LONDON STOCK EXCHANGE
ANNOUNCEMENT
JPMORGAN EMERGING MARKETS
INVESTMENT TRUST PLC
UNAUDITED HALF YEAR RESULTS
FOR THE SIX MONTHS
ENDED 31ST DECEMBER
2023
Legal Entity Identifier: 5493001VPQDYH1SSSR77
Information disclosed in accordance with DTR
4.2.2
JPMorgan Emerging Markets Investment
Trust plc (the 'Company') has today announced its half year results
for the period ending 31st December 2023.
Highlights
·
Net asset value ('NAV') per share on a total
return basis was 3.2%, while total return to shareholders was 2.8%.
This compares with a 4.4% increase in the Benchmark, the MSCI
Emerging Markets Index with net dividends reinvested, in sterling
terms.
·
In the five years ended 31st December 2023, the
Company has delivered an annualised total return of 6.1% on a NAV
basis, outpacing the Benchmark, which returned 3.7% on the same
basis.
·
The Board has declared an interim dividend of 0.60
pence (2022: 0.58 pence), to be paid on 26th April 2024 to
shareholders on the register as at the close of business on 15th
March 2024.
·
The Board is introducing a
five-year performance-related conditional tender offer. This will
allow shareholders to redeem a portion of their shares at close to
NAV if, over the next five years from the start of the next
financial year being 1st July 2024, the Company's audited NAV total
return does not exceed the total return of the
Benchmark.
CHAIR'S
STATEMENT
Introduction
The past half-year was a mixed one
for emerging markets. China, the largest economy within your
Company's investable universe, remained weak. After prolonged and
stringent lockdowns, its post-pandemic recovery disappointed the
expectations of most investors, including ourselves, as severe
challenges in the property sector weighed on consumer sentiment. In
response there have been a number of interventions by the Chinese
authorities in recent weeks. However developments in other emerging
markets have been more positive. For example, India continues to
grow strongly, supported by domestic reforms, infrastructure
spending and rising foreign investment, while Mexico and Indonesia
are enjoying foreign capital inflows as global businesses diversify
their supply chains. Meanwhile, initial excitement about artificial
intelligence ('AI') underscores strong prospects for AI-exposed
technology companies, with global leaders in Taiwan and Korea seen
as clear beneficiaries.
Investment Performance
Against this background, the
Company's net asset value ('NAV') total return over the six months
ended 31st December 2023 was 3.2%, while the total return to
shareholders was 2.8%. This compares with a 4.4% increase in the
benchmark, the MSCI Emerging Markets Index with net dividends
reinvested, in sterling terms (the 'Benchmark' or 'MSCI Index').
Relative performance was adversely impacted by exposure to India,
the Company's largest overweight position, where the returns of
portfolio holdings lagged the market as a whole, despite their
strong fundamentals. The unexpected and continued weakness in
Chinese consumer demand also detracted from performance, as the
Company's holdings in Chinese consumer stocks derated. On the
positive side, returns were supported by the good performance of
positions in South Africa, Argentina and Mexico.
While this six-month
underperformance is disappointing, your Company's investment
strategy is focused on the long-term, and on this basis,
performance continues to be robust. The Company has delivered an
average annualised total return of 6.1% over the past five years
and 8.1% over the past ten years on an NAV basis, outpacing
the MSCI Index, which returned 3.7% per annum over five years and
5.4% over ten years, on the same basis.
The Company's recent performance is
discussed in more detail in the Portfolio Managers' Report
below.
Continuation Vote
I am pleased to report that, at the
Company's Annual General Meeting ('AGM') held in November 2023,
shareholders voted in favour of the Company's continuation as an
investment trust for a further three-year period. My fellow Board
members and I thank shareholders for their ongoing
support.
Share Rating
During the period, the Company's
shares traded at an average discount to NAV of 9.5%. The discount
ranged between 12.6% and 6.8% and ended the period at
10.2%.
The Board regularly considers the
merits of buying back shares in order to manage the level and
volatility of the discount if markets are orderly and it is in the
best interests of shareholders to do so. As shares are only
bought back at a discount to the prevailing net asset value, share
buybacks benefit shareholders as they increase the net asset value
per share of the remaining outstanding shares. In addition buybacks
demonstrate confidence in the portfolio and its long-term prospects
to outperform.
Over the six-month period 14,936,280
shares (representing 1.3% of the outstanding share capital) were
bought back into Treasury at an average discount of 10.6% at a cost
of £15.2 million. Shares repurchased are held in Treasury and such
Treasury shares and any new ordinary shares will only be sold or
issued at a premium to NAV. Share repurchases have continued since
the period end.
Introduction of Conditional Tender Mechanism
The Board remains focused on high
standards of governance and operating in the interests of
shareholders. It notes the increased incidence of tenders and other
forms of redemption, which are additional mechanisms to assist with
discount management. Therefore, the Board has decided that it is
now an appropriate time to introduce a five-year
performance-related conditional tender offer ('tender offer'). This
allows shareholders to redeem a portion of their shares at close to
NAV, subject to the performance of the Company over that
period.
Under the mechanism a tender offer
will be made to shareholders for up to 25% of the Company's
outstanding share capital, at a price equal to the then prevailing
NAV less 2% if, over the next five years from the start of the next
financial year being 1st July 2024, the Company's audited NAV total
return does not exceed the total return of the Benchmark over the
five-year period on a cumulative basis.
If the tender offer is triggered, it
will be subject to shareholder approval at the relevant time and
will also be conditional on shareholders approving the continuation
votes at the respective AGMs in 2026 and 2029 and would be held as
soon as practicable following the conclusion of the Company's 2029
AGM.
The introduction of the tender offer
will not change the Board's current approach to discount management
which is outlined above. Nor will it affect the Portfolio Managers'
clear and consistent investment philosophy and process, set out in
detail in the Company's 2023 Annual Report.
Revenue and Dividends
The Company's primary focus is to
generate a total return for shareholders, in line with its
investment objective, rather than targeting a particular level of
income. For any individual year, dividends received in sterling
terms can fluctuate according to the underlying earnings of the
portfolio as well as changes in its composition and of course
currency movements. This means that the level of dividends may
vary.
In respect of the financial year to
30th June 2023 an interim dividend of 0.58 pence per share and a
final dividend of 1.07 pence per share were paid to shareholders on
25th April and 10th November 2023 respectively, representing an
increase of 22.2% on the previous year.
Net revenue after taxation for the
six months to 31st December 2023 was £8.03 million (2022:
£7.47 million) and earnings per share were 0.70 pence (2022:
0.64 pence). The Board has declared an interim dividend of 0.60
pence (2022: 0.58 pence), to be paid on 26th April 2024 to
shareholders on the register as at the close of business on 15th
March 2024. The ex-dividend date will be 14th March
2024.
Board of Directors
The Board plans for succession to
ensure it retains an appropriate balance of skills, knowledge and
diverse perspectives. To this end, the Board appointed Alison
Jefferis as a Non-Executive Director with effect from 1st January
2024.
Alison has direct and relevant
experience within the investment sector, particularly in the fields
of marketing, communication and investor relations, including
digital engagement covering traditional and alternative asset
classes, listed and non-listed structures and retail, intermediary
and institutional investors. She most recently held the role of
Head of Corporate Affairs at Columbia Threadneedle Investments, a
global asset manager, from 2015 to 2022.
In addition Zoe Clements succeeded
Richard Laing in the role of Audit Committee Chair at the
conclusion of the Company's AGM in November 2023. As outlined in my
annual statement, it was Richard's intention to retire from the
Board in the first half of 2024; he duly stood down from the Board
as of the date of this statement. We thank Richard for his valued
contribution to the Company and wish him all the best for the
future.
The Board can confirm that its
current composition is compliant with all applicable diversity
targets for UK companies listed on the premium segment of the
London Stock Exchange. It is the intention that this will continue
to be the case.
Shareholder Communications
The Company is committed to engaging
with its shareholders including those with smaller holdings who
invest via platforms. To support this goal, the Company has
developed a range of initiatives including email updates on the
Company's progress. If you have not already signed up to receive
these communications and you wish to do so, you can opt in via
https://tinyurl.com/JMG-Sign-Up or by
scanning the QR code in the margin.
In addition our Portfolio Managers
both record webinars and video updates which can be found on the
Company's website. In particular I would draw your attention to the
recording of their detailed portfolio presentation delivered at the
AGM last November.
Outlook
The past three years have certainly
been challenging. As highlighted in my 2023 annual statement,
rising interest rates have put the Company's quality growth
strategy under pressure, by undermining the valuations of some
portfolio companies. At the same time, the Company has had to
navigate through a global pandemic, the Russia-Ukraine war and an
insipid Chinese recovery.
However, looking ahead in 2024,
there are reasons to be more optimistic: emerging market economies
are in general doing well, with stronger growth, less inflation and
lower debt than their western counterparts; meanwhile falling
global inflation should provide emerging market central banks with
scope to cut interest rates in due course; lower rates should, in
turn, bring relief to household and corporate balance sheets; the
US dollar is down considerably, which eases the interest burden on
emerging market debt; and China's economy is growing, albeit more
slowly than previously expected, but still faster than most
developed economies. Furthermore, valuations have fallen, and
earnings are forecast to grow strongly in 2024/25. That said, in
political terms 2024 will be a busy and complex year, with the
recent Taiwanese and Indonesian presidential elections to be
followed by elections in India, Mexico and South Africa, as
well as in the US and Britain.
In addition, the long-term case for
investment in emerging markets remains strong, thanks to their
superior economic growth prospects, and favourable demographics,
which will continue to drive incomes and consumption. And there are
many high-quality, innovative, disruptive businesses in these
markets capable of capitalising on the various investment
opportunities such economic vibrancy generates.
While the Company's Portfolio
Managers monitor short-term macroeconomic and political
developments, and longer-term structural themes, they do not
attempt to predict events or top-down trends, but instead
concentrate on identifying those companies that are best-placed to
endure and grow regardless of the macroeconomic or political
environment. This time-tested strategy is supported by a
well-resourced and deeply experienced team of research analysts,
many of whom are located 'on the ground' in the markets in which
the Company invests.
There may be periods, such as the
past six months, when the Company underperforms the Benchmark and
you will note that Austin and John address this directly in the
last paragraph of their statement below. However the strong
long-term performance track record of outright gains and
outperformance attests to the strategy's effectiveness in
maximising total returns over the long run. The Board remains
confident that this approach, allied with the Managers' experience
and expertise, will continue to reward investors going forward. It
is pleasing that others also share those conclusions. Hargreaves
Lansdown, one of the largest UK retail investment platforms, has
recently nominated your Company as one of its 'five funds to watch
in 2024'.
In the meantime, we will continue to
deploy our strategy, well summarised by Austin in a recent article
that you can find on our website, 'to invest in businesses with
strong finances, strong competitive advantages and ideally low
valuations, that can withstand whatever is thrown at
them.'
Aidan Lisser
Chair
23rd February 2024
PORTFOLIO MANAGERS'
REPORT
Introduction
As we review 2023 emerging markets
can be divided into two groups: in the first group, China; in the
second group, everything else. For China, it was another annus
horribilis, with sustained falls in share prices leaving the market
down 16% in sterling terms, with declines continuing throughout the
year. For other countries in our benchmark index it was a pretty
good year; in aggregate their equity markets returned 14% in
sterling terms throughout the year, and were up almost 9% in the
last six months alone. But given China's significance in the asset
class, the two combined to produce only a modest outcome for the
overall emerging market index: the year as a whole saw a return of
4.4% for the benchmark index, and that return came entirely during
the latest six-month period.
Investment Performance and Approach
Against this background, we are
disappointed to report that over the half year under review the
Company's net asset value ('NAV') total return lagged the benchmark
index, rising by just under 3.2%. To explain this, we need look no
further than the Company's two most significant markets in terms of
investment, India and China. We have more money invested in India,
at just under a quarter of the total portfolio, than any other
country; this has been the right investment destination, but our
larger investments there have failed to keep pace with an
increasingly euphoric stock market. Equity market returns in the
last six months in India have been boosted by rising valuations as
investor enthusiasm has mounted, and while some of the Company's
investments have participated in this re-rating, others have not.
Some of our larger investments in India are exporters, especially
of IT services, and these companies depend not on the Indian
economy, but on global business conditions, which have been more
subdued. Meanwhile, HDFC Bank is digesting its merger with its
parent HDFC Ltd, and while this should prove a temporary phase,
investors in India have looked elsewhere for exposure to the strong
domestic economy that country is enjoying. In China, which now
accounts for one sixth of your portfolio, the slowdown in the
economy and continued regulatory uncertainty have weighed upon the
share prices of most of our investments, with our exposure to the
consumer sector proving particularly costly. As consumer confidence
has declined, we have seen down-trading and enhanced competition
across the consumer sector in China, from e-commerce to consumer
products, resulting in margin pressure for several of our
investments. We have a marginally lower allocation to China than
our benchmark index, though clearly in retrospect an even more
negative stance would have been appropriate.
The drag on the entire asset class
from China threatens to obscure the fact that other emerging
markets have come through a challenging few years in relatively
good economic shape. Governments in emerging markets offered less
fiscal support during the pandemic than many developed countries,
but also avoided the consequent build-up of sovereign debt; and
when inflation pressures mounted their central banks were generally
far more decisive, meaning that they now have scope to reduce
interest rates and help domestic demand. That is not a bad backdrop
for domestic business profits and for growth. If it combines with a
global cycle in which developed economies avoid recession or see
only a mild downcycle, then we may look forward to a period in
which export businesses in emerging markets can expect some
improvement in customer demand, while at the same time
domestically-focused companies also see easier monetary conditions
and a potential cyclical recovery. That would be a more favourable
combination of circumstances than we have seen for several years.
Your Company's principal exposures remain in financial services and
consumer companies, both geared to domestic economic conditions,
and technology, where emerging markets companies are essential
suppliers to the global demand for hardware and software
services.
Finally, a word on our investment
approach. We are keenly aware that recent relative performance has
dipped below the long-term outcomes achieved for shareholders.
There are several reasons for this, some to do with the wider
market environment, some to do with our own judgements. No fund
manager should expect to be able to produce outperformance in every
market environment or every period; but when we look at the last
few years we should not use the change in market conditions as an
excuse. We firmly believe that our investment process, developed
and tested over the last three decades, will produce good results
in the future, as it has in the past. Our challenge is, as ever, to
continue to take informed risks by investing in the best companies
we can find, while avoiding excessive valuations. Our focus remains
resolutely long term, and our turnover low. Where we conclude that
our investment theses will not work out, we make changes; but if we
own strong companies, we stick with them, and shareholders should
expect that we continue to do so.
Austin Forey
John
Citron
Portfolio
Managers
23rd February 2024
INTERIM MANAGEMENT
REPORT
The Company is required to make the
following disclosures in its half year report:
Principal and Emerging Risks and
Uncertainties
The principal and emerging risks and
uncertainties faced by the Company have not changed from those
reported in the Annual Report and Financial Statements for the year
ended 30th June 2023 ('AFR') and fall into the following broad
categories: investment underperformance; loss of investment team or
investment manager; political and economic; strategy/business
management; operational and counterparty failure and cyber crime;
share price discount; change of corporate control of the manager;
legal and regulatory; corporate governance and shareholder
relations; and financial. Information on each of these areas is
given in the Business Review within the AFR.
Related Parties Transactions
During the first six months of the
current financial year, no transactions with related parties have
taken place which have materially affected the financial position
or the performance of the Company.
Going Concern
The Directors believe, having
considered the Company's investment objectives, risk management
policies, capital management policies and procedures, nature of the
portfolio and expenditure projections, that the Company has
adequate resources, an appropriate financial structure and suitable
management arrangements in place to continue in operational
existence for the foreseeable future and more specifically, that
there are no material uncertainties pertaining to the Company that
would prevent its ability to continue in such operational existence
for at least 12 months from the date of the approval of this
half year financial report. For these reasons, they consider there
is reasonable evidence to continue to adopt the going concern basis
in preparing the accounts.
Directors' Responsibilities
The Board of Directors confirms
that, to the best of its knowledge:
(i) the condensed
set of financial statements contained within the half yearly
financial report has been prepared in accordance with FRS 104
'Interim Financial Reporting' and gives a true and fair view of the
state of affairs of the Company and of the assets, liabilities,
financial position and net return of the Company, as at 31st
December 2023 as required by the UK Listing Authority Disclosure
and Transparency Rules 4.2.4R; and
(ii) the interim
management report includes a fair review of the information
required by 4.2.7R and 4.2.8R of the UK Listing Authority
Disclosure and Transparency Rules.
In order to provide these
confirmations, and in preparing these financial statements, the
Directors are required to:
•
select suitable accounting policies and then apply them
consistently;
• make
judgements and accounting estimates that are reasonable and
prudent;
•
state whether applicable UK 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;
and the Directors confirm that they
have done so.
For and on behalf of the
Board
Aidan Lisser
Chair
23rd February 2024
CONDENSED STATEMENT OF
COMPREHENSIVE INCOME
|
(Unaudited)
|
(Unaudited)
|
(Audited)
|
|
Six months
ended
|
Six months
ended
|
Year ended
|
|
31st December
2023
|
31st December
2022
|
30th June
2023
|
|
Revenue
|
Capital
|
Total
|
Revenue
|
Capital
|
Total
|
Revenue
|
Capital
|
Total
|
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
Gains/(losses) on
investments
|
|
|
|
|
|
|
|
|
|
held at fair value
through
|
|
|
|
|
|
|
|
|
|
profit or loss
|
-
|
38,633
|
38,633
|
-
|
14,026
|
14,026
|
-
|
(10,303)
|
(10,303)
|
Net foreign currency
|
|
|
|
|
|
|
|
|
|
gains/(losses)
|
-
|
722
|
722
|
-
|
942
|
942
|
-
|
(2,310)
|
(2,310)
|
Income from investments
|
10,550
|
-
|
10,550
|
9,971
|
-
|
9,971
|
28,130
|
-
|
28,130
|
Interest receivable
|
569
|
-
|
569
|
843
|
-
|
843
|
2,299
|
-
|
2,299
|
Gross return/(loss)
|
11,119
|
39,355
|
50,474
|
10,814
|
14,968
|
25,782
|
30,429
|
(12,613)
|
17,816
|
Management fee
|
(1,327)
|
(3,097)
|
(4,424)
|
(1,532)
|
(3,575)
|
(5,107)
|
(3,082)
|
(7,190)
|
(10,272)
|
Other administrative
expenses
|
(767)
|
-
|
(767)
|
(648)
|
-
|
(648)
|
(1,456)
|
-
|
(1,456)
|
Net
return/(loss) before
|
|
|
|
|
|
|
|
|
|
taxation
|
9,025
|
36,258
|
45,283
|
8,634
|
11,393
|
20,027
|
25,891
|
(19,803)
|
6,088
|
Taxation
|
(995)
|
(4,150)
|
(5,145)
|
(1,169)
|
(3,293)
|
(4,462)
|
(3,294)
|
(4,708)
|
(8,002)
|
Net
return/(loss) after
|
|
|
|
|
|
|
|
|
|
taxation
|
8,030
|
32,108
|
40,138
|
7,465
|
8,100
|
15,565
|
22,597
|
(24,511)
|
(1,914)
|
Return/(loss) per share (note
3)
|
0.70p
|
2.81p
|
3.51p
|
0.64p
|
0.69p
|
1.33p
|
1.94p
|
(2.11)p
|
(0.17)p
|
All revenue and capital items in the
above statement derive from continuing operations. No operations
were acquired or discontinued in the period.
The 'Total' column of this statement
is the profit and loss account of the Company and the 'Revenue' and
'Capital' columns represent supplementary information prepared
under guidance issued by the Association of Investment
Companies.
The net return/(loss) after taxation
represents the profit/(loss) for the period and also the total
comprehensive income.
CONDENSED STATEMENT OF
CHANGES IN EQUITY
|
Called up
|
|
Capital
|
|
|
|
|
|
share
|
Share
|
redemption
|
Other
|
Capital
|
Revenue
|
|
|
capital
|
premium
|
reserve
|
reserve
|
reserves
|
reserve1
|
Total
|
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
Six
months ended 31st December 2023 (Unaudited)
|
|
|
|
|
|
|
|
At
30th June 2023
|
33,091
|
173,631
|
1,665
|
69,939
|
1,027,276
|
24,220
|
1,329,822
|
Repurchase of shares into
Treasury
|
-
|
-
|
-
|
-
|
(15,245)
|
-
|
(15,245)
|
Net return
|
-
|
-
|
-
|
-
|
32,108
|
8,030
|
40,138
|
Dividends paid in the period (note
4)
|
-
|
-
|
-
|
-
|
-
|
(12,265)
|
(12,265)
|
At
31st December 2023
|
33,091
|
173,631
|
1,665
|
69,939
|
1,044,139
|
19,985
|
1,342,450
|
Six
months ended 31st December 2022 (Unaudited)
|
|
|
|
|
|
|
|
At
30th June 2022
|
33,091
|
173,631
|
1,665
|
69,939
|
1,072,940
|
18,040
|
1,369,306
|
Repurchase of shares into
Treasury
|
-
|
-
|
-
|
-
|
(7,652)
|
-
|
(7,652)
|
Net return
|
-
|
-
|
-
|
-
|
8,100
|
7,465
|
15,565
|
Dividends paid in the period (note
4)
|
-
|
-
|
-
|
-
|
-
|
(9,683)
|
(9,683)
|
At
31st December 2022
|
33,091
|
173,631
|
1,665
|
69,939
|
1,073,388
|
15,822
|
1,367,536
|
Year
ended 30th June 2023 (Audited)
|
|
|
|
|
|
|
|
At
30th June 2022
|
33,091
|
173,631
|
1,665
|
69,939
|
1,072,940
|
18,040
|
1,369,306
|
Repurchase of shares into
Treasury
|
-
|
-
|
-
|
-
|
(21,153)
|
-
|
(21,153)
|
Net (loss)/return
|
-
|
-
|
-
|
-
|
(24,511)
|
22,597
|
(1,914)
|
Dividend paid in the year (note
4)
|
-
|
-
|
-
|
-
|
-
|
(16,417)
|
(16,417)
|
At
30th June 2023
|
33,091
|
173,631
|
1,665
|
69,939
|
1,027,276
|
24,220
|
1,329,822
|
1 This
reserve forms the distributable reserve of the Company and may be
used to fund distributions to investors.
CONDENSED STATEMENT OF
FINANCIAL POSITION
|
(Unaudited)
|
(Unaudited)
|
(Audited)
|
|
At
|
At
|
At
|
|
31st
December
|
31st
December
|
30th June
|
|
2023
|
2022
|
2023
|
|
£'000
|
£'000
|
£'000
|
Fixed assets
|
|
|
|
Investments held at fair value through profit or
loss
|
1,346,894
|
1,323,386
|
1,311,009
|
Current assets
|
|
|
|
Debtors
|
2,982
|
2,514
|
5,074
|
Cash and cash equivalents
|
6,589
|
50,531
|
24,866
|
|
9,571
|
53,045
|
29,940
|
Current liabilities
|
|
|
|
Creditors: amounts falling due
within one year
|
(549)
|
(182)
|
(999)
|
Net
current assets
|
9,022
|
52,863
|
28,941
|
Total assets less current liabilities
|
1,355,916
|
1,376,249
|
1,339,950
|
Non
current liabilities
|
|
|
|
Creditors: amounts falling due
after more than one year
|
(13,466)
|
(8,713)
|
(10,128)
|
Net
assets
|
1,342,450
|
1,367,536
|
1,329,822
|
Capital and reserves
|
|
|
|
Called up share capital
|
33,091
|
33,091
|
33,091
|
Share premium
|
173,631
|
173,631
|
173,631
|
Capital redemption reserve
|
1,665
|
1,665
|
1,665
|
Other reserve
|
69,939
|
69,939
|
69,939
|
Capital reserves
|
1,044,139
|
1,073,388
|
1,027,276
|
Revenue reserve
|
19,985
|
15,822
|
24,220
|
Total shareholders' funds
|
1,342,450
|
1,367,536
|
1,329,822
|
Net
asset value per share (note
5)
|
118.2p
|
117.6p
|
115.6p
|
CONDENSED STATEMENT OF CASH
FLOWS
|
(Unaudited)
|
(Unaudited)
|
(Audited)
|
|
Six months
ended
|
Six months
ended
|
Year ended
|
|
31st
December
|
31st
December
|
30th June
|
|
2023
|
20221
|
2023
|
|
£'000
|
£'000
|
£'000
|
Cash
flows from operating activities
|
|
|
|
Net return before finance costs and
taxation
|
45,283
|
20,027
|
6,088
|
Adjustment for:
|
|
|
|
Net (gains)/losses on investments
held at fair value
|
|
|
|
through profit or loss
|
(38,633)
|
(14,026)
|
10,303
|
Net foreign currency
(gains)/losses
|
(722)
|
(942)
|
2,310
|
Dividend income
|
(10,472)
|
(9,971)
|
(28,130)
|
Interest income
|
(569)
|
(843)
|
(2,299)
|
Scrip Dividends received as
income
|
(78)
|
-
|
-
|
Realised (losses)/gains on foreign
exchange transactions
|
(66)
|
(107)
|
123
|
Realised exchange gains on Liquidity
fund
|
586
|
3,180
|
2,795
|
Decrease/(increase) in accrued income
and other debtors
|
6
|
24
|
(15)
|
(Decrease)/increase in accrued
expenses
|
(127)
|
(109)
|
289
|
|
(4,792)
|
(2,767)
|
(8,536)
|
Dividends received
|
11,765
|
10,818
|
23,963
|
Interest received
|
569
|
666
|
2,299
|
Overseas withholding tax
(paid)/recovered
|
(201)
|
(173)
|
16
|
Capital gains tax paid
|
(812)
|
-
|
-
|
Net
cash inflow from operating activities
|
6,529
|
8,544
|
17,742
|
Purchases of investments
|
(35,744)
|
(25,349)
|
(64,572)
|
Sales of investments
|
38,567
|
29,266
|
56,540
|
Net
cash inflow/(outflow) from investing activities
|
2,823
|
3,917
|
(8,032)
|
Equity dividends paid
|
(12,265)
|
(9,683)
|
(16,417)
|
Repurchase of shares into
Treasury
|
(15,566)
|
(7,814)
|
(20,899)
|
Net
cash outflow from financing activities
|
(27,831)
|
(17,497)
|
(37,316)
|
Decrease in cash and cash equivalents
|
(18,479)
|
(5,036)
|
(27,606)
|
Cash and cash equivalents at start of
year
|
24,866
|
57,700
|
57,700
|
Exchange movements
|
202
|
(2,133)
|
(5,228)
|
Cash
and cash equivalents at end of period/year
|
6,589
|
50,531
|
24,866
|
Decrease in cash and cash equivalents
|
(18,479)
|
(5,036)
|
(27,606)
|
Cash
and cash equivalents consist of:
|
|
|
|
Cash and short term
deposits
|
109
|
650
|
737
|
Cash held in liquidity
fund
|
6,480
|
49,881
|
24,129
|
Total
|
6,589
|
50,531
|
24,866
|
1 The
presentation of the Cash Flow Statement, as permitted under FRS
102, has been changed so as to present the 'reconciliation of net
return before finance costs and taxation' to 'net cash inflow from
operating activities' on the Cash Flow Statement. Previously, this
was shown by way of note to the Cash Flow Statement. Other than
consequential changes in presentation of the certain cash flow
items, there is no change to the cash flows as presented in
previous periods.
Analysis of change in net cash/(debt)
|
As at
|
|
Other
|
As at
|
|
30th June
|
|
non-cash
|
31st
December
|
|
2023
|
Cash flows
|
charges
|
2023
|
|
£'000
|
£'000
|
£'000
|
£'000
|
Cash
and cash equivalents
|
|
|
|
|
Cash
|
737
|
(628)
|
-
|
109
|
Cash equivalents
|
24,129
|
(17,851)
|
202
|
6,480
|
Net
cash
|
24,866
|
(18,479)
|
202
|
6,589
|
NOTES TO THE CONDENSED
FINANCIAL STATEMENTS
For
the six months ended 31st December 2023
1. Financial
statements
The information contained within the
condensed financial statements in this half year report has not
been audited or reviewed by the Company's auditors.
The figures and financial
information for the year ended 30th June 2023 are extracted from
the latest published financial statements of the Company and do not
constitute statutory accounts for that year. Those financial
statements have been delivered to the Registrar of Companies and
including the report of the auditors which was unqualified and did
not contain a statement under either section 498(2) or 498(3)
of the Companies Act 2006.
2. Accounting
policies
The financial statements have been
prepared in accordance with the Companies Act 2006, FRS 102 'The
Financial Reporting Standard applicable in the UK and Republic of
Ireland' of the United Kingdom Generally Accepted Accounting
Practice ('UK GAAP') and with the Statement of Recommended
Practice 'Financial Statements of Investment Trust Companies and
Venture Capital Trusts' (the revised 'SORP') issued by the
Association of Investment Companies in July 2022.
FRS 104, 'Interim Financial
Reporting', issued by the Financial Reporting Council ('FRC') in
March 2015 has been applied in preparing this condensed set of
financial statements for the six months ended 31st December
2023.
All of the Company's operations are
of a continuing nature.
The accounting policies applied to
this condensed set of financial statements are consistent with
those applied in the financial statements for the year ended 30th
June 2023.
3. Return/(loss) per
share
|
(Unaudited)
|
(Unaudited)
|
(Audited)
|
|
Six months
ended
|
Six months
ended
|
Year ended
|
|
31st December
2023
|
31st December
2022
|
30th June
2023
|
|
£'000
|
£'000
|
£'000
|
Return per share is based on the
following:
|
|
|
|
Revenue return
|
8,030
|
7,465
|
22,597
|
Capital return/(loss)
|
32,108
|
8,100
|
(24,511)
|
Total return/(loss)
|
40,138
|
15,565
|
(1,914)
|
Weighted average number of shares in
issue
|
|
|
|
(excluding shares held in
Treasury)
|
1,144,084,836
|
1,166,901,335
|
1,162,832,611
|
Revenue return per share
|
0.70p
|
0.64p
|
1.94p
|
Capital return/(loss) per
share
|
2.81p
|
0.69p
|
(2.11)p
|
Total return/(loss) per share
|
3.51p
|
1.33p
|
(0.17)p
|
4. Dividends
paid
|
(Unaudited)
|
(Unaudited)
|
(Audited)
|
|
Six months
ended
|
Six months
ended
|
Year ended
|
|
31st December
2023
|
31st December
2022
|
30th June
2023
|
|
£'000
|
£'000
|
£'000
|
Dividend paid
|
|
|
|
2023 final dividend of 1.07p (2022:
0.83p)
|
12,265
|
9,683
|
9,683
|
2023 interim dividend of
0.58p
|
-
|
-
|
6,734
|
Total dividends paid in the period/year
|
12,265
|
9,683
|
16,417
|
All dividends paid in the period
have been funded from the revenue reserve.
An interim dividend of 0.60p (2023:
0.58p) per share amounting to £6,814,000 (2023: £6,734,000), has
been declared payable in respect of the six months ended 31st
December 2023. The interim dividend will be paid on 26th April 2024
to shareholders on the register at the close of business on 15th
March 2024. The ex-dividend date will be 14th March
2024.
5.
Net asset value per
share
|
(Unaudited)
|
(Unaudited)
|
(Audited)
|
|
Six months
ended
|
Six months
ended
|
Year ended
|
|
31st December
2023
|
31st December
2022
|
30th June
2023
|
|
|
|
|
Net assets (£'000)
|
1,342,450
|
1,367,536
|
1,329,822
|
Number of shares in issue
|
1,135,693,085
|
1,163,258,513
|
1,150,629,365
|
Net
asset value per share
|
118.2p
|
117.6p
|
115.6p
|
6. Fair valuation of
instruments
The fair value hierarchy disclosures
required by FRS 102 are given below.
|
(Unaudited)
|
(Unaudited)
|
(Audited)
|
|
Six months
ended
|
Six months
ended
|
Year ended
|
|
31st December
2023
|
31st December
2022
|
30th June
2023
|
|
Assets
|
Liabilities
|
Assets
|
Liabilities
|
Assets
|
Liabilities
|
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
Level 1
|
1,346,836
|
-
|
1,323,325
|
-
|
1,310,951
|
-
|
Level 31
|
58
|
-
|
61
|
-
|
58
|
-
|
Total value of investments
|
1,346,894
|
-
|
1,323,386
|
-
|
1,311,009
|
-
|
1 The
Level 3 investment relates to the Company's holding in the Russian
stock Sberbank of Russia.
There have been no transfers between
Levels 1, 2 or 3 during the year.
|
Equity
|
|
Equity
|
|
Equity
|
|
|
Investments
|
Total
|
Investments
|
Total
|
Investments
|
Total
|
Level 31
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
Opening balance
|
58
|
58
|
60
|
60
|
60
|
60
|
Change in fair value of unquoted
investment
|
|
|
|
|
|
|
during the period/year
|
-
|
-
|
1
|
1
|
(2)
|
(2)
|
Total
|
58
|
58
|
61
|
61
|
58
|
58
|
1 The Level 3
investment relates to the Company's holding in the Russian stock
Sberbank of Russia.
The price of this stock has been
determined by taking the live market price as at 25th February 2022
and applying a 99% haircut.
JPMORGAN FUNDS LIMITED
23rd February 2024
For further
information, please contact:
Alison
Vincent
For and on
behalf of
JPMorgan
Funds Limited
020 7742
4000
Neither the contents of the
Company's website nor the contents of any website accessible from
hyperlinks on the Company's website (or any other website) is
incorporated into, or forms part of, this
announcement.
JPMORGAN ASSET MANAGEMENT (UK) LIMITED
ENDS
A copy of the Half Year Report has
been submitted to the National Storage Mechanism and will shortly
be available for inspection at
https://data.fca.org.uk/#/nsm/nationalstoragemechanism.
The Half Year Report will also
shortly be available on the Company's website at
www.jpmemergingmarkets.co.uk
where up to date information on the Company,
including daily NAV and share prices, factsheets and portfolio
information can also be found.