RNS Number:2338C
Henderson Far East Income Trust PLC
28 April 2006
Page 1
28 April 2006
HENDERSON FAR EAST INCOME TRUST PLC
Unaudited Interim Results
for the half year ended 28 February 2006
Results
There was a positive total return of 12.7% over the half year ended 28 February
2006. Revenues remained strong with growth of 21.4% to #6.5 million. Earnings
per share increased to 4.99p. Dividends of 4.40p net per share were declared
compared with 4.20p for the first half year of the previous year.
Forecast Dividend
We have increased the forecast of dividends to be paid for the year to 31 August
2006 to not less than 9.00p (2005: 8.60p) net per share, always subject to stock
market conditions.
Financial Highlights
Half year ended Year ended
Half year ended 28 February 2005 31 August 2005
28 February 2006 (Unaudited (Audited
Per ordinary share (Unaudited) and restated-note 8) and restated-note 7)
Net asset value 231.31p 203.49p 210.54p
Earnings per share 4.99p 4.43p 10.22p
Dividend (paid quarterly) 4.40p 4.20p 8.60p
Performance (percentage change)
to 28 February 2006
6 months 1 year 5 years 10 years
% % % %
...Net asset value total return 12.7 18.2 114.4 119.4
...Share price total return 7.8 13.9 175.2 118.4
*Dividends net - 4.8 15.8 37.5
......FTSE World Asia Pacific ex Japan (#) 19.7 32.3 62.2 37.7
......FTSE All-World Asia Pacific ex Japan (#) 19.7 29.9 45.1 12.1
*Excludes a special dividend of 1.0p net per ordinary share in 1999.
... Source: AITC (net income reinvested assuming that all dividends received were reinvested in the shares of
the company at the time the shares were quoted ex-dividend).
......Source: Datastream (gross income reinvested).
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Page 2
HENDERSON FAR EAST INCOME TRUST PLC
Unaudited Interim Results
for the half year ended 28 February 2006
Chairman's Statement
Helped by ongoing strength in the US economy, notwithstanding rises in short
term interest rates, investors' sentiment was generally buoyant over the first
six months of our financial year.
Performance
At the interim stage gross revenues rose to #6.5m compared with #5.3m in the
first half of the previous year. Earnings per share of 5.0p were achieved
compared with 4.4p a year earlier. Net assets at 28 February 2006 were 231.3p
per share compared with 210.5p (as restated) at the end of the financial year.
Adding back income earned, there was a positive total return of 12.7%. This may
be compared with a positive total return of 19.7% for the FTSE World Asia
Pacific ex Japan Index.
From our next financial year we will be adopting the FTSE All-World Asia Pacific
ex Japan Index for comparison purposes. The historic performance of both indices
may be seen on page 1. The new index is more broadly based and includes India, a
stock market in which we are able to invest going forward, as approved by
shareholders at the company's last AGM. The new index remains predominantly
growth biased and so, like its predecessor, will only be used for comparison
purposes. We continue to have no formal benchmark index.
Investment Strategy
Our investment strategy continued to focus on attractively valued companies
offering sound investment potential and above average yields. With long term
bond yields at low levels across the world, investors' appetite for higher risk
was increased. Our portfolio remained relatively risk averse in order to achieve
our income objectives and, consequently, our performance has suffered, whilst
still remaining positive in absolute terms.
New Accounting Standards
As reported in our last annual report, our accounts are now prepared in
accordance with the new International Financial Reporting Standards.
Shareholders should note that, in order for dividends to appear in accounts,
they must be paid before the period end. This impacts the way we show dividends
in the accounts but does not impact our quarterly distributions or our
declaration and ex-dividend dates, which remain unchanged. We have also changed
our policy for valuations from mid-market to bid prices. The effect of this is
not material, reducing our assets by 0.3%.
Dividends
As previously forecast, we have so far declared two quarterly dividends of 2.2p
net per share, totalling 4.4p compared with a total of 4.2p at the interim stage
of the previous year, an advance of 4.8%. Our forecast for the year has been
raised to not less than 9.0p net per share, always subject to stock market
conditions. This assumes that we will be raising the quarterly payment to 2.3p
net from the next payment, making a total of 9.0p net for the current financial
year, compared with 8.6p net in the previous year, representing a rise of 4.7%.
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Page 3
HENDERSON FAR EAST INCOME TRUST PLC
Unaudited Interim Results
for the half year ended 28 February 2006
Share Price Premium and Issue of New Shares
I can report that the company's shares continued to trade at a premium to assets
throughout this period. This was at a lower level than in recent years due to
the underperformance of income orientated shares and the launch of competing
investment vehicles. Over the period there were 1.6 million new shares issued at
an average premium of 6.8%. No shares have been issued since the AGM in December
2005 and in recent weeks the shares have been trading at a small discount.
Deputy Portfolio Manager
The Board is pleased to report that Michael Kerley has been appointed Deputy
Portfolio Manager to assist Michael Watt in the management of the company's
assets.
Outlook
Stock markets have continued to climb as long term interest rates remain low by
historic standards. The US economy has performed very well, despite rising short
term interest rates and high commodity and energy prices. Imbalances in the US
economy have not only continued, but have reached new extremes, raising risks
around the world, and not least in emerging markets. We remain relatively
cautious with regards to the outlook for stock markets with a flexible and lower
risk portfolio policy.
Sir Victor Garland
28 April 2006
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Page 4
HENDERSON FAR EAST INCOME TRUST PLC
Unaudited Interim Results
for the half year ended 28 February 2006
Group Income Statement
for the half year ended 28 February 2006
Half year ended Half year ended Year ended
28 February 2006 28 February 2005 31 August 2005
(Unaudited) (Unaudited and restated-note (Audited and restated-note 7)
8)
Revenue Capital Revenue Capital Revenue Capital
Return Return Total Return Return Total Return Return Total
#'000 #'000 #'000 #'000 #'000 #'000 #'000 #'000 #'000
Investment income 6,420 - 6,420 5,253 - 5,253 12,556 - 12,556
Other income 60 - 60 83 - 83 177 - 177
Gains on investments held
at fair value through
profit or loss - 15,558 15,558 - 17,036 17,036 - 21,156 21,156
--------- -------- --------- --------- --------- --------- --------- --------- ---------
Total income 6,480 15,558 22,038 5,336 17,036 22,372 12,733 21,156 33,889
Expenses
Management fee (489) (245) (734) (505) (252) (757) (975) (488) (1,463)
Other expenses (222) - (222) (205) - (205) (423) - (423)
--------- -------- --------- --------- --------- --------- --------- --------- ---------
Profit before finance
costs and taxation 5,769 15,313 21,082 4,626 16,784 21,410 11,335 20,668 32,003
Finance costs (27) (27) (54) (7) (7) (14) (22) (22) (44)
--------- ---------- ---------- --------- --------- --------- --------- --------- ---------
Profit before taxation 5,742 15,286 21,028 4,619 16,777 21,396 11,313 20,646 31,959
Taxation (1,879) 82 (1,797) (1,513) 78 (1,435) (3,876) 184 (3,692)
--------- -------- -------- --------- --------- --------- --------- --------- ---------
Profit for the period 3,863 15,368 19,231 3,106 16,855 19,961 7,437 20,830 28,267
===== ===== ===== ===== ===== ===== ===== ===== =====
Earnings per ordinary 4.99p 19.85p 24.84p 4.43p 24.03p 28.46p 10.22p 28.63p 38.85p
share
(note 2)
The total columns of this statement represent the Group's Income Statement,
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 Trust Companies.
All items in the above statement derive from continuing operations.
All income is attributable to the equity holders of Henderson Far East Income
Trust plc, the parent company.
There are no minority interests.
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Page 5
HENDERSON FAR EAST INCOME TRUST PLC
Unaudited Interim Results
for the half year ended 28 February 2006
Consolidated Statement of Changes in Equity
for the half year ended 28 February 2006
Half year ended 28 February 2006
(Unaudited)
Ordinary Capital Other
Share Redemption
Share Reserve Capital Retained
Capital Earnings
Premium Reserves Total
#'000 #'000 #'000 #'000 #'000 #'000
At 31 August 2005 18,994 41,235 50 91,419 8,264 159,962
Issue of ordinary shares 412 3,322 - - - 3,734
Profit for the period - - - 15,368 3,863 19,231
Ordinary dividends paid - - - - (3,375) (3,375)
----------- ------------ ---------- ------------ ----------- -----------
At 28 February 2006 19,406 44,557 50 106,787 8,752 179,552
====== ======= ====== ======= ====== ======
Half year ended 28 February 2005
(Unaudited and
restated - notes 8 and 9)
Ordinary Capital Other
Share Redemption
Share Reserve Capital Retained
Capital Earnings
Premium Reserves Total
#'000 #'000 #'000 #'000 #'000 #'000
At 31 August 2004 16,477 23,407 50 70,589 6,797 117,320
Issue of ordinary shares 2,217 15,513 - - - 17,730
Profit for the period - - - 16,855 3,106 19,961
Ordinary dividends paid - - - - (2,847) (2,847)
------------ ------------ ------------ ------------ ------------ -----------
At 28 February 2005 18,694 38,920 50 87,444 7,056 152,164
======= ======= ======= ======= ======= ======
Year ended 31 August 2005
(Audited and
restated - notes 7 and 9)
Ordinary Capital Other
Share Redemption
Share Reserve Capital Retained
Capital Earnings
Premium Reserves Total
#'000 #'000 #'000 #'000 #'000 #'000
At 31 August 2004 16,477 23,407 50 70,589 6,797 117,320
Issue of ordinary shares 2,517 17,828 - - - 20,345
Profit for the period - - - 20,830 7,437 28,267
Ordinary dividends paid - - - - (5,970) (5,970)
------------ ------------ ------------ ------------- ------------ -----------
At 31 August 2005 18,994 41,235 50 91,419 8,264 159,962
======= ======= ======= ======= ======= ======
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Page 6
HENDERSON FAR EAST INCOME TRUST PLC
Unaudited Interim Results
for the half year ended 28 February 2006
Consolidated Balance Sheet
at 28 February 2006
At 28 February At 31 August
At 28 February 2005 2005
2006 (Unaudited and (Audited and
restated - note 8) restated - note
(Unaudited) 7)
#'000 #'000 #'000
Non-current assets
Investments held at fair value through profit or loss 173,648 140,552 156,354
----------- ----------- -----------
Current assets
Sales for future settlement - 5,337 3,101
Taxation recoverable 25 - 20
Prepayment and accrued income 1,810 3,609 1,474
Cash and cash equivalents 8,121 5,083 4,717
---------- ----------- -----------
9,956 14,029 9,312
----------- ----------- -----------
Total assets 183,604 154,581 165,666
----------- ----------- -----------
Current liabilities
Purchases for future settlement 655 753 3,204
Accruals 477 564 940
Taxation payable 1,165 706 1,166
Bank loans and overdrafts 1,472 - 119
----------- ----------- -----------
3,769 2,023 5,429
Provision for liabilities and charges 283 394 275
----------- ----------- -----------
Net assets 179,552 152,164 159,962
====== ====== ======
Equity attributable to equity holders
Called up share capital 19,406 18,694 18,994
Share premium 44,557 38,920 41,235
Capital redemption reserve 50 50 50
Other capital reserves 106,787 87,444 91,419
Retained earnings 8,752 7,056 8,264
----------- ----------- -----------
Total equity 179,552 152,164 159,962
====== ====== ======
Net asset value per ordinary share (note 6) 231.31p 203.49p 210.54p
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Page 7
HENDERSON FAR EAST INCOME TRUST PLC
Unaudited Interim Results
for the half year ended 28 February 2006
Consolidated Cash Flow Statement
for the half year ended 28 February 2006
Half year ended Half year ended Year ended
28 February 28 February 31 August
2006 2005 2005
(Unaudited) (Unaudited and (Audited and
restated - note 8) restated - note
7)
#'000 #'000 #'000
Net cash inflow/(outflow) from operating activities
(note 10) 1,691 (13,620) (15,283)
---------- ---------- -----------
Net cash inflow/(outflow) before use of financing 1,691 (13,620) (15,283)
Net cash inflow from financing activities 1,832 13,198 14,376
---------- ----------- ------------
Net increase/(decrease) in cash and cash equivalents 3,523 (422) (907)
Cash and cash equivalents at the start of the period 4,598 5,505 5,505
----------- ----------- ------------
Cash and cash equivalents at the period end 8,121 5,083 4,598
====== ====== =======
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Page 8
HENDERSON FAR EAST INCOME TRUST PLC
Unaudited Interim Results
for the half year ended 28 February 2006
Notes to the Financial Statements
1. Accounting policies
(a) Basis of preparation
The consolidated financial information for the half year ended 28 February 2006 has been prepared
using the accounting policies expected to be used in the group's annual accounts for the year
ending 31 August 2006. These accounting policies will be based on International Financial
Reporting Standards ("IFRS"), comprising standards and interpretations approved by the
International Accounting Standards Board ("IASB"), together with interpretations of the
International Accounting Standards and Standing Interpretations Committee approved by the
International Accounting Standards Committee ("IASC") that remain in effect, to the extent that
IFRS have been adopted by the European Union for the group's year ending 31 August 2006.
The accounts have been prepared on the historical cost basis, except for the revaluation of
certain financial instruments. The principal accounting policies adopted are set out below.
Where presentational guidance set out in the revised Statement of Recommended Practice ("the SORP
") for investment trusts issued by the Association of Investment Trust Companies ("the AITC") in
January 2003 (revised December 2005) is consistent with the requirements of IFRS, the directors
have sought to prepare the financial statements on a basis compliant with the recommendations of
the revised SORP.
(b) First time adoption of IFRS
The date of transition to IFRS for the group is 1 September 2004. The IFRS accounting policies
set out herein have been applied retrospectively to the opening balance sheet as at 1 September
2004 and all subsequent periods. The disclosures required by First-time Adoption of
International Financial Reporting Standards ("IFRS 1") concerning the transition from UK GAAP to
IFRS are given in notes 7, 8 and 9.
(c) Basis of consolidation
The group accounts consolidate the accounts of the company and of its wholly owned subsidiary
undertaking, TRA Finance Company Limited.
(d) Investments held at fair value through profit or loss
All investments are designated upon initial recognition as held at fair value through profit or
loss. Assets are de-recognised at the trade date of the disposal. Proceeds will be measured at
fair value which will be regarded as the proceeds of sale less any transaction costs. The fair
value of the financial instruments is based on their quoted bid price at the balance sheet date,
without deduction of the estimated future selling costs. Unquoted investments are valued by the
directors using primary valuation techniques such as earnings multiples, recent transactions and
net assets. Where fair value cannot reliably be measured the investment will be carried at the
previous reporting date value unless there is evidence that the investment has since been
impaired, in which case the value will be reduced.
Changes in the fair value of investments held at fair value through profit or loss and gains and
losses on disposal are recognised in the Income Statement as "Gains or losses on investments held
at fair value through profit or loss". Also included within this caption are transaction costs in
relation to the purchase or sale of investments, including the difference between the purchase
price of an investment and its bid price at the date of purchase.
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Page 9
HENDERSON FAR EAST INCOME TRUST PLC
Unaudited Interim Results
for the half year ended 28 February 2006
Notes to the Financial Statements (continued)
(e) Presentation of the Income Statement
In order to reflect better the activities of an investment trust company, and in accordance with guidance
issued by the Association of Investment Trust Companies ("AITC"), supplementary information which
analyses the Income Statement between items of a revenue and capital nature has been presented alongside
the Income Statement. In accordance with the company's status as a UK investment company under section
266 of the Companies Act 1985, net capital returns may not be distributed by way of dividend.
Additionally, the net revenue is the measure the directors believe appropriate in assessing the group's
compliance with certain requirements set out in section 842 of the Income and Corporation Taxes Act 1988.
(f) Income
Dividends receivable on equity shares are recognised as revenue for the period on an ex-dividend basis.
Special dividends are treated as income or as capital, depending on the facts of each individual case.
Income from fixed interest debt securities is recognised using the effective interest rate method. The
trading profits of the subsidiary undertaking, which represent realised gains and losses on the sale of
current asset investments, are dealt with in the revenue column of the Income Statement as a revenue
item. Bank deposit interest is accounted for on an accruals basis.
(g) Expenses
All administration expenses and interest payable are accounted for on an accruals basis. Expenses which
are incidental to the purchase or sale of an investment are charged to the capital column of the Income
Statement and allocated to other capital reserves. On the basis of the Board's expected long term split
of returns equally between capital gains and income, the company charges 50% of its interest payable and
management fee (insofar as they relate to the maintenance and enhancement of the value of investments) to
capital.
Purchase and sale transaction costs for the half year ended 28 February 2006 were #739,000 (half year
ended 28 February 2005: #647,000; year ended 31 August 2005: #1,237,000). These comprise mainly stamp
duty and commission.
(h) Taxation
Deferred taxation is accounted for within provision for liabilities and charges and is provided on all
taxable temporary differences that have originated but not reversed by the balance sheet date, other than
those differences regarded as permanent. Any liability to deferred tax is provided at the average rate
of tax expected to apply, based on tax law that had been enacted or substantially enacted by the balance
sheet date. A deferred tax asset is recognised only to the extend that it is considered probable that
sufficient taxable profits will be available to allow the deferred tax benefit of that asset to be
utilised. Deferred tax assets and liabilities are not discounted to reflect the time value of money.
(i) Foreign currency
For the purpose of the consolidated accounts, the results and financial position of each entity is
expressed in pounds sterling, which is the functional currency of the company and the presentational
currency of the group. Sterling is the functional currency because it is the currency of the primary
economic environment in which the group operates. The United Kingdom is the company's country of
incorporation and the primary location of the shareholder base. Sterling is the currency by which
dividends are returned to shareholders, share buy-backs and share issues are conducted and is the cost
base of the company.
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Page 10
HENDERSON FAR EAST INCOME TRUST PLC
Unaudited Interim Results
for the half year ended 28 February 2006
Notes to the Financial Statements (continued)
Transactions recorded in overseas currencies during the year are translated into sterling at the
appropriate daily exchange rates. Assets and liabilities denominated in overseas currencies at the balance
sheet date are translated into sterling at the exchange rates ruling at that date.
(j) Cash and cash equivalents
Cash comprises cash in hand and demand deposits. Cash equivalents are short term, highly liquid
investments that are readily convertible to known amounts of cash and that are subject to insignificant
risks of changes in value.
(k) Bank borrowings
Interest-bearing bank loans and overdrafts are recorded as the proceeds received, net of direct issue
costs. Finance charges, including premiums payable on settlement or redemption and direct issue costs,
are accounted for on an accrual basis in the Income Statement using the effective interest rate method and
are added to the carrying amount of the instrument to the extent that they are not settled in the period
in which they arise.
2. Earnings per ordinary share
The earnings per ordinary share figure is based on the net profit for the half year of #19,231,000
(half year ended 28 February 2005: #19,961,000; year ended 31 August 2005: #28,267,000) and on
77,409,340 (half year ended 28 February 2005: 70,133,445; year ended 31 August 2005: 72,768,034)
ordinary shares, being the weighted average number of ordinary shares in issue during the period.
The return per ordinary share detailed above can be further analysed between income revenue and
capital, as below.
Half year ended Year ended
Half year ended 28 February 2005 31 August 2005
28 February 2006 (Unaudited and (Audited and
restated-note 8)
(Unaudited) restated-note 7)
#'000 #'000 #'000
Net revenue profit 3,863 3,106 7,437
Net capital profit 15,368 16,855 20,830
--------- ------------ -------------
Net total profit 19,231 19,961 28,267
===== ====== =======
Weighted average number of ordinary
shares in issue during the period
77,409,340 70,133,445 72,768,034
Pence Pence Pence
Revenue earnings per ordinary share 4.99 4.43 10.22
Capital earnings per ordinary share 19.85 24.03 28.63
--------- ----------- ----------
Total earnings per ordinary share 24.84 28.46 38.85
===== ====== =====
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Page 11
HENDERSON FAR EAST INCOME TRUST PLC
Unaudited Interim Results
for the half year ended 28 February 2006
Notes to the Financial Statements (continued)
3. Ordinary share capital
At 28 February 2006 there were 77,622,619 ordinary shares in issue (28 February 2005: 74,776,927; 31 August
2005: 75,976,927). During the half year ended 28 February 2006 the company issued 1,645,692 new ordinary
shares (half year ended 28 February 2005: 8,868,357; year ended 31 August 2005: 10,068,357). The proceeds
amounted to #3,734,000 (half year ended 28 February 2005: #17,730,000; year ended 31 August 2005:
#20,345,000).
4. Interim dividend
The directors have declared a second interim dividend of 2.20p (2005: 2.10p) net per ordinary share payable
on 3 July 2006 to shareholders registered on 26 May 2006. The shares will be quoted ex-dividend on 24 May
2006.
5. Comparative information
The financial information contained in the interim report does not constitute statutory accounts as defined
in section 240 of the Companies Act 1985. The financial information for the half years ended 28 February
2006 and 28 February 2005 has not been audited.
The information for the year ended 31 August 2005 has been extracted from the latest published audited
accounts and restated to comply with IFRS (see note 7). The audited accounts for the year ended 31 August
2005 have been filed with the Registrar of Companies. The report of the auditors on those accounts
contained no qualification or statement under either section 237(2) or (3) of the Companies Act 1985.
6. Net asset value per share
The net asset value per ordinary share is based on the net assets attributable to equity shareholders of
#179,552,000 (28 February 2005: #152,164,000 as restated; 31 August 2005: #159,962,000 as restated) and on
77,622,619 (28 February 2005: 74,776,927; 31 August 2005: 75,976,927) ordinary shares, being the number of
ordinary shares in issue at the period end.
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Page 12
HENDERSON FAR EAST INCOME TRUST PLC
Unaudited Interim Results
for the half year ended 28 February 2006
Notes to the Financial Statements (continued)
7a Restatement of balances as at and for the year ended 31 August 2005
As at 1 September 2005 the company adopted International Financial Reporting Standards. In accordance with
IFRS 1 (First-time Adoption of International Financial Reporting Standards) the following is a
reconciliation of the results as at and for the year ended 31 August 2005, previously reported under the
applicable UK Accounting Standards and the SORP, to the restated IFRS results.
Previously reported Effect of Restated
transition to
31 August 2005 IFRS 31 August 2005
(Audited)
Notes #'000 #'000 #'000
Investments 1 156,853 (499) 156,354
Current assets 9,312 - 9,312
Creditors: amounts falling due
within one year
2 (8,771) 3,342 (5,429)
----------- ----------- ----------
Total assets less current 157,394 2,843 160,237
liabilities
Provision for liabilities and (275) - (275)
charges
----------- ----------- -----------
157,119 2,843 159,962
====== ====== ======
Capital and reserves
Called up share capital 18,994 - 18,994
Share premium 41,235 - 41,235
Capital redemption reserve 50 - 50
Capital reserve - realised 1,3 73,746 (73,746) -
Capital reserve - unrealised/
revaluation reserve 1,3 18,172 (18,172) -
Other capital reserves 1,3 - 91,419 91,419
Revenue reserve/Retained earnings 2 4,922 3,342 8,264
---------- ----------- ----------
157,119 2,843 159,962
====== ====== ======
Notes to the reconciliation
1. Investments are classified as held at fair value through profit or loss under IFRS and are carried
at bid prices which total their fair value of #156,354,000. Previously, under UK GAAP, they were
carried at mid prices. The aggregate difference, being a revaluation downwards of #499,000, also
decreases other capital reserves.
2. No provision has been made for the third and fourth interim dividends on the ordinary shares for the
year ended 31 August 2005 of #3,342,000. Under IFRS, interim dividends are not recognised until
paid.
3. The "capital reserve - realised" and the "capital reserve - unrealised" are now reclassified as "
other capital reserves".
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Page 13
HENDERSON FAR EAST INCOME TRUST PLC
Unaudited Interim Results
for the half year ended 28 February 2006
Notes to the Financial Statements (continued)
7b Reconciliation of the Statement of Total Return to the Income Statement for the year ended 31 August 2005
Under IFRS the Income Statement is the equivalent of the Statement of Total Return as reported previously.
2005 EPS Impact
Note #'000 Pence
Net return on ordinary activities after taxation
per Statement of Total Return
28,367
Change from mid to bid basis at 31 August 2004 1 399 0.55
Change from mid to bid basis at 31 August 2005 1 (499) (0.68)
------------ -----------
Net gain per Income Statement 28,267 (0.13)
======= ======
Note to the reconciliation
1. The portfolio valuations at 31 August 2004 and 31 August 2005 are valued at fair value under IFRS.
These values are lower than the previous valuations by #399,000 and #499,000 respectively.
7c Reconciliation of the Cash Flow Statement for the year ended 31 August 2005
Previously Effect of Adjusted cash
reported cash transition to flows 2005
flows 2005 IFRS
(Audited)
Notes
#'000 #'000 #'000
Net cash inflow from operating
activities
1 9,605 (24,888) (15,283)
Returns on investments and servicing -
of finance
1 (44) 44
Taxation (2,097) 2,097 -
Net cash outflow from financial
investment
(22,747) 22,747 -
Equity dividends paid 2 (5,969) 5,969 -
------------- ------------- -------------
Net cash outflow before financing 1,2 (21,252) 5,969 (15,283)
Financing 1,2 20,345 (5,969) 14,376
------------- ------------- -------------
Decrease in cash (907) - (907)
======= ======= =======
Notes to the reconciliation
1. Servicing of finance, taxation and net cash outflow from financial investment have now been analysed
within operating activities.
2. Equity dividends paid are now analysed within financing.
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Page 14
HENDERSON FAR EAST INCOME TRUST PLC
Unaudited Interim Results
for the half year ended 28 February 2006
Notes to the Financial Statements (continued)
8a Restatement of balances as at and for the half year ended 28 February 2005
At 1 September 2005 the company adopted International Financial Reporting Standards. In accordance with
IFRS 1 the following is a reconciliation of the results as at and for the period ended 28 February 2005,
previously reported under the applicable UK Accounting Standards and the SORP, to the restated IFRS
results.
Previously Effect of Restated
reported transition to
IFRS 28 February
28 February
2005
2005
(Unaudited)
Notes
#'000 #'000 #'000
Investments 1 141,026 (474) 140,552
Current assets 14,029 - 14,029
Creditors: amounts falling due within
one year
2 (5,163) 3,140 (2,023)
----------- ------------ ------------
Total assets less current liabilities 149,892 2,666 152,558
Provision for liabilities and charges (394) - (394)
----------- ------------ ------------
149,498 2,666 152,164
====== ======= =======
Capital and reserves
Called up share capital 18,694 - 18,694
Share premium 38,920 - 38,920
Capital redemption reserve 50 - 50
Capital reserve - realised 1,3 72,365 (72,365) -
Capital reserve - unrealised/
revaluation reserve 1,3 15,553 (15,553) -
Other capital reserves 1,3 - 87,444 87,444
Revenue reserve/Retained earnings 2 3,916 3,140 7,056
----------- ------------ ------------
149,498 2,666 152,164
====== ======= =======
Notes to the reconciliation
1. Investments are classified as held at fair value through profit or loss under IFRS and are carried at
bid prices which total their fair value of #140,552,000. Previously, under UK GAAP, they were carried
at mid prices. The aggregate difference, being a revaluation downwards of #474,000, also decreases
other capital reserves.
2. No provision has been made for the first and second interim dividends on the ordinary shares for the
half year ended 28 February 2005 of #3,140,000. Under IFRS, interim dividends are not recognised until
paid.
3. The "capital reserve - realised" and the "capital reserve - unrealised" are now reclassified as "other
capital reserves".
- MORE -
Page 15
HENDERSON FAR EAST INCOME TRUST PLC
Unaudited Interim Results
for the half year ended 28 February 2006
Notes to the Financial Statements (continued)
8b Reconciliation of the Statement of Total Return to the Income Statement for the period ended 28 February
2005
Under IFRS the Income Statement is the equivalent of the Statement of Total Return as reported previously.
2005 EPS Impact
Note #'000 Pence
Net return on ordinary activities after taxation per
Statement of Total Return
20,036
Change from mid to bid basis at 31 August 2004 1 399 0.57
Change from mid to bid basis at 28 February 2005 1 (474) (0.68)
----------- -----------
Net gain per Income Statement 19,961 (0.11)
====== ======
Note to the reconciliation
1. The portfolio valuations at 31 August 2004 and 28 February 2005 are valued at fair value under IFRS.
These values are lower than the previous valuations by #399,000 and #474,000 respectively.
8c Reconciliation of the Cash Flow Statement for the half year ended 28 February 2005
Previously Adjusted Cash
reported Cash Flows
Flows
2005
(Unaudited) Effect of
transition to
2005 IFRS
Notes #'000 #'000 #'000
Net cash inflow from operating activities 1 3,434 (17,054) (13,620)
Returns on investments and servicing of finance 1 (11) 11 -
Taxation 1 (934) 934 -
Net cash outflow from financial investment 1 (16,109) 16,109 -
Equity dividends paid 2 (2,847) 2,847 -
----------- ----------- -----------
Net cash outflow before financing (16,467) 2,847 (13,620)
Financing 1,2 16,045 (2,847) 13,198
----------- ----------- -----------
Decrease in cash (422) - (422)
====== ====== ======
Notes to the reconciliation
1. Servicing of finance, taxation and net cash inflow from financial investment have now been
analysed within operating activities.
2. Equity dividends paid are now analysed within financing.
- MORE -
Page 16
HENDERSON FAR EAST INCOME TRUST PLC
Unaudited Interim Results
for the half year ended 28 February 2006
Notes to the Financial Statements (continued)
9. Restatement of opening balances as at 31 August 2004
As at 1 September 2005 the company adopted International Financial Reporting Standards. In accordance
with IFRS 1 the following is a reconciliation of the results as at and for the year ended 31 August
2005, previously reported under the applicable UK Accounting Standards and the SORP, to the restated
IFRS results.
Previously
reported
31 August 2004
(Audited) Effect of Restated
transition to
IFRS 31 August 2004
Notes #'000 #'000 #'000
Investments 1 112,195 (399) 111,796
Current assets 6,946 - 6,946
Creditors: amounts falling due within one year
2 (3,871) 2,768 (1,103)
----------- ------------ ------------
Total assets less current liabilities 115,270 2,369 117,639
Provision for liabilities and charges (319) - (319)
----------- ------------ ------------
114,951 2,369 117,320
====== ======= =======
Capital and reserves
Called up share capital 16,477 - 16,477
Share premium 23,407 - 23,407
Capital redemption reserve 50 - 50
Capital reserve - realised 1,3 67,381 (67,381)
-
Capital reserve - unrealised/revaluation 1,3 3,607 (3,607) -
reserve
Other capital reserves 1,3 - 70,589 70,589
Revenue reserve/Retained earnings 2 4,029 2,768 6,797
------------ ----------- ----------
114,951 2,369 117,320
======= ====== ======
Notes to the reconciliation
1. Investments are classified as held at fair value under IFRS and are carried at bid prices which
total their fair value of #111,796,000. Previously, under UK GAAP, they were carried at mid
prices. The aggregate difference, being a revaluation downwards of #399,000, also decreases other
capital reserves.
2. No provision has been made for the third and fourth interim dividends on the ordinary shares for
the year ended 31 August 2004 of #2,768,000. Under IFRS, interim dividends are not recognised
until paid.
3. The "capital reserve - realised" and the "capital reserve - unrealised" are now reclassified as "
other capital reserves".
- MORE -
Page 17
HENDERSON FAR EAST INCOME TRUST PLC
Unaudited Interim Results
for the half year ended 28 February 2006
Notes to the Financial Statements (continued)
10. Reconciliation of profit before taxation to net cash inflow/(outflow) from operating activities
Half year ended Year ended
28 February Half year ended 31 August
(Unaudited)
28 February 2005 2005
2006
(Unaudited and (Audited and
restated-note 8) restated-note 7)
#'000 #'000 #'000
Profit before taxation 21,028 21,396 31,959
Gains on investments held at fair value through
profit or loss
(15,558) (17,036) (21,156)
Increase in accrued income (407) (659) (150)
Decrease in other debtors 73 106 49
(Decrease)/increase in accruals (466) 456 834
Decrease/(increase) in sales settlement debtor
3,101 (5,275) (3,039)
(Decrease)/increase in purchases settlement
creditor
(2,549) 753 3,204
Net purchases of investments (1,735) (11,629) (23,402)
Taxation on investment income (1,796) (1,732) (3,582)
---------- ----------- ------------
1,691 (13,620) 15,283
====== ======= =======
- MORE -
Page 18
HENDERSON FAR EAST INCOME TRUST PLC
Unaudited Interim Results
for the half year ended 28 February 2006
Geographical Distribution of Group Investments
28 Feb 2006 28 Feb 2005 31 Aug 2005
% % %
Japan 0.0 0.0 0.0
South Korea 12.0 7.1 8.3
China 5.4 3.9 5.5
Taiwan 9.3 5.7 16.7
Hong Kong 15.6 19.2 17.4
India 0.0 0.0 0.0
Thailand 5.8 7.6 3.4
The Philippines 1.7 0.0 0.0
Malaysia 7.3 8.2 8.1
Singapore 10.6 10.1 11.5
Indonesia 2.1 5.3 2.9
Australia 25.8 25.1 20.8
New Zealand 4.4 7.8 5.4
Stock Market Performance for the half year ended 28 February 2006 (percentage
change)
Local Sterling
Currency Adjusted
% %
Japan 30.6 28.7
South Korea 26.6 39.3
China 20.3 23.8
Taiwan 8.8 12.7
Hong Kong 6.8 9.9
India 32.9 35.6
Thailand 6.6 15.5
The Philippines 9.6 22.7
Malaysia 1.7 6.0
Singapore 9.7 17.1
Indonesia 17.2 35.0
Australia 10.5 12.3
New Zealand 1.6 (0.3)
- ENDS -
For further information please contact:
Michael Watt
Director and Fund Manager, Tel: 020 7818 4339
James de Sausmarez
Head of Investment Trusts, Henderson Global Investors, Tel: 020 7818 3349
Sarah Gibbons-Cook
Investor Relations and PR Manager, Henderson Global Investors, Tel: 020 7818
3198
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR DVLFLQZBBBBD
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