26 Jul 2010 07:00
ABERDEEN PRIVATE EQUITY FUND LIMITED
AUDITED ANNUAL FINANCIAL REPORT
for the year ended 31 March 2010
1. CHAIRMAN'S STATEMENT
Following a very eventful first full year as Chairman I present to shareholders the Annual Report and financial statements of the Company for the financial year ended 31 March 2010.
On 19 November 2009 Aberdeen Asset Managers Limited was appointed as Manager of the Company following a period of consultation with the Company's principal shareholders and consideration by the Board and its advisers as to the future of the Company. As shareholders will be aware we have recently concluded the changes to the Company's name, its objective and policy and its structure, which I refer to further below. I am pleased to report that the Company's new Manager has enthusiastically completed the process of reviewing the portfolio, focusing on the new private equity-focused investment policy and seeking out and assessing new opportunities for investment across the full private equity spectrum.
Performance
During the period under review the net asset value ("NAV") per Sterling share fell by 0.6% and the NAV per US Dollar share rose by 5.2%. Although the shares were trading at discounts to their underlying NAVs at the year end of 39.7% and 36.6% respectively, the discount on the Sterling shares had tightened sharply from last year's figure of 55%, whilst the Dollar shares had widened from 25%.
Your Board
On 23 December 2009, we welcomed four new non executive Directors to the Board; Philip Hebson, Howard Myles, David Staples and Jennifer Wick. Mr Hebson and Ms Wick are employed by two of the Company's larger shareholders, Merseyside Pension Fund and Elsina, respectively. This represents a considerable strengthening of the depth and experience of the Board and provides considerable shareholder representation. With the whole Board having been appointed during the year under review, separate resolutions for the election of each Director will be proposed at the Company's Annual General Meeting ("AGM") convened for 1.30 p.m. on 13 September 2010 at Canada Court, Upland Road, St Peter Port, Guernsey, GY1 3QE, Channel Islands.
Extraordinary General Meeting and Class Meeting on 3 June 2010
I wrote to shareholders on 10 May 2010 with a number of proposals following the appointment of Aberdeen Asset Managers Limited as the new Manager of the Company. The proposals related to:
1. the change of the Company's name to Aberdeen Private Equity Fund Limited;
2. the refinement of the Company's investment policy to focus on Private Equity funds;
3. the conversion of the US Dollar shares into Sterling shares to simplify the capital structure; and,
4. the approval of a technical waiver granted by the Takeover Panel of the obligation that would otherwise arise on Elsina to make a mandatory offer to shareholders.
The resolutions were all unanimously approved by shareholders at the meetings (with Elsina not voting in respect of the waiver resolution) and the change of the Company's name became effective on 4 June 2010.
Share Capital
Pursuant to the shareholder authority granted at the meetings on 3 June 2010, the US Dollar shares were compulsorily converted into Sterling shares on 2 July 2010 and 45,540,957 new Sterling shares were issued. The entitlement to Sterling shares was determined by the ratio of NAV attributable to the US Dollar shares to the NAV of the Sterling shares and on that basis 581 Sterling shares were issued for every 1000 US Dollar shares held. Your Board believes that the conversion will increase the liquidity in the Company's shares and simplify any future buy-backs or capital raisings.
The Board are seeking to renew the shareholder authority to buy back up to 14.99% of the Company's share capital.
Portfolio Commentary/Liquidity/Commitments
The Company's residual holdings in Hedge Funds have substantially reduced to 3.3% of the Company's NAV (all percentages are as at the year end). We anticipate the bulk of the remaining investments to be unlocked and returned to the Company by calendar year end. The Manager is liaising with the underlying managers to ensure an expedited return of those assets.
The Company has 53.4% of its NAV invested, in Fair Market Value terms, in Private Equity, and Private Equity like funds (see explanation in the Manager's Review). This latter group includes Venture Capital, Growth Equity, Buyout, Distressed and Specialty funds. All conform to the Private Equity model of drawing down investments from an initial committed amount with the exception of Aarkad Plc, an investment originally held in the Company's former "Transitional portfolio", which was re-categorised as a Specialty Fund during the period. This investment in Aarkad Plc has been reduced to 0.75% of the Company's NAV, as a result of a substantive valuation reduction by the Manager.
The Manager reports that they have now had satisfactory discussions with the managers of all the Company's Private Equity and Private Equity like investments and they continue to spend a significant amount of time on assessing potential return on investment profiles of underlying companies. This work is ongoing and we support the Manager's bottom up approach in assessing these investments.
Despite much of the negative news the Company experienced last year in connection with certain legacy investments, most notable of which was the Company's exposure to certain Bernard L Madoff strategies, it is pleasing to note that the Manager's reports of strategies meetings with General Partners have been largely positive with initial quality assessments being for the most part good. These investments are, in the majority of cases, with well known GPs with established track records, sizeable Limited Partner bases, and importantly, tradeable (albeit not instantly) on the secondary private equity market.
Although the Manager intends to retain the majority of investments, nonetheless the secondary market provides some support to valuation levels, though that market has seen wildly different pricing behaviour. A good example is the Company's holding in Terra Firma III, for which the Manager was receiving indicative offers late last year that would have required the Manager to pay to sell the commitment. In a relatively short period of time this has changed to potential offers being made that would see the Company receiving a payment, albeit still at a discount. This is as much a reflection of returning positive sentiment to the Private Equity sector, as it is on investors' perceptions on one particular fund. Indeed there is some evidence of major institutional funds increasing exposure to this asset class, perhaps unsurprising given historically low valuations.
Outlook
The size of drawdown and distribution cashflows has been stable, with both increasing, over the last two quarters, though we would caution against extrapolating from this trend. Although private equity investment is relatively long term in nature, in certain cases, some funds are always going to be capable of delivering results in very short time frames. This is particularly true of the Distressed fund sub category, where its percentage of the portfolio by Fair Market Value is much greater than its percentage of the portfolio by commitment and collectively they have not yet fully drawn down. This is a reflection of how quickly these funds have delivered good returns and it is very likely that these will be the first of the Company's investments to deliver material value.
As at 31 March 2010 the Company had total commitments of $212.0m and had drawn down $112.8m. The Company's commitment cover as at the year end was 88.4%, a conservative level, and your Company is favourably placed in that respect relative to its peers in the quoted Fund of Private Equity Fund universe. Your Manager recalls that many investors in this universe, up until quite recently, demanded of their Boards that 'cash drag' was minimised and we note that many of those investors now require comfort that future calls on private equity commitments are covered to a much higher extent. The Board are working with the Manager to establish where they feel the appropriate level of commitment cover should lie, and, depending on distribution flow, it is likely that an element of the current cash levels will be deployed into 2010 and 2011 vintage investments. This is especially important to ensure that no significant vintage gap is opened up for the Company in future years.
The Company, on a look through basis, has good diversification at a sector and company level and we do not anticipate a material change to this. There is a strong bias to the US, which is to be expected given the US dominance in this asset class. The Manager may seek to add some emerging market exposure though this would very much depend on any prospective investment satisfying the Manager's quality, risk and return criteria. Other broader asset classes which are likely to be of interest to the Manager are US and European middle market buyouts. Venture will always play a role in the Company, and this is likely to remain focused on technology related areas, though as a long term theme the Manager aspires to have a higher weighting in venture healthcare.
I am confident that mark downs have been reflected in the NAVs of underlying funds, though a sustained rally in global equity markets, and an increase in M&A activity, will help to support that. Deal flow for Private Equity General Partners is increasing, helped by the fact that corporates are focusing again on core activities and are minded to realise cash from non-core assets. Combined with banks moving away from providing stretched debt there are many opportunities for Private Equity funds to acquire quality businesses.
Your Board believes that the changes that have been made to the Company during the last year place it in a much stronger position to move forward. The name now accurately reflects the Company's investment proposition, the new Manager is committed to the Company going forward and has committed significant resource to the management of the Company's affairs. The Board believes that all of these, combined with the simplification of the structure, offer investors a much clearer investment proposition. The Company will not be immune from the performance of the rest of the sector but we are heartened by the progress to date.
I look forward to meeting those of you who can attend the Annual General Meeting and to reporting to you again in November 2010 in respect of the six months ending 30 September 2010. In the meantime, shareholders will find regular monthly updates on the Company's portfolio on the Company's website, www.aberdeenprivateequity.co.uk.
Jonathan Carr
Chairman
23 July 2010
2. MANAGER'S REVIEW
Introduction and context
The mandate for the investment management of Aberdeen Private Equity Fund Limited (formerly Bramdean Alternatives Limited) transferred from Bramdean Asset Management LLP (Bramdean) to Aberdeen Asset Managers Limited (Aberdeen) on 19 November 2009. On that date approximately 3% of the Company's NAV was invested in what was then termed a Transitional portfolio, 10.3% in a Strategic Hedge funds portfolio, 27% in Private Equity, 19.2% in Specialty funds, and 40.5% in cash.
In total the Company held 22 funds in its portfolio on the date of transition plus a further two fully written down funds that had exposure to the Bernard L Madoff strategy. These positions had been selected by the Company's previous manager and its former sub delegated Hedge Fund advisor.
Of the 22 funds, 11 were classified as Private Equity funds, 6 as Specialty funds, 1 as a Transitional fund and 4 as Strategic Hedge funds.
On assumption of the mandate from Bramdean, we put in place an action plan to review all holdings, identify sale and possible write down candidates from the portfolio, start the pipeline of potential new investment opportunities for the portfolio and complete a full cash management review.
Within that period we met with or had conference calls with all but two of the holdings (which were Hedge funds being redeemed). We looked first at the Transitional portfolio the historic purpose of which was as a capital preservation pool, to fund known future capital draw downs from the Company's investments in Private Equity and Specialty funds.
We re-classified one of the portfolio's remaining Transitional investments, Aarkad plc, as a Specialty fund, believing the former classification to be no longer of meaningful relevance.
Aarkad was subsequently written down by Aberdeen, and we discuss this later in the report. Aberdeen no longer use the Transitional categorisation although Defender Limited is still technically a part of this portfolio, believing that all investments have a role to play in providing cover for future capital calls from existing investments.
On transfer of the mandate, the investment management responsibility for the Strategic Hedge Funds portfolio remained with the Company's contracted sub delegated advisor, MAN Investments (CH) AG Guernsey Branch (formerly RMF Investment Management Nassau Branch). Man Investments were given formal notice of the termination of their contract by the Company's previous manager, Bramdean Asset Management LLP, on transfer of the mandate to Aberdeen. Those sub delegated assets, on completion of the 3 month notice period transferred to Aberdeen's management on 17 February 2010.
We should note that the Private Equity portfolio contains funds that are not in the strictest sense Private Equity, and thus we have chosen to re-categorise this section of the portfolio as "Private Equity and Private Equity like".
We maintained the Specialty sector classification, but have opted to now only classify one of the former six Specialty funds so, and re-categorise the remaining as "Private Equity like". These include the Company's positions in Distressed and Growth equity funds.
Performance
We set out here a summary of the monthly NAV and share price performance of the two share classes over the year.
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| Net Asset Value per Sterling Share (Sterling Equivalent) pence | Monthly Performance Sterling Shares % | Sterling Share Price pence | Monthly Performance Sterling Share Price % |
| March 2009 | 90.10 | (6.50) | 40.50 | (4.14) |
| April 2009 | 88.14 | (2.18) | 55.50 | 37.04 |
| May 2009 | 81.35 | (7.70) | 57.00 | 2.70 |
| June 2009 | 79.28 | (2.54) | 51.25 | (10.09) |
| July 2009 | 80.53 | 1.58) | 46.75 | (8.78) |
| August 2009 | 82.16 | 2.02 | 46.00 | (1.60) |
| September 2009 | 86.13 | 4.83 | 53.50 | 16.30 |
| October 2009 | 83.50 | (3.05) | 50.75 | (5.14) |
| November 2009 | 83.96 | 0.55 | 50.00 | (1.48) |
| December 2009 | 82.33 | (1.94) | 52.00 | 4.00 |
| January 2010 | 83.50 | 1.42 | 50.25 | (3.37) |
| February 2010 | 87.30 | 4.55 | 50.50 | 0.50 |
| March 2010 | 89.55 | 2.58 | 54.00 | 6.93 |
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| Net Asset Value per US Dollar Share (Sterling Equivalent)US$ | Monthly Performance US Dollar Shares % | US Dollar Share Price US$ | Monthly Performance US Dollar Share Price % |
| March 2009 | 0.7503 | (5.85) | 0.56 | (20.00) |
| April 2009 | 0.7583 | 1.07 | 0.50 | (10.71) |
| May 2009 | 0.7622 | 0.51 | 0.50 | 0.00 |
| June 2009 | 0.7586 | (0.47) | 0.60 | 20.00 |
| July 2009 | 0.7757 | 2.25 | 0.60 | 0.00 |
| August 2009 | 0.7787 | 0.39 | 0.60 | 0.00 |
| September 2009 | 0.8003 | 2.77 | 0.60 | 0.00 |
| October 2009 | 0.7997 | (0.07) | 0.60 | 0.00 |
| November 2009 | 0.8006 | 0.11 | 0.60 | 0.00 |
| December 2009 | 0.7724 | (3.52) | 0.53 | (11.67) |
| January 2010 | 0.7774 | 0.65 | 0.47 | (11.32) |
| February 2010 | 0.7722 | (0.67) | 0.47 | 0.00 |
| March 2010 | 0.7892 | 2.20 | 0.50 | 6.38 |
Hedging activity
There were no currency hedges in place on Aberdeen's assumption of the mandate, nor at the start of the investment year. The removal of the currency hedge by the previous management team has meant that the Sterling share class holder is exposed to translational risk as assets in USD convert into GBP. The assets of the Company are mostly priced in US Dollars, the cash is held in US Dollars and the Company's liabilities are predominantly in US Dollars, which means that we have minimal transactional risk. The Manager regularly reviews the hedging strategy with the Board, however given the close match of US dollar denominated liabilities to assets, there is lessened risk from liabilities materially outstripping assets as a result of an adverse currency movement. It should also be noted that whilst the commitment cover ratio of the Company is high (indeed, one of the highest in the sector) it is not 100%.
If hedging were to be implemented we should note that there would be a risk of cash outflows to fund a currency hedge that has moved in the wrong direction, thus further impairing the high quality commitment cover level, one of the Company's strong features.
Transitional portfolio review
On assumption of the mandate, the Aberdeen investment team launched a full review of Aarkad. Aarkad's corporate role was to pass investments to a Master structure, Heather Partners Ltd. Heather Partners, in turn lent monies invested by Aarkad, to Mathon Limited, who used the monies to provide secured loans to largely residential developers in, for the most part, Greater Glasgow or the central belt of Scotland. Aberdeen made immediate and substantive calls for further information from the Aarkad board particularly to obtain clarification on individual loan lines and on the portfolio liquidation process that appeared to be underway.
Aberdeen's requests for information were all rejected. We were disappointed to find out that the liquidation recovery rates for certain underlying investments were proving to be extremely low.
Following further extensive work, including one site visit in Lanarkshire, Scotland, and in conjunction with the Board and Aberdeen's own pricing committee, the Aarkad position was written down by 75%. Ernst and Young (Isle of Man) have since been appointed as liquidators to Heather Partners Ltd. We expect there to be some residual value in the portfolio so we believe it remains appropriate to maintain some carrying value. We watch developments closely.
The investment in Defender Limited, a Madoff feeder fund vehicle, was written down to zero for the November 2008 NAV after disclosure of the Madoff fraud in December 2008. The Aberdeen investment team has been monitoring the Madoff bankruptcy proceedings since assumption of the mandate. As at the end of March 2010, the Madoff trustee has only settled with one of the other feeder funds but has been in discussions with the board of Defender Limited. Until settlements with the feeder funds have been made, it will be difficult to determine what the recovery from the Madoff bankruptcy will be. We will continue to monitor the Madoff bankruptcy proceedings and assess options for the Company's holding in Defender Limited in light of those proceedings.
Strategic Hedge Funds review
We inherited four remaining hedge fund positions on 19 November 2009, all managed by Man Investments. That portfolio transferred to our control on 17 February 2010 following the termination of the Man contract. A redemption order for the Paulson Advantage Plus holding was submitted in December 2009 with a target redemption date of 30 April 2010. That cash payment arrived in full in May 2010.
The main King Street holding was sold to a Man client and full proceeds were realised. A King Street sidepocket remains, of which half has now been redeemed, leaving an investment valued at approximately £62,000 outstanding.
DE Shaw was fully redeemed on 31 January 2010, with all proceeds being received by 31 March 2010.
Deephaven remains illiquid though we are now starting to see a drip feed of capital being returned. We are optimistic that we will receive back the bulk of that investment during the course of 2010.
Similar to the Company's holding in Defender Limited, Rye Select Broad Market XL Portfolio Ltd. is a Madoff feeder fund. We will continue to monitor the Madoff bankruptcy proceedings and assess options for this holding in light of those proceedings.
Private Equity and Private Equity Like review
The pace of draw-downs from Private Equity General Partners (GPs) had slowed considerably in the first half of 2009 as managers retained their cautious outlook on the economy, focused on running their existing portfolio companies and focused on re-financing existing debt to longer maturities. The easing of the credit crisis and the significant rally in financial markets in the last part of 2009 resulted in some initial confidence returning to the private equity industry.
Aberdeen have seen some interesting developments in the private equity market, which we see as confirmatory evidence that this market may now be out of the starting blocks of recovery and up and running. On the fund raising side, despite estimates that there is up to US$400bn of dry powder (as yet unspent commitments) in the US industry alone, Aberdeen have been presented with approximately 120 different fund opportunities in the first quarter of 2010. These range in size from US$100m growth capital funds right up to US$4bn buy-out funds.
There has also been a marked increase in potential IPO activity. In the first quarter, there were 238 S1 filings (IPO registration) with the SEC. This bodes well for the Company's venture holdings but should benefit larger investments as well. Historically a healthy IPO market has attracted corporate M&A where GPs can typically exit at higher multiples.
Indeed, the Company has seen an increase in distributions, in the latter part of the Company's financial year. When capital refunds are included, in the fourth quarter alone, the Company saw distributions of US$2.54m which is the highest we have seen in the last six quarters. With investment activity tailing down, as well, the Company has managed to retain its high commitment cover.
We expect investment to pick up again over the year as the GPs we are invested in, on the whole, are talking about good pipelines of potential investments.
Indeed, the Company's funds have started to see capital calls return to more normalised levels. We see this as a positive sign and are discussing in detail with GPs the companies that they are deploying our cash into.
Much of Aberdeen's work since the assumption of the mandate from Bramdean has focused on continuing the due diligence started on individual holdings prior to formal change of control. We are broadly comfortable with the majority of the holdings and have now seen or had conference calls with all the Private Equity and Private Equity like holdings, plus the specialist funds.
A number of the holdings have demanded a significant amount of Aberdeen's investment management time to assess the quality and health of underlying investments. Aberdeen have been keeping a close watch on the secondary market to potentially allow us to actively manage an already in place portfolio, in what is a very illiquid private equity market. Whilst, when we assumed control of the mandate, it appeared that certain funds required us to pay cash to exit from positions and future commitments, we have seen a strong normalisation of the market. As such, pricing for secondary positions is in the range of 55% to 100% of NAV depending on portfolio quality and level of drawdowns.
Due to a key man clause being triggered following the departure of a number of senior partners at the GP managing the Pinebridge Latin America Partners II L.P. (formerly AIG Brazil Special Situations Fund II L.P.), the Company was released from future commitments. Whilst this was previously notified to the Board, our attention in Q4 last year focused on the proposed necessary approval required from investors for AIG's private equity business to be acquired by Pacific Century Group (and rename itself PineBridge Investments). After much work we voted in favour of the change, taking the view that the underlying investments should remain largely unaffected.
Whilst Aberdeen continue to monitor the performance and prospects for the funds the Company is already invested in, with such a strong influx of new funds, we have also turned our attention to considering new investments. Our work here has identified another positive for the Private Equity market as a whole, as two out of the twenty five funds we have asked for meetings with, closed between the information being received by Aberdeen and our meeting request. These were in European buyout and Latin American growth capital.
Thus far, one of the funds we have looked at has been worth further diligence. It is an Indian growth equity vehicle that differentiates itself by looking for investments in manufacturing rather than the services sector, where valuations are higher. It is a first time fund but the team have a long track record of providing debt to growth companies in India. This is very much work in progress but we flag it at this stage to give some comfort that our focus is as much on future potential investments as it is on staying on top of what we own. And of course any investment into any new fund would be subject to satisfactory findings from Aberdeen's operational and legal due diligence team, as well as complete comfort from the investment team that our investment criteria are met.
We do not anticipate any material change in the Company's asset allocation within Private Equity, though we may opportunistically look to trade out of individual positions subject to attractive pricing conditions in the secondary market. Our cash weighting remains high, and it is likely that we will maintain high levels to meet accelerating drawdown requests from GPs.
Lastly, we look forward to working within our new wholly Private Equity mandate following the recent Circular on the Company's proposed name change to Aberdeen Private Equity Fund Limited, and proposed mandate change. We welcome the clarity and purity of investment purpose that this brings. We have a strong team in place and believe that a tremendous opportunity in Private Equity (and Private Equity like funds) lies ahead.
Alexander Barr
Aberdeen Asset Managers Limited
Manager
23 July 2010
3. STATEMENT OF DIRECTORS' RESPONSIBILITIES
The Directors are responsible for preparing financial statements for each financial year which give a true and fair view in accordance with applicable Guernsey law and International Financial Reporting Standards, of the state of affairs of the Company and of the profit or loss of the Company for that year. In preparing the financial statements, the Directors are required to:
- select suitable accounting policies and apply them consistently;
- make judgements and estimates that are reasonable and prudent;
- state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements; and
- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.
The Directors confirm to the best of their knowledge that:
- they have complied with the above requirements in preparing the financial statements;
- there is no relevant audit information of which the Company's auditors are unaware.
In accordance with Disclosure and Transparency Rule 4.1.12:
The Directors confirm to the best of their knowledge that:
(a) the financial statements, prepared in accordance with the applicable set of accounting standards, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company; and
(b) the Directors' Report includes a fair review of the development and performance of the business and the position of the Company, together with a description of the principal risks and uncertainties that they face.
The Directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that the financial statements comply with The Companies (Guernsey) Law, 2008. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Each Director confirms that, so far as he or she is aware, there is no relevant audit information of which the Company's auditors are unaware, and he or she has taken all the steps that they ought to have taken as a Director in order to make themselves aware of any relevant audit information and to establish that the Company's auditors are aware of that information. Additionally, all important events since the year end are properly disclosed in the financial statements.
The maintenance and integrity of the Company's website is the responsibility of the Directors; the work carried out by the auditors does not involve consideration of the maintenance and integrity of this website and, accordingly, the auditors accept no responsibility for any changes that may have occurred to the financial statements since they were initially presented on the website. Legislation in Guernsey governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.
For Aberdeen Private Equity Fund Limited
J D Carr
Chairman
23 July 2010
SCHEDULE OF INVESTMENTS
As at 31 March 2010
| Investments Private Equity & Private Equity Like Funds portfolio | Investment called/cost US$'000 |
Fair Value US$'000 |
% of NAV | 2009 Fair Value US$'000D |
| Aarkad PLC | 7,100 | 1,386 | 0.8 | 5,550 |
| Coller International Partners V L.P. | 6,825 | 7,496 | 4.0 | 5,059 |
| DFJ Athena L.P. | 6,160 | 5,522 | 3.0 | 3,211 |
| Goldman Sachs Capital Partners VI L.P. | 5,563 | 4,404 | 2.4 | 2,840 |
| Greenpark International Investors III L.P. | 14,142 | 11,961 | 6.5 | 10,999 |
| HIG Bayside Debt & LBO Fund II L.P. | 4,170 | 5,094 | 2.7 | 2,299 |
| MatlinPatterson Global Opportunities Partners III L.P. | 6,408 | 6,103 | 3.3 | 2,708 |
| Oaktree OCM Opportunities Fund VIIb L.P. | 12,750 | 18,188 | 9.8 | 8,926 |
| Pine Brook Capital Partners L.P. | 2,689 | 3,374 | 1.8 | 1,956 |
| PineBridge Latin America Partners II L.P.A | 1,676 | 1,743 | 0.9 | 1,678 |
| Resonant Music I L.P. | 3,251 | 3,021 | 1.6 | 1,796 |
| Rho Ventures VI L.P. | 2,550 | 2,226 | 1.2 | 1,189 |
| Silver Lake Partners III L.P. | 4,846 | 5,405 | 2.9 | 1,677 |
| SVG Strategic Recovery Fund II L.P. | 8,510 | 5,968 | 3.2 | 3,423 |
| Tenaya Capital V L.P.B | 4,313 | 4,070 | 2.2 | 2,576 |
| Terra Firma Capital Partners III L.P. | 11,268 | 3,391 | 1.8 | 2,861 |
| Thoma Bravo Fund IX L.P. | 2,255 | 2,673 | 1.5 | 1,381 |
| Thomas H Lee Parallel Fund VI L.P. | 7,471 | 6,896 | 3.7 | 6,667 |
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| ________ | ________ | ________ |
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| 111,947 | 98,921 | 53.3 |
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| ________ | ________ | ________ |
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| Investments Strategic Hedge Funds portfolio | Investment called/cost US$'000 | Fair Value US$'000 | % of NAV |
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| Deephaven Global Multi-Strategy Fund Ltd. | 1,691 | 1,137 | 0.6 | 5,069 |
| King Street Capital Ltd. | 231 | 61 | 0.1 | 2,840 |
| Paulson Advantage Plus Ltd. | 2,349 | 4,873 | 2.6 | 5,063 |
| Rye Select Broad Market XL Portfolio Ltd.C | 8,500 | - | - | - |
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| ________ | ________ | ________ |
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| 12,771 | 6,071 | 3.3 |
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| ________ | ________ | ________ |
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| Investments Transitional portfolio | Investment called/cost US$'000 | Fair Value US$'000 | % of NAV |
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| Defender Ltd.C | 10,200 | - | - | - |
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| ________ | ________ | ________ |
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| 10,200 | - | - |
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| ________ | ________ | ________ |
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| Total Investments | 134,918 | 104,992 | 56.5 |
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| ________ | ________ | ________ |
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| Fixed-term deposits |
| Fair Value US$'000 | % of NAV |
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| Bank of Scotland |
| 20,510 | 11.1 |
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| BNP Paribas Group |
| 25,806 | 13.9 |
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| Deutsche Bank |
| 2,915 | 1.6 |
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| Royal Bank of Canada |
| 4,003 | 2.2 |
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| Royal Bank of Scotland International |
| 25,196 | 13.6 |
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| ________ | ________ |
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| 78,430 | 42.4 |
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| ________ | ________ |
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| Cash |
| 2,131 | 1.2 |
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| Other liabilities less assets |
| (319) | (0.2) |
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| ________ | ________ |
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| 1,812 | 1.0 |
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| ________ | ________ |
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| Net assets |
| 185,234 | 100.0 |
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| ________ | ________ |
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| A Formerly AIG Brazil Special Situations Fund II L.P. B Formerly Lehman Brothers Ventures Partners V L.P. C Because of their exposure to Bernard L. Madoff Investment Securities LLC, these investments were written down to nil value. The Company continues to monitor the situation on behalf of its investors and to make every appropriate effort to seek recovery of the assets. D Purchases and/or sales effected during the year will result in 2009 and 2010 values not being directly comparable.
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4. BUSINESS REVIEW
Aberdeen Private Equity Fund Limited (the "Company") (formerly Bramdean Alternatives Limited) is a closed-ended investment company registered in Guernsey with registered number 46192. The Company's shares are listed on the Official List of the United Kingdom Listing Authority and admitted to trading on the Main Market of the London Stock Exchange. The Company is a member of the Association of Investment Companies.
A review of the Company's activities is given in the Chairman's Statement and the Manager's Review. This includes a review of the business of the Company and its principal activities, likely future developments of the business, and details of changes to the Company's share capital during the year by the Company. The major risks associated with the Company are detailed below and in note 18 to the financial statements. The Key Performance Indicators for the Company including NAV performance and share price performance are detailed in the Manager's Review.
The Company does not make political donations or expenditures and has not made any donations for charitable purposes during the year and in common with most investment companies, the Company has no employees. Directors' & Officers' liability insurance cover has been maintained throughout the year at the expense of the Company.
Principal Risk Factors
Sterling Shares
The market price and the realisable value of the Sterling shares, as well as being affected by their underlying net asset value, also take into account supply and demand for the Sterling shares, market conditions and general investor sentiment. As such, the market value and the realisable value of the Sterling shares may fluctuate and vary considerably from the net asset value of the Sterling shares and investors may not be able to realise the value of their original investment.
Borrowings
The Company may borrow up to 25% of the NAV of the Company. Whilst the use of borrowings should enhance the total return on the Sterling shares where the return on the Company's underlying assets is rising and exceeds the cost of borrowing, it will have the opposite effect where the underlying return is less than the cost of borrowing, further reducing the total return on the Sterling shares.
Market Risks
The fair value or future cash flows of a financial instrument held by the Company may fluctuate because of changes in market prices. Market risk comprises three elements, interest rate risk, currency risk and other price risk. Further details of these risks are disclosed in note 18 to the financial statements. Investment in private equity securities involves a greater degree of risk than that usually associated with investment in listed securities markets.
General
The Company does not have a fixed winding-up date and, therefore, unless shareholders vote to wind up the Company, shareholders will only be able to realise their investment through the market.
Taxation and Exchange Controls
Any change in the Company's tax status or in taxation legislation (including the tax treatment of dividends or other investment income received by the Company) could affect the value of the investments held by the Company, affect the Company's ability to provide returns to shareholders or alter the post-tax returns to shareholders.
Investment Strategy and Performance
Inappropriate long-term investment strategies in terms of, inter alia, asset allocation, level of gearing or manager selection may result in underperformance of the Company against the companies within the peer group. The Board regularly considers the Company's investment strategy and monitors performance at each Board meeting.
Portfolio Risks
Private equity investments are long-term in nature and it may take a considerable period to be realised. A substantial proportion of the Company's assets are invested in limited partnerships which invest in private companies.
These unquoted investments are less readily realisable than quoted securities. Such investments may therefore carry a higher degree of risk than quoted securities. In valuing its investments in private equity funds or limited partnerships and in calculating its NAV, the Company relies to a significant extent on the accuracy of financial and other information provided by these funds to the Manager. Limited partnerships typically provide updated (unaudited) valuations on a quarterly or six-monthly basis.
Internal Control
The Board is ultimately responsible for the Company's system of internal control and for reviewing its effectiveness. Following publication of the Financial Reporting Council's "Internal Control: Revised Guidance for Directors on the Combined Code" (the FRC Guidance), the Board confirms that there is an ongoing process for identifying, evaluating and managing the significant risks faced by the Company. This process has been in place for the year under review and up to the date of approval of this Annual Financial Report, and is regularly reviewed by the Board and accords with the FRC Guidance. The Board has reviewed the effectiveness of the system of internal control. In particular, it has reviewed and updated the process for identifying and evaluating the significant risks affecting the Company and policies by which these risks are managed.
5. STATEMENT OF COMPREHENSIVE INCOME
For the year ended 31 March 2010
|
| Notes | Year ended 31 March 2010 US$'000 | Year ended 31 March 2009 US$'000 |
| Gains/(losses) on investments | 11 | 14,007 | (55,613) |
| Income | 4 | 147 | 547 |
| Currency losses |
| (14) | (20,294) |
| Investment management fees | 5 | (2,740) | (3,374) |
| Other expenses | 6 | (2,272) | (1,133) |
|
|
| ____________ | ____________ |
| Profit/(loss) attributable to equity shareholders |
| 9,128 | (79,867) |
|
|
| ____________ | ____________ |
| Earnings per share |
|
|
|
| US Dollar shares | 8 | US$ 0.0388 | USD(0.0644) |
|
|
| ____________ | ____________ |
| Sterling shares | 8 | GBP 0.0442 | GBP(0.1226) |
|
|
| ____________ | ____________ |
6. BALANCE SHEET
As at 31 March 2010
|
|
| As at 31 March 2010 | As at 31 March 2009 | ||
|
| Notes | US$'000 | US$'000 | US$'000 | US$'000 |
| Non-current assets |
|
|
|
|
|
| Financial assets at fair value through profit or loss | 9 |
| 104,992 |
| 112,610 |
|
|
|
|
|
|
|
| Current assets |
|
|
|
|
|
| Cash and cash equivalents |
| 80,561 |
| 54,309 |
|
| Trade and other receivables | 12 | 140 |
| 9,697 |
|
|
|
| _______ |
| _______ |
|
|
|
| 80,701 |
| 64,006 |
|
| Creditors: amounts falling due within one year |
|
|
|
|
|
| Trade and other payables | 13 | (459) |
| (510) |
|
|
|
| _______ |
| _______ |
|
| Net current assets |
|
| 80,242 |
| 63,496 |
|
|
|
| _______ |
| _______ |
| Net assets |
|
| 185,234 |
| 176,106 |
|
|
|
| _______ |
| _______ |
| Capital and reserves |
|
|
|
|
|
| Share capital | 14 |
| - |
| - |
| Share premium | 14 |
| 258,759 |
| 258,759 |
| Revenue reserves | 15 |
| (73,525) |
| (82,653) |
|
|
|
| _______ |
| _______ |
| Total shareholders' funds |
|
| 185,234 |
| 176,106 |
|
|
|
| _______ |
| _______ |
| Net asset value per share |
|
|
|
|
|
| US Dollar shares | 16 |
| US$ 0.7892 |
| US$ 0.7503 |
| Sterling shares | 16 |
| GBP 0.8955 |
| GBP 0.9010 |
7. RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS
For the year ended 31 March 2010
|
| Notes | Share Capital and Share Premium US$'000 | Revenue Reserves US$'000 | Total US$'000 |
| Net assets at 31 March 2009 |
| 258,759 | (82,653) | 176,106 |
| Profit from operations |
| - | 9,128 | 9,128 |
|
|
| __________ | __________ | __________ |
| Net assets at 31 March 2010 |
| 258,759 | (73,525) | 185,234 |
|
|
| __________ | __________ | __________ |
For the year ended 31 March 2009
|
| Notes | Share Capital and Share Premium US$'000 | Revenue Reserves US$'000 | Total US$'000 |
| Net assets at 1 April 2008 |
| 259,187 | (2,786) | 256,401 |
| Repurchase of shares | 14 | (428) | - | (428) |
| Loss from operations |
| - | (79,867) | (79,867) |
|
|
| __________ | __________ | __________ |
| Net assets at 31 March 2009 |
| 258,759 | (82,653) | 176,106 |
|
|
| __________ | __________ | __________ |
The accompanying notes are an integral part of the financial statements.
8. STATEMENT OF CASH FLOWS
For the year ended 31 March 2010
|
| Note | Year ended 31 March 2010 US$'000 | Year ended 31 March 2009 US$'000 |
| Cash flows from operating activities |
|
|
|
| Profit/(loss) for the year |
| 9,128 | (79,867) |
| Net interest income from cash and cash equivalents |
| (1) | (48) |
| (Gains)/losses on investments | 11 | (12,771) | 49,285 |
| Decrease in trade and other payables |
| (51) | (1,614) |
| (Increase)/decrease in trade and other receivables |
| (34) | 27 |
|
|
| ___________________ | ________________ |
| Net cash outflows from operating activities |
| (3,729) | (32,217) |
|
|
|
|
|
| Cash flows from investing activities |
|
|
|
| Net interest income from cash and cash equivalents |
| 1 | 48 |
| Purchases of investments |
| (21,196) | (102,078) |
| Sales of investments |
| 51,176 | 161,036 |
|
|
| ___________________ | ________________ |
| Net cash inflows from investing activities |
| 29,981 | 59,006 |
|
|
|
|
|
| Cash flows from financing activities |
|
|
|
| Repurchase of shares | 14 | - | (428) |
|
|
| _________________ | _______________ |
| Net cash outflows from financing activities |
| - | (428) |
|
|
| ___________________ | ________________ |
| Net change in cash and cash equivalents for the year |
| 26,252 | 26,361 |
| Cash and cash equivalents at beginning of the year |
| 54,309 | 27,948 |
|
|
| ___________________ | ________________ |
| Cash and cash equivalents at end of the year |
| 80,561 | 54,309 |
|
|
| ___________________ | ________________ |
The accompanying notes are an integral part of the financial statements.
9. NOTES TO THE FINANCIAL STATEMENTS:
For the year ended 31 March 2010
1 General information
Aberdeen Private Equity Fund Limited (the "Company") was incorporated with limited liability and registered in Guernsey on 5 January 2007. The Company's US Dollar and Sterling shares were listed on the London Stock Exchange on 9 July 2007 whereupon the Company became a closed-ended investment company, domiciled in Guernsey. The Company is authorised by the Guernsey Financial Services Commission.
2 Accounting policies
The following accounting policies have been applied consistently in dealing with items which are considered material in relation to the Company's financial statements.
(a) Basis of preparation
The financial statements have been prepared on a going concern basis under the historical cost convention, as modified by the revaluation of financial assets and financial liabilities at fair value through profit or loss.
The financial statements are prepared in accordance with International Financial Reporting Standards ("IFRS") issued by the International Accounting Standards Board (IASB), and interpretations issued by the International Financial Reporting Interpretations Committee ("IFRIC").
The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates which requires management to exercise its judgement in the process of applying the accounting policies. Actual results may differ from these estimates. It is in the area of valuation of investments where management are required to exercise judgement in the adoption of critical estimates and judgements which can impact the carrying values of investments.
The following new standards and amendments to standards are mandatory for the first time for financial years beginning on or after 1 January 2009.
- IAS 1 (Revised), 'Presentation of Financial Statements'. The revised standard prohibits the presentation of items of income and expenses (that is 'non-owner changes in equity') in the statement of changes in equity, requiring 'non-owner changes in equity' to be presented separately from owner changes in equity. All 'non-owner changes in equity' are required to be shown in a performance statement.
Entities can choose whether to present one performance statement (the statement of comprehensive income) or two statements (the income statement and statement of comprehensive income). The Company has elected to present one statement: the statement of comprehensive income.
- IAS 32 (Amendment), 'Financial Instruments: Presentation', and IAS 1 (Amendment), 'Presentation of Financial Statements' - 'Puttable financial instruments and obligations arising on liquidation' (the "Amendment"). The Amendment requires puttable financial instruments that meet the definition of a financial liability to be classified as equity where certain strict criteria are met. Those criteria include: the puttable instruments must entitle the holder to a pro-rata share of net assets; the puttable instruments must be the most subordinated class and that class' features must be identical; there must be no contractual obligations to deliver cash or another financial asset other than the obligation on the issuer to repurchase; and the total expected cash flows from the puttable instrument over its life must be based substantially on the profit or loss of the issuer. The Company's Sterling shares and US Dollar shares are both classified as equity.
- IAS 39 (Amendment), 'Financial Instruments: Recognition and Measurement'. The definition of financial asset or financial liability at fair value through profit or loss as it relates to items that are held for trading is amended. This clarifies that a financial asset or liability that is part of a portfolio of financial instruments managed together with evidence of an actual recent pattern of short-term profit taking is included in such a portfolio on initial recognition.
- IFRS 7 (Amendment), 'Disclosures - Improving Disclosures about Financial Instruments' requires fair value measurements to be disclosed by the source inputs, using a three level hierarchy. See Note 10 - Financial assets at fair value through profit or loss for further information regarding the IFRS 7 (Amendment).
The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurements) and the lowest priority to unobservable inputs (level 3 measurements). A financial instrument's level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.
- IFRS 8 'Operating segments' replaces IAS 14 'Segment reporting'. The new standard requires a 'management approach', under which segment information is presented on the same basis as that used for internal reporting purposes.
The Board has considered the requirements of IFRS 8 'Operating Segments', and is of the view that the Company is engaged in three segments of business: investment in the Private Equity & Private Equity Like Funds portfolio, the Strategic Hedge Funds portfolio and the Transitional portfolio. The Board, as a whole, has been determined as constituting the chief operating decision maker of the Company. The key measure of performance used by the Board to assess the Company's performance and to allocate resources is the total return on the Company's net asset value, as calculated under IFRS, together with the performance of each of the three portfolios.
At the date of authorisation of these financial statements, the following Standards and Interpretations were in issue but not yet effective:
- IFRS 9 Financial Instruments: Classification and Measurement (effective for annual period beginning on or after 2013). This standard has not yet been adopted by the EU.
- Amendments to IFRS 1 - First-time Adoption of IFRS' and Additional Exemptions for First-time adopters (effective for annual period beginning on or after 1 July 2009 and 1 January 2010 respectively);
- Amendments to IFRS 2 - Group cash-settled share-based payments (effective for annual periods beginning on or after 1 January 2010);
- Amendments to IFRS 3 and IAS 27 - Business Combinations (effective for annual periods beginning on or after 1 July 2009);
- Amendments to IAS 24 - Related Party Disclosures (effective for annual periods beginning on or after 1 January 2011);
- Amendments to IAS 32 - Classification of Rights Issues (effective for annual periods beginning on or after 1 February 2010);
- Amendments to IAS 39 - Eligible hedged items (effective for annual periods beginning on or after 1 July 2009);
- IFRIC 17 - Distributions of Non-cash assets to Owners (effective for annual periods beginning on or after 1 July 2009);
- IFRIC 19 - Extinguishing Financial Liabilities with Equity Instruments (effective for annual periods beginning on or after 1 July 2009); and
- Amendments to IFRIC 14 - Pre-payments of a Minimum Funding Requirement (effective for annual periods beginning on or after 1 July 2009).
(b) Financial instruments
i) Classification
A financial asset or financial liability at fair value through profit or loss is a financial asset or liability that is classified as held-for-trading or designated at fair value through profit or loss on inception. Forward contracts in a receivable position (positive fair value) are reported as financial assets at fair value through profit or loss. Forward contracts in a payable position (negative fair value) are reported as financial liabilities at fair value through profit or loss.
Financial assets that are not at fair value through profit or loss include certain balances due from brokers and accounts receivable. Financial liabilities that are not at fair value through profit or loss include certain balances due to brokers and accounts payable.
ii) Recognition
The Company recognises financial assets and financial liabilities on the date it becomes party to the contractual provisions of the investment. Purchases and sales of financial assets and financial liabilities are recognised using trade date accounting. From trade date, any gains and losses arising from changes in fair value of the financial assets or financial liabilities are recorded in the statement of comprehensive income.
iii) Fair value measurement principles
Financial assets and liabilities are initially recorded at their transaction price and then measured at fair value subsequent to initial recognition. Gains and losses arising from changes in the fair value of the 'financial assets or financial liabilities at fair value through profit or loss' category are presented in the statement of comprehensive income for the period in which they arise.
Financial assets classified as receivables are carried at cost less any impairment losses. Financial liabilities, other than those at fair value through profit or loss, are measured at amortised cost using the effective interest rate method.
iv) Investees
The Company's investments in investees are subject to the terms and conditions of the respective investee's offering documentation. The investments in the investees are valued based on the reported Net Asset Value ("NAV") of such assets as determined by the administrator or general partner of the investee and adjusted by the Manager to take account of concerns such as liquidity so as to ensure that investments held at fair value through profit or loss are carried at fair value. The reported NAV is net of applicable fees and expenses of the investees and the underlying investments held by each investee are accounted for, as defined in the respective investee's offering documentation. While the underlying fund managers may utilise various model-based approaches to value their investment portfolios, on which the Company's valuations are based, no such models are used directly in the preparation of fair values of the investments. The NAV of investees reported by the administrators may subsequently be adjusted when such results are subject to audit and the audit adjustments may be material to the Company.
v) Cash and cash equivalents
Cash and cash equivalents consist principally of cash on hand, demand deposits and short-term, highly liquid investments with maturities of three months or less. Cash and cash equivalents are valued at amortised cost, which approximates fair value.
(c) Interest income dividend/distribution income
Interest income on cash and cash equivalents is accrued using the effective interest method. Dividend income and income from investees is recognised when the right to receive payment is established.
(d) Realised and unrealised gains and losses
Realised gains and losses arising on the disposal of investments are calculated by reference to the proceeds received on disposal and the average cost attributable to those investments, and are recognised in the statement of comprehensive income. Unrealised gains and losses on investments held at fair value through profit or loss are also recognised in the statement of comprehensive income.
(e) Foreign currency
i) Functional and presentation currency
The Company aims to make investments primarily denominated in US Dollars and to make returns to investors in US Dollars. The Board of Directors considers US Dollars as the currency that most faithfully represents the economic effects of the underlying transactions, events and conditions. The financial statements are presented in US Dollars, which is the Company's functional and presentation currency.
ii) Transactions and balances
Foreign currency transactions are translated into the functional and presentation currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies other than US Dollars are recognised in the statement of comprehensive income.
iii) Translation differences on non-monetary financial assets and liabilities such as investments at fair value through profit or loss are recognised in the Statement of Comprehensive Income within the fair value net gain or loss.
(f) Expenses
All expenses are recognised in the statement of comprehensive income on an accruals basis.
(g) Share issue expenses
The expenses which are directly incurred only on the issue of shares are written off against the share premium account.
(h) Statement of Cash Flows
For the purpose of the Statement of Cash Flows, the Company considers balances due to and from banks as cash and cash equivalents.
3. Operating segments
The Company is engaged in three segments of business: investment in the Private Equity & Private Equity Like Funds portfolio, the Strategic Hedge Funds portfolio and the Transitional portfolio. Information on the movement in value of the investments held in each portfolio is disclosed in Note 9 - Financial assets at fair value through profit or loss.
The Company is domiciled in Guernsey. All of the Company's income from investments is from underlying investments that are incorporated in countries other than Guernsey.
The Company has a highly diversified portfolio of investments and no single investment accounts for more than 20% of the Company's income.
4.
|
| 2010 | 2009 |
| Income | US$'000 | US$'000 |
| Net income from investments in limited partnerships and directly held investments | 146 | 499 |
| Net interest income from cash and cash equivalents | 1 | 48 |
|
| __________ | __________ |
|
| 147 | 547 |
|
| __________ | __________ |
5.
|
| 2010 | 2009 |
| Investment management fees | US$'000 | US$'000 |
| Investment management fees | 2,740 | 3,374 |
|
| __________ | __________ |
The Company appointed Aberdeen Asset Managers Limited as its Manager on 19 November 2009 replacing Bramdean Asset Management LLP. The Manager is paid by the Company a monthly fee equal to one-twelfth of 1.5% of the NAV of the Company (before deduction of any performance fee). The fee is calculated and accrued as at the last business day of each month and is paid monthly in arrears. At 31 March 2010 US$233,000 was outstanding (31 March 2009 - US$227,000).
In addition, the Manager is entitled to a performance fee of 10% with respect to each class of shares based on the total increase in the NAV of the relevant class at the end of each performance year (ending 31 March each year). For a performance fee to be paid, the Manager must achieve returns in excess of 8% (subject to a high watermark). No performance fee has been earned in the year ended 31 March 2010 (31 March 2009 - nil).
6.
| Other expenses | 2010 US$'000 | 2009 US$'000 |
| Directors' fees | 211 | 328 |
| Auditors' fees | 80 | 100 |
| Legal and professional fees | 925 | 112 |
| Brokerage fees | 524 | 62 |
| Printing and communication costs | 225 | 221 |
| Administration fees | 91 | 113 |
| Custody fees | 77 | 104 |
| Travelling expenses | 72 | 32 |
| Directors' and officers' insurance | 57 | 48 |
| Bank charges | 10 | 13 |
|
| __________ | __________ |
|
| 2,272 | 1,133 |
|
| __________ | __________ |
During the year ended 31 March 2010, the Company incurred legal and professional fees of US$925,000 (31 March 2009 - US$ 112,000). The Company incurred brokerage fees of US$524,000 for the year ended 31 March 2010 (31 March 2009 - US$62,000). The significant increase was as a result of exceptional corporate activity during the year under review connected with an extraordinary general meeting of the Company requisitioned by a major shareholder and the subsequent appointment of the new Board of Directors to the Company on 18 June 2009.
The Administrator was paid by the Company a fee of not greater than 0.05% per annum of the NAV of the Company, subject to a minimum annual fee of £50,000. With effect from 1 April 2010 the minimum annual fee payable to the Administrator is £100,000 and the notice period is 90 days. At 31 March 2010 US$8,000 was outstanding (31 March 2009 - US$8,000).
The custodian was paid by the Company a fee not greater than 0.03% per annum on cash and deposits and 0.05% per annum on investments, subject to a minimum annual fee of £10,000. At 31 March 2010 US$6,000 was outstanding (31 March 2009 - US$6,000).
7. Taxation
The Company is domiciled in Guernsey. The Company is exempt from paying income tax in Guernsey. The Company is registered for taxation purposes in Guernsey where it pays an annual exempt status fee (which is currently £600) under The Income Tax (Exempt Bodies) (Guernsey) Ordinances 1989 (as amended).
8. Earnings per share
Basic earnings per share is calculated by dividing the returns attributable to holders of shares in a particular class by the weighted average number of shares in that class in issue during the period. There were no potentially dilutive shares in issue at 31 March 2010 (31 March 2009 - nil).
9.
| Financial assets at fair value through profit or loss | 2010 US$'000 | 2009 US$'000 |
| Cost at beginning of the year | 155,307 | 222,890 |
| Additions | 21,196 | 102,078 |
| Disposals | (44,333) | (165,271) |
| Realised gains / (losses) on investments | 2,748 | (4,390) |
| Cost at end of the year | 134,918 | 155,307 |
| Unrealised losses on investments | (29,926) | (42,697) |
|
| __________ | __________ |
| Fair value at end of the year | 104,992 | 112,610 |
|
| __________ | __________ |
| 31 March 2010 | Private Equity & Private Equity Like Funds portfolio US$'000 | Strategic Hedge Funds portfolio US$'000 | Transitional portfolio US$'000 | Total US$'000 |
| Cost at beginning of the year | 86,361 | 46,652 | 22,294 | 155,307 |
| Additions | 21,144 | 52 | - | 21,196 |
| Disposals | (2,120) | (35,436) | (6,777) | (44,333) |
| Reclassifications | 7,100 | (1,225) | (5,875) | - |
| Realised gains / (losses) on investments | (538) | 2,728 | 558 | 2,748 |
|
| __________ | __________ | __________ | __________ |
| Cost at end of the year | 111,947 | 12,771 | 10,200 | 134,918 |
| Unrealised losses on investments | (13,026) | (6,700) | (10,200) | (29,926) |
|
| __________ | __________ | __________ | __________ |
| Fair value at end of the year | 98,921 | 6,071 | - | 104,992 |
|
| __________ | __________ | __________ | __________ |
| 31 March 2009 | Private Equity & Private Equity Like Funds portfolio US$'000 | Strategic Hedge Funds portfolio US$'000 | Transitional portfolio US$'000 | Total US$'000 |
| Cost at beginning of the year | 45,731 | 78,343 | 98,816 | 222,890 |
| Additions | 42,501 | 23,189 | 36,388 | 102,078 |
| Disposals | (1,858) | (60,754) | (102,659) | (165,271) |
| Realised gains / (losses) on investments | (13) | 5,874 | (10,251) | (4,390) |
|
| __________ | __________ | __________ | __________ |
| Cost at end of the year | 86,361 | 46,652 | 22,294 | 155,307 |
| Unrealised losses on investments | (24,855) | (6,235) | (11,607) | (42,697) |
|
| __________ | __________ | __________ | __________ |
| Fair value at end of the year | 61,506 | 40,417 | 10,687 | 112,610 |
|
| __________ | __________ | __________ | __________ |
10 Fair value hierarchy
The three levels of the fair value hierarchy under the Amendment to IFRS 7 are described below:
Level 1 - Unadjusted quoted prices in active markets for identical assets or liabilities;
Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (as prices) or indirectly (derived from prices);
Level 3 - Inputs for the asset or liability that are not based on observable market data (unobservable inputs).
The level in the fair value hierarchy within which the fair value measurement is categorised in its entirety shall be determined on the basis of the lowest level input that is significant to the fair value measurement in its entirety. For this purpose, the significance of an input is assessed against the fair value measurement in its entirety. If a fair value measurement uses observable inputs that require significant adjustment based on unobservable inputs, that measurement is a Level 3 measurement. Assessing the significance of a particular input to the fair value measurement in its entirety requires judgement, considering factors specific to the asset or liability. In evaluating the level at which the Company's investments have been classified, the Company has assessed factors including, but not limited to price transparency, the ability to redeem at NAV at the measurement date and the existence or absence of certain restrictions at the measurement date.
The following table summarises by level within the fair value hierarchy the Company's financial assets and liabilities at fair value at 31 March 2010:
|
| Level 1 US$'000 | Level 2 US$'000 | Level 3 US$'000 | Total US$'000 |
| Financial assets at fair value through profit and loss | - | 6,071 | 98,921 | 104,992 |
A reconciliation of fair value measurements in Level 3 is set out in the following table.
|
| Private Equity & Private Equity Like Funds portfolio US$'000 | Transitional portfolio US$'000 | Total US$'000 |
| Opening balance | 61,506 | 10,687 | 72,193 |
| Purchases | 21,144 | - | 21,144 |
| Sales | (2,120) | (6,777) | (8,897) |
| Reclassifications | 7,100 | (5,875) | 1,225 |
| Total gains or losses on investments included in Statement of Comprehensive Income: | |||
| - on assets sold | (538) | 558 | 20 |
| - on assets held at the year end | 11,829 | 1,407 | 13,236 |
|
| __________ | __________ | __________ |
|
| 98,921 | - | 98,921 |
|
| __________ | __________ | __________ |
11 Net changes in fair value of financial assets at fair value through profit or loss
The net realised and unrealised investment gain or loss from trading in financial assets and financial liabilities shown in the statement of comprehensive income for the year ended 31 March 2010 is analysed as follows:
|
| 2010 US$'000 | 2009 US$'000 |
| Unrealised gains/(losses) on investments | 12,771 | (49,285) |
| Capital calls expenses | (1,512) | (1,938) |
| Realised gains / (losses) on investments | 2,748 | (4,390) |
|
| __________ | __________ |
|
| 14,007 | (55,613) |
|
| __________ | __________ |
Capital call expenses relate to management fees and other expenses paid to investees.
12 Trade and other receivables
|
| 2010 US$'000 | 2009 US$'000 |
| Prepayments | 128 | 95 |
| Accrued interest | 8 | 7 |
| Due from brokers | 4 | 9,595 |
|
| __________ | __________ |
|
| 140 | 9,697 |
|
| __________ | __________ |
13 Trade and other payables
|
| 2010 US$'000 | 2009 US$'000 |
| Management fees | 233 | 227 |
| Administration fees | 8 | 8 |
| Custody fees | 6 | 6 |
| Sundry expenses | 212 | 269 |
|
| __________ | __________ |
|
| 459 | 510 |
|
| __________ | __________ |
14 Share capital and share premium
|
| 2010 US$'000 | 2009 US$'000 |
| Share capital |
|
|
| Management shares |
|
|
| Authorised: 10,000 shares of £1.00 each |
|
|
| 2 Management Shares of £1.00 each | - | - |
|
| __________ | __________ |
|
| - | - |
|
| __________ | __________ |
| Shares |
|
|
| Authorised: unlimited number of shares of no par value |
|
|
| Share premium issued and fully paid |
|
|
| 90,825,779 (2009 -92,142,177) Sterling shares of no par value | 182,704 | 184,415 |
| 78,383,753 (2009 - 76,116,060) US Dollar shares of no par value | 76,055 | 74,344 |
|
| __________ | __________ |
|
| 258,759 | 258,759 |
|
| __________ | __________ |
|
| 2010 US$'000 | 2009 US$'000 |
| Ordinary Shares |
|
|
| Authorised: unlimited numbers of shares of no par value |
|
|
| Issued and fully paid |
|
|
| Balance as at 1 April 2009 | 258,759 | 259,187 |
| Nil (2009 - 260,000) Sterling Shares repurchased | - | (428) |
|
| __________ | __________ |
| Balance as at 31 March 2010 | 258,759 | 258,759 |
|
| __________ | __________ |
The authorised share capital of the Company on incorporation was £10,000 divided into 10,000 shares of £1.00 each. On 31 May 2007 a special resolution was passed by the Company to increase the share capital to an unlimited number of participating shares of no par value ("Shares"), which, upon issue, the Directors were able to designate as Sterling shares, US Dollar shares or otherwise as determined by the Directors at the time of issue, and 10,000 Management shares of £1.00 each.
The shares were issued on 4 July 2007 as a result of the Company announcing the placing and offer for subscription of its Shares on 6 June 2007.
The rights attaching to the shares at the year end were as follows:
a) On 30 April and 31 October of each year a shareholder could elect to convert some or all of their shares of one currency class into shares of another currency class.
b) Subject to any restrictions set out in the Company's Articles of Incorporation, each US Dollar share carried one vote per share and each Sterling share carried 2.0194 votes per share at a general meeting.
c) The capital and assets of the Company would on a winding-up be divided (following payment to the holders of Management shares of sums up to the nominal value paid up thereon) amongst the holders of shares on the basis of the capital and assets attributable to the respective classes of shares at the date of winding-up and amongst the holders of shares of a particular class pro rata according to their holdings of shares in that class.
On 22 May 2009, certain holders of shares in the Company owning Sterling shares elected to switch into US Dollar shares on the basis of the NAV of the Company's shares as at 30 April 2009. As a result of the switch, 1,429,183 Sterling shares were converted into 2,461,821 US Dollar shares and 4,005 US Dollar shares were converted into 2,325 Sterling shares.
On 26 November 2009, certain holders of shares in the Company owning the Sterling shares elected to switch into US Dollar shares and certain holders of shares in the Company owning the US Dollar shares elected to switch into Sterling shares on the basis of NAV of the Company's shares at 31 October 2009. As a result of the switch, 76,500 Sterling shares where converted into 131,664 US Dollar shares and 321,790 US Dollar shares where converted into 186,960 Sterling shares.
Following approval by shareholders of the Share Conversion Proposal on 3 June 2010, all the US Dollar shares were converted into new Sterling shares on 2 July 2010, on the basis of 0.5810 Sterling shares for every US Dollar share held.
15 Revenue Reserves
| Revenue Reserves | 2010 US$'000 | 2009 US$'000 |
| Opening revenue reserves | (82,653) | (2,786) |
| Change in net assets from operations | 9,128 | (79,867) |
|
| __________ | __________ |
| Closing revenue reserves | (73,525) | (82,653) |
|
| __________ | __________ |
| Revenue reserves attributable to Management Shares | - | - |
| Revenue reserves attributable to Sterling Shares | (49,056) | (65,422) |
| Revenue reserves attributable to US Dollar Shares | (24,469) | (17,231) |
|
| __________ | __________ |
|
| (73,525) | (82,653) |
|
| __________ | __________ |
16 Net asset value
The net asset value of each Sterling share is determined by dividing the net assets of the Company attributable to the Sterling shares of £81,332,000 (US$123,372,000) (2009 - £83,020,000 (US$118,993,000)) by 90,825,779 (2009 - 92,142,177), being the number of Sterling Shares in issue at the year end.
The net asset value of each US Dollar share is determined by dividing the net assets of the Company attributable to the US Dollar shares of US$61,862,000 (2009 - US$57,113,000) by 78,383,753 (2009 - 76,116,060), being the number of US Dollar shares in issue at the year end.
17 Commitments
The table below summarises commitments to the underlying investments of the Company at 31 March 2010.
| Total |
| Outstanding | ||
| Currency | Commitments | Currency | Commitments | |
| '000 | US$'000 | '000 | US$'000 | |
| Coller International Partners V L.P. |
| 15,000 |
| 6,767 |
| DFJ Athena L.P. |
| 10,000 |
| 3,840 |
| Goldman Sachs Capital Partners VI L.P. |
| 15,000 |
| 7,912 |
| Greenpark International Investors III L.P. | EURO14,600 | 19,755 | EURO3,372 | 4,563 |
| HIG Bayside Debt & LBO Fund II L.P. |
| 15,000 |
| 10,475 |
| MatlinPatterson Global Opportunities |
| 10,000 |
| 2,588 |
| Partners III L.P. |
|
|
|
|
| Oaktree OCM Oppportunities Fund Vllb L.P. |
| 15,000 |
| 2,250 |
| PineBridge Latin America Partners II L.P.A |
| 2,611B |
| 415 |
| Pine Brook Capital Partners L.P |
| 10,000 |
| 6,931 |
| Resonant Music I L.P. |
| 5,453 |
| 2,153 |
| Rho Ventures VI L.P. |
| 10,000 |
| 7,450 |
| Silver Lake Partners III L.P. |
| 15,000 |
| 9,761 |
| SVG Strategic Recovery Fund II L.P. | £7,500 | 11,377 | £1,562 | 2,369 |
| Tenaya Capital V L.PC |
| 12,500 |
| 7,558 |
| Terra Firma Capital Partners III L.P. | EURO15,000 | 20,297 | EURO6,089 | 8,239 |
| Thoma Bravo IX Fund L.P. |
| 10,000 |
| 7,380 |
| Thomas H Lee Fund VI L.P. |
| 15,000 |
| 6,775 |
| At 31 March 2010 |
| 211,993 |
| 97,426 |
A AIG Brazil Special Sits II L.P. B Following termination of the fund's investment period, Aberdeen Private Equity Fund Limited's commitment was reduced to US$2.6 million. C Formerly Lehman Brothers Venture Partners V L.P.
18 Financial Risk Management
The Company maintains positions in a variety of investees as determined by its investment management strategy.
The investees' own investing activities expose the Company to various types of risks that are associated with the financial investments and markets in which they invest. The significant types of financial risks, to which the Company is exposed are market price risk, credit risk and liquidity risk.
Asset allocation is determined by the Company's Manager which manages the allocation of assets to achieve the investment objectives as detailed in the Annual Report. Achievement of the investment objectives involves taking risks. The Manager exercises judgement based on analysis, research and risk management techniques when making investment decisions. Divergence from target asset allocations and the composition of the portfolio is monitored by the Board.
The significant types of risk that the Company is exposed to are detailed below:
a) Capital management policies and procedures
The Company's capital management objectives are:
- to ensure the Company's ability to continue as a going concern, and
- to provide an adequate return to shareholders.
The Company seeks to achieve these objectives by adopting the investment objectives set out in the Annual Report.
b) Market price risk
The potential for changes in the fair value of the Company's investment portfolio is referred to as market price risk. Commonly used categories of market risk include currency risk, interest rate risk and other price risk.
- Currency risk may result from exposure to changes in spot prices, forward prices and volatilities of currency exchange rates.
- Interest rate risk may result from exposures to changes in the level, slope and curvature of the various yield curves, the volatility of interest rates, and credit spreads.
- Other price risk is the risk that the value of an instrument will fluctuate as a result of changes in market prices other than those arising from currency risk or interest rate risk.
i) Market risk management
The Company's unlisted investment securities are susceptible to market price risk arising from uncertainties about future values of the investment securities. The Manager provides the Company with investment recommendations that are consistent with the Company's objectives.
The valuation method of these investments is described within the accounting policies. The nature of some of the Company's investments, which are unquoted investments in private equity funds, means that the investments are valued by the Manager on behalf of the Company after due consideration of the most recent available information from the underlying investments as adjusted where relevant by the Directors. While the underlying fund managers may utilise various model-based approaches to value their investment portfolios, on which the Company's valuations are based, no such models are used directly in the preparation of fair values of the investments.
Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. The investments of the Company are subject to normal market fluctuations and the risks inherent with investment in financial markets. The maximum risk resulting from financial instruments held by the Company is determined by the fair value of the financial instruments. The Manager moderates this risk through careful selection of funds managed by experienced fund managers, which meet the investment objectives outlined in the Annual Report; the Company's market price risk is managed through diversification of the investment portfolio. Through a variety of analytical techniques, the Manager monitors, on a weekly basis, the Company's overall market positions, as well as its exposure to market price risk.
ii) Currency risk
The Company has assets and liabilities denominated in currencies other than US Dollars, its functional currency. The Company is therefore exposed to currency risk, as the value of the assets and liabilities denominated in other currencies fluctuates due to changes in exchange rates. The Company may from time to time engage in currency hedging in an attempt to reduce the impact on the Sterling shares of currency fluctuations. The Company may manage the US Dollar exposure of the Sterling shares through the use of forward foreign exchange contracts although there can be no guarantee that the management of currency risk and exposure will be successful.
During the twelve months up to 31 March 2010, the value of Sterling increased by 5.83% (2009 - 27.88%) against the US Dollar. At 31 March 2010, a similar movement in the value of Sterling against the US Dollar would, with all other variables held constant, increase or decrease the NAV of the Company by approximately US$352,000 (2009 - US$663,000).
During the twelve months up to 31 March 2010, the value of the Euro increased by 1.91% (2009 - 16.21% decrease) against the US Dollar. At 31 March 2010, a similar movement in the value of the Euro against the US Dollar would, with all other variables held constant, increase or decrease the NAV of the Company by approximately US$293,000 (2009 - US$1,053,000).
Due to the volatile movement between the US Dollar, Sterling and the Euro, the Company discontinued hedging its US Dollar, Sterling and Euro exposure to both share classes to eliminate the cash flow volatility caused by hedging currencies.
The table below summarises the Company's exposure in US Dollars to currency risks at the year end:
|
| US$'000 | £'000 | EURO'000 | Total |
| Assets/(liabilities) |
|
|
|
|
| Financial assets at fair value through profit or loss | 83,673 | 5,967 | 15,352 | 104,992 |
| Cash and fixed deposits | 80,493 | 68 | - | 80,561 |
| Other assets and liabilities | (319) | - | - | (319) |
|
| __________ | __________ | __________ | __________ |
| Total at 31 March 2010 | 163,847 | 6,035 | 15,352 | 185,234 |
|
| __________ | __________ | __________ | __________ |
|
| US$'000 | £'000 | EURO'000 | Total |
| Assets/(liabilities) |
|
|
|
|
| Financial assets at fair value through profit or loss | 95,326 | 3,423 | 13,861 | 112,610 |
| Cash and fixed deposits | 54,298 | 11 | - | 54,309 |
| Other assets and liabilities | 9,360 | (173) | - | 9,187 |
|
| __________ | __________ | __________ | __________ |
| Total at 31 March 2009 | 158,984 | 3,261 | 13,861 | 176,106 |
|
| __________ | __________ | __________ | __________ |
iii) Interest rate risk
The Company is exposed to interest rate risk. The Company invests primarily in private equity and hedge funds that are non interest bearing investments, primarily subject to market price risk. Investees may invest in fixed income securities and interest rate swap contracts. Interest receivable on bank deposits will be affected by fluctuations in interest rates. Changes to prevailing interest rates or changes in expectations of future rates may result in an increase or decrease in the value of the securities held. In general, if interest rates rise, the value of fixed income securities will decline. A decline in interest rates will, in general, have the opposite effect.
Although the majority of the Company's financial assets and liabilities are non interest bearing, cash and cash equivalents represents 43% of the Company's NAV (31 March 2009 - 31%). As a result, the Company is subject to significant amounts of risk due to fluctuations in the prevailing levels of market interest rates. Any excess cash and cash equivalents are invested at short-term market interest rates.
As at 31 March 2010 the Company's interest bearing assets and liabilities, all of which receive or pay interest at a variable rate, were as follows:
|
|
|
| 2010 US$'000 | 2009 US$'000 |
| Cash and cash equivalents |
|
| 80,561 | 54,309 |
|
|
|
| __________ | _________ |
Based on the cash and cash equivalents held at 31 March 2010, a movement of 1% in market interest rates would impact the Company's annual income by approximately US$806,000 per annum (2009 - US$540,000 per annum).
iv) Other price risk
Other price risk is the risk that the value of the investees' financial investments will fluctuate as a result of changes in market prices, other than those arising from currency risk or interest rate risk whether caused by factors specific to an individual investment, its issuer or any factor affecting financial investments traded in the market.
As the Company's investments are carried at fair value with fair value changes recognised in the statement of comprehensive income, all changes in market conditions will directly affect the overall NAV.
The investments are valued based on the latest available unaudited price of such shares or interests as determined by the administrator or general partner of the investees and adjusted accordingly to take account of concerns such as liquidity. Furthermore, valuations received from the administrator or general partner of the investees may be estimates and such values are generally used to calculate the net asset value of the Company. Such estimates provided by the administrators or general partner of the investees may be subject to subsequent revisions which may not be restated for the purpose of the Company's final month-end NAV.
Currency, interest rate and other price risk are managed by the Company's Manager as part of the integrated market price risk management processes.
c) Credit risk
The Company takes on exposure to credit risk, which is the risk that a counterparty will be unable to pay amounts in full when due. The Manager has adopted procedures to reduce credit risk related to the Company's dealings with counterparties. Before transacting with any counterparty, the Manager or its affiliates evaluate both creditworthiness and reputation by conducting a credit analysis of the party, its business and its reputation. The credit risk of approved counterparties is then monitored on an ongoing basis, including periodic reviews of financial statements and interim financial reports as needed. Impairment provisions are provided for losses, if any, that have been incurred by the Balance Sheet date.
At 31 March 2010 and 31 March 2009, the following financial assets were exposed to counterparty credit risk: cash and cash equivalents and other receivables. The carrying amounts of financial assets best represent the maximum credit risk exposure at the year end date. There were no significant concentrations of credit risk at 31 March 2010 or 31 March 2009.
The Company places cash deposits with counterparties whose credit ratings are all investment graded. Ratings for fixed deposits, as rated primarily by Moody's that subject the Company to credit risk at 31 March 2010 and 31 March 2009 are noted below:
|
| 2010 | 2009 | ||
| Credit ratings for short-term notes | Rating | % of NAV | Rating | % of NAV |
| Bank of Scotland | A1 | 11.07 | A1 | 2.84 |
| BNP Paribas Group | Aa2 | 13.93 | Aa1 | 10.72 |
| Deutsche Bank | Aa3 | 1.57 | Aa1 | 3.41 |
| Royal Bank of Canada | Aaa | 2.16 | Aaa | 3.98 |
| Royal Bank of Scotland International | A1 | 13.60 | A1 | 9.30 |
d) Liquidity risk
The Company's financial instruments include investments in unlisted investment funds, which are not traded in an organised public market and may generally be illiquid. This illiquidity is considered as part of the investment valuations, however as a result, should the Company be required to dispose of such investments in a short time-frame, an action that is not consistent with the Company's investment objective, the Company may have difficulty liquidating quickly its investments in these instruments at an amount close to fair value in order to respond to its liquidity requirements or to specific events.
The financial liabilities of the Company comprise accrued expenses. The Company will generally retain sufficient cash and cash equivalent balances to satisfy accrued expenses as they fall due.
The Company's outstanding commitments are detailed in note 17. When an over-commitment approach is followed, the aggregate amount of capital committed by the Company to investments at any given time may exceed the aggregate amount of cash that the Company has available for immediate investment, so there is a risk that the Company might not be able to meet capital calls when they fall due. To manage this risk, the Company holds what the Board believes is an appropriate amount of its assets in cash and cash equivalents.
In planning the Company's commitments, the Manager takes into account expected cash flows to and from the portfolio of fund interests and, from time to time, may use borrowings to meet draw downs; these expected cash flows are monitored against actual draw downs and distributions on a monthly basis to assess the level of additional commitments that can be made and how much cash needs to be kept on hand. The Directors have resolved that the Company may borrow up to 25% of its NAV for short-term or long-term purposes. As at 31 March 2010, the Company did not have a loan facility in place.
The table below sets forth the liquidity risk of the Company as at 31 March 2010 and 31 March 2009. All liabilities represent amounts falling due within 12 months. Amounts due within 12 months equal their carrying balances.
| Financial liabilities | Less than one year 2010 US$'000 | Less than one year 2009 US$'000 |
| Trade and other payables | 459 | 510 |
Based on communications with General Partners and the Manager's best estimates, the outstanding commitments are expected to be drawn down with the following maturity profile:
| Maturity | 2010 US$ million | 2009 US$ million |
| Less than 3 months | 12 | 13 |
| 3 - 6 months | 12 | 13 |
| 6 - 12 months | 22 | 24 |
| 1 - 2 years | 32 | 41 |
| Greater than 2 years | 19 | 42 |
|
| __________ | _________ |
|
| 97 | 133 |
|
| __________ | _________ |
As at 31 March 2010, an analysis of the financial instruments by category shows Assets at fair value through profit or loss US$ 104,992,000 (2009 - US$ 112,610,000) loans and receiveables of US$ 80,701,000 (2009 - US$ 64,006,000) and other financial liabilities totalling US$ 459,000 (2009 - US$ 510,000).
19 Controlling party
In the opinion of the Directors on the basis of shareholdings advised to them, the Company has no immediate or ultimate controlling party.
20 Exchange rates
As at 31 March 2010 and 31 March 2009, the exchange rates used (against US$) in preparation of these financial statements are as follows:
|
| 2010 US$ | 2009 US$ |
| Sterling | 1.5169 | 1.4333 |
| Euro | 1.3531 | 1.3277 |
21 Geographical analysis
The geographical allocation of investments at the year end was as follows:
|
| 2010 US$ million | 2009 US$ million |
| North America | 106.3 | 105.5 |
| Europe | 10.5 | 39.3 |
| Global | 61.2 | 26.7 |
| Asia & Other | 7.3 | 4.7 |
As at 31 March 2010, the geographic analysis of revenues generated shows the following:
USA USD 147,000 (2009 - USD 47,000)
22 Subsequent events
On 3 June 2010 shareholders approved all resolutions proposed in the Circular of 10 May 2010 and details of the proposals approved by shareholders can be found in the Annual Report. On 2 July 2010 all the US Dollar shares were converted into new Sterling shares on the basis of 0.5810 Sterling shares for every US Dollar share held.
23 Related Party Disclosure
Ms Wick is chief investment officer of Consensus Business Group which acts as adviser to Elsina Limited, which is a substantial shareholder of the Company. Mr Hebson is a senior fund manager at Merseyside Pension Fund, which is also a substantial shareholder of the Company. Other related party disclosures in respect of the Directors are disclosed elsewhere within the Financial Statements and Annual Report.
Please note that past performance is not necessarily a guide to the future and that the value of investments and the income from them may fall as well as rise and may be affected by exchange rate movements. Investors may not get back the amount they originally invested.
The above financial information does not constitute statutory financial statements as defined in Section 262 of The Companies (Guernsey) Law, 2008. The comparative information is based on the statutory financial statements for the year ended 31 March 2009 upon which the auditors issued an unqualified opinion.
The Annual General Meeting of the Company will be held at 1.30 p.m. on 13 September 2010 at Canada Court, Upland Road, St Peter Port, Guernsey GY1 3QE.
The audited Annual Report and Accounts incorporating the Notice of Annual General Meeting will be posted to shareholders at the end of July. Copies may be obtained during normal business hours from the Company's Registered Office, Canada Court, Upland Road, St Peter Port, Guernsey GY1 3BQ Channel Islands or from the Manager, Bow Bells House, 1 Bread Street, London EC4M 9HH. Further copies will be available for download from the Company's website www.aberdeenprivateequity.co.uk.
By order of the Board
RBC Offshore Fund Managers Limited 23 July 2010