 2020 - 2.25p per Ordinary share (2019 - 2.25p) | 3,983 | 4,011 | 4,011 | |
8,419 | 8,297 | 16,302 | ||
A second interim dividend of 2.25p for the year to 31 December 2020 will be paid on 21 August 2020 to shareholders on the register on 31 July 2020. The ex-dividend date was 30 July 2020. | ||||
Â
7. | Transaction costs. During the period expenses were incurred in acquiring or disposing of investments classified as fair value through profit or loss. These have been expensed through capital and are included within gains/(losses) on financial assets at fair value through profit or loss in the Condensed Statement of Comprehensive Income. The total costs were as follows: | |||
Six months ended | Six months ended | Year ended | ||
 30 June 2020 |  30 June 2019 |  31 December 2019 | ||
(unaudited) | (unaudited) | (audited) | ||
£'000 | £'000 | £'000 | ||
Purchases | 44 | 39 | 73 | |
Sales | 53 | 39 | 71 | |
97 | 78 | 144 | ||
Â
Â
8. | Bank loans. In April 2020, the Company entered into a new unsecured £40 million multi-currency revolving loan facility agreement with Scotiabank Europe PLC which runs until 6 April 2021. This facility agreement replaced the existing £40 million multi currency revolving loan facility agreement with Scotiabank (Ireland) Designated Activity Company. At the period end approximately USD 7.2 million and HKD 213 million, equivalent to £28.0 million was drawn down from the £40 million facility. The interest rates attributed to the USD and HKD loans at the period end were 1.525% and 2.184% respectively. |
In March 2018, the Company entered into a new fixed three year £10 million credit facility with Scotiabank Europe PLC at an all-in interest rate of 2.179% which will mature on 2 March 2021. | |
The loan is shown on the balance sheet net of expenses which are being amortised over the life of the liability. | |
At the period end, bank loans totalled £37,982,000 (30 June 2019 - £36,994,000; 31 December 2019 - £35,989,000). |
Â
9. | Stated capital | |||||||||
 30 June 2020 |  30 June 2019 |  31 December 2019 | ||||||||
Number | £'000 | Number | £'000 | Number | £'000 | |||||
Ordinary shares of no par value | ||||||||||
Authorised | Unlimited | Unlimited | Unlimited | Unlimited | Unlimited | Unlimited | ||||
Issued and fully paid | 194,933,389 | 194,933 | 194,933,389 | 194,933 | 194,933,389 | 194,933 | ||||
During the period 632,285 Ordinary shares were bought back by the Company for holding in treasury at a cost of £1,288,000 (30 June 2019 - 677,390 shares were bought back at a cost of £1,426,000; 31 December 2019 - 1,038,713 shares were bought back for holding in treasury at a cost of £2,191,000). As at 30 June 2020 17,973,699 (30 June 2019 - 16,980,091; 31 December 2019 - 17,341,414) Ordinary shares were held in treasury. | ||||||||||
The Ordinary shares give shareholders the entitlement to all of the capital growth in the Company's assets and to all the income from the Company that is resolved to be distributed. | ||||||||||
Â
10. | Related party disclosures and transactions with the Manager |
Transactions with the Manager. The Company has an agreement with Aberdeen Standard Capital International Limited ("ASCIL") for the provision of management services. This agreement has been sub-delegated to Aberdeen Standard Investments (Asia) Limited ("ASI Asia"). | |
On 1 January 2020 the Company agreed with the Manager that with effect from 1 January 2020, the calculation of the management fee be changed to 0.85% per annum on average net assets of the previous six months up to £350 million and 0.65% per annum thereafter. The fee continues to be payable quarterly in arrears. During the period, £1,579,000 (30 June 2019 - £1,680,000; 31 December 2019 - £3,532,000) of management fees were paid and payable, with a balance of £765,000 (30 June 2019 - £1,124,000; 31 December 2019 - £1,146,000) being payable to ASI Asia at the period end. | |
The Company also agreed with the Manager that payment of the secretarial administration fee of £134,000 per annum would cease with effect from 1 January 2020. During the period £nil (30 June 2019 - £67,000; 31 December 2019 - £134,000) of fees were paid and payable, with a balance of £nil (30 June 2019 - £33,000; 31 December 2019 - £67,000) being payable to ASCIL at the period end. | |
The promotional activities fee is based on a current annual amount of £206,000 payable quarterly in arrears. During the period £103,000 (30 June 2019 - £103,000; 31 December 2019 - £206,000) of fees were payable, with a balance of £103,000 (30 June 2019 - £52,000; 31 December 2019 - £52,000) being payable to ASCIL at the period end. |
Â
Â
Â
11. | Fair value hierarchy. IFRS 13 'Fair Value Measurement' requires an entity to classify fair value measurements using a fair value hierarchy that reflects the significance of the inputs used in making measurements. The fair value hierarchy has the following levels: | Â | |||||||
Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities; | |||||||||
Level 2: inputs other than quoted prices included within Level 1 that are observable for the assets or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and | Â | ||||||||
Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs). | |||||||||
The financial assets and liabilities measured at fair value in the Condensed Balance Sheet are grouped into the fair value hierarchy as follows: | Â | ||||||||
 | |||||||||
Level 1 | Level 2 | Level 3 | Total | Â | |||||
At 30 June 2020 (unaudited) | Note | £'000 | £'000 | £'000 | £'000 |  | |||
Financial assets at fair value through profit or loss | Â | ||||||||
Quoted equities | a) | 394,801 | - | - | 394,801 | Â | |||
Quoted bonds | b) | - | 4,160 | - | 4,160 | Â | |||
Total assets | 394,801 | 4,160 | - | 398,961 | Â | ||||
 | |||||||||
Level 1 | Level 2 | Level 3 | Total | Â | |||||
At 30 June 2019 (unaudited) | Note | £'000 | £'000 | £'000 | £'000 |  | |||
Financial assets at fair value through profit or loss | Â | ||||||||
Quoted equities | a) | 440,703 | - | - | 440,703 | Â | |||
Quoted bonds | b) | 457 | 10,045 | - | 10,502 | Â | |||
Total assets | 441,160 | 10,045 | - | 451,205 | Â | ||||
 | |||||||||
Level 1 | Level 2 | Level 3 | Total | Â | |||||
At 31 December 2019 (audited) | Note | £'000 | £'000 | £'000 | £'000 |  | |||
Financial assets at fair value through profit or loss | Â | ||||||||
Quoted equities | a) | 432,105 | - | - | 432,105 | Â | |||
Quoted bonds | b) | - | 3,879 | - | 3,879 | Â | |||
Total assets | 432,105 | 3,879 | - | 435,984 | Â | ||||
 | |||||||||
a) Quoted equities. The fair value of the Company's investments in quoted equities has been determined by reference to their quoted bid prices at the reporting date. Quoted equities included in Fair Value Level 1 are actively traded on recognised stock exchanges. | Â | ||||||||
b) Quoted bonds. The fair value of the Company's investments in quoted bonds has been determined by reference to their quoted bid prices at the reporting date. Investments in quoted bonds which are not considered to trade in active markets have been classified as Level 2. | Â | ||||||||
Fair value of financial assets. The Directors are of the opinion that the fair value of other financial assets is equal to the carrying amounts in the Condensed Balance Sheet. | Â | ||||||||
Fair values of financial liabilities. The fair value of borrowings as at 30 June 2020 is the same as the par value at £37,982,000 (carrying value per the Condensed Balance Sheet 30 June 2020 - £37,982,000; 30 June 2019 - £36,994,000; 31 December 2019 - £35,999,000). At 30 June 2019 the fair value was £35,934,000 and at 31 December 2019 it was £35,999,000, calculated using a discounted cash flow valuation technique. Under the fair value hierarchy in accordance with IFRS 13, these borrowings are classified as Level 2. |  | ||||||||
Â
12. | Events after the reporting period. A further 400,157 Ordinary shares have been bought back by the Company for holding in treasury, subsequent to the reporting period end, at a cost of £739,000. Following the share buybacks there were 176,559,533 Ordinary shares in issue excluding those held in treasury. |
Â
13. | Half Yearly Financial Report. The financial information for the six months ended 30 June 2020 and 30 June 2019 has not been audited. |
Â
14. | Approval. This Half Yearly Financial Report was approved by the Board on 11 August 2020. |
Â
Â
The Half Year Report will be posted to shareholders in late August 2020 and copies will be available on the Company's website (asian-income.co.uk*).
Â
*Neither the Company's website nor the content of any website accessible from hyperlinks on that website (or any other website) is (or is deemed to be) incorporated into, or forms (or is deemed to form) part of this announcement
Â
Aberdeen Standard Capital International Limited
Company Secretary
11 August 2020
Â
Â
Investment Portfolio
Â
As at 30 June 2020 | |||||
Valuation | Total assets | ||||
Company | Country | £'000 | % | ||
Samsung Electronics (Pref) | South Korea | 34,404 | 8.5 | ||
Taiwan Semiconductor Manufacturing Company | Taiwan | 30,175 | 7.4 | ||
Venture Corporation | Singapore | 15,312 | 3.8 | ||
Taiwan Mobile | Taiwan | 12,943 | 3.2 | ||
Ping An Insurance (H Shares) | China | 12,390 | 3.1 | ||
Oversea-Chinese Banking Corporation | Singapore | 12,296 | 3.0 | ||
Tesco Lotus Retail Growth | Thailand | 11,766 | 2.9 | ||
Waypoint REIT | Australia | 10,564 | 2.6 | ||
Rio Tinto {A} | Australia | 10,052 | 2.5 | ||
AusNet Services | Australia | 9,857 | 2.4 | ||
Top ten investments | 159,759 | 39.4 | |||
Momo.com Inc | Taiwan | 9,761 | 2.4 | ||
DBS Group | Singapore | 9,321 | 2.3 | ||
Singapore Telecommunications | Singapore | 8,930 | 2.2 | ||
LG Chemical (Pref) | South Korea | 8,285 | 2.0 | ||
Commonwealth Bank of Australia | Australia | 8,167 | 2.0 | ||
China Mobile | China | 8,111 | 2.0 | ||
Spark New Zealand | New Zealand | 7,869 | 1.9 | ||
HSBC Holdings | Hong Kong | 7,801 | 1.9 | ||
Shopping Centres Australasia | Australia | 7,742 | 1.9 | ||
China Resources Land | China | 7,533 | 1.9 | ||
Top twenty investments | 243,279 | 59.9 | |||
Siam Cement {B} | Thailand | 6,687 | 1.7 | ||
BHP Group {A} | Australia | 6,584 | 1.6 | ||
Singapore Technologies Engineering | Singapore | 6,494 | 1.6 | ||
Hana Microelectronics (Foreign) | Thailand | 6,458 | 1.6 | ||
SAIC Motor 'A' | China | 6,287 | 1.6 | ||
Hang Lung Properties | Hong Kong | 5,962 | 1.5 | ||
ASX | Australia | 5,654 | 1.4 | ||
Okinawa Cellular Telephone | Japan | 5,457 | 1.3 | ||
Infosys | India | 5,269 | 1.3 | ||
United Overseas Bank | Singapore | 5,211 | 1.3 | ||
Top thirty investments | 303,342 | 74.8 | |||
Amada Holdings | Japan | 5,197 | 1.3 | ||
Auckland International Airport | New Zealand | 4,942 | 1.2 | ||
Tata Consultancy Services | India | 4,917 | 1.2 | ||
CNOOC | China | 4,908 | 1.2 | ||
Ascendas India Trust | Singapore | 4,761 | 1.2 | ||
Globalwafers | Taiwan | 4,472 | 1.1 | ||
Yum China Holdings | China | 4,334 | 1.1 | ||
Heineken Malaysia | Malaysia | 4,309 | 1.1 | ||
ICICI Bank {D} | India | 4,160 | 1.0 | ||
NZX | New Zealand | 4,055 | 1.0 | ||
Top forty investments | 349,397 | 86.2 | |||
Charter Hall long WALE | Australia | 3,957 | 1.0 | ||
Power Grid Corp of India | India | 3,930 | 1.0 | ||
Capitaland | Singapore | 3,864 | 1.0 | ||
Aeon Credit Service M | Malaysia | 3,568 | 0.9 | ||
Convenience Retail Asia | Hong Kong | 3,558 | 0.9 | ||
Land & Houses Foreign | Thailand | 3,489 | 0.9 | ||
Jardine Cycle & Carriage | Singapore | 3,470 | 0.8 | ||
Tisco Financial Group Foreign | Thailand | 3,440 | 0.8 | ||
Medibank Private | Australia | 3,390 | 0.8 | ||
Bank Rakyat | Indonesia | 3,306 | 0.8 | ||
Top fifty investments | 385,369 | 95.1 | |||
ComfortDelGro | Singapore | 2,393 | 0.6 | ||
APA Group | Australia | 2,186 | 0.5 | ||
Capitaland Mall Trust | Singapore | 1,876 | 0.5 | ||
Westpac Banking Corporation | Australia | 1,775 | 0.4 | ||
Mapletree Commercial Trust | Singapore | 1,671 | 0.4 | ||
Standard Chartered | United Kingdom | 1,618 | 0.4 | ||
SP Setia {C} | Malaysia | 1,065 | 0.2 | ||
Kingmaker Footwear | Hong Kong | 717 | 0.2 | ||
City Developments (Pref) | Singapore | 291 | 0.1 | ||
G3 Exploration {D} | China | - | - | ||
Top sixty investments | 398,961 | 98.4 | |||
Total value of investments | 398,961 | 98.4 | |||
Net current assets {E} | 6,360 | 1.6 | |||
Total assets | 405,321 | 100.0 | |||
{A} Incorporated in and listing held in United Kingdom. | |||||
{B} Holding includes investment in common (£4,470,000) and non-voting depositary receipt (£2,217,000) lines. | |||||
{C} Holding includes investment in Preference Shares (£399,000) and Common Stock (£666,000). | |||||
{D} Corporate bonds. | |||||
{E} Excludes bank loans of £37,982,000. | |||||
Â
Â
ALTERNATIVE PERFORMANCE MEASURES | Â | ||||||
 | |||||||
 | Alternative performance measures are numerical measures of the Company's current, historical or future performance, financial position or cash flows, other than financial measures defined or specified in the applicable financial framework. The Company's applicable financial framework includes IFRS and the AIC SORP. The Directors assess the Company's performance against a range of criteria which are viewed as particularly relevant for closed-end investment companies. ​​​ | ||||||
 | |||||||
 | Total return. NAV and share price total returns show how the NAV and share price have performed over a period of time in percentage terms, taking into account both capital returns and dividends paid to shareholders. NAV total return involves investing the net dividend in the NAV of the Company with debt at fair value on the date on which that dividend goes ex-dividend. Share price total return involves reinvesting the net dividend in the share price of the Company on the date on which that dividend goes ex-dividend. ​​​ | ||||||
 | |||||||
 | The tables below provide information relating to the NAVs and share prices of the Company on the dividend reinvestment dates during the six months ended 30 June 2020 and the year ended 31 December 2019. ​​​ | ||||||
 | ​ | ​ | ​ | ​ | |||
 | ​ | Dividend | ​ | Share | |||
 | Six months ended 30 June 2020 | rate | NAV | price | |||
 | 31 December 2019 | N/A | 227.15p | 214.00p | |||
 | 23 January 2020 | 2.50p | 229.76p | 211.00p | |||
 | 23 April 2020 | 2.25p | 187.79p | 166.00p | |||
 | 30 June 2020 | N/A | 207.57p | 182.00p | |||
 | Total return | ​ | -6.5% | -12.8% | |||
 | ​ | ​ | ​ | ​ | |||
 | ​ | Dividend | ​ | Share | |||
 | Year ended 31 December 2019 | rate | NAV | price | |||
 | 31 December 2018 | N/A | 213.96p | 195.75p | |||
 | 17 January 2019 | 2.40p | 216.13p | 196.50p | |||
 | 25 April 2019 | 2.25p | 231.16p | 214.00p | |||
 | 18 July 2019 | 2.25p | 237.99p | 218.00p | |||
 | 24 October 2019 | 2.25p | 226.02p | 207.00p | |||
 | 31 December 2019 | N/A | 227.15p | 214.00p | |||
 | Total return | ​ | +10.5% | +14.2% | |||
 | ​ | ​ | ​ | ​ | |||
 | Discount to net asset value per Ordinary share. The difference between the share price of 182.00p (31 December 2019 - 214.00p) and the net asset value per Ordinary share of 207.57p (31 December 2019 - 227.15p) expressed as a percentage of the net asset value per Ordinary share. ​​​ | ||||||
 | |||||||
 | Dividend yield. The annual dividend of 9.25p per Ordinary share (31 December 2019 - 9.25p) divided by the share price of 182.00p (31 December 2019 - 214.00p), expressed as a percentage.​​​ | ||||||
 | |||||||
 | Net gearing. Net gearing measures the total borrowings of £37,982,000 (31 December 2019 - £35,989,000) less cash and cash equivalents of £5,734,000 (31 December 2019 - £3,453,000) divided by shareholders' funds of £367,320,000 (31 December 2019 - £403,403,000), expressed as a percentage. Under AIC reporting guidance cash and cash equivalents includes net amounts due from brokers at the period end of £7,000 (31 December 2019 - £5,000) as well as cash held at banks of £5,727,000 (31 December 2019 - £3,458,000). ​​​ | ||||||
 | |||||||
 | Ongoing charges. The ongoing charges ratio has been calculated in accordance with guidance issued by the AIC as the total of investment management fees and administrative expenses and expressed as a percentage of the average net asset values with debt at fair value throughout the year. The ratio for 30 June 2020 is based on forecast ongoing charges for the year ending 31 December 2020. ​​​ | ||||||
 | ​ | ​ | ​ | ​ | |||
 | ​ | ​ | 30 June 2020 | 31 December 2019 | |||
 | Investment management fees (£'000) | ​ | 3,099 | 3,431 | |||
 | Administrative expenses (£'000) | ​ | 834 | 951 | |||
 | Ongoing charges (£'000) | ​ | 3,933 | 4,382 | |||
 | Average net assets (£'000) | ​ | 365,940 | 406,372 | |||
 | Ongoing charges ratio | ​ | 1.07% | 1.08% | |||
 | ​ | ​ | ​ | ​ | |||
 | The ongoing charges percentage provided in the Company's Key Information Document is calculated in line with the PRIIPs regulations which among other things, includes the cost of borrowings and transaction costs. ​​​ | ||||||
Â
Â
Â