Aberdeen Investment Trusts Monthly Reports October 2016
Contents Page
United Kingdom UK Equity Income Dunedin Income Growth Investment Trust PLC Murray Income Trust PLC Shires Income PLC
4 7 10
UK Equity and Bond Income Aberdeen Smaller Companies Income Trust PLC
13
UK Smaller Companies Dunedin Smaller Companies Investment Trust PLC
16
Asia Pacific Asia Pacific excluding Japan Aberdeen Asian Income Fund Limited Aberdeen Asian Smaller Companies Investment Trust PLC Aberdeen New Dawn Investment Trust PLC Edinburgh Dragon Trust plc
19 22 25 28
Country Specialists: Asia Pacific Aberdeen New Thai Investment Trust PLC New India Investment Trust PLC
31 33
Emerging Markets Global Aberdeen Emerging Markets Investment Company Limited Aberdeen Frontier Markets Investment Company Limited
36 39
Latin American Aberdeen Latin American Income Fund Limited
42
Global Global Equity Income Murray International Trust PLC
45
Japan Aberdeen Japan Investment Trust PLC
48
North America The North American Income Trust plc
51
Tracker Aberdeen UK Tracker Trust plc
54
Investment Trust
Dunedin Income Growth Investment Trust PLC Performance Data and Analytics to 30 September 2016
Investment objective The Company’s investment objective is to achieve growth of income and capital from a portfolio invested mainly in companies listed or quoted in the United Kingdom.
Morningstar Analyst RatingTM
Benchmark FTSE All-Share Index total return.
B
Cumulative performance (%)
Morningstar RatingTM
Morningstar Analyst Rating™ Morningstar analysts assign the ratings globally on a five-tier scale with three positive ratings of Gold, Silver and Bronze.
as at 30/09/16
1 month
3 months
6 months
1 year
3 years
Share Price
244.5p
(2.1)
8.4
17.5
14.8
5.7
54.7
NAVA
273.1p
1.4
6.1
16.1
18.2
16.7
65.6
1.7
7.8
12.8
16.8
21.1
68.9
FTSE All-Share
5 years
Discrete performance (%) Year ending:
Twenty largest equity holdings 30/09/16
30/09/15
30/09/14
30/09/13
30/09/12
Share Price
14.8
(11.0)
3.4
22.0
20.0
NAVA
18.2
(6.8)
5.9
19.8
18.5
FTSE All-Share
16.8
(2.3)
6.1
18.9
17.2
Total return; NAV to NAV, net income reinvested, GBP. Share price total return is on a mid-to-mid basis. Dividend calculations are to reinvest as at the ex-dividend date. NAV returns based on NAVs with debt valued at fair value. Source: Aberdeen Asset Managers Limited, Lipper and Morningstar. Past performance is not a guide to future results.
Fund managers’ report The FTSE All-Share Index continued its positive momentum during September rising by 1.7% on a total return basis. A gentle recovery in oil and commodity prices coupled with a further depreciation of sterling which is beneficial to those companies with overseas earnings and exporters, led the market to perform well. These factors lay behind the outperformance of the FTSE 100 Index compared to the FTSE 250 Index. In the month of September the trust introduced Manx Telecom, the Isle of Man’s incumbent telecoms operator, at a small weight after an encouraging set of results and meeting with management. While the growth of the core business is likely to be muted it is expected to be steady and should translate into above inflation growth in the dividend which has an attractive starting yield. The trust also added to the recently introduced Essentra following a meeting with the new Chairman. To help fund these purchases the holding in HSBC was trimmed after some strong short term performance. We continued to write options to gently increase the income available to the trust with calls in Centrica, GKN and AstraZeneca, amongst others. Although the UK equity market has recovered swiftly it remains much too early to tell what the ramifications of leaving the EU will be. It is though notable that as more data has become available some of the more downbeat commentators have shifted to less extreme positions. In the meantime sterling has continued to weaken as markets have focussed on the risks of a so called ‘hard Brexit’. Sterling’s weakness is being regarded as a positive for the profitability of many UK companies but devaluing the currency is not a panacea and brings with it the risk of future inflation. This spectre is particularly worrying given the policy ammunition usually used to control rising prices is unavailable. These concerns along with the ongoing lack of transparency regarding the UK’s relationship with the EU further complicates an already challenging global macroeconomic picture where vulnerabilities include Europe’s banking sector, China’s credit-fuelled growth and the outcome of the Presidential election in the United States. Fund managers' report continues overleaf Including current year revenue. B Copyright © 2016 Morningstar UK Ltd. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is not a guide to future results. A
Morningstar RatingTM for Funds Morningstar rates funds from one to five stars based on how well they’ve performed (after adjusting for risk and accounting for all sales charges) in comparison to similar funds.
B
% 5.1 4.9 4.3 4.0 3.9 3.7 3.4 3.3 3.2 3.0 3.0 2.9 2.9 2.9 2.8 2.5 2.4 2.4 2.3 2.2 65.1
GlaxoSmithKline British American Tobacco Royal Dutch Shell 'B' AstraZeneca Unilever HSBC Unibail Rodamco Prudential Vodafone Centrica Total BHP Billiton Roche National Grid BP Compass Close Brothers Sage Provident Financial Pearson Total Based on equity holdings only.
Ten largest fixed income holdings BHP Billiton Finance 6.5% 22/10/77 HBOS Cap Funding 6.461% ENEL 6.625% 15/09/76 Rabobank Cap Funding Trust 5.556% Credit Agricole 8.125% Lloyds Bank 5.75% 09/07/25 HSBC Bank Funding 5.862% 29/04/49 BG Energy Cap 6.5% 30/11/72 Barclays Bank 10% 21/05//21 QBE Insurance 6.115% 24/05/42 Total
% 9.3 8.9 8.3 5.3 3.8 3.6 3.6 3.5 3.4 3.4 53.1
Based on fixed income holdings only. Figures may not add up due to rounding.
Total number of investments
79
All sources (unless indicated): Aberdeen Asset Managers Limited 30 September 2016.
Private investors 0500 00 00 40 Institutional investors Andrew Leigh +44 (0)20 7463 6312 or Kenneth Harper +44 (0)131 528 4224 PAGE 04 OF 56
Investment Trust
Dunedin Income Growth Investment Trust PLC Performance Data and Analytics to 30 September 2016
Fund managers’ report - continued Indeed, in these difficult times it tends to be those companies with globally diverse revenue streams, strong competitive advantages and robust financial characteristics that perform best. While it is difficult to suggest that valuations in absolute terms look attractive on average, amid the uncertainty there are pockets where the returns on offer are more attractive than they have been for some time.
Sector allocation % 24.6 12.6 11.8 11.1 10.6 7.5 6.7 6.4 4.5 2.9 1.3 100.0
Financials Consumer Goods Oil & Gas Health Care Industrials Utilities Consumer Services Basic Materials Telecommunication Services Technology Cash Total
Key information Calendar Year end Accounts published Annual General Meeting Dividend paid Established Fund managers Ongoing chargesC Annual management fee
Premium/(Discount) with Debt at PAR Premium/(Discount) with Debt at fair value YieldD Active shareE
31 January March May February, May, August, November 1873 Ben Ritchie Louise Kernohan 0.62% 0.45% on the first £225m, 0.35% on the next £200m and 0.25% over £425m per annum of the net assets of the Company. (12.9)% (10.5)% 4.7% 60.9%
Gearing Net gearingF Net gearing with Debt at market valueF Equity gearingG
Assets/Debt
Expressed as a percentage of average daily net assets for the year ended 31 January 2016. The Ongoing Charges Figure (OCF) is the overall cost shown as a percentage of the value of the assets of the Company. It is made up of the Annual Management Fee and other charges. It does not include any costs associated with buying shares in the Company or the cost of buying and selling stocks within the Company. The Ongoing Charges figure can help you compare the annual operating expenses of different Companies. D Calculated using the Company’s historic net dividends and month end share price. E The ‘Active Share’ percentage is a measure used to describe what proportion of the Company's holdings differ from the benchmark index holdings. F Gearing is expressed as a percentage of gross assets, which includes current year revenue, less cash/cash equivalents divided by shareholders' funds. G Expressed as a percentage of total equities held divided by shareholders' funds. C
The risk outlined overleaf relating to gearing is particularly relevant to the trust, but should be read in conjunction with all warnings and comments given. Important information overleaf
Gross assets Equities Fixed Income Total investments Cash Other net assets Short-term borrowings 3.99% Senior Secured Note 2045 7.875% Debenture 2019 Net assets
14.7% 18.0% 7.7%
£’000 % 455,144 29,921 485,065 7,525 (11,333) (30,000)
107.7 7.1 114.8 1.8 0.0 (2.7) (7.1)
(28,600) 422,657
(6.8) 100.0
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Investment Trust
Dunedin Income Growth Investment Trust PLC Performance Data and Analytics to 30 September 2016 AIFMD Leverage Limits Gross Notional Commitment
2.5x 2x
Capital structure Ordinary shares Treasury shares
150,512,687 3,165,248
Allocation of management fees and finance costs Capital Revenue
60% 40%
Trading details Reuters/Epic/Bloomberg code ISIN code Sedol code Stockbrokers Market makers
DIG GB0003406096 0340609 J.P. Morgan Cazenove SETSmm
Important information Risk factors you should consider prior to investing: • The value of investments and the income from them can fall and investors may get back less than the amount invested. • Past performance is not a guide to future results. • Investment in the Company may not be appropriate for investors who plan to withdraw their money within 5 years. • The Company may borrow to finance further investment (gearing). The use of gearing is likely to lead to volatility in the Net Asset Value (NAV) meaning that any movement in the value of the company's assets will result in a magnified movement in the NAV. • The Company may accumulate investment positions which represent more than normal trading volumes which may make it difficult to realise investments and may lead to volatility in the market price of the Company's shares. • The Company may charge expenses to capital which may erode the capital value of the investment. • Derivatives may be used, subject to restrictions set out for the Company, in order to manage risk and generate income. The market in derivatives can be volatile and there is a higher than average risk of loss. • There is no guarantee that the market price of the Company's shares will fully reflect their underlying Net Asset Value. • As with all stock exchange investments the value of the Company's shares purchased will immediately fall by the difference between the buying and selling prices, the bid-offer spread. If trading volumes fall, the bid-offer spread can widen. • Certain trusts may seek to invest in higher yielding securities such as bonds, which are subject to credit risk, market price risk and interest rate risk. Unlike income from a single bond, the level of income from an investment trust is not fixed and may fluctuate. • Yields are estimated figures and may fluctuate, there are no guarantees that future dividends will match or exceed historic dividends and certain investors may be subject to further tax on dividends. Other important information: Issued by Aberdeen Asset Managers Limited which is authorised and regulated by the Financial Conduct Authority in the United Kingdom. Registered Office: 10 Queen’s Terrace, Aberdeen AB10 1YG. Registered in Scotland No. 108419. An investment trust should be considered only as part of a balanced portfolio. Under no circumstances should this information be considered as an offer or solicitation to deal in investments. FTSE International Limited (‘FTSE’) © FTSE 2016. ‘FTSE®’ is a trade mark of the London Stock Exchange Group companies and is used by FTSE International Limited under licence. RAFI® is a registered trademark of Research Affiliates, LLC. All rights in the FTSE indices and/ or FTSE ratings vest in FTSE and/or its licensors. Neither FTSE nor its licensors accept any liability for any errors or omissions in the FTSE indices and/or FTSE ratings or underlying data. No further distribution of FTSE Data is permitted without FTSE’s express written consent. PAGE 06 OF 56
Investment Trust
Murray Income Trust PLC Performance Data and Analytics to 30 September 2016
Investment objective
Morningstar Analyst RatingTM
To achieve a high and growing income combined with capital growth through investment in a portfolio principally of UK equities.
Benchmark FTSE All-Share Index.
Morningstar Analyst Rating™ Morningstar analysts assign the ratings globally on a five-tier scale with three positive ratings of Gold, Silver and Bronze. B
Cumulative performance (%)
Morningstar RatingTM
as at 30/09/16
1 month
3 months
6 months
1 year
3 years
Share Price
723.0p
0.6
9.3
14.7
15.7
8.9
5 years 55.0
NAVA
793.6p
0.6
5.0
13.9
18.1
19.7
69.0
FTSE All-Share
1.7
7.8
12.8
16.8
21.1
68.9
FTSE 350 Higher Yield
2.4
7.0
16.7
22.8
18.4
60.5
Discrete performance (%) Year ending:
30/09/16
30/09/15
30/09/14
30/09/13
Share Price
15.7
(9.2)
3.6
18.8
30/09/12 19.8
NAVA
18.1
(4.8)
6.4
19.5
18.1
FTSE All-Share
16.8
(2.3)
6.1
18.9
17.2
FTSE 350 Higher Yield
22.8
(9.7)
6.7
16.8
16.1
Total return; NAV to NAV, net income reinvested, GBP. Share price total return is on a mid-to-mid basis. Dividend calculations are to reinvest as at the ex-dividend date. NAV returns based on NAVs with debt valued at fair value. Source: Aberdeen Asset Managers Limited, Lipper and Morningstar. Past performance is not a guide to future results.
Fund managers’ report The FTSE All-Share Index continued its positive momentum during September rising by 1.7% on a total return basis. A gentle recovery in oil and commodity prices coupled with a further depreciation of sterling which is beneficial to those companies with overseas earnings and exporters, led the market to perform well. These factors lay behind the outperformance of the FTSE 100 Index compared to the FTSE 250 Index. Partly due to the advantages of weaker sterling for exporters, September’s Manufacturing PMI rose strongly, ahead of expectations. The Services PMI was essentially flat compared to August confirming the belief, that at least in the short term, the more pessimistic forecasts for a slowdown in growth in the UK economy were unlikely to materialise. The Monetary Policy Committee left interest rates unchanged. However deputy governor Minouche Shafik suggested that interest rates would stay relatively low on a permanent basis given structural and demographic changes in the world economy and that further monetary stimulus would be needed in the UK. The Consumer Price Index measure of inflation was unchanged in August compared to July although a rise in the Producer Prices Index provided an indication that the weakness of sterling had impacted import prices. September was a relatively quiet month for trading. However, we added to the holdings in BBA Aviation and Essentra given their attractive valuations and reduced the exposure to Centrica due to concern about the company’s long term strategy and risk of political interference. We continued to write options to gently increase the income available to the trust with calls in Sage, GKN and AstraZeneca, amongst others.
Morningstar RatingTM for Funds Morningstar rates funds from one to five stars based on how well they’ve performed (after adjusting for risk and accounting for all sales charges) in comparison to similar funds. B
Twenty largest equity holdings % 4.9 4.9 4.7 4.4 3.8 3.5 3.3 3.2 3.1 3.0 2.9 2.8 2.6 2.6 2.5 2.5 2.4 2.4 2.4 2.1 64.0
British American Tobacco Unilever GlaxoSmithKline AstraZeneca Royal Dutch Shell 'B' Roche HSBC Imperial Brands Compass Vodafone Prudential BHP Billiton Sage National Grid Aberforth Smaller Companies Trust Nordea Bank Provident Financial Microsoft BP Inmarsat Total
Sector allocation % 23.2 17.6 12.5 10.7 7.5 7.1 5.1 5.1 5.0 4.5 1.7 100.0
Financials Consumer Goods Healthcare Industrials Oil & Gas Telecommunications Consumer Services Basic Materials Technology Utilities Cash Total Figures may not add up to 100 due to rounding.
Total number of investments
48
All sources (unless indicated): Aberdeen Asset Managers Limited 30 September 2016.
Fund managers' report continues overleaf Including current year revenue. B Copyright © 2016 Morningstar UK Ltd. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is not a guide to future results. A
Private investors 0500 00 00 40 Institutional investors Kenneth Harper +44 (0)131 528 4224 or Andrew Leigh +44 (0)20 7463 6312 PAGE 07 OF 56
Investment Trust
Murray Income Trust PLC Performance Data and Analytics to 30 September 2016
Fund managers’ report - continued Although the UK equity market has recovered swiftly, many uncertainties remain following the decision to leave the EU. For management teams and consumers alike the future is far from clear, a position manifested by the broad range of forecasts for UK GDP growth over the medium term. As monetary policy reaches the limits of its capabilities and effectiveness, we are likely to see the baton passed to fiscal policy to support the domestic economy. However, the lack of transparency regarding the UK’s relationship with the EU is unlikely to be easily or simply resolved. This complicates an already challenging global macro-economic picture where vulnerabilities include Europe’s banking sector, China’s credit-fuelled growth and the outcome of the Presidential election in the United States. In an environment where quantitative easing has benefited asset prices more than the real economy and with an uneven distribution of wealth, it is perhaps unsurprising to see an increase in populist political rhetoric. It is difficult to suggest that valuations in absolute terms look attractive although a more powerful argument can be made relative to government or corporate bonds but perhaps this should not be overly relied on given the current highly unorthodox setting. Indeed, in more difficult times it tends to be those companies with globally diverse revenue streams, strong competitive advantages and robust financial characteristics that perform best. We will endeavour to retain this focus as we navigate the uncharted waters ahead.
Key information Calendar Year end Accounts published Annual General Meeting Dividend paid Established Fund manager Ongoing chargesC Annual management fee
Premium/(Discount) YieldD Net gearingE Active shareF
30 June September October January, April, July, October 1923 Charles Luke 0.76% 0.55% per annum on first £400m of net assets, 0.45% on next £150m, 0.25% on excess over £550m. (8.9)% 4.5% 10.1% 62.3%
AIFMD Leverage Limits Gross Notional Commitment
2.5x 2x
Assets/Debt (£m) Gross assets Short-term borrowings Cash
589.4 56.5 2.9
Capital structure 67,150,458 1,443,000
Ordinary shares Treasury shares
Allocation of management fees and finance costs Capital Revenue
50% 50%
Trading details Reuters/Epic/Bloomberg code ISIN code Sedol code Stockbrokers Market makers
Expressed as a percentage of average daily net assets for the year ended 30 June 2016. The Ongoing Charges Figure (OCF) is the overall cost shown as a percentage of the value of the assets of the Company. It is made up of the Annual Management Fee and other charges. It does not include any costs associated with buying shares in the Company or the cost of buying and selling stocks within the Company. The Ongoing Charges figure can help you compare the annual operating expenses of different Companies. D Calculated using the Company’s historic net dividends and month end share price. E Gearing is defined as a percentage, with net debt (total debt less cash/cash equivalents) divided by shareholders’ funds. F The ‘Active Share’ percentage is a measure used to describe what proportion of the Company's holdings differ from the benchmark index holdings.
MUT GB0006111123 0611112 Canaccord Genuity SETSmm
C
The risk outlined overleaf relating to gearing is particularly relevant to the trust, but should be read in conjunction with all warnings and comments given. Important information overleaf
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Investment Trust
Murray Income Trust PLC
Important information Risk factors you should consider prior to investing: • The value of investments and the income from them can fall and investors may get back less than the amount invested. • Past performance is not a guide to future results. • Investment in the Company may not be appropriate for investors who plan to withdraw their money within 5 years. • The Company may borrow to finance further investment (gearing). The use of gearing is likely to lead to volatility in the Net Asset Value (NAV) meaning that any movement in the value of the company's assets will result in a magnified movement in the NAV. • The Company may accumulate investment positions which represent more than normal trading volumes which may make it difficult to realise investments and may lead to volatility in the market price of the Company's shares. • The Company may charge expenses to capital which may erode the capital value of the investment. • Derivatives may be used, subject to restrictions set out for the Company, in order to manage risk and generate income. The market in derivatives can be volatile and there is a higher than average risk of loss. • There is no guarantee that the market price of the Company's shares will fully reflect their underlying Net Asset Value. • As with all stock exchange investments the value of the Company's shares purchased will immediately fall by the difference between the buying and selling prices, the bid-offer spread. If trading volumes fall, the bid-offer spread can widen. • Certain trusts may seek to invest in higher yielding securities such as bonds, which are subject to credit risk, market price risk and interest rate risk. Unlike income from a single bond, the level of income from an investment trust is not fixed and may fluctuate. • Yields are estimated figures and may fluctuate, there are no guarantees that future dividends will match or exceed historic dividends and certain investors may be subject to further tax on dividends. Other important information: Issued by Aberdeen Asset Managers Limited which is authorised and regulated by the Financial Conduct Authority in the United Kingdom. Registered Office: 10 Queen’s Terrace, Aberdeen AB10 1YG. Registered in Scotland No. 108419. An investment trust should be considered only as part of a balanced portfolio. Under no circumstances should this information be considered as an offer or solicitation to deal in investments. FTSE International Limited (‘FTSE’) © FTSE 2016. ‘FTSE®’ is a trade mark of the London Stock Exchange Group companies and is used by FTSE International Limited under licence. RAFI® is a registered trademark of Research Affiliates, LLC. All rights in the FTSE indices and/ or FTSE ratings vest in FTSE and/or its licensors. Neither FTSE nor its licensors accept any liability for any errors or omissions in the FTSE indices and/or FTSE ratings or underlying data. No further distribution of FTSE Data is permitted without FTSE’s express written consent. PAGE 09 OF 56
Investment Trust
Shires Income PLC Performance Data and Analytics to 30 September 2016
Investment objective To provide a high level of income together with growth of both income and capital from a portfolio substantially invested in UK Equities.
Benchmark FTSE All-Share Index total return.
as at 30/09/16
1 month
3 months
6 months
1 year
3 years
Share Price
228.0p
1.1
12.6
16.4
7.6
15.1
71.3
NAVA
258.5p
0.4
10.5
15.8
16.6
27.3
94.8
1.7
7.8
12.8
16.8
21.1
68.9
5 years
30/09/16
30/09/15
30/09/14
30/09/13
30/09/12
7.6
(2.3)
9.6
17.3
26.8
NAV
16.6
(0.4)
9.5
24.1
23.4
FTSE All-Share
16.8
(2.3)
6.1
18.9
17.2
Discrete performance (%) Year ending:
Morningstar RatingTM for Funds Morningstar rates funds from one to five stars based on how well they’ve performed (after adjusting for risk and accounting for all sales charges) in comparison to similar funds. B
Ten largest equity holdings
Cumulative performance (%)
FTSE All-Share
Morningstar RatingTM
Share Price A
Total return; NAV to NAV, net income reinvested, GBP. Share price total return is on a mid-to-mid basis. Dividend calculations are to reinvest as at the ex-dividend date. NAV returns based on NAVs with debt valued at fair value. Source: Aberdeen Asset Managers Limited, Lipper and Morningstar. Past performance is not a guide to future results.
Fund managers’ report Equity markets made further progress during September with the FTSE All-Share Index registering a total return of 1.7%. Smaller companies were not quite as strong, though they were in positive territory recording a gain of 1.3%. The major central banks left interest rates unchanged and there is still an expectation that the Federal Reserve will increase rates in the US before the end of the year. The situation remains very different in the UK and Europe where it seems likely that it will be some time before rates move upwards and indeed there may yet be further cuts. In the portfolio we top-sliced some Centrica which despite the difficulties faced by the business had staged something of a recovery post the Brexit referendum. We also sold some calls over part of the holding. We topped up BBA which has announced the sale of its ground and fuel handling business, ASIG. This will strengthen the balance sheet in the wake of the purchase of the legacy assets. We also topped up our recent introduction Essentra, following a promising conversation with the Chairman. Lastly we sold some calls over AstraZeneca in recognition of the strong performance. Global growth looks set to improve next year aided by an ongoing recovery in the US, Russia and Brazil exiting recession and a Chinese economy that increasingly looks to have stabilised, albeit at levels of expansion below those enjoyed previously. However, the risks posed by Brexit, the fragility of the European banking system and US Presidential elections mean that there are significant uncertainties facing investors, companies and consumers.
Aberdeen Smaller Companies Income Royal Dutch Shell 'B' British American Tobacco AstraZeneca GlaxoSmithKline HSBC Unilever BHP Billiton Vodafone Chesnara Total
% 6.5 3.3 3.2 3.0 3.0 2.8 2.8 2.3 2.3 2.2 31.4
Fixed income holdings % 6.2 5.8 5.0 4.7 3.7 0.9 0.6 26.9
Ecclesiastical Insurance 8.875% Royal & Sun Alliance 7.375% General Accident 7.875% Santander 10.375% Standard Chartered 8.25% Rea Holdings 9% Balfour Beatty 10.75% Total
Sector allocation % 47.2 10.7 9.1 6.7 6.3 5.9 4.5 3.9 2.9 2.8 100.0
Financials Industrials Consumer Goods Oil & Gas Health Care Consumer Services Basic Materials Telecommunications Utilities Technology Total Figures may not add up to 100 due to rounding.
Total number of investments
48
All sources (unless indicated): Aberdeen Asset Managers Limited 30 September 2016.
Fund managers' report continues overleaf Including current year revenue. B Copyright © 2016 Morningstar UK Ltd. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is not a guide to future results. A
Private investors 0500 00 00 40 Institutional investors Kenneth Harper +44 (0)131 528 4224 or Andrew Leigh +44 (0)20 7463 6312 PAGE 10 OF 56
Investment Trust
Shires Income PLC Performance Data and Analytics to 30 September 2016
Fund managers’ report - continued OPEC has announced that it intends to reduce supply for the first time since 2008. The news has been positive for oil producers and those businesses with direct and indirect exposure to oil and gas production. The oil price has bounced strongly on the back of the news. However, history shows that compliance with quotas is often weak and it will be sometime before we know if this will genuinely lead to a structural re-balancing between supply and demand. Sterling has continued to weaken as markets have focused on the risks of a hard Brexit. It remains much too early to tell what the ramifications of leaving the EU will be though it is notable that as more data has become available some of the more downbeat commentators have been forced to shift to a less extreme position. In the meantime sterling weakness is being regarded as a positive for the profitability of many UK companies, especially larger ones and hence equity markets. That holds true to a point but devaluing the currency is not a panacea and brings with it the risk of future inflation at a time when the tools conventionally used to control rising prices are unavailable.
Key information Calendar Year end Accounts published Annual General Meeting Dividend paid Established Fund manager Ongoing chargesC Annual management fee
Premium/(Discount) YieldD Active shareE
31 March June July January, April, July, October 1929 Ed Beal 0.97% 0.45% up to £100m and 0.4% over £100m on net assets and long term borrowings (11.8)% 5.4% 58.3%
Gearing EquitiesF Total netG
(11.3)% 21.5%
AIFMD Leverage Limits Gross Notional Commitment
2.5x 2x
Assets
£’000 %
Equities (inc. Cnv's) Fixed Income Total investments Cash Other net assets Debt Net Assets
68,836 25,395 94,231 2,373 23 (19,050) 77,577
88.7 32.8 121.5 3.1 0.0 (24.6) 100.0
Capital structure Ordinary shares 3.5% Cumulative Preference shares
29,997,580 50,000
Allocation of management fees and finance costs Capital Revenue
50% 50%
Trading details
Expressed as a percentage of average daily net assets for the year ended 31 March 2016. The Ongoing Charges Figure (OCF) is the overall cost shown as a percentage of the value of the assets of the Company. It is made up of the Annual Management Fee and other charges. It does not include any costs associated with buying shares in the Company or the cost of buying and selling stocks within the Company. The Ongoing Charges figure can help you compare the annual operating expenses of different Companies. D Calculated using the Company’s historic net dividends and month end share price. E The ‘Active Share’ percentage is a measure used to describe what proportion of the Company's holdings differ from the benchmark index holdings. F Expressed as a percentage of total equities held divided by shareholders’ funds. G Net gearing is expressed as a percentage of gross assets, which includes current year revenue, less cash/cash equivalents divided by shareholders' funds. C
The risk outlined overleaf relating to gearing is particularly relevant to the trust, but should be read in conjunction with all warnings and comments given. Important information overleaf
Reuters/Epic/Bloomberg code ISIN code Sedol code Stockbrokers Market makers
SHRS GB0008052507 0805250 J.P. Morgan Cazenove CANA, CFEP, JPMS, NITE , WINS
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Investment Trust
Shires Income PLC
Important information Risk factors you should consider prior to investing: • The value of investments and the income from them can fall and investors may get back less than the amount invested. • Past performance is not a guide to future results. • Investment in the Company may not be appropriate for investors who plan to withdraw their money within 5 years. • The Company may borrow to finance further investment (gearing). The use of gearing is likely to lead to volatility in the Net Asset Value (NAV) meaning that any movement in the value of the company's assets will result in a magnified movement in the NAV. • The Company may accumulate investment positions which represent more than normal trading volumes which may make it difficult to realise investments and may lead to volatility in the market price of the Company's shares. • The Company may charge expenses to capital which may erode the capital value of the investment. • There is no guarantee that the market price of the Company's shares will fully reflect their underlying Net Asset Value. • As with all stock exchange investments the value of the Company's shares purchased will immediately fall by the difference between the buying and selling prices, the bid-offer spread. If trading volumes fall, the bid-offer spread can widen. • Certain trusts may seek to invest in higher yielding securities such as bonds, which are subject to credit risk, market price risk and interest rate risk. Unlike income from a single bond, the level of income from an investment trust is not fixed and may fluctuate. • With funds investing in bonds there is a risk that interest rate fluctuations could affect the capital value of investments. Where long term interest rates rise, the capital value of shares is likely to fall, and vice versa. In addition to the interest rate risk, bond investments are also exposed to credit risk reflecting the ability of the borrower (i.e. bond issuer) to meet its obligations (i.e. pay the interest on a bond and return the capital on the redemption date). The risk of this happening is usually higher with bonds classified as ‘sub-investment grade’. These may produce a higher level of income but at a higher risk than investments in ‘investment grade’ bonds. In turn, this may have an adverse impact on funds that invest in such bonds. • Yields are estimated figures and may fluctuate, there are no guarantees that future dividends will match or exceed historic dividends and certain investors may be subject to further tax on dividends. Other important information: Issued by Aberdeen Asset Managers Limited which is authorised and regulated by the Financial Conduct Authority in the United Kingdom. Registered Office: 10 Queen’s Terrace, Aberdeen AB10 1YG. Registered in Scotland No. 108419. An investment trust should be considered only as part of a balanced portfolio. Under no circumstances should this information be considered as an offer or solicitation to deal in investments. FTSE International Limited (‘FTSE’) © FTSE 2016. ‘FTSE®’ is a trade mark of the London Stock Exchange Group companies and is used by FTSE International Limited under licence. RAFI® is a registered trademark of Research Affiliates, LLC. All rights in the FTSE indices and/or FTSE ratings vest in FTSE and/or its licensors. Neither FTSE nor its licensors accept any liability for any errors or omissions in the FTSE indices and/ or FTSE ratings or underlying data. No further distribution of FTSE Data is permitted without FTSE’s express written consent.
PAGE 12 OF 56
Investment Trust
Aberdeen Smaller Companies Income Trust PLC Performance Data and Analytics to 30 September 2016
Investment objective To provide a high and growing dividend and capital growth from a portfolio invested principally in the ordinary shares of small companies and UK fixed income securities.
Benchmark FTSE SmallCap (ex Investment Companies) Index total return.
Morningstar RatingTM Morningstar RatingTM for Funds Morningstar rates funds from one to five stars based on how well they’ve performed (after adjusting for risk and accounting for all sales charges) in comparison to similar funds. B
Ten largest equity holdings
Cumulative performance (%) as at 30/09/16
1 month
3 months
6 months
Share Price
204.0p
2.8
13.5
8.5
(2.5)
5.7
127.0
NAVA
260.0p
2.1
13.6
9.0
9.8
30.6
126.7
1.3
12.8
8.2
10.5
27.2
123.8
30/09/16
30/09/15
30/09/14
30/09/13
30/09/12
(2.5)
16.4
(6.9)
65.8
29.5
9.8
12.1
6.1
39.2
24.7
10.5
9.0
5.6
44.9
21.4
FTSE SmallCap ex IC
1 year
3 years
5 years
Discrete performance (%) Year ending: Share Price NAV
A
FTSE SmallCap ex IC
% 3.8 3.6 3.5 3.0 2.7 2.7 2.7 2.6 2.5 2.5 29.6
RPC Dechra Pharmaceuticals XP Power James Fisher & Sons Aveva Wilmington Euromoney Institutional Investor Hansteen Chesnara Acal Total
Total return; NAV to NAV, net income reinvested, GBP. Share price total return is on a mid-to-mid basis. Dividend calculations are to reinvest as at the ex-dividend date. NAV returns based on NAVs with debt valued at fair value. Source: Aberdeen Asset Managers Limited, Lipper and Morningstar. Past performance is not a guide to future results.
Fixed income, Convertibles and Preference share holdings
Fund managers’ report
General Accident 8.875% Aviva 8.75% Balfour Beatty Cum Cnv 10.75% Ecclesiastical Insurance 8.625% Anglian Water Serv Finance 4.5% 22/02/26 Society of Lloyds 7.421% Wales & West Utilities Finance 6.75% 17/12/36 Électricité de France 6% HBOS Cap Funding 6.461% Total
The FTSE All-Share Index enjoyed a further strong month in September, rising 1.7% on a total return basis. This performance was driven by the larger constituents, with the FTSE 100 Index up 1.8% on the back of recoveries in several commodity exposed companies. Smaller companies also rose but to a lesser degree, the FTSE SmallCap ex-IC (ex-Investment Companies) index was up 1.3% with the FTSE 250 Index increasing similarly by 1.2%, total return. The Government All Stocks and UK Corporate Bond Indices retracted from the August highs with yields edging back up, posting falls of 2.3% and 1.6% respectively. During the month, OPEC members reached agreement to cut production for the first time in eight years, a move which drove an increase in oil prices back above $50 per barrel at the end of the period. This move together with some improving metals and mineral prices contributed to the outperformance of the commodity exposed companies in the month. In the UK, base rates were held and there were some positive data points regarding manufacturing, though political moves towards firming up a date to commence Brexit proceedings led to a continued slide in sterling. Portfolio activity was modest in the period. We trimmed RPC and Euromoney Institutional Investor following recent strength and reinvested proceeds into the position in Cairn Homes. We are attracted by the significant supply and demand mismatch in the Irish housing market and feel that Cairn Homes is well placed to benefit from this as they bring through production of new houses from their established landbank. Increasingly it seems that the Irish government is focusing on the housing shortage too which should provide a supportive backdrop over the coming years. As the UK continues along the path to its exit from the European Union, companies remain cautious of the domestic prospects. For exporters, the weakening sterling will likely provide a fillip though the impacts on domestic consumer demand are as yet unclear. We continue to invest in a diverse portfolio of businesses, whose prospects are tied to various markets around the world and not just the UK. As such, we remain confident that these businesses will continue to build on their established strengths and we will look to add selectively to positions where valuations present opportunity. Including current year revenue. B Copyright © 2016 Morningstar UK Ltd. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is not a guide to future results. A
% 2.3 2.2 1.6 1.3 1.0 0.9 0.9 0.8 0.7 11.7
Sector allocation % 40.6 20.6 12.4 8.1 7.0 5.1 3.1 2.5 0.5 0.1 100.0
Industrials Financials Consumer Services Health Care Consumer Goods Basic Materials Technology Telecommunications Oil & Gas Utilities Total Figures may not add up to 100 due to rounding.
Total number of investments
54
All sources (unless indicated): Aberdeen Asset Managers Limited 30 September 2016.
Private investors 0500 00 00 40 Institutional investors Kenneth Harper +44 (0)131 528 4224 or Andrew Leigh +44 (0)20 7463 6312 PAGE 13 OF 56
Investment Trust
Aberdeen Smaller Companies Income Trust PLC Performance Data and Analytics to 30 September 2016 Key information Calendar Year end Accounts published Annual General Meeting Dividend paid Established Fund manager Ongoing chargesC Annual management feeD Premium/(Discount) YieldE Active shareF
31 December March April January, April, July, October 1992 Jonathan Allison 1.50% 0.75% (21.5)% 3.3% 86.7%
Gearing EquitiesG Total netH
(2.5)% 10.3%
AIFMD Leverage Limits Gross Notional Commitment
2.5x 2x
Assets
£’000 %
Equities Convertibles Fixed Income Total investments Cash Other net assets Debt Net assets
56,071 1,009 6,353 63,433 1,101 (1) (7,000)
97.5 1.8 11.0 110.3 1.9 (12.2)
57,533
100.0
Capital structure 22,109,765
Ordinary shares
Allocation of management fees and finance costs Capital Revenue
70% 30%
Trading details Reuters/Epic/Bloomberg code ISIN code Sedol code Stockbrokers Market makers Expressed as a percentage of average daily net assets for the year ended 31 December 2015. The Ongoing Charges Figure (OCF) is the overall cost shown as a percentage of the value of the assets of the Company. It is made up of the Annual Management Fee and other charges. It does not include any costs associated with buying shares in the Company or the cost of buying and selling stocks within the Company. The Ongoing Charges figure can help you compare the annual operating expenses of different Companies. D 0.75% per annum of the value of the Company’s gross assets. E Calculated using the Company’s historic net dividends and month end share price. F The ‘Active Share’ percentage is a measure used to describe what proportion of the Company's holdings differ from the benchmark index holdings. G Expressed as a percentage of total equities held divided by shareholders' funds. H Net gearing is expressed as a percentage of gross assets, which includes current year revenue, less cash/cash equivalents divided by shareholders' funds.
ASCI GB0008063728 0806372 WINS Investment Trusts CANA, CFEP, INV, JPMS, WINS
C
The risks outlined overleaf relating to gearing and smaller companies are particularly relevant to this trust but should be read in conjunction with all warnings and comments given. Important information overleaf
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Investment Trust
Aberdeen Smaller Companies Income Trust PLC
Important information Risk factors you should consider prior to investing: • The value of investments and the income from them can fall and investors may get back less than the amount invested. • Past performance is not a guide to future results. • Investment in the Company may not be appropriate for investors who plan to withdraw their money within 5 years. • The Company may borrow to finance further investment (gearing). The use of gearing is likely to lead to volatility in the Net Asset Value (NAV) meaning that any movement in the value of the company's assets will result in a magnified movement in the NAV. • The Company may accumulate investment positions which represent more than normal trading volumes which may make it difficult to realise investments and may lead to volatility in the market price of the Company's shares. • The Company may charge expenses to capital which may erode the capital value of the investment. • The Company invests in the securities of smaller companies which are likely to carry a higher degree of risk than larger companies. • Derivatives may be used, subject to restrictions set out for the Company, in order to manage risk and generate income. The market in derivatives can be volatile and there is a higher than average risk of loss. • There is no guarantee that the market price of the Company's shares will fully reflect their underlying Net Asset Value. • As with all stock exchange investments the value of the Company's shares purchased will immediately fall by the difference between the buying and selling prices, the bid-offer spread. If trading volumes fall, the bid-offer spread can widen. • Certain trusts may seek to invest in higher yielding securities such as bonds, which are subject to credit risk, market price risk and interest rate risk. Unlike income from a single bond, the level of income from an investment trust is not fixed and may fluctuate. • With funds investing in bonds there is a risk that interest rate fluctuations could affect the capital value of investments. Where long term interest rates rise, the capital value of shares is likely to fall, and vice versa. In addition to the interest rate risk, bond investments are also exposed to credit risk reflecting the ability of the borrower (i.e. bond issuer) to meet its obligations (i.e. pay the interest on a bond and return the capital on the redemption date). The risk of this happening is usually higher with bonds classified as ‘sub-investment grade’. These may produce a higher level of income but at a higher risk than investments in ‘investment grade’ bonds. In turn, this may have an adverse impact on funds that invest in such bonds. • Specialist funds which invest in small markets or sectors of industry are likely to be more volatile than more diversified trusts. • Yields are estimated figures and may fluctuate, there are no guarantees that future dividends will match or exceed historic dividends and certain investors may be subject to further tax on dividends. Other important information: Issued by Aberdeen Asset Managers Limited which is authorised and regulated by the Financial Conduct Authority in the United Kingdom. Registered Office: 10 Queen’s Terrace, Aberdeen AB10 1YG. Registered in Scotland No. 108419. An investment trust should be considered only as part of a balanced portfolio. Under no circumstances should this information be considered as an offer or solicitation to deal in investments. FTSE International Limited (‘FTSE’) © FTSE 2016. ‘FTSE®’ is a trade mark of the London Stock Exchange Group companies and is used by FTSE International Limited under licence. RAFI® is a registered trademark of Research Affiliates, LLC. All rights in the FTSE indices and/ or FTSE ratings vest in FTSE and/or its licensors. Neither FTSE nor its licensors accept any liability for any errors or omissions in the FTSE indices and/or FTSE ratings or underlying data. No further distribution of FTSE Data is permitted without FTSE’s express written consent. PAGE 15 OF 56
Investment Trust
Dunedin Smaller Companies Investment Trust PLC Performance Data and Analytics to 30 September 2016
Investment objective
Morningstar Analyst RatingTM
The achievement of long term growth from a portfolio of smaller companies in the United Kingdom.
Benchmark FTSE SmallCap (ex Investment Companies) Index.
Morningstar Analyst Rating™ Morningstar analysts assign the ratings globally on a five-tier scale with three positive ratings of Gold, Silver and Bronze. B
Cumulative performance (%) as at 30/09/16
1 month
3 months
6 months
1 year
3 years
5 years
Share Price
204.0p
1.7
12.9
8.6
7.5
4.0
83.1
NAVA
250.1p
2.5
12.3
8.1
9.7
23.6
104.4
1.3
12.8
8.2
10.5
27.2
123.8
FTSE SmallCap ex IC
Discrete performance (%) Year ending:
30/09/16
30/09/15
30/09/14
30/09/13
30/09/12
Share Price
7.5
10.4
(12.4)
40.9
25.0
NAVA
9.7
9.3
3.0
35.0
22.5
10.5
9.0
5.6
44.9
21.4
FTSE SmallCap ex IC
Total return; NAV to NAV, net income reinvested, GBP. Share price total return is on a mid-to-mid basis. Dividend calculations are to reinvest as at the ex-dividend date. NAV returns based on NAVs with debt valued at fair value. Source: Aberdeen Asset Managers Limited, Lipper and Morningstar. Past performance is not a guide to future results.
Fund managers’ report Equity markets made further progress during September with the FTSE All-Share Index registering a total return of 1.7%. Smaller companies were not quite as strong though they were in positive territory recording a gain of 1.3%. The major central banks left interest rates unchanged and there is still an expectation that the Federal Reserve will increase rates in the US before the end of the year. The situation remains very different in the UK and Europe where it seems likely that it will be some time before rates move upwards and indeed there may yet be further cuts. There was limited activity in the portfolio during the month. RPC, the plastic packaging company, continued to perform strongly and we took some profits from this holding. Global growth looks set to improve next year aided by an ongoing recovery in the US, Russia and Brazil exiting recession and a Chinese economy that increasingly looks to have stabilised, albeit at levels of expansion below those enjoyed previously. However, the risks posed by Brexit, the fragility of the European banking system and US Presidential elections mean that there are significant uncertainties facing investors, companies and consumers. OPEC has announced that it intends to reduce supply for the first time since 2008. The news has been positive for oil producers and those businesses with direct and indirect exposure to oil and gas production. The oil price has bounced strongly on the back of the news. However, history shows that compliance with quotas is often weak and it will be sometime before we know if this will genuinely lead to a structural re-balancing between supply and demand. Sterling has continued to weaken as markets have focused on the risks of a hard Brexit. It remains much too early to tell what the ramifications of leaving the EU will be though it is notable that as more data has become available some of the more downbeat commentators have been forced to shift to a less extreme position. In the meantime sterling weakness is being regarded as a positive for the profitability of many UK companies, especially larger ones and hence equity markets. That holds true to a point but devaluing the currency is not a panacea and brings with it the risk of future inflation at a time when the tools conventionally used to control rising prices are unavailable. Including current year revenue. B Copyright © 2016 Morningstar UK Ltd. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is not a guide to future results. A
Morningstar RatingTM Morningstar RatingTM for Funds Morningstar rates funds from one to five stars based on how well they’ve performed (after adjusting for risk and accounting for all sales charges) in comparison to similar funds. B
Ten largest equity holdings % 4.1 3.9 3.6 3.2 3.2 3.0 2.9 2.9 2.9 2.8 32.5
RPC Dechra Pharmaceuticals XP Power James Fisher & Sons Euromoney Institutional Investor Smart Metering Systems Aveva Wilmington Acal Hansteen Total
Sector allocation % 42.4 14.2 12.7 8.1 6.4 4.9 2.9 1.9 0.8 5.7 100.0
Industrials Financials Consumer Services Health Care Consumer Goods Basic Materials Technology Telecommunications Oil & Gas Cash Total Figures may not add up to 100 due to rounding.
Total number of investments
43
All sources (unless indicated): Aberdeen Asset Managers Limited 30 September 2016.
Private investors 0500 00 00 40 Institutional investors Andrew Leigh +44 (0)20 7463 6312 or Kenneth Harper +44 (0)131 528 4224 PAGE 16 OF 56
Investment Trust
Dunedin Smaller Companies Investment Trust PLC Performance Data and Analytics to 30 September 2016 Key information Calendar Year end Accounts published Annual General Meeting Dividend paid Established Fund manager Ongoing chargesC (excluding performance fees) Ongoing chargesC (including performance fees) Annual management feeD Premium/(Discount) YieldE Gearing Active shareF
31 October January February February, July 1927 Ed Beal 0.81% 1.03% 0.4% of adjusted gross assets (18.4)% 2.9% nil 86.6%
AIFMD Leverage Limits Gross Notional Commitment
2.5x 2x
Assets/Debt (£m) Gross assets Debt Cash
124.7 5.0 7.3
Capital structure 47,857,317
Ordinary shares
Allocation of management fees and finance costs Capitalz Revenue
75% 25%
Trading details Reuters/Epic/Bloomberg code ISIN code Sedol code Stockbrokers Market makers
C Expressed as a percentage of average daily net assets for the year ended 31 October 2015. The Ongoing Charges Figure (OCF) is the overall cost shown as a percentage of the value of the assets of the Company. It is made up of the Annual Management Fee and other charges. It does not include any costs associated with buying shares in the Company or the cost of buying and selling stocks within the Company. The Ongoing Charges figure can help you compare the annual operating expenses of different Companies. D With performance fee element maximum annual management fee is capped at 0.9% of adjusted gross assets in any one year. E Calculated using the Company’s historic net dividends and month end share price. F The ‘Active Share’ percentage is a measure used to describe what proportion of the Company's holdings differ from the benchmark index holdings.
The risks outlined overleaf relating to gearing and smaller companies are particularly relevant to this trust but should be read in conjunction with all warnings and comments given. Important information overleaf
DNDL GB00B1GCL258 B1GCL25 Cantor Fitzgerald Europe SETSmm
Receive the factsheet by email as soon as it is available by registering at www.invtrusts.co.uk/ITemail www.dunedinsmaller.co.uk PAGE 17 OF 56
Investment Trust
Dunedin Smaller Companies Investment Trust PLC
Important information Risk factors you should consider prior to investing: • The value of investments and the income from them can fall and investors may get back less than the amount invested. • Past performance is not a guide to future results. • Investment in the Company may not be appropriate for investors who plan to withdraw their money within 5 years. • The Company may borrow to finance further investment (gearing). The use of gearing is likely to lead to volatility in the Net Asset Value (NAV) meaning that any movement in the value of the company's assets will result in a magnified movement in the NAV. • The Company may accumulate investment positions which represent more than normal trading volumes which may make it difficult to realise investments and may lead to volatility in the market price of the Company's shares. • The Company may charge expenses to capital which may erode the capital value of the investment. • The Company invests in the securities of smaller companies which are likely to carry a higher degree of risk than larger companies. • There is no guarantee that the market price of the Company's shares will fully reflect their underlying Net Asset Value. • As with all stock exchange investments the value of the Company's shares purchased will immediately fall by the difference between the buying and selling prices, the bid-offer spread. If trading volumes fall, the bid-offer spread can widen. • In the event that certain performance criteria are met the Company will pay its investment manager an additional management fee. Details of the criteria to be met and the amount of any payment are given in the Company's annual report. • Specialist funds which invest in small markets or sectors of industry are likely to be more volatile than more diversified trusts. • Yields are estimated figures and may fluctuate, there are no guarantees that future dividends will match or exceed historic dividends and certain investors may be subject to further tax on dividends. Other important information: Issued by Aberdeen Asset Managers Limited which is authorised and regulated by the Financial Conduct Authority in the United Kingdom. Registered Office: 10 Queen’s Terrace, Aberdeen AB10 1YG. Registered in Scotland No. 108419. An investment trust should be considered only as part of a balanced portfolio. Under no circumstances should this information be considered as an offer or solicitation to deal in investments. FTSE International Limited (‘FTSE’) © FTSE 2016. ‘FTSE®’ is a trade mark of the London Stock Exchange Group companies and is used by FTSE International Limited under licence. RAFI® is a registered trademark of Research Affiliates, LLC. All rights in the FTSE indices and/ or FTSE ratings vest in FTSE and/or its licensors. Neither FTSE nor its licensors accept any liability for any errors or omissions in the FTSE indices and/or FTSE ratings or underlying data. No further distribution of FTSE Data is permitted without FTSE’s express written consent. PAGE 18 OF 56
Investment Company
Aberdeen Asian Income Fund Limited Performance Data and Analytics to 30 September 2016
Investment objective To provide investors with a total return primarily through investing in Asian Pacific securities, including those with an above average yield. Within its overall investment objective, the Company aims to grow its dividends over time.
Benchmark
Morningstar Analyst RatingTM
Morningstar Analyst Rating™ Morningstar analysts assign the ratings globally on a five-tier scale with three positive ratings of Gold, Silver and Bronze. B
The Company’s portfolio is constructed without reference to the composition of any stock market index or benchmark. It is likely, therefore, that there will be periods when its performance will be quite unlike that of any index or benchmark and there can be no assurance that such divergence will be wholly or even primarily to the Company’s advantage. The Company and Manager measure its performance against the MSCI AC Asia Pacific ex Japan Index (in sterling terms).
Cumulative performance (%) as at 30/09/16
Morningstar RatingTM Morningstar RatingTM for Funds Morningstar rates funds from one to five stars based on how well they’ve performed (after adjusting for risk and accounting for all sales charges) in comparison to similar funds. B
Ten largest holdings
1 month
3 months
6 months
1 year
3 years
5 years
30/09/16
30/09/15
30/09/14
30/09/13
Share Price
35.1
(19.3)
(0.8)
4.8
36.3
NAVA
34.8
(14.8)
2.9
6.5
32.3
Venture Corporation SingTel Oversea-Chinese Banking Corp. Taiwan Semiconductor Manufacturing HSBC Taiwan Mobile Jardine Cycle & Carriage China Mobile Tesco Lotus Retail Growth Heineken Malaysia
MSCI AC Asia Pacific ex Japan
38.1
(8.2)
6.1
7.1
16.5
Total
Share Price
198.8p
1.9
11.6
25.8
35.1
8.2
54.4
NAVA
210.5p
1.1
9.5
18.7
34.8
18.1
66.5
2.6
13.0
22.2
38.1
34.5
67.7
MSCI AC Asia Pacific ex Japan
Discrete performance (%) Year ending:
30/09/12
Total return; NAV to NAV, net income reinvested, GBP. Share price total return is on a mid-to-mid basis. Dividend calculations are to reinvest as at the ex-dividend date. NAV returns based on NAVs with debt valued at fair value. Source: Aberdeen Asset Managers Limited, Lipper and Morningstar. Past performance is not a guide to future results.
Fund managers’ report Market review Asian equity markets rose in September, ending the quarter on a high note. Sentiment was buoyed by the US Federal Reserve’s decision to keep interest rates unchanged and the Bank of Japan’s (BOJ) policy review. But gains were pared at the month-end, as enthusiasm over possible production cuts by major oil exporters receded and worries over Deutsche Bank’s troubles rattled financial stocks worldwide. Portfolio review Samsung Electronics is discontinuing production of its Galaxy Note 7 smartphone, after several reported incidents of replacement units also catching fire. In early September, the company swiftly recalled and replaced faulty batches but the problems persisted. While management has yet to define the cost of the exercise, the financial impact should be manageable for the company, given its hefty cash reserves. Furthermore, terminating production now and writing off the cost of the Note 7 range allows Samsung to focus its attention on developing the next generation of handsets due in 2017, and should lessen the impact on its brand over the long term. HSBC bought back 3.27 million shares at 575.20 pence each, as part of its strategy to boost shareholders’ value. The bank's financial position remains robust.
Country Singapore Singapore Singapore Taiwan
% 3.8 3.5 3.4 3.2
Hong Kong Taiwan Singapore Hong Kong Thailand Malaysia
3.2 3.2 3.1 2.9 2.7 2.6 31.6
Country allocation (%)
Singapore Australia Thailand Hong Kong Malaysia Taiwan Japan China New Zealand Indonesia Korea United Kingdom India Sri Lanka Philippines Cash Total
Trust 25.6 16.7 11.7 10.6 6.8 6.4 6.1 4.6 2.6 2.5 1.7 1.1 1.0 0.9 – 1.7 100.0
Regional Index 3.5 20.4 2.0 9.7 2.5 11.2 – 24.8 0.6 2.5 13.7 – 7.8 – 1.2 – 100.0
Month’s market change 2.5 3.3 (2.7) 4.5 (2.1) 3.8 – 3.4 0.9 2.9 2.2 – (0.1) – (4.8) –
Month’s market change represents the individual country returns calculated using the MSCI Index series (£). Market change is Total Return in GBP. Index may not add up to 100 due to rounding. Source: Aberdeen Asset Managers Limited and MSCI.
Total number of investments
58
All sources (unless indicated): Aberdeen Asset Managers Limited 30 September 2016.
Fund managers' report continues overleaf Including current year revenue. B Copyright © 2016 Morningstar UK Ltd. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is not a guide to future results. A
Private investors 0500 00 00 40 Institutional investors Jonathon McManus +44 (0)20 7618 1444 or Colin Edge +44 (0)20 7463 5881 PAGE 19 OF 56
Investment Company
Aberdeen Asian Income Fund Limited Performance Data and Analytics to 30 September 2016
Fund managers’ report - continued In portfolio activity, we trimmed the position in Giordano on price strength. Against this we added to Okinawa Cellular, the company is the dominant player mobile operator in the province, with a strong net cash balance sheet allowing greater flexibility for a more attractive dividend, we continue to engage the management on this front. Elsewhere, we also added to Thai media company BEC World, a position we had trimmed after a strong run last year but with the market correcting this year, valuations have returned to more attractive levels. Outlook Historically low interest rates in the developed world have driven investors to Asia and the wider emerging markets in search of better yields. However, key risks persist. Of continued concern is the prospect of a tighter US monetary policy, with the Federal Reserve signalling that a rate hike at the year-end is likely (we expect the same). Although a repeat of the ‘taper tantrum’ is not expected, this could stoke market volatility and send capital flows back to the US. An unexpected outcome of the presidential election could trigger further bouts of volatility, as it risks disrupting America’s longstanding trade and security arrangements with Asia. Meanwhile, worries over China’s rapid credit expansion and industrial overcapacity remain, even though steadier economic activity has eased fears of a hard landing lately. Add to that the murky outlook for exports, which much of Asia still relies on economically, and there is plenty to keep investors on tenterhooks in the coming months. For us, the focus remains on finding quality holdings with solid fundamentals that will help them withstand the testing times ahead.
Fund risk statistics 3 Years Annualised Standard Deviation of Fund Beta Sharpe Ratio Annualised Tracking Error Annualised Information Ratio R-Squared
12.44 0.81 0.50 4.92 (0.64) 0.90
5 Years 12.17 0.73 0.81 6.72 0.27 0.81
Source: Aberdeen Asset Management, BPSS & Thomson Reuters Datastream. Basis: Total Return, Gross of Fees, GBP. Please note that risk analytics figures are calculated on gross returns whereas the performance figures are based on net asset value(NAV) returns. In addition, the risk analytics figures lag the performance figures by a month.
Key information Calendar Year end Accounts published Annual General Meeting Dividend paid Launch date Fund manager Ongoing chargesC Annual management feeD Premium/(Discount) YieldE Net gearingF Active shareG
31 December April May February, May, August, November December 2005 Asian Equities Team 1.25% 0.85% (5.6)% 4.3% 7.6% 85.4%
AIFMD Leverage Limits Gross Notional Commitment
2.5x 2x
Assets/Debt (£m) Equities Fixed Income Debt Cash
402.9 22.8 39.4 9.2
Capital structure Ordinary shares Treasury Shares
187,833,389 7,100,000
Allocation of management fees and finance costs Capital Revenue
60% 40%
Borrowing policy Up to 25% of net assets (measured at the time any borrowings are drawn down).
Trading details Expressed as a percentage of average daily net assets for the year ended 31 December 2015. The Ongoing Charges Figure (OCF) is the overall cost shown as a percentage of the value of the assets of the Company. It is made up of the Annual Management Fee and other charges. It does not include any costs associated with buying shares in the Company or the cost of buying and selling stocks within the Company. The Ongoing Charges figure can help you compare the annual operating expenses of different Companies. D With effect from 1 June 2016 the annual management fee was reduced from 1.0% to 0.85% of net assets. E Calculated using the Company’s historic net dividends and month end share price. F Net gearing is expressed as a percentage of gross assets, which includes current year revenue, less cash/cash equivalents divided by shareholders' funds. G The ‘Active Share’ percentage is a measure used to describe what proportion of the Company's holdings differ from the benchmark index holdings. C
The risks outlined overleaf relating to gearing, emerging markets, exchange rate movements and warrants are particularly relevant to this investment company but should be read in conjunction with all warnings and comments given. Important information overleaf
Reuters/Epic/Bloomberg code ISIN code Sedol code Stockbrokers Market makers
AAIF GB00B0P6J834 B0P6J83 Cantor Fitzgerald Europe SETSmm
Receive the factsheet by email as soon as it is available by registering at www.invtrusts.co.uk/ITemail www.asian-income.co.uk PAGE 20 OF 56
Investment Company
Aberdeen Asian Income Fund Limited
Important information Risk factors you should consider prior to investing: • The value of investments and the income from them can fall and investors may get back less than the amount invested. • Past performance is not a guide to future results. • Investment in the Company may not be appropriate for investors who plan to withdraw their money within 5 years. • The Company may borrow to finance further investment (gearing). The use of gearing is likely to lead to volatility in the Net Asset Value (NAV) meaning that any movement in the value of the company's assets will result in a magnified movement in the NAV. • The Company may accumulate investment positions which represent more than normal trading volumes which may make it difficult to realise investments and may lead to volatility in the market price of the Company's shares. • The Company may charge expenses to capital which may erode the capital value of the investment. • Movements in exchange rates will impact on both the level of income received and the capital value of your investment. • There is no guarantee that the market price of the Company's shares will fully reflect their underlying Net Asset Value. • As with all stock exchange investments the value of the Company's shares purchased will immediately fall by the difference between the buying and selling prices, the bid-offer spread. If trading volumes fall, the bid-offer spread can widen. • The Company invests in emerging markets which tend to be more volatile than mature markets and the value of your investment could move sharply up or down. • Yields are estimated figures and may fluctuate, there are no guarantees that future dividends will match or exceed historic dividends and certain investors may be subject to further tax on dividends. Other important information: Issued by Aberdeen Asset Managers Limited which is authorised and regulated by the Financial Conduct Authority in the United Kingdom. Registered Office: 10 Queen’s Terrace, Aberdeen AB10 1YG. Registered in Scotland No. 108419. An investment company should be considered only as part of a balanced portfolio. Under no circumstances should this information be considered as an offer or solicitation to deal in investments. The MSCI information may only be used for your internal use, may not be reproduced or redisseminated in any form and may not be used as a basis for or a component of any financial instruments or products or indices. None of the MSCI information is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such. Historical data and analysis, should not be taken as an indication or guarantee of any future performance analysis forecast or prediction. The MSCI information is provided on an “as is” basis and the user of this information assumes the entire risk of any use made of this information. MSCI, each of its affiliates and each other person involved in or related to compiling, computing or creating any MSCI information (collectively, the “MSCI” Parties) expressly disclaims all warranties (including without limitation, any warranties of originality, accuracy, completeness, timeliness, non-infringement, merchantability and fitness for a particular purpose) with respect to this information. Without limiting any of the foregoing, in no event shall any MSCI Party have any liability for any direct, indirect, special, incidental, punitive, consequential (including, without limitation, lost profits) or any other damages (www.msci.com). PAGE 21 OF 56
Investment Trust
Aberdeen Asian Smaller Companies Investment Trust PLC Performance Data and Analytics to 30 September 2016
Investment objective The objective of Aberdeen Asian Smaller Companies Investment Trust PLC is to maximise total return to shareholders over the long term from a portfolio of smaller quoted companies (with a market capitalisation of up to approximately US$1 billion at the time of investment) in the economies of Asia and Australasia, outside Japan.
Comparative benchmark
Morningstar Analyst RatingTM
Morningstar Analyst Rating™ Morningstar analysts assign the ratings globally on a five-tier scale with three positive ratings of Gold, Silver and Bronze. B
There has not always been a meaningful smaller companies index against which to compare the performance of the Company. Accordingly, the Manager utilises two general regional indices, the MSCI AC Asia Pacific ex Japan (currency adjusted) and the MSCI AC Asia Pacific ex Japan SmallCap (currency adjusted), as well as peer group comparisons for Board reporting. It is likely that performance will diverge, possibly quite dramatically in either direction, from these or any other indices.
Morningstar RatingTM
Cumulative performance (%)
LPI Capital Bank OCBC Multi Bintang AEON Co Hana Microelectronics Dah Sing Financial Ramco Cements Yoma Strategic CEBU Jollibee Foods Total
as at 30/09/16
3 months
6 months
1 year
3 years
939.0p
(1.6)
10.0
19.6
36.2
4.4
70.9
1089.1p
(0.4)
10.2
21.1
35.4
23.2
91.7
MSCI AC Asia Pacific ex Japan
2.6
13.0
22.2
38.1
34.5
67.7
MSCI AC Asia Pacific ex Japan SmallCap
2.3
11.0
19.8
34.6
32.4
59.3
Share Price Diluted NAVA
1 month
5 years
Discrete performance (%) Year ending:
30/09/16
30/09/15
30/09/14
30/09/13
30/09/12
Share Price
36.2
(27.5)
5.8
16.1
40.9
Diluted NAVA
35.4
(16.2)
8.6
16.3
33.8
MSCI AC Asia Pacific ex Japan
38.1
(8.2)
6.1
7.1
16.5
MSCI AC Asia Pacific ex Japan SmallCap
34.6
(7.9)
6.8
8.0
11.4
Total return; NAV to NAV, net income reinvested, GBP. Share price total return is on a mid-to-mid basis. Dividend calculations are to reinvest as at the ex-dividend date. NAV returns based on NAVs with debt valued at fair value. Source: Aberdeen Asset Managers Limited and Morningstar. Past performance is not a guide to future results.
Fund managers’ report Market review Asian small-cap stocks extended their gains in September, ending the quarter on a high note. Sentiment was buoyed by the US Federal Reserve’s decision to keep interest rates unchanged and the Bank of Japan’s policy review. But gains were pared at the month-end, as enthusiasm over possible production cuts by major oil exporters receded and worries over Deutsche Bank’s troubles rattled financial stocks worldwide. Portfolio review In portfolio-related news, YNH Property’s results exceeded our expectations, owing to sales from Fraser Residence, lower costs and a better showing from its hotels and hospitality division. However, its gearing remains high and the revenue outlook remains uncertain, given a subdued residential property market. During the month, we took some profits from AEON Thana following a sharp run-up in its share price and pared First Sponsor and Tisco Financial. Against this, we added to Convenience Retail Asia on recent price weakness.
Morningstar RatingTM for Funds Morningstar rates funds from one to five stars based on how well they’ve performed (after adjusting for risk and accounting for all sales charges) in comparison to similar funds. B
Ten largest equity holdings Country Malaysia Indonesia Indonesia Malaysia Thailand Hong Kong India Singapore Philipines Philipines
% 3.3 3.1 3.1 3.0 2.9 2.8 2.7 2.5 2.3 2.3 28.0
Country allocation (%)
Malaysia Hong Kong Thailand India Singapore Indonesia Philippines Sri Lanka Australia New Zealand Denmark United Kingdom China Pakistan Korea Taiwan Cash Total
Trust 17.8 15.6 12.0 11.2 11.1 8.0 7.1 3.5 3.3 2.4 1.7 1.3 0.7 0.4 0.2 – 3.7 100.0
Regional Index 2.5 9.7 2.0 7.8 3.5 2.5 1.2 – 20.4 0.6 – – 24.8 – 13.7 11.2 – 100.0
Month’s market change (2.1) 4.5 (2.7) (0.1) 2.5 2.9 (4.8) – 3.3 0.9 – – 3.4 – 2.2 3.8 –
Month’s market change represents the individual country returns calculated using the MSCI Index series (£). Market change is Total Return in GBP. Index may not add up to 100 due to rounding. Source: Aberdeen Asset Managers Limited and MSCI.
Total number of investments
77
All sources (unless indicated): Aberdeen Asset Managers Limited 30 September 2016.
Fund managers' report continues overleaf Including current year revenue. B Copyright © 2016 Morningstar UK Ltd. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is not a guide to future results. A
Private investors 0500 00 00 40 Institutional investors Andrew Leigh +44 (0)20 7463 6312 or Kenneth Harper +44 (0)131 528 4224 PAGE 22 OF 56
Investment Trust
Aberdeen Asian Smaller Companies Investment Trust PLC Performance Data and Analytics to 30 September 2016
Fund managers’ report - continued
Outlook Historically low interest rates in the developed world have driven investors to Asia and the wider emerging markets in search of better yields. However, key risks persist. Of continued concern is the prospect of a tighter US monetary policy, with the Federal Reserve signalling that a rate hike at the year-end is likely (we expect the same). Although a repeat of the ‘taper tantrum’ is not expected, this could stoke market volatility and send capital flows back to the US. An unexpected outcome of the presidential election could trigger further bouts of volatility, as it risks disrupting America’s longstanding trade and security arrangements with Asia. Meanwhile, worries over China’s rapid credit expansion and industrial overcapacity remain, even though steadier economic activity has eased fears of a hard landing lately. Add to that the murky outlook for exports, which much of Asia still relies on economically, and there is plenty to keep investors on tenterhooks in the coming months. For us, the focus remains on finding quality holdings with solid fundamentals that will help them withstand the testing times ahead.
Fund risk statistics Annualised Standard Deviation of Fund Beta Sharpe Ratio Annualised Tracking Error Annualised Information Ratio R-Squared
3 Years
5 Years
12.19 0.74 0.72 6.93 (0.12) 0.78
13.10 0.67 0.98 9.75 0.47 0.59
Source: Aberdeen Asset Management, BPSS & Thomson Reuters Datastream. Basis: Total Return, Gross of Fees, GBP. Please note that risk analytics figures are calculated on gross returns whereas the performance figures are based on net asset value(NAV) returns. In addition, the risk analytics figures lag the performance figures by a month.
Key information Calendar Year end Accounts published Annual General Meeting Dividend paid Launch date Fund manager Ongoing chargesC Annual management feeD Premium/(Discount) with debt at fair value YieldE Net gearing with debt at parF Active shareG
31 July October December December October 1995 Asian Equities Team 1.46% 1.0% (13.8)% 1.6% 7.1% 98.8%
AIFMD Leverage Limits Gross Notional Commitment
2.5x 2x
Assets/Debt (£m) Gross assets 443.9 Debt (CULS plus bank loan) at nominal value 45.0 Cash 16.5
Capital structure Ordinary shares Treasury shares Convertible Unsecured Loan Stock 2019 (CULS) at nominal value
35,678,834 3,498,624 £33,040,814
Allocation of management fees and finance costs Capital Revenue Expressed as a percentage of average daily net assets for the year ended 31 July 2015. The Ongoing Charges Figure (OCF) is the overall cost shown as a percentage of the value of the assets of the Company. It is made up of the Annual Management Fee and other charges. It does not include any costs associated with buying shares in the Company or the cost of buying and selling stocks within the Company. The Ongoing Charges figure can help you compare the annual operating expenses of different Companies. D With effect from 1 August 2016 1.0% (previously 1.2%) of the average net asset value of the Company's net assets (gross assets less liabilities excluding the amount of any loan facilities or overdraft drawn down) over a 24 month period, valued monthly. E Calculated using the Company’s historic net dividends and month end share price. F Net gearing is expressed as a percentage of gross assets, which includes current year revenue, less cash/cash equivalents divided by shareholders' funds. G The ‘Active Share’ percentage is a measure used to describe what proportion of the Company's holdings differ from the benchmark index holdings. C
The risks outlined overleaf relating to gearing, emerging markets, small companies and exchange rate movements are particularly relevant to this trust but should be read in conjunction with all warnings and comments given. Important information overleaf
0% 100%
Trading details Reuters/Epic/Bloomberg code ISIN code Sedol code Stockbrokers Market makers
AAS GB0000100767 0010076 Panmure Gordon SETSmm
Receive the factsheet by email as soon as it is available by registering at www.invtrusts.co.uk/ITemail www.asian-smaller.co.uk PAGE 23 OF 56
Investment Trust
Aberdeen Asian Smaller Companies Investment Trust PLC
Important information Risk factors you should consider prior to investing: • The value of investments and the income from them can fall and investors may get back less than the amount invested. • Past performance is not a guide to future results. • Investment in the Company may not be appropriate for investors who plan to withdraw their money within 5 years. • The Company may borrow to finance further investment (gearing). The use of gearing is likely to lead to volatility in the Net Asset Value (NAV) meaning that any movement in the value of the company's assets will result in a magnified movement in the NAV. • The Company may accumulate investment positions which represent more than normal trading volumes which may make it difficult to realise investments and may lead to volatility in the market price of the Company's shares. • The Company may charge expenses to capital which may erode the capital value of the investment. • The Company invests in the securities of smaller companies which are likely to carry a higher degree of risk than larger companies. • Movements in exchange rates will impact on both the level of income received and the capital value of your investment. • There is no guarantee that the market price of the Company's shares will fully reflect their underlying Net Asset Value. • As with all stock exchange investments the value of the Company's shares purchased will immediately fall by the difference between the buying and selling prices, the bid-offer spread. If trading volumes fall, the bid-offer spread can widen. • The Company invests in emerging markets which tend to be more volatile than mature markets and the value of your investment could move sharply up or down. • Specialist funds which invest in small markets or sectors of industry are likely to be more volatile than more diversified trusts. • Yields are estimated figures and may fluctuate, there are no guarantees that future dividends will match or exceed historic dividends and certain investors may be subject to further tax on dividends. Other important information: Issued by Aberdeen Asset Managers Limited which is authorised and regulated by the Financial Conduct Authority in the United Kingdom. Registered Office: 10 Queen’s Terrace, Aberdeen AB10 1YG. Registered in Scotland No. 108419. An investment trust should be considered only as part of a balanced portfolio. Under no circumstances should this information be considered as an offer or solicitation to deal in investments. The MSCI information may only be used for your internal use, may not be reproduced or redisseminated in any form and may not be used as a basis for or a component of any financial instruments or products or indices. None of the MSCI information is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such. Historical data and analysis, should not be taken as an indication or guarantee of any future performance analysis forecast or prediction. The MSCI information is provided on an “as is” basis and the user of this information assumes the entire risk of any use made of this information. MSCI, each of its affiliates and each other person involved in or related to compiling, computing or creating any MSCI information (collectively, the “MSCI” Parties) expressly disclaims all warranties (including without limitation, any warranties of originality, accuracy, completeness, timeliness, non-infringement, merchantability and fitness for a particular purpose) with respect to this information. Without limiting any of the foregoing, in no event shall any MSCI Party have any liability for any direct, indirect, special, incidental, punitive, consequential (including, without limitation, lost profits) or any other damages (www.msci.com). PAGE 24 OF 56
Investment Trust
Aberdeen New Dawn Investment Trust PLC Performance Data and Analytics to 30 September 2016
Investment objective The objective of Aberdeen New Dawn Investment Trust PLC is to provide shareholders with a high level of capital growth through equity investment in the Asia Pacific countries excluding Japan.
Morningstar Analyst Rating™ Morningstar analysts assign the ratings globally on a five-tier scale with three positive ratings of Gold, Silver and Bronze. B
Benchmark MSCI AC Asia Pacific ex Japan. This benchmark includes Australia and New Zealand.
Morningstar RatingTM
Cumulative performance (%) as at 30/09/16
1 month
3 months
6 months
1 year
3 years
186.5p
1.9
13.8
26.3
32.1
13.8
38.4
NAVA
216.7p
2.0
10.4
23.6
33.2
21.0
49.8
2.6
13.0
22.2
38.1
34.5
67.7
5 years
Discrete performance (%) Year ending:
30/09/16
30/09/15
30/09/14
30/09/13
Share Price
32.1
(16.6)
3.4
7.9
30/09/12 12.7
NAVA
33.2
(14.5)
6.3
3.6
19.5
MSCI AC Asia Pacific ex Japan
38.1
(8.2)
6.1
7.1
16.5
Total return; NAV to NAV, net income reinvested, GBP. Share price total return is on a mid-to-mid basis. Dividend calculations are to reinvest as at the ex-dividend date. NAV returns based on NAVs with debt valued at fair value. Source: Aberdeen Asset Managers Limited, Lipper and Morningstar. Past performance is not a guide to future results.
Fund managers’ report Market review Asian equity markets rose in September, ending the quarter on a high note. Sentiment was buoyed by the US Federal Reserve’s decision to keep interest rates unchanged and the Bank of Japan’s (BOJ) policy review. But gains were pared at the month-end, as enthusiasm over possible production cuts by major oil exporters receded and worries over Deutsche Bank’s troubles rattled financial stocks worldwide. Portfolio review Samsung Electronics is discontinuing production of its Galaxy Note 7 smartphone, after several reported incidents of replacement units also catching fire. In early September, the company swiftly recalled and replaced faulty batches but the problems persisted. While management has yet to define the cost of the exercise, the financial impact should be manageable for the company, given its hefty cash reserves. Furthermore, terminating production now and writing off the cost of the Note 7 range allows Samsung to focus its attention on developing the next generation of handsets due in 2017, and should lessen the impact on its brand over the long term. HSBC bought back 3.27 million shares at 575.20 pence each, as part of its strategy to boost shareholders’ value. The bank's financial position remains robust. We continued building our position in Indonesia’s Bank Central Asia, which has a conservative track record and good asset quality. We also topped up CSL on price weakness. While the company’s results were weaker than expected, the correction in its share price was overdone as the core business remains robust. CSL is the world's lowest cost producer of blood products with a strong R&D pipeline. Fund managers' report continues overleaf Including current year revenue. Copyright © 2016 Morningstar UK Ltd. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is not a guide to future results. C Excluded for the purposes of calculating the investment management fee. B
Morningstar RatingTM for Funds Morningstar rates funds from one to five stars based on how well they’ve performed (after adjusting for risk and accounting for all sales charges) in comparison to similar funds. B
Share Price
MSCI AC Asia Pacific ex Japan
A
Morningstar Analyst RatingTM
Ten largest equity holdings Aberdeen Global-Indian EquityC Samsung Electronics Pref Jardine Strategic Oversea-Chinese Banking Corp. AIA Taiwan Semiconductor Ayala Land Rio Tinto City Developments HSBC Total
Country India Korea Hong Kong Singapore Hong Kong Taiwan Philippines Australia Singapore Hong Kong
% 10.5 5.4 5.0 4.2 3.9 3.8 3.6 3.2 3.0 2.9 45.5
Country allocation (%)
Hong Kong Singapore India Australia Korea China Taiwan United Kingdom Philippines Indonesia Thailand Sri Lanka Malaysia Vietnam New Zealand Cash Total
Trust 21.2 18.7 12.2 8.3 8.1 5.8 5.7 4.0 3.6 3.3 2.7 2.0 1.8 0.5 – 2.1 100.0
Regional Index 9.7 3.5 7.8 20.4 13.7 24.8 11.2 – 1.2 2.5 2.0 – 2.5 – 0.6 – 100.0
Month’s market change 4.5 2.5 (0.1) 3.3 2.2 3.4 3.8 – (4.8) 2.9 (2.7) – (2.1) – 0.9 –
Month’s market change represents the individual country total return calculated using the MSCI Index series Capital GBP. Figures may not add up to 100 due to rounding. Source: Aberdeen Asset Managers Limited and MSCI.
Total number of investments
53
All sources (unless indicated): Aberdeen Asset Managers Limited 30 September 2016.
Private investors 0500 00 00 40 Institutional investors Andrew Leigh +44 (0)20 7463 6312 or Kenneth Harper +44 (0)131 528 4224 PAGE 25 OF 56
Investment Trust
Aberdeen New Dawn Investment Trust PLC Performance Data and Analytics to 30 September 2016
Fund managers’ report - continued
Outlook Historically low interest rates in the developed world have driven investors to Asia and the wider emerging markets in search of better yields. However, key risks persist. Of continued concern is the prospect of a tighter US monetary policy, with the Federal Reserve signalling that a rate hike at the year-end is likely (we expect the same). Although a repeat of the ‘taper tantrum’ is not expected, this could stoke market volatility and send capital flows back to the US. An unexpected outcome of the presidential election could trigger further bouts of volatility, as it risks disrupting America’s longstanding trade and security arrangements with Asia. Meanwhile, worries over China’s rapid credit expansion and industrial overcapacity remain, even though steadier economic activity has eased fears of a hard landing lately. Add to that the murky outlook for exports, which much of Asia still relies on economically, and there is plenty to keep investors on tenterhooks in the coming months. For us, the focus remains on finding quality holdings with solid fundamentals that will help them withstand the testing times ahead.
Fund risk statistics 3 Years Annualised Standard Deviation of Fund Beta Sharpe Ratio Annualised Tracking Error Annualised Information Ratio R-Squared
13.73 0.89 0.50 4.59 (0.52) 0.90
5 Years 13.71 0.86 0.48 4.99 (0.20) 0.89
Source: Aberdeen Asset Management, BPSS & Thomson Reuters Datastream. Basis: Total Return, Gross of Fees, GBP. Please note that risk analytics figures are calculated on gross returns whereas the performance figures are based on net asset value(NAV) returns. In addition, the risk analytics figures lag the performance figures by a month.
Key information Calendar Year end Accounts published Annual General Meeting Dividend paid Launch date Fund manager Ongoing chargesD Annual management feeE Premium/(Discount) YieldF Net gearingG Active shareH
30 April July August January, September May 1989 Asian Equities Team 1.08% 0.85% of net assets (13.9)% 2.1% 9.2% 77.4%
AIFMD Leverage Limits Gross Notional Commitment
2.5x 2x
Assets/Debt (£m) Gross assets Debt Cash
287.3 29.5 5.9
Capital structure Ordinary shares Treasury shares
118,869,510 8,066,155
Allocation of management fees and finance costs (%) Capital Revenue
50% 50%
Trading details
Expressed as a percentage of average daily net assets for the year ended 30 April 2016. The Ongoing Charges Figure (OCF) is the overall cost shown as a percentage of the value of the assets of the Company. It is made up of the Annual Management Fee and other charges. It does not include any costs associated with buying shares in the Company or the cost of buying and selling stocks within the Company. The Ongoing Charges figure can help you compare the annual operating expenses of different Companies. E With effect from 1 July 2016. Previously 1.0% of net assets. F Calculated using the Company’s historic net dividends and month end share price. G Net gearing is expressed as a percentage of gross assets, which includes current year revenue, less cash/cash equivalents divided by shareholders' funds. H The ‘Active Share’ percentage is a measure used to describe what proportion of the Company's holdings differ from the benchmark index holdings. D
The risks outlined overleaf relating to gearing, emerging markets and exchange rate movements are particularly relevant to this trust but should be read in conjunction with all warnings and comments given. Important information overleaf
Reuters/Epic/Bloomberg code ISIN code Sedol code Stockbrokers Market makers
ABD GB00BBM56V29 BBM56V2 Cantor Fitzgerald Europe SETSmm
Receive the factsheet by email as soon as it is available by registering at www.invtrusts.co.uk/ITemail www.newdawn-trust.co.uk PAGE 26 OF 56
Investment Trust
Aberdeen New Dawn Investment Trust PLC
Important information Risk factors you should consider prior to investing: • The value of investments and the income from them can fall and investors may get back less than the amount invested. • Past performance is not a guide to future results. • Investment in the Company may not be appropriate for investors who plan to withdraw their money within 5 years. • The Company may borrow to finance further investment (gearing). The use of gearing is likely to lead to volatility in the Net Asset Value (NAV) meaning that any movement in the value of the company's assets will result in a magnified movement in the NAV. • The Company may accumulate investment positions which represent more than normal trading volumes which may make it difficult to realise investments and may lead to volatility in the market price of the Company's shares. • The Company may charge expenses to capital which may erode the capital value of the investment. • Movements in exchange rates will impact on both the level of income received and the capital value of your investment. • There is no guarantee that the market price of the Company's shares will fully reflect their underlying Net Asset Value. • As with all stock exchange investments the value of the Company's shares purchased will immediately fall by the difference between the buying and selling prices, the bid-offer spread. If trading volumes fall, the bid-offer spread can widen. • The Company invests in emerging markets which tend to be more volatile than mature markets and the value of your investment could move sharply up or down. • Yields are estimated figures and may fluctuate, there are no guarantees that future dividends will match or exceed historic dividends and certain investors may be subject to further tax on dividends. Other important information: Issued by Aberdeen Asset Managers Limited which is authorised and regulated by the Financial Conduct Authority in the United Kingdom. Registered Office: 10 Queen’s Terrace, Aberdeen AB10 1YG. Registered in Scotland No. 108419. An investment trust should be considered only as part of a balanced portfolio. Under no circumstances should this information be considered as an offer or solicitation to deal in investments. The MSCI information may only be used for your internal use, may not be reproduced or redisseminated in any form and may not be used as a basis for or a component of any financial instruments or products or indices. None of the MSCI information is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such. Historical data and analysis, should not be taken as an indication or guarantee of any future performance analysis forecast or prediction. The MSCI information is provided on an “as is” basis and the user of this information assumes the entire risk of any use made of this information. MSCI, each of its affiliates and each other person involved in or related to compiling, computing or creating any MSCI information (collectively, the “MSCI” Parties) expressly disclaims all warranties (including without limitation, any warranties of originality, accuracy, completeness, timeliness, non-infringement, merchantability and fitness for a particular purpose) with respect to this information. Without limiting any of the foregoing, in no event shall any MSCI Party have any liability for any direct, indirect, special, incidental, punitive, consequential (including, without limitation, lost profits) or any other damages (www.msci.com). PAGE 27 OF 56
Investment Trust
Edinburgh Dragon Trust plc Performance Data and Analytics to 30 September 2016
Investment objective To achieve long term capital growth through investment in the Far East. The company’s benchmark is the MSCI AC Asia ex Japan Index. Investments are made mainly in stock markets in the region, with the exception of Japan and Australasia, principally in large companies. When appropriate, the trust will utilise gearing to maximise long term returns.
Benchmark MSCI AC Asia ex Japan Index. This benchmark excludes Japan, Australia, New Zealand and Sri Lanka.
Cumulative performance (%) as at 30/09/16
1 month
3 months
6 months
1 year
3 years
5 years
Share Price
303.0p
0.3
9.0
23.2
35.5
19.7
53.8
NAV
348.6p
1.5
9.8
23.2
35.5
26.1
57.6
2.5
13.5
22.6
36.6
39.3
69.7
30/09/14
30/09/13
30/09/12
A
MSCI AC Asia ex Japan
Discrete performance (%) Year ending:
30/09/16
30/09/15
Share Price
35.5
(15.7)
4.9
6.7
20.5
NAVA
35.5
(12.4)
6.3
2.9
21.4
MSCI AC Asia ex Japan
36.6
(6.0)
8.4
5.3
15.7
Total return; NAV to NAV, net income reinvested, GBP. Share price total return is on a mid-to-mid basis. Dividend calculations are to reinvest as at the ex-dividend date. NAV returns based on NAVs with debt valued at fair value. Source: Aberdeen Asset Managers Limited, Lipper and Morningstar. Past performance is not a guide to future results.
Morningstar Analyst RatingTM
Morningstar Analyst Rating™ Morningstar analysts assign the ratings globally on a five-tier scale with three positive ratings of Gold, Silver and Bronze. B
Morningstar RatingTM Morningstar RatingTM for Funds Morningstar rates funds from one to five stars based on how well they’ve performed (after adjusting for risk and accounting for all sales charges) in comparison to similar funds. B
Ten largest equity holdings Samsung Electronics Pref. Jardine Strategic Taiwan Semiconductor Housing Development Finance Oversea-Chinese Banking Corp. AIA SingTel United Overseas Bank City Developments Siam Cement Total
Country Korea Hong Kong Taiwan India Singapore Hong Kong Singapore Singapore Singapore Thailand
% 5.9 4.4 4.3 4.0 4.0 3.9 3.2 3.1 3.0 3.0 38.8
Country allocation (%)
Fund managers’ report Market r eview Asian equity markets rose in September, ending the third quarter on a high note. Sentiment was buoyed by the US Federal Reserve’s decision to keep interest rates unchanged and the Bank of Japan’s (BOJ) monetary policy review. But gains were pared at the month-end, as enthusiasm over possible production cuts by major oil exporters receded and worries over Deutsche Bank’s troubles rattled financial stocks worldwide. Portfolio review Samsung Electronics is discontinuing production of its Galaxy Note 7 smartphone, after several reported incidents of replacement units also catching fire. In early September, the company swiftly recalled and replaced faulty batches but the problems persisted. While management has yet to define the cost of the exercise, the financial impact should be manageable for the company, given its hefty cash reserves. Furthermore, terminating production now and writing off the cost of the Note 7 range allows Samsung to focus its attention on developing the next generation of handsets due in 2017, and should lessen the impact on its brand over the long term. HSBC bought back 3.27 million shares at 575.20 pence each, as part of its strategy to boost shareholders’ value. The bank's financial position remains robust.
Hong Kong Singapore India Korea Taiwan China Indonesia Philippines Malaysia Thailand Sri Lanka United Kingdom Vietnam Cash Total
Trust 22.5 18.6 16.4 9.8 6.7 5.1 4.6 4.2 3.7 3.0 2.4 2.0 0.5 0.5 100.0
Month’s Regional market Index changeC 12.3 4.5 4.5 2.5 9.9 (0.1) 17.3 2.2 14.2 3.8 31.4 3.4 3.2 2.9 1.6 (4.8) 3.1 (2.1) 2.6 (2.7) – – – – – – – – 100.0
Source: Aberdeen Asset Managers Limited and MSCI. Figures may not add up to 100 due to rounding.
Total number of investments
63
In portfolio activity, we continued building our position in Indonesia’s Bank Central Asia, which has a conservative track record and good asset quality. Against that, we trimmed Singapore bank UOB. Fund managers' report continues overleaf Including current year revenue. Copyright © 2016 Morningstar UK Ltd. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is not a guide to future results. C Represents the individual country returns calculated using the MSCI Index Series (£). Market change is total return in GBP. A B
All sources (unless indicated): Aberdeen Asset Managers Limited 30 September 2016.
Private investors 0500 00 00 40 Institutional investors Kenneth Harper +44 (0)131 528 4224 or Andrew Leigh +44 (0)20 7463 6312 PAGE 28 OF 56
Investment Trust
Edinburgh Dragon Trust plc Performance Data and Analytics to 30 September 2016
Fund managers’ report - continued
Outlook Historically low interest rates in the developed world have driven investors to Asia and the wider emerging markets in search of better yields. However, key risks persist. Of continued concern is the prospect of a tighter US monetary policy, with the Federal Reserve signalling that a rate hike at the year-end is likely (we expect the same). Although a repeat of the ‘taper tantrum’ is not expected, this could stoke market volatility and send capital flows back to the US. An unexpected outcome of the presidential election could trigger further bouts of volatility, as it risks disrupting America’s longstanding trade and security arrangements with Asia. Meanwhile, worries over China’s rapid credit expansion and industrial overcapacity remain, even though steadier economic activity has eased fears of a hard landing lately. Add to that the murky outlook for exports, which much of Asia still relies on economically, and there is plenty to keep investors on tenterhooks in the coming months. For us, the focus remains on finding quality holdings with solid fundamentals that will help them withstand the testing times ahead.
Fund risk statistics Annualised Standard Deviation of Fund Beta Sharpe Ratio Annualised Tracking Error Annualised Information Ratio R-Squared
3 Years 14.03 0.89 0.62 4.85 (0.35) 0.89
5 Years 13.85 0.87 0.58 4.91 – 0.89
Source: Aberdeen Asset Management, BPSS & Thomson Reuters Datastream. Basis: Total Return, Gross of Fees, GBP. Please note that risk analytics figures are calculated on gross returns whereas the performance figures are based on net asset value(NAV) returns. In addition, the risk analytics figures lag the performance figures by a month.
Key information Calendar Year end 31 August Accounts published November Annual General Meeting December Dividend paid December Launch date 1987 Fund manager Adrian Lim Ongoing chargesE 1.15% 0.85% on net assets Annual management fee Premium/(Discount) with debt at fair value (13.1)% YieldF 1.0% Net gearing with debt at parG 7.8% Active shareH 75.6%
AIFMD Leverage Limits Gross Notional Commitment
2.5x 2x
Assets/Debt (£m) GrossI Debt (CULS) at nominal value Cash
730.4 59.8 7.6
Capital structure Ordinary shares Treasury shares 3.5% Convertible Unsecured Loan Stock 2018 (CULS) at nominal value
190,509,202 5,521,300 £59,778,788
Allocation of management fees and finance costs Revenue
100%
Trading details Reuters/Epic/Bloomberg code ISIN code Sedol code Stockbrokers Expressed as a percentage of average daily net assets for the year ended 31 August 2015. The Ongoing Charges Figure (OCF) is the overall cost shown as a percentage of the value of the assets of the Company. It is made up of the Annual Management Fee and other charges. It does not include any costs associated with buying shares in the Company or the cost of buying and selling stocks within the Company. The Ongoing Charges figure can help you compare the annual operating expenses of different Companies. F Calculated using the Company’s historic net dividends and month end share price. G Gearing is expressed as a percentage of gross assets, which includes current year revenue, divided by shareholders' funds. H The ‘Active Share’ percentage is a measure used to describe what proportion of the Company's holdings differ from the benchmark index holdings. I Includes current year revenue. E
The risks outlined overleaf relating to gearing, exchange rate movements and emerging markets are particularly relevant to this trust but should be read in conjunction with all warnings and comments made. Important information overleaf
Market makers
EFM GB0002945029 0294502 WINS Investment Trusts SETSmm
Receive the factsheet by email as soon as it is available by registering at www.invtrusts.co.uk/ITemail www.edinburghdragon.co.uk PAGE 29 OF 56
Investment Trust
Edinburgh Dragon Trust plc
Important information Risk factors you should consider prior to investing: • The value of investments and the income from them can fall and investors may get back less than the amount invested. • Past performance is not a guide to future results. • Investment in the Company may not be appropriate for investors who plan to withdraw their money within 5 years. • The Company may borrow to finance further investment (gearing). The use of gearing is likely to lead to volatility in the Net Asset Value (NAV) meaning that any movement in the value of the company's assets will result in a magnified movement in the NAV. • The Company may accumulate investment positions which represent more than normal trading volumes which may make it difficult to realise investments and may lead to volatility in the market price of the Company's shares. • Movements in exchange rates will impact on both the level of income received and the capital value of your investment. • There is no guarantee that the market price of the Company's shares will fully reflect their underlying Net Asset Value. • As with all stock exchange investments the value of the Company's shares purchased will immediately fall by the difference between the buying and selling prices, the bid-offer spread. If trading volumes fall, the bid-offer spread can widen. • The Company invests in emerging markets which tend to be more volatile than mature markets and the value of your investment could move sharply up or down. • Yields are estimated figures and may fluctuate, there are no guarantees that future dividends will match or exceed historic dividends and certain investors may be subject to further tax on dividends. Other important information: Issued by Aberdeen Asset Managers Limited which is authorised and regulated by the Financial Conduct Authority in the United Kingdom. Registered Office: 10 Queen’s Terrace, Aberdeen AB10 1YG. Registered in Scotland No. 108419. An investment trust should be considered only as part of a balanced portfolio. Under no circumstances should this information be considered as an offer or solicitation to deal in investments. The MSCI information may only be used for your internal use, may not be reproduced or redisseminated in any form and may not be used as a basis for or a component of any financial instruments or products or indices. None of the MSCI information is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such. Historical data and analysis, should not be taken as an indication or guarantee of any future performance analysis forecast or prediction. The MSCI information is provided on an “as is” basis and the user of this information assumes the entire risk of any use made of this information. MSCI, each of its affiliates and each other person involved in or related to compiling, computing or creating any MSCI information (collectively, the “MSCI” Parties) expressly disclaims all warranties (including without limitation, any warranties of originality, accuracy, completeness, timeliness, non-infringement, merchantability and fitness for a particular purpose) with respect to this information. Without limiting any of the foregoing, in no event shall any MSCI Party have any liability for any direct, indirect, special, incidental, punitive, consequential (including, without limitation, lost profits) or any other damages (www.msci.com). PAGE 30 OF 56
Investment Trust
Aberdeen New Thai Investment Trust PLC Performance Data and Analytics to 30 September 2016
Investment objective To provide a high level of long-term, above-average capital growth through investment in Thailand.
Morningstar Analyst RatingTM Morningstar Analyst Rating™ Morningstar analysts assign the ratings globally on a five-tier scale with three positive ratings of Gold, Silver and Bronze. B
Morningstar RatingTM
Benchmark Stock Exchange of Thailand Index (currency adjusted).
Morningstar RatingTM for Funds Morningstar rates funds from one to five stars based on how well they’ve performed (after adjusting for risk and accounting for all sales charges) in comparison to similar funds. B
Cumulative performance (%) as at 30/09/16
1 month
3 months
6 months
1 year
3 years
5 years
Ordinary share price
472.4p
(1.1)
8.2
17.8
36.0
25.7
96.2
NAV
553.4p
(2.3)
6.9
16.1
33.2
23.1
95.4
(3.3)
8.2
20.9
38.9
33.3
106.1
30/09/12
A
SET Index
Discrete performance (%) Year ending:
30/09/16
30/09/15
30/09/14
30/09/13
Ordinary share price
36.0
(16.8)
11.0
10.7
41.1
NAVA
33.2
(16.8)
11.1
11.3
42.5
SET Index
38.9
(16.1)
14.4
7.7
43.6
Total return; NAV to NAV, net income reinvested, GBP. Share price total return is on a mid-to-mid basis. Dividend calculations are to reinvest as at the ex-dividend date. NAV returns based on NAVs with debt valued at fair value. Source: Aberdeen Asset Managers Limited, Lipper and Morningstar. Past performance is not a guide to future results.
Fund managers’ report Market Review Thai equities succumbed to profit taking in September, exacerbated by domestic concerns. The correction was welcomed to a degree; markets had become frothy amid a period of sustained inflows. The Bank of Thailand upped its full year economic growth forecast to 3.2% in light of a robust current account and better than expected private consumption. However, household finances remain stretched, despite debt levels easing slightly to 81.3% of GDP in the second quarter. This could stifle consumption over the longer term. Exports staged a notable recovery in August, although a significant portion of the 6.5% headline growth was flattered by the inclusion of July’s auto shipments following technical issues. Nevertheless, normalised exports grew for the first time in five months, on the back of electronics and construction materials. Portfolio review Bangkok Dusit Medical Services (BDMS) acquired a hotel in central Bangkok for 10.8 billion baht. It will spend around 2 billion baht redeveloping the site into a health and wellness centre, focused on preventive medicine and longevity treatments. While the investment is expected to increase BDMS’s leverage, it remains manageable and well within the company’s required limits. Coal-miner Banpu will sell around 22% of subsidiary Banpu Power (Banpu-P) to list it on Thailand’s stock exchange, at an indicative price of between 18-21 baht per share. The final price will be determined by investor demand. We will take our full entitlement, based on our holding in parent Banpu.
Ten largest equity holdings % 5.9 5.3 4.9 4.9 4.5 4.2 3.7 3.6 3.6 3.5 44.1
Siam Cement Big C Supercenter Kasikornbank Bangkok Insurance Siam Commercial Bank Advanced Information AEON Thana Sinsap Home Product Center Hana Microelectronics PTT Exploration and Production Total
Sector allocation (%) Banking Energy & Utilities Construction Materials Insurance Commerce Property Development Finance & Securities Media & Publishing Automotive Information & Communications Technology Healthcare Services Food & Beverages Electronic Components Property Fund Packaging Transportation & Logistics Other Cash Total
Trust Benchmark weight weight 16.2 14.3 13.6 17.1 11.4 6.2 9.2 1.2 8.8 10.2 6.4 6.7 4.9 2.0 4.5 1.5 4.3 0.5 4.2 3.8 3.6 3.6 2.1 2.1 – – 1.3 100.0
8.8 4.9 6.9 1.5 2.9 0.4 7.3 7.5 – 100.0
Source: Aberdeen Asset Managers Ltd and Bloomberg. Figures may not add up to 100 due to rounding.
Total number of investments
40
Fund managers' report continues overleaf Including current year revenue. Copyright © 2016 Morningstar UK Ltd. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is not a guide to future results.
A B
The risks outlined overleaf relating to gearing, emerging markets and exchange rate movements are particularly relevant to this trust but should be read in conjunction with all warnings and comments given. Important information overleaf
All sources (unless indicated): Aberdeen Asset Managers Limited 30 September 2016.
Private investors 0500 00 00 40 Institutional investors Andrew Leigh +44 (0)20 7463 6312 or Kenneth Harper +44 (0)131 528 4224 PAGE 31 OF 56
Investment Trust
Aberdeen New Thai Investment Trust PLC Performance Data and Analytics to 30 September 2016
Fund managers’ report - continued Siam Commercial Bank (SCB) will lend up to 42.5 billion baht to Pete Bodharamik, chief executive and largest shareholder of Jasmine International (JAS), to enable him to buy the outstanding shares in the Bangkok-based telecoms company. Meanwhile, SCB plans to lower its provisions in the remainder of the year, while maintaining 130% coverage. There were no major portfolio moves in September. Outlook The passing on 13 October of the highly-revered King Bhumibol is not expected to have a long-term impact on Thailand’s stock market or economy, even though markets had been volatile for several weeks in the lead-up. Domestic activity, particularly in the consumer and hospitality sectors, is likely to soften in the short term as the kingdom grieves. However, the government has indicated any mourning-period restrictions will not be detrimental to tourism or the economy over the longer term. Meanwhile, we expect a smooth transition. Crown Prince Maha Vajiralongkorn, the designated successor, has asked that his accession be delayed while he and the nation mourn the King. Expressed as a percentage of average daily net assets for the year ended 28 February 2016. The Ongoing Charges Figure (OCF) is the overall cost shown as a percentage of the value of the assets of the Company. It is made up of the Annual Management Fee and other charges. It does not include any costs associated with buying shares in the Company or the cost of buying and selling stocks within the Company. The Ongoing Charges figure can help you compare the annual operating expenses of different Companies. D Calculated using the Company’s historic net dividends and month end share price. E Net gearing is expressed as a percentage of gross assets, which includes current year revenue, less cash/cash equivalents divided by shareholders' funds. F The ‘Active Share’ percentage is a measure used to describe what proportion of the Company's holdings differ from the benchmark index holdings. C
Important information Risk factors you should consider prior to investing: • The value of investments and the income from them can fall and investors may get back less than the amount invested. • Past performance is not a guide to future results. • Investment in the Company may not be appropriate for investors who plan to withdraw their money within 5 years. • The Company may borrow to finance further investment (gearing). The use of gearing is likely to lead to volatility in the Net Asset Value (NAV) meaning that any movement in the value of the company's assets will result in a magnified movement in the NAV. • The Company may accumulate investment positions which represent more than normal trading volumes which may make it difficult to realise investments and may lead to volatility in the market price of the Company's shares. • Movements in exchange rates will impact on both the level of income received and the capital value of your investment. • There is no guarantee that the market price of the Company's shares will fully reflect their underlying Net Asset Value. • As with all stock exchange investments the value of the Company's shares purchased will immediately fall by the difference between the buying and selling prices, the bid-offer spread. If trading volumes fall, the bid-offer spread can widen. • The Company invests in emerging markets which tend to be more volatile than mature markets and the value of your investment could move sharply up or down. • Specialist funds which invest in small markets or sectors of industry are likely to be more volatile than more diversified trusts. • Yields are estimated figures and may fluctuate, there are no guarantees that future dividends will match or exceed historic dividends and certain investors may be subject to further tax on dividends. Other important information: Issued by Aberdeen Asset Managers Limited which is authorised and regulated by the Financial Conduct Authority in the United Kingdom. Registered Office: 10 Queen’s Terrace, Aberdeen AB10 1YG. Registered in Scotland No. 108419. An investment trust should be considered only as part of a balanced portfolio. Under no circumstances should this information be considered as an offer or solicitation to deal in investments.
Fund risk statistics 3 Years Annualised Standard Deviation of Fund Beta Sharpe Ratio Annualised Tracking Error Annualised Information Ratio R-Squared
15.77 0.88 0.66 4.99 (0.45) 0.92
5 Years 17.85 0.88 0.77 6.62 0.15 0.88
Source: Aberdeen Asset Management, BPSS & Thomson Reuters Datastream. Basis: Total Return, Gross of Fees, GBP. Please note that risk analytics figures are calculated on gross returns whereas the performance figures are based on net asset value(NAV) returns. In addition, the risk analytics figures lag the performance figures by a month.
Key information Calendar Year end Accounts published Annual General Meeting Dividend paid Launch date Fund manager Ongoing chargesC Annual management fee Premium/(Discount) YieldD Net gearingE Active shareF
28 February May June July December 1989 Asian Equities Team 1.45% 1.0% (14.6)% 1.8% 1.4% 73.2%
AIFMD Leverage Limits Gross Notional Commitment
2.5x 2x
Assets/Debt (£m) Gross assets Debt Cash
109.9 2.7 1.2
Capital structure Ordinary shares
19,388,282
Allocation of management fees and finance costs Revenue
100%
Trading details Reuters/Epic/Bloomberg code ISIN code Sedol code Market makers Stockbrokers
ANW GB0000059971 0005997 CANA, CFEP, CNKS, INV, WINS, NUMS Numis Securities
Receive the factsheet by email as soon as it is available by registering at www.invtrusts.co.uk/ITemail www.newthai-trust.co.uk PAGE 32 OF 56
Investment Trust
New India Investment Trust PLC Performance Data and Analytics to 30 September 2016
Investment objective
Morningstar RatingTM
To achieve long-term capital appreciation by investing in companies which are incorporated in India or which derive significant revenue or profit from India, with dividend yield from the company being of secondary importance.
Morningstar RatingTM for Funds Morningstar rates funds from one to five stars based on how well they’ve performed (after adjusting for risk and accounting for all sales charges) in comparison to similar funds. B
Benchmark The Company compares its performance to the MSCI India Index (sterling adjusted). However, the Company’s portfolio is constructed without reference to the composition of any stock market index or benchmark. It is likely, therefore, that there will be periods when its performance may vary significantly from the benchmark.
Cumulative performance (%) as at 30/09/16 1 month 3 months 6 months
Since portfolio change 5 years 31/01/05
YTD
1 year
3 years
Share Price
380.8p
(1.9)
7.0
21.5
17.9
24.4
95.3
79.3
303.5
NAVA
440.0p
(1.2)
6.4
21.5
23.7
28.1
91.3
84.3
377.7
(0.1)
9.0
21.6
21.5
23.8
71.3
55.2
337.2
MSCI India
Discrete performance (%)
Year ending:
Since portfolio change 31/01/05 30/09/12 annualised
30/09/16
30/09/15
30/09/14
30/09/13
Share Price
24.4
7.4
46.2
(11.2)
3.4
12.7
NAVA
28.1
7.3
39.2
(8.7)
5.5
14.3
MSCI India
23.8
0.7
37.5
(12.7)
3.7
13.5
Total return; NAV to NAV, net income reinvested, GBP. Share price total return is on a mid-to-mid basis. Dividend calculations are to reinvest as at the ex-dividend date. NAV returns based on NAVs with debt valued at fair value. Source: Aberdeen Asset Managers Limited, Lipper and Morningstar. Past performance is not a guide to future results.
Fund managers’ report Market Review After a sustained rally, the Indian stock market was flat in September, on concerns that valuations had outpaced earnings. Investors were also spooked by heightened tensions with Pakistan over the disputed Kashmir region. The escalating fracas prompted India’s pull-out from a regional summit and it may re-examine a water-sharing treaty with its neighbour. The government appointed three academics to join new Reserve Bank of India governor Urjit Patel and two other central bank officials on the Monetary Policy Committee, in formulating interest rate decisions and inflation targeting. At the time of writing, the committee cut rates by 25 basis points at its first meeting.
Fifteen largest equity holdings % 8.8 7.3 6.9 5.0 4.6 4.0 4.0 3.7 3.7 3.6 3.6 3.5 3.5 3.3 3.2 68.7
Housing Development Finance Tata Consultancy Services Infosys ITC Grasim Industries Piramal Enterprises Kotak Mahindra Bank Ambuja Cements Godrej Consumer Products Hero MotoCorp Bosch Kansai Nerolac Paints Sun Pharmaceutical ICICI Bank Hindustan Unilever Total
Sector allocation (%) Financials Materials Information Technology Consumer Staples Health Care Consumer Discretionary Industrials Telecommunication Services Utilities Energy Cash Total
Trust Benchmark 20.6 21.7 17.9 7.3 16.7 16.9 16.4 9.6 13.2 10.4 7.3 14.3 4.4 6.1 1.7 2.7 1.3 1.9 0.2 9.1 0.3 – 100.0 100.0
Source: Aberdeen Asset Managers Limited and Bloomberg. Figures may not add up to 100 due to rounding.
Total number of investments
38
In economic news, inflation eased by more than expected in August, aided by slower rises in food prices. Manufacturing growth decelerated in September, but export orders rose the most in over a year. Portfolio review In September, we added to Sun Pharmaceutical as valuations were relatively attractive. We also topped up Bharti Infratel on share price weakness. We feel the market’s negative reaction to its new rate card approach was exaggerated, and believe the company remains a good proxy for tapping into local data growth. Fund managers' report continues overleaf Including current year revenue. Copyright © 2016 Morningstar UK Ltd. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is not a guide to future results.
A B
All sources (unless indicated): Aberdeen Asset Managers Limited 30 September 2016.
Private investors 0500 00 00 40 Institutional investors Jonathon McManus +44 (0)20 7618 1444 or Colin Edge +44 (0)20 7463 5881 PAGE 33 OF 56
Investment Trust
New India Investment Trust PLC Performance Data and Analytics to 30 September 2016
Fund managers’ report - continued In corporate news, Gujarat Gas reported healthy second quarter profit growth, as lower gas costs offset declining volumes in both the residential and industrial divisions. BP sold an 8.5% stake in Castrol India to shore up its capital position. BP retains a 51% controlling stake in the company, and reaffirmed its commitment to long-term investment in India. Elsewhere, Grasim Industries relaxed the foreign institutional investor limit from 24% to 30%, pending shareholder approval. We believe our holding, Bharti Airtel, remains well positioned to face intensifying competition from the launch of Reliance Industries’ Jio telecommunications unit. Although there may be short term pressure on revenues, we think that in the long term, the industry could benefit from the shake out of weaker operators. Outlook A slew of reforms passed by the Modi government in the last few months have made many investors sit up and take notice of India once again. The groundbreaking Goods and Services Tax bill, together with a focused monetary policy team, smoother foreign investment regulations and a new bankruptcy code, have restored confidence in the prime minister’s ability to liberalise the Indian economy and ease the costs of doing business. Meanwhile, consumption spending is likely to stay buoyant, with the Diwali shopping season well underway and retailers vying for consumer dollars. A good monsoon bodes well for expectations of a pick-up in rural demand. The ‘Make in India’ campaign has already seen some success in attracting foreign investment. And the tough clean-up of the banking sector is making some progress. However, challenges remain, particularly in the areas of land and labour reform. In addition, escalating geopolitical strife and external uncertainties, such as ongoing Brexit volatility and the potential outcome of the upcoming US election, could yet have an adverse impact on India. Nevertheless, we continue to seek and hold local companies with efficient operations, good management and the potential to provide robust returns over the long term.
Fund risk statistics Annualised Standard Deviation of Fund Beta Sharpe Ratio Annualised Tracking Error Annualised Information Ratio R-Squared
3 Years
5 Years
18.41 0.96 1.54 4.53 1.34 0.94
19.21 0.85 0.71 6.35 0.73 0.92
Source: Aberdeen Asset Management, BPSS & Thomson Reuters Datastream.Basis: Total Return, Gross of Fees, GBP. Please note that risk analytics figures are calculated on gross returns whereas the performance figures are based on net asset value(NAV) returns. In addition, the risk analytics figures lag the performance figures by a month.
Key information Calendar Year end Accounts published Annual General Meeting Dividend paid
31 March June September n/a
Launch date Original trust February 1994 Name change/reconstruction December 2004 Fund manager Asian Equities Team Ongoing chargesC 1.36% Annual management feeD 1.0% Premium/(Discount) YieldE Gearing Active shareF
(13.5)% 0.0% nil 60.5%
AIFMD Leverage Limits Gross Notional Commitment
2.5x 2x
Assets/Debt (£m) Gross assets Debt Cash
259.9 0.0 2.9
Capital structure Ordinary shares
59,070,140
Allocation of management fees and finance costs Revenue
100%
Trading details
Expressed as a percentage of average daily net assets for the year ended 31 March 2016. The Ongoing Charges Figure (OCF) is the overall cost shown as a percentage of the value of the assets of the Company. It is made up of the Annual Management Fee and other charges. It does not include any costs associated with buying shares in the Company or the cost of buying and selling stocks within the Company. The Ongoing Charges figure can help you compare the annual operating expenses of different Companies. D The basic management fee is 1% of total assets less current liabilities per annum. E Calculated using the Company’s historic net dividends and month end share price. F The ‘Active Share’ percentage is a measure used to describe what proportion of the Company's holdings differ from the benchmark index holdings. C
The risks outlined overleaf relating to gearing, warrants, emerging markets, small companies and exchange rate movements are particularly relevant to this trust but should be read in conjunction with all warnings and comments given. Important information overleaf
Reuters/Epic/Bloomberg code NII ISIN code GB0006048770 Sedol code 0604877 Stockbrokers WINS Investment Trusts Market makers CANA, CFEP, INV, JPMS, NITE, PEEL, STFL, WINS, WEST
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Investment Trust
New India Investment Trust PLC
Important information Risk factors you should consider prior to investing: • The value of investments and the income from them can fall and investors may get back less than the amount invested. • Past performance is not a guide to future results. • Investment in the Company may not be appropriate for investors who plan to withdraw their money within 5 years. • The Company may borrow to finance further investment (gearing). The use of gearing is likely to lead to volatility in the Net Asset Value (NAV) meaning that any movement in the value of the company's assets will result in a magnified movement in the NAV. • The Company may accumulate investment positions which represent more than normal trading volumes which may make it difficult to realise investments and may lead to volatility in the market price of the Company's shares. • Movements in exchange rates will impact on both the level of income received and the capital value of your investment. • There is no guarantee that the market price of the Company's shares will fully reflect their underlying Net Asset Value. • As with all stock exchange investments the value of the Company's shares purchased will immediately fall by the difference between the buying and selling prices, the bid-offer spread. If trading volumes fall, the bid-offer spread can widen. • The Company invests in emerging markets which tend to be more volatile than mature markets and the value of your investment could move sharply up or down. • Yields are estimated figures and may fluctuate, there are no guarantees that future dividends will match or exceed historic dividends and certain investors may be subject to further tax on dividends. Other important information: Issued by Aberdeen Asset Managers Limited which is authorised and regulated by the Financial Conduct Authority in the United Kingdom. Registered Office: 10 Queen’s Terrace, Aberdeen AB10 1YG. Registered in Scotland No. 108419. An investment trust should be considered only as part of a balanced portfolio. Under no circumstances should this information be considered as an offer or solicitation to deal in investments. The MSCI information may only be used for your internal use, may not be reproduced or redisseminated in any form and may not be used as a basis for or a component of any financial instruments or products or indices. None of the MSCI information is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such. Historical data and analysis, should not be taken as an indication or guarantee of any future performance analysis forecast or prediction. The MSCI information is provided on an “as is” basis and the user of this information assumes the entire risk of any use made of this information. MSCI, each of its affiliates and each other person involved in or related to compiling, computing or creating any MSCI information (collectively, the “MSCI” Parties) expressly disclaims all warranties (including without limitation, any warranties of originality, accuracy, completeness, timeliness, non-infringement, merchantability and fitness for a particular purpose) with respect to this information. Without limiting any of the foregoing, in no event shall any MSCI Party have any liability for any direct, indirect, special, incidental, punitive, consequential (including, without limitation, lost profits) or any other damages (www.msci.com). PAGE 35 OF 56
Investment Company
Aberdeen Emerging Markets Investment Company Limited Performance Data and Analytics to 30 September 2016
Investment objective To achieve consistent returns for shareholders in excess of the MSCI Emerging Markets Net Total Return Index in sterling terms.
Benchmark MSCI Emerging Markets Net Total Return Index in sterling terms.
as at 30/09/16
1 month
3 months
6 months
1 year
3 years
Share Price
499.00p
3.9
11.9
21.8
32.5
17.4
21.7
NAVA
583.84p
1.8
11.9
22.2
36.5
23.6
34.5
2.5
11.8
21.4
36.1
22.6
38.9
5 years
Discrete performance (%) Year ending:
30/09/16
30/09/15
30/09/14
30/09/13
30/09/12
Share Price
32.5
(14.1)
3.2
1.9
1.8
NAVA
36.5
(12.7)
3.7
2.0
6.7
Composite BenchmarkB
36.1
(13.5)
4.1
0.9
12.3
Total return; NAV to NAV, net income reinvested, GBP. Share price total return is on a mid-to-mid basis. Dividend calculations are to reinvest as at the ex-dividend date. NAV returns based on NAVs with debt valued at fair value. Source: Aberdeen Asset Managers Limited and Bloomberg. Past performance is not a guide to future results.
Fund managers’ report Market review Emerging markets gained 2.5% in September with sterling weakness contributing to the return once again. Emerging markets have gained 31.7% so far this year, some 11.9% ahead of the return from developed markets. Russia and South Africa were amongst the best performing emerging markets in September, posting gains of 5.1% and 7.1% respectively. Russian stocks and the ruble were helped by OPEC’s announcement of an agreement for modest production cuts and the resultant oil price rise. In addition, the Central Bank of Russia cut interest rates by 0.5% while rating agency S&P raised the country’s outlook to stable from negative. In South Africa, the rand rebounded sharply as political risk stabilised and economic data improved. The Turkish market was close to flat for the month despite a debt downgrade by Moody’s, who cited concerns about the rule of law, risk from external financing and a slowing economy. The central bank responded with an interest rate cut. In Asia, China moved 3.8% higher, buoyed by the fact that Chinese insurance companies can now invest into Hong Kong listed stocks via the Shanghai-Hong Kong Stock Connect. India gained a modest 0.3% with market sentiment impacted by rising tensions with Pakistan following attacks on terrorist camps in Pakistan-occupied Kashmir. Taiwan performed well, rising 4.1% as its technology components sector benefited from a strong iPhone 7 launch. The Korean market gained 2.6% despite mobile phone battery issues weighing heavily on Samsung Electronics. The Philippine index dropped 4.5% with the currency and market reacting negatively to controversial remarks from President Duterte. In contrast, US presidential election uncertainty continued to weigh on sentiment towards Mexico. The market delivered a negative return for the month (-2.1%), largely a consequence of a weakening peso. The market has, year to date, been amongst the “weakest” emerging markets, up just 12.0% and lagging the Brazilian market by a staggering 73%. Such a difference serves to highlight the challenges faced by investors in emerging markets in terms of asset allocation. Fund managers' report continues overleaf NAV performance is adjusted for the impact of subscription shares. Composite - S&P IFCI GEM PR from inception until 31 Oct 2011 then MSCI EM NTR. C Copyright © 2016 Morningstar UK Ltd. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is not a guide to future results. A B
Morningstar RatingTM for Funds Morningstar rates funds from one to five stars based on how well they’ve performed (after adjusting for risk and accounting for all sales charges) in comparison to similar funds.
C
Ten largest holdings
Cumulative performance (%)
Composite BenchmarkB
Morningstar RatingTM
Weiss Korea Opportunity Fund Schroder AsiaPacific Fund Fidelity China Special Situations NB - China Equity Fund Genesis Emerging Markets Edinburgh Dragon Trust SCM South Africa Fund BlackRock Emerging Europe PLC Ton Poh Fund - Class C Korea Value Stategy Fund Total
Country Korea Asia China China GEM Asia South Africa Europe Thailand Korea
% 5.9 5.8 5.2 5.2 4.9 4.7 4.2 3.4 3.2 3.1 45.7
Asset allocation (%) ASIA China / HK Korea India Taiwan Thailand Indonesia Singapore Philippines Malaysia Other EMEA Russia South Africa Turkey Poland Qatar Czech Rep Greece Hungary UAE Egypt Other LATAM Brazil Mexico Peru Chile Colombia Other Non-specified Indirect Cash Portfolio Cash Total
Fund Benchmark 64.6 71.3 20.6 27.0 14.6 14.8 10.2 8.5 7.9 12.1 3.7 2.2 2.9 2.7 1.4 – 0.9 1.3 0.8 2.7 1.5 – 21.1 15.7 6.6 3.7 5.1 7.1 3.4 1.2 1.6 1.1 0.5 0.9 0.3 0.1 0.3 0.3 0.1 0.3 0.1 0.8 – 0.2 3.2 – 10.8 13.0 4.6 7.4 4.1 3.7 0.5 0.4 0.4 1.1 0.3 0.5 0.8 – 3.6 2.8 (2.9) 100.0 100.0
Total number of investments
43
Figures may not add up to 100 due to rounding. All sources (unless indicated): Aberdeen Asset Managers Limited 30 September 2016.
Private investors 0500 00 00 40 Institutional investors Jonathon McManus +44 (0)20 7618 1444 or Colin Edge +44 (0)20 7463 5881 PAGE 36 OF 56
Investment Company
Aberdeen Emerging Markets Investment Company Limited Performance Data and Analytics to 30 September 2016
Fund managers’ report - continued Performance commentary The net asset value of Aberdeen Emerging Markets Investment Company rose by 1.8% in September while the share price gained 3.9% as the discount at which the Company’s shares trade narrowed to 14.5%. Net asset value performance was 0.8% behind the benchmark and largely a result of underlying holdings lagging their benchmarks in the rally, which seems to be driven more by ETF inflows than company-specific fundamentals for now. Portfolio activity During the month we made a number of changes on asset allocation grounds. These included taking profits in Goldman Sachs India Equity Portfolio and reallocating the proceeds to Schroder Taiwanese Equity Fund. We continued adding to Russia through purchases of JPMorgan Russian Securities plc on a discount to net asset value of approximately 18%, as well as to Verno Capital Growth Fund, our preferred open ended vehicle. Additional shares were also purchased in Romanian closed end fund Fondul Proprietatea on a discount of approximately 30%. We had a recent update from the Company’s largest holding - Weiss Korea Opportunitiy Fund. The Korean market has performed well this year (+30.8%), but the fund’s NAV has lagged on account of an underweight position to index heavyweight Samsung Electronics (24% of MSCI Korea and up 55.5% year to date) and a moderation in the trend of discount narrowing on the fund’s portfolio of preferred shares. As at the end of September the weighted average discount on preferred shares held was 37.1%, providing exposure to an already attractively valued Korean market at a Price to Earnings multiple of 7.1 times. We consider this to be extremely good value and remain positive on the future prospects for this investment. Outlook The remainder of the year looks set to be dominated by the US presidential election. A Clinton victory would be neutral for emerging markets in our opinion, while a Trump victory would be perceived as negative in the short term, and could be sufficient to prompt a global spike in market volatility, from which emerging markets would likely not be immune (although they would benefit from any weakening of the US dollar). Over the longer term, we would expect whoever ends up in the White House to have little bearing on the direction of emerging markets in aggregate. Whichever way the election goes, it is certainly not wasted on the Federal Reserve’s Open Market Committee that this is a potential risk to markets. As such, US interest rates (arguably the other variable that could dampen investors’ renewed enthusiasm for emerging market assets) are unlikely to change before the December meeting, if at all this year. Within emerging markets themselves, market data continues to point to investors increasing allocations to the asset class, and to valuations rising without a great deal of support from earnings growth thus far. There are, however, signs that earnings downgrades have moderated. For now, emerging markets look set to continue benefitting from improving sentiment and momentum.
Expressed as a percentage of average daily net assets for the year ended 31 October 2015. The Ongoing Charges Figure (OCF) is the overall cost shown as a percentage of the value of the assets of the Company. It is made up of the Annual Management Fee and other charges. It does not include any costs associated with buying shares in the Company or the cost of buying and selling stocks within the Company. The Ongoing Charges figure can help you compare the annual operating expenses of different Companies. E Calculated using the Company’s historic net dividends and month end share price. F The Company has no borrowings.
Fund risk statistics Return (Fund) Return (Benchmark) Tracking Error Alpha Beta Correlation
5 Years 6.10 6.80 4.20 (0.10) 0.92 0.96
Basis: Total Return, Net of Fees, GBP. Please note that risk analytics figures are calculated on net returns whereas the performance figures are based on net asset value(NAV) returns. In addition, the risk analytics figures lag the performance figures by a month.
Key information Calendar Year end Accounts published Annual General Meeting Dividend paid Launch date Fund manager Annual management fee Performance fee
Ongoing chargesD Gross assets Premium/(Discount) YieldE GearingF
October January April Annually, if available 21 Jun 1998 (redomiciled on 6 Nov 2009) Andrew Lister and Bernard Moody 1% of market cap 10% (of outperformance, with High Water Mark) 1.20% £302.5m (14.5)% 0.0% nil
AIFMD Leverage Limits Gross Notional Commitment
1.15x 1.15x
Capital structure Ordinary shares Treasury shares
51,810,329 2,808,178
Trading details Reuters/Epic/Bloomberg code ISIN code Sedol code Stockbroker
AEMC GG00B45L2K95 B45L2K9 Stockdale Securities
D
The risks outlined overleaf relating to gearing, exchange rate movements and emerging markets are particularly relevant to this investment company but should be read in conjunction with all warnings and comments given. Important information overleaf
Receive the factsheet by email as soon as it is available by registering at www.invtrusts.co.uk/ITemail www.aberdeen-emerging-capital.com PAGE 37 OF 56
Investment Company
Aberdeen Emerging Markets Investment Company Limited
Important information Risk factors you should consider prior to investing: • The value of investments and the income from them can fall and investors may get back less than the amount invested. • Past performance is not a guide to future results. • Emerging markets or less developed countries may face more political, economic or structural challenges than developed countries. This may mean your money is at greater risk. • Investing globally can bring additional returns and diversify risk. However, currency exchange rate fluctuations may have a positive or negative impact on the value of your investment. • The Sub-fund can use derivatives in order to meet its investment objectives or to protect from price and currency movements. This may result in gains or losses that are greater than the original amount invested. • This Fund may invest through non-regulated markets which are subject to increased risk relating to ownership and custody of investments. • This Fund invests into other funds which themselves invest in assets such as bonds, company shares, cash and currencies. The objectives and risk profiles of these underlying funds may not be fully in line with those of this Fund. Other important information: The Company is a Closed-ended investment scheme registered pursuant to the Protection of Investors (Bailiwick of Guernsey) Law 1987, as amended and the Registered Collective Investment Scheme Rules 2008 issued by the Guernsey Financial Services Commission. The MSCI information may only be used for your internal use, may not be reproduced or redisseminated in any form and may not be used as a basis for or a component of any financial instruments or products or indices. None of the MSCI information is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such. Historical data and analysis, should not be taken as an indication or guarantee of any future performance analysis forecast or prediction. The MSCI information is provided on an “as is” basis and the user of this information assumes the entire risk of any use made of this information. MSCI, each of its affiliates and each other person involved in or related to compiling, computing or creating any MSCI information (collectively, the “MSCI” Parties) expressly disclaims all warranties (including without limitation, any warranties of originality, accuracy, completeness, timeliness, non-infringement, merchantability and fitness for a particular purpose) with respect to this information. Without limiting any of the foregoing, in no event shall any MSCI Party have any liability for any direct, indirect, special, incidental, punitive, consequential (including, without limitation, lost profits) or any other damages (www.msci.com). Issued by Aberdeen Asset Managers Limited which is authorised and regulated by the Financial Conduct Authority in the United Kingdom. Registered Office: 10 Queen’s Terrace, Aberdeen AB10 1YG. Registered in Scotland No. 108419. An investment trust should be considered only as part of a balanced portfolio. Under no circumstances should this information be considered as an offer or solicitation to deal in investments. PAGE 38 OF 56
Investment Company
Aberdeen Frontier Markets Investment Company Limited Performance Data and Analytics to 30 September 2016
Investment objective
Morningstar RatingTM
To provide shareholders with long term capital growth by investing in the Frontier Markets of Africa, the Middle East, Eastern Europe, Asia and Latin America.
Benchmark This fund does not have a benchmark. The MSCI Frontier Index is shown for reference purposes only. It does not constitute a benchmark for the fund's performance, nor does the investment team refer to it when deciding the fund's asset allocation.
Cumulative performance (%) as at 30/09/16
1 month
3 months
6 months
1 year
3 years
5 years
Share Price
0.61p
0.4
8.4
18.0
23.6
15.8
50.9
NAV
0.66p
3.0
7.0
18.3
19.0
15.8
40.9
3.8
5.3
14.1
17.6
24.1
50.7
MSCI Frontier Index TR
Discrete performance (%) Year ending:
Morningstar RatingTM for Funds Morningstar rates funds from one to five stars based on how well they’ve performed (after adjusting for risk and accounting for all sales charges) in comparison to similar funds. A
30/09/16
30/09/15
30/09/14
30/09/13
30/09/12
Share Price
23.6
(21.7)
19.5
29.2
0.9
NAV
19.0
(19.5)
20.8
19.8
1.6
MSCI Frontier Index TR
17.6
(18.7)
29.8
21.6
(0.1)
Total return; NAV to NAV, net income reinvested, GBP. Share price total return is on a mid-to-mid basis. Dividend calculations are to reinvest as at the ex-dividend date. NAV returns based on NAVs with debt valued at fair value. Source: Aberdeen Asset Managers Limited and Bloomberg. Past performance is not a guide to future results.
Fund managers’ report Market review Frontier markets made meaningful gains in September, with Kenya amongst the best performers (+9.4%) as the country’s banks rallied after communicating to shareholders means of mitigating the impact on their businesses of an interest rate cap introduced by the government in August. The Kazakh market rallied (+8.8%), supported by oil price gains on the back of OPEC’s announcement of modest production cuts. After a period of consolidation, the Argentine market rose by 6.6% on no discernible catalyst. In Europe, all frontier markets delivered gains, helped by the weakness of sterling relative to the euro. One of the few markets to end the month in negative territory was Saudi Arabia (-6.0%) where the government announced austerity measures. The reaction of the market is understandable given the dependence of many companies on government spending. Performance commentary AFMC’s NAV rose by 3.0% during the month, lagging the MSCI Frontier Markets Index return by 0.8% as the hitherto beneficial overweight position in Vietnam proved detrimental to relative returns. AFMC’s share price gained 0.4% as the discount at which the Company’s shares trades widened to 7.6%. Portfolio activity In a month of modest activity we continued to trim the position in Vietnam Holding Ltd at relatively tight discount levels in order to reduce Vietnamese exposure back towards 15%. Additional shares were purchased in Romanian closed end holding Fondul Proprietatea at a discount of 30% while a follow-on investment was instructed into Sturgeon Central Asia Equities Fund at month end on asset allocation grounds.
Ten largest holdings East Capital Balkan Fund - C Class Fondul Proprietatea GDR VinaCapital Vietnam Opp. Tundra Pakistan Fund Advance Copernico Argentina PXP Vietnam Emerging Equity Fund SCM Africa Fund Sturgeon Central Asia Equities Fund SC Africa Consumer Fund MSCI Pakistan Total
Country Balkans Romania Vietnam Pakistan Argentina Vietnam Africa Asia Africa Pakistan
% 8.2 8.2 8.0 7.7 7.4 7.0 4.7 4.6 4.2 3.9 63.9
Asset allocation AFRICA Nigeria Kenya Egypt Morocco Zambia Zimbabwe Ghana Senegal Tanzania Botswana Ivory Coast Other Africa MIDDLE EAST Qatar Saudi Arabia Lebanon UAE Kuwait Oman Bahrain Other Middle East ASIA Vietnam Pakistan Bangladesh Kazakhstan Sri Lanka Other Asia LATIN AMERICA Argentina Other Latin America
% 18.3 6.0 3.2 2.1 2.1 1.2 1.1 0.8 0.6 0.4 0.3 0.3 – 7.8 2.2 1.6 1.4 1.1 1.0 0.2 0.1 0.1 37.4 15.9 15.2 2.6 2.0 1.4 0.3 9.9 9.7 0.2
Total number of investments
34
All sources (unless indicated): Aberdeen Asset Managers Limited 30 September 2016.
Fund managers' report continues overleaf A Copyright © 2016 Morningstar UK Ltd. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is not a guide to future results.
Private investors 0500 00 00 40 Institutional investors Jonathon McManus +44 (0)20 7618 1444 or Colin Edge +44 (0)20 7463 5881 PAGE 39 OF 56
Investment Company
Aberdeen Frontier Markets Investment Company Limited Performance Data and Analytics to 30 September 2016
Fund managers’ report - continued Outlook The remainder of the year looks set to be dominated by the US presidential election. A Clinton victory would be neutral for frontier markets in our opinion, while a Trump victory would be perceived as negative in the short term, and could be sufficient to prompt a global spike in market volatility, from which frontier markets may not be immune, despite their generally low valuations and low correlations to other asset classes. Over the longer term, we would expect whoever ends up in the White House to have little bearing on frontier market returns, and for their attractive fundamentals and the behaviour of local investors to drive returns. Whichever way the election goes, it is certainly not wasted on the Federal Reserve’s Open Market Committee that this is a potential risk to markets. As such, US interest rates (arguably the other variable that could dampen investors’ appetite for “risk assets”) are unlikely to change before the December meeting, if at all this year. The high yield offered by frontier market equities will remain attractive in this environment. Despite the positive fundamentals we see in many frontier economies, frontier equity markets remain underrepresented in global indices relative to their economic significance. Frontier markets are, in aggregate, home to 31% of the world’s population and account for 9% of global GDP but have a market capitalisation that is equivalent to just 0.2% of the global total. From such a low base, we believe there is scope for the asset class to grow significantly over the long term. Current valuations do not adequately reflect the long term potential of the asset class, in our opinion.
Asset allocation (continued) % 20.2 9.1 2.6 2.0 1.1 0.9 0.9 0.5 – 3.2 1.5 6.2 (1.3) 100.0
EASTERN EUROPE Romania Turkey Slovenia Greece Serbia Georgia Croatia Ukraine Other Eastern Europe Non-specified Indirect Cash Portfolio Cash Total Figures may not add up to 100 due to rounding.
Fund risk statistics Return (Fund) Return (MSCI FM) Volatility (Fund) Volatility (MSCI FM)
5 Years 7.1 8.5 10.1 10.6
Basis: Total Return, Net of Fees, GBP. Please note that risk analytics figures are calculated on net returns whereas the performance figures are based on net asset value(NAV) returns. In addition, the risk analytics figures lag the performance figures by a month.
Key information Calendar Year end Accounts published Annual General Meeting Dividend paid Launch date Fund manager Semi-annually management fee Performance fee Ongoing chargesB Gross assets Premium/(Discount) YieldC Net gearingD
June September November Annually, if available 15 June 2007 Andrew Lister and Bernard Moody 1.25% of market cap 12% (12% hurdle) 1.67% £112.8m (7.6)% 0.0% nil
AIFMD Leverage Limits Gross Notional Commitment
1.1x 1.1x
Capital structure Ordinary shares
169,460,000
Trading details
Expressed as a percentage of average weekly net assets for the year ended 30 June 2016. The Ongoing Charges Figure (OCF) is the overall cost shown as a percentage of the value of the assets of the Company. It is made up of the Annual Management Fee and other charges. It does not include any costs associated with buying shares in the Company or the cost of buying and selling stocks within the Company. The Ongoing Charges figure can help you compare the annual operating expenses of different Companies. C Calculated using the Company’s historic net dividends and month end share price. D Net gearing is expressed as a percentage of gross assets, which includes current year revenue, less cash/cash equivalents divided by shareholders' funds. B
The risks outlined overleaf relating to gearing, exchange rate movements and frontier markets are particularly relevant to this investment company but should be read in conjunction with all warnings and comments given. Important information overleaf
Reuters/Epic/Bloomberg code ISIN code Sedol Stockbroker
AFMC GG00B1W59J17 B1W59J1 Numis Securities
Receive the factsheet by email as soon as it is available by registering at www.invtrusts.co.uk/ITemail www.aberdeen-emerging-capital.com PAGE 40 OF 56
Investment Company
Aberdeen Frontier Markets Investment Company Limited
Important information Risk factors you should consider prior to investing: • The value of investments and the income from them can fall and investors may get back less than the amount invested. • Past performance is not a guide to future results. • Frontier market countries typically have smaller economies and even less developed capital markets or legal and political systems than traditional, more developed emerging market countries. As a result, the investment in frontier markets can be riskier than investing in emerging market countries. • Investing globally can bring additional returns and diversify risk. However,currency exchange rate fluctuations may have a positive or negative impact on the value of your investment. • The Sub-fund can use derivatives in order to meet its investment objectives or to protect from price and currency movements. This may result in gains or losses that are greater than the original amount invested. • This Fund may invest through non-regulated markets which are subject to increased risk relating to ownership and custody of investments. • This Fund invests into other funds which themselves invest in assets such as bonds, company shares, cash and currencies. The objectives and risk profiles of these underlying funds may not be fully in line with those of this Fund. Other important information: The Company is a Closed-ended investment scheme registered pursuant to the Protection of Investors (Bailiwick of Guernsey) Law 1987, as amended and the Registered Collective Investment Scheme Rules 2008 issued by the Guernsey Financial Services Commission. The MSCI information may only be used for your internal use, may not be reproduced or redisseminated in any form and may not be used as a basis for or a component of any financial instruments or products or indices. None of the MSCI information is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such. Historical data and analysis, should not be taken as an indication or guarantee of any future performance analysis forecast or prediction. The MSCI information is provided on an “as is” basis and the user of this information assumes the entire risk of any use made of this information. MSCI, each of its affiliates and each other person involved in or related to compiling, computing or creating any MSCI information (collectively, the “MSCI” Parties) expressly disclaims all warranties (including without limitation, any warranties of originality, accuracy, completeness, timeliness, non-infringement, merchantability and fitness for a particular purpose) with respect to this information. Without limiting any of the foregoing, in no event shall any MSCI Party have any liability for any direct, indirect, special, incidental, punitive, consequential (including, without limitation, lost profits) or any other damages (www.msci.com). Issued by Aberdeen Asset Managers Limited which is authorised and regulated by the Financial Conduct Authority in the United Kingdom. Registered Office: 10 Queen’s Terrace, Aberdeen AB10 1YG. Registered in Scotland No. 108419. An investment trust should be considered only as part of a balanced portfolio. Under no circumstances should this information be considered as an offer or solicitation to deal in investments. PAGE 41 OF 56
Investment Company
Aberdeen Latin American Income Fund Limited Performance Data and Analytics to 30 September 2016
Investment objective To provide ordinary shareholders with a total return, with an above average yield, primarily through investing in Latin America through a diversified portfolio of equities and fixed income investments.
Benchmark 60% MSCI EM Latin American 10/40 Index and 40% JP Morgan GBI EM Global Diversified (Latin America carve out). Given that the Manager does not adopt a benchmark approach, performance can vary widely from the benchmark.
Cumulative performance (%) 1 month
3 months
6 months
Share Price
as at 30/09/16 67.1p
0.7
11.6
33.0
58.9
(7.8)
1.4
NAVA
76.7p
1.5
7.7
30.3
57.1
(1.7)
11.1
0.7
6.7
21.8
47.0
4.0
9.2
Composite Benchmark
1 year
3 years
5 years
Discrete performance (%) Year ending:
30/09/16
30/09/15
30/09/14
30/09/13
30/09/12
Share Price
58.9
(35.7)
(9.8)
(6.2)
17.2
NAVA
57.1
(33.3)
(6.2)
(4.6)
18.4
Composite Benchmark
47.0
(29.6)
0.4
(5.9)
11.6
Fund managers’ report
Latin American equities ended flat in September, underperforming the broader emerging markets. Investors were cautious ahead of key central bank meetings and uncertainty ahead of the US presidential elections. While sentiment was buoyed by a divided US Federal Reserve that left interest rates unchanged, markets expect a rate hike by December. Emerging market debt sentiment was driven by key monetary policy decisions, including the Bank of Japan’s latest easing package, and an oil-price jump following Opec’s surprise production cut agreement. On the month, the JP Morgan GBI-EM Global Diversified (Latin America) index (unhedged in GBP) returned 1.86%. Brazil’s economy shrank by 3.8% in the second quarter, but investments grew for the first time in three years. Newly-confirmed president Michel Temer ruled out higher wages for the public sector, signalling his commitment to fiscal consolidation. In Mexico, the stockmarket and currency both fell in the run-up to the US elections, with Donald Trump and Hillary Clinton still tied in recent polls. The central bank raised interest rates by 50 basis points to curb inflation and stem the peso’s decline. Well-respected finance minister Luis Videgaray resigned following popular backlash for arranging a meeting between president Pena Nieto and Trump. His replacement, Jose Antonio Meade, unveiled the latest budget designed to return a primary surplus for the first time since 2008. It will include a series of spending cuts. In corporate news, FEMSA subsidiary, Coca-Cola FEMSA, will buy Brazilian coke-bottler Vonpar for US$1.1 billion, considerably expanding its footprint in Latin America’s largest economy, and boosting local sales volumes by 25%. Vale sold a 15% stake in its Moatize coal mine to Japanese group Mitsui, in a deal that will raise US$768 million and help the miner free up to US$2.7 billion in funding commitments. There were no major portfolio changes in September. Including current year revenue. Copyright © 2016 Morningstar UK Ltd. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is not a guide to future results.
B
Morningstar RatingTM for Funds Morningstar rates funds from one to five stars based on how well they’ve performed (after adjusting for risk and accounting for all sales charges) in comparison to similar funds. B
Ten largest equity holdings % 3.6 3.2 2.2 2.0 1.9 1.8 1.8 1.7 1.6 1.5 21.3
Banco Bradesco ADR ItaÚ Unibanco ADR Lojas Renner Ambev Multiplan Empreendimentos Grupo Aeroportuario Grupo Financiero Banorte FEMSA ADR Ultrapar Participacoes ADR BRF Sponsored ADR Total Consolidates all equity holdings from same issuer.
Total return; NAV to NAV, net income reinvested, GBP. Share price total return is on a mid-to-mid basis. Dividend calculations are to reinvest as at the ex-dividend date. NAV returns based on NAVs with debt valued at fair value. Source: Aberdeen Asset Managers Limited, Lipper and Morningstar. Past performance is not a guide to future results.
A
Morningstar RatingTM
Ten largest fixed income holdings %
Brazil (Fed Rep of) 10% 01/01/25 Uruguay (Rep of) 5% 14/09/18 Colombia (Rep of) 9.85% 28/06/27 Brazil (Fed Rep of) 10% 01/01/17 Mex Bonos Desarr Fix Rt 8% 07/12/23 Brazil (Fed Rep of) 10% 01/01/27 Mex Bonos Desarr Fix Rt 7.5% 03/06/27 Peru (Rep of) 6.95% 12/08/31 Brazil (Fed Rep of) 10% 01/01/18 Brazil (Fed Rep of) 10% 01/01/21
10.5 9.3 9.1 6.9 3.6 2.7 2.6 2.3 2.3 2.2 51.5
Total
As at 30 September 2016 the equity exposure within total investments was 41.15% and bond exposure 58.85%.
Geographic breakdown % 49.8 17.8 11.1 9.9 5.1 4.3 1.0 1.0 100.0
Brazil Mexico Uruguay Colombia Peru Chile Argentina Cash Total Figures may not add up to 100 due to rounding.
Total number of investments
57
All sources (unless indicated): Aberdeen Asset Managers Limited 30 September 2016.
Private investors 0500 00 00 40 Institutional investors Colin Edge +44 (0)20 7463 5881 or Jonathon McManus +44 (0)20 7618 1444 PAGE 42 OF 56
Investment Company
Aberdeen Latin American Income Fund Limited Performance Data and Analytics to 30 September 2016 Key information Calendar Year end Accounts published Annual General Meeting Dividend paid Launch date Fund manager
Ongoing chargesC Annual management feeD Premium/(Discount) YieldE Active shareF
31 August November December January, April, July, October Aug 2010 Emerging Market Equity Team Emerging Market Debt Team 1.89% 1.0% (12.5)% 5.8% 59.3%
Net gearing TotalG
11.1%
AIFMD Leverage Limits Gross Notional Commitment
2.5x 2x
Assets
£’000 %
Equities Fixed Income Total investment Cash Other assets/(liabilities) Debt Net assets
22,481 32,146 54,627 1,056 (6,500)
45.7 65.4 111.1 2.1 0.0 (13.2)
49,183
100.0
Capital structure 64,122,824 2,450,000
Ordinary shares Treasury shares
Allocation of management fees and finance costs Capital Revenue
60% 40%
Trading details Reuters/Epic/Bloomberg code ISIN code Sedol code Stockbrokers Expressed as a percentage of average daily net assets for the year ended 31 August 2015. The Ongoing Charges Figure (OCF) is the overall cost shown as a percentage of the value of the assets of the Company. It is made up of the Annual Management Fee and other charges. It does not include any costs associated with buying shares in the Company or the cost of buying and selling stocks within the Company. The Ongoing Charges figure can help you compare the annual operating expenses of different Companies. D 1% per annum of the value of the Company’s net assets. E Calculated using the Company’s historic net dividends and month end share price. F The ‘Active Share’ percentage is a measure used to describe what proportion of the Company's holdings differ from the benchmark index holdings. For Aberdeen Latin American Income Fund this relates purely to the equity element of the portfolio. G Net gearing is expressed as a percentage of gross assets, which includes current year revenue, less cash/cash equivalents divided by shareholders' funds. C
The risks outlined overleaf relating to gearing, emerging market exposure and exchange rate movements are particularly relevant to this trust but should be read in conjunction with all warnings and comments given. Important information overleaf
Market makers
ALAI JE00B44ZTP62 B44ZTP6 Cantor Fitzgerald Europe CANA, CFEP, INV, JPMS, NUMS, PEEL, STFL, WINS
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Investment Company
Aberdeen Latin American Income Fund Limited
Important information Risk factors you should consider prior to investing: • The value of investments and the income from them can fall and investors may get back less than the amount invested. • Past performance is not a guide to future results. • Investment in the Company may not be appropriate for investors who plan to withdraw their money within 5 years. • The Company may borrow to finance further investment (gearing). The use of gearing is likely to lead to volatility in the Net Asset Value (NAV) meaning that any movement in the value of the company's assets will result in a magnified movement in the NAV. • The Company may accumulate investment positions which represent more than normal trading volumes which may make it difficult to realise investments and may lead to volatility in the market price of the Company's shares. • The Company may charge expenses to capital which may erode the capital value of the investment. • Derivatives may be used, subject to restrictions set out for the Company, in order to manage risk and generate income. The market in derivatives can be volatile and there is a higher than average risk of loss. • Movements in exchange rates will impact on both the level of income received and the capital value of your investment. • There is no guarantee that the market price of the Company's shares will fully reflect their underlying Net Asset Value. • As with all stock exchange investments the value of the Company's shares purchased will immediately fall by the difference between the buying and selling prices, the bid-offer spread. If trading volumes fall, the bid-offer spread can widen. • The Company invests in emerging markets which tend to be more volatile than mature markets and the value of your investment could move sharply up or down. • Certain trusts may seek to invest in higher yielding securities such as bonds, which are subject to credit risk, market price risk and interest rate risk. Unlike income from a single bond, the level of income from an investment trust is not fixed and may fluctuate. • With funds investing in bonds there is a risk that interest rate fluctuations could affect the capital value of investments. Where long term interest rates rise, the capital value of shares is likely to fall, and vice versa. In addition to the interest rate risk, bond investments are also exposed to credit risk reflecting the ability of the borrower (i.e. bond issuer) to meet its obligations (i.e. pay the interest on a bond and return the capital on the redemption date). The risk of this happening is usually higher with bonds classified as ‘sub-investment grade’. These may produce a higher level of income but at a higher risk than investments in ‘investment grade’ bonds. In turn, this may have an adverse impact on funds that invest in such bonds. • Yields are estimated figures and may fluctuate, there are no guarantees that future dividends will match or exceed historic dividends and certain investors may be subject to further tax on dividends. Other important information: Issued by Aberdeen Asset Managers Limited which is authorised and regulated by the Financial Conduct Authority in the United Kingdom. Registered Office: 10 Queen’s Terrace, Aberdeen AB10 1YG. Registered in Scotland No. 108419. An investment trust should be considered only as part of a balanced portfolio. Under no circumstances should this information be considered as an offer or solicitation to deal in investments. The MSCI information may only be used for your internal use, may not be reproduced or redisseminated in any form and may not be used as a basis for or a component of any financial instruments or products or indices. None of the MSCI information is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such. Historical data and analysis, should not be taken as an indication or guarantee of any future performance analysis forecast or prediction. The MSCI information is provided on an “as is” basis and the user of this information assumes the entire risk of any use made of this information. MSCI, each of its affiliates and each other person involved in or related to compiling, computing or creating any MSCI information (collectively, the “MSCI” Parties) expressly disclaims all warranties (including without limitation, any warranties of originality, accuracy, completeness, timeliness, non-infringement, merchantability and fitness for a particular purpose) with respect to this information. Without limiting any of the foregoing, in no event shall any MSCI Party have any liability for any direct, indirect, special, incidental, punitive, consequential (including, without limitation, lost profits) or any other damages (www.msci.com). PAGE 44 OF 56
Investment Trust
Murray International Trust PLC Performance Data and Analytics to 30 September 2016
Investment objective
The aim is to achieve a total return greater than its benchmark by investing predominantly in equities worldwide. Within this objective, the manager will seek to increase the Company’s revenues in order to maintain an above average dividend yield.
Benchmark
Morningstar Analyst RatingTM
Morningstar Analyst Rating™ Morningstar analysts assign the ratings globally on a five-tier scale with three positive ratings of Gold, Silver and Bronze. B
40% FTSE World UK and 60% FTSE World ex UK.
Morningstar RatingTM
Cumulative performance (%) as at 30/09/16
1 month
3 months
6 months
1 year
3 years
5 years
Share Price
1131.0p
2.2
15.7
31.2
45.3
18.6
66.5
NAVA
1124.8p
2.0
6.0
23.2
44.6
28.9
73.0
1.6
7.9
16.4
26.6
37.6
91.3
Composite Benchmark
Twenty largest equity holdings
Discrete performance (%) Year ending:
Morningstar RatingTM for Funds Morningstar rates funds from one to five stars based on how well they’ve performed (after adjusting for risk and accounting for all sales charges) in comparison to similar funds. B
30/09/14
30/09/13
Share Price
30/09/16 45.3
30/09/15 (21.6)
4.1
10.0
30/09/12 27.6
NAVA
44.6
(14.9)
4.8
10.1
21.9
Composite Benchmark
26.6
(1.0)
9.8
18.5
17.3
Total return; NAV to NAV, net income reinvested, GBP. Share price total return is on a mid-to-mid basis. Dividend calculations are to reinvest as at the ex-dividend date. NAV returns based on NAVs with debt valued at fair value. Source: Aberdeen Asset Managers Limited, Lipper and Morningstar. Past performance is not a guide to future results.
Fund managers’ report Background With Central Bank policymakers throughout the so-called developed world uncomfortably ensnared in a monetary trap of their own making, global bond yields moved deeper into negative territory due to the policy vacuum that prevailed. Widespread erosion of real living standards remained the dominant economic consequence of such macroeconomic mismanagement – widespread reluctance to acknowledge increasingly fragile fundamentals the most noticeable influence on sentiment. Performance In local currency terms, global equity markets were relatively flat over the month. Weakness in sterling against most Asian and emerging market currencies boosted capital returns, as did having exposure to Energy and Basic Material companies which continued to perform well. Defensive exposure in Pharmaceutical companies proved a drag on relative performance as investors shunned the Sector ahead of the US Presidential Election. Activity Trading activity was extremely low during the period. Outlook Preventing rational pricing in fixed income markets through constant implementation of unorthodox monetary policy that ignores credit quality and credit risk continues to distort the current financial landscape beyond any recognition. Predicting outcomes against such an unfamiliar economic and financial backdrop is arguably completely futile. Given such prevailing circumstances, diversification remains the strategy of preference, extreme caution the modus operandi. Including current year revenue. Copyright © 2016 Morningstar UK Ltd. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is not a guide to future results. C Consolidates all equity holdings from same issuer.
Taiwan Semiconductor British American TobaccoC ASUR Unilever Indonesia Philip Morris Taiwan Mobile Daito SingTel Verizon Communications TELUS Roche Total Sociedad Quimica Y Minera De Chile PepsiCo FEMSA Kimberly-Clark de Mexico Public Bank Johnson & Johnson Royal Dutch Shell 'B' CME Total
% 4.7 4.6 4.2 4.1 3.6 3.6 3.0 2.6 2.6 2.5 2.4 2.3 2.2 2.1 1.9 1.8 1.8 1.7 1.7 1.6 55.0
Ten largest fixed income holdings Petroleos Mexicanos 5.5% 27/06/44 Petroleos De Venezuela 5.25% 12/04/17 Brazil (Fed Rep of) 10% 01/01/17 South Africa (Rep of) 7% 28/02/31 Vale Overseas Limited 6.875% 21/11/36 Indonesia (Rep Of) 6.125% 15/05/28 Indonesia (Rep Of) 7% 15/05/22 Bharti Airtel Intl 5.125% 11/03/23 Dominican (Rep of) 6.85% 27/01/45 Indonesia (Rep Of) 8.375% 15/03/34 Total
% 1.2 1.2 1.2 1.2 1.0 1.0 1.0 0.9 0.8 0.8 10.3
Total number of investments Total Equity Holdings in Portfolio : Total Fixed Income Holdings in Portfolio : Total
47 21 68
A B
The risks outlined overleaf relating to gearing, exchange rate movements and emerging markets are particularly relevant to this trust but should be read in conjunction with all warnings and comments given.
All sources (unless indicated): Aberdeen Asset Managers Limited 30 September 2016.
Private investors 0500 00 00 40 Institutional investors Kenneth Harper +44 (0)131 528 4224 or Andrew Leigh +44 (0)20 7463 6312 PAGE 45 OF 56
Investment Trust
Murray International Trust PLC Performance Data and Analytics to 30 September 2016 Portfolio analysis %
Equities Asia Pacific ex Japan Latin America & Emerging Markets North America Europe ex UK United Kingdom Japan Africa Fixed Income Latin America & Emerging Markets Asia Pacific ex Japan Africa United Kingdom Cash Total
25.0 16.1 15.0 11.9 10.7 4.3 0.9 8.9 5.0 1.2 0.5 0.5 100.0
Key information Calendar Year end Accounts published Annual General Meeting Dividend paid
31 December March April 2017 in Glasgow February, May, August, November Established 1907 Fund manager Bruce Stout 0.75% Ongoing chargesD Annual management feeE 0.575% (tiered) 0.6% Premium/(Discount) 4.1% YieldF 11.7% Net gearingG Active shareH
89.1%
AIFMD Leverage Limits Gross Notional Commitment
Assets Equities Fixed Income Cash Other net assets/(liabilities) Gross assets Debt Net assets
2.5x 2x
£’m % 1,353.4 251.6 1,605.0 17.7 0.1 1,622.8 (185.2) 1,437.6
94.2 17.5 111.7 1.2 0.0 112.9 (12.9) 100.0
Capital structure Ordinary shares Treasury shares
127,613,238 936,838
Allocation of management fees and finance costs Capital Revenue
70% 30%
Trading details Expressed as a percentage of total costs divided by average daily net assets for the year ended 31 December 2015. The Ongoing Charges Figure (OCF) is the overall cost shown as a percentage of the value of the assets of the Company. It is made up of the Annual Management Fee and other charges. It does not include any costs associated with buying shares in the Company or the cost of buying and selling stocks within the Company. The Ongoing Charges figure can help you compare the annual operating expenses of different Companies. E From 1 January 2016 onwards the annual fee will be charged at 0.575% of net assets (ie excluding gearing) up to £1,200 million, 0.5% of Net Assets between £1,200 million and £1,400 million, and 0.425% of Net Assets above £1,400 million. From 1 January 2016 the performance fee was abolished and the annual fee was amended to a tiered structure. F Calculated using the Company’s historic net dividends and month end share price. G Gearing is defined as a percentage, with net debt (total debt less cash/cash equivalents) divided by shareholders’ funds. H The ‘Active Share’ percentage is a measure used to describe what proportion of the Company's holdings differ from the benchmark index holdings. D
Important information overleaf
Reuters/Epic/Bloomberg code ISIN code Sedol code Stockbrokers Market makers
MYI GB0006111909 0611190 Stifel Securities SETSmm
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Investment Trust
Murray International Trust PLC
Important information Risk factors you should consider prior to investing: • The value of investments and the income from them can fall and investors may get back less than the amount invested. • Past performance is not a guide to future results. • Investment in the Company may not be appropriate for investors who plan to withdraw their money within 5 years. • The Company may borrow to finance further investment (gearing). The use of gearing is likely to lead to volatility in the Net Asset Value (NAV) meaning that any movement in the value of the company's assets will result in a magnified movement in the NAV. • The Company may accumulate investment positions which represent more than normal trading volumes which may make it difficult to realise investments and may lead to volatility in the market price of the Company's shares. • The Company may charge expenses to capital which may erode the capital value of the investment. • Movements in exchange rates will impact on both the level of income received and the capital value of your investment. • There is no guarantee that the market price of the Company's shares will fully reflect their underlying Net Asset Value. • As with all stock exchange investments the value of the Company's shares purchased will immediately fall by the difference between the buying and selling prices, the bid-offer spread. If trading volumes fall, the bid-offer spread can widen. • With funds investing in bonds there is a risk that interest rate fluctuations could affect the capital value of investments. Where long term interest rates rise, the capital value of shares is likely to fall, and vice versa. In addition to the interest rate risk, bond investments are also exposed to credit risk reflecting the ability of the borrower (i.e. bond issuer) to meet its obligations (i.e. pay the interest on a bond and return the capital on the redemption date). The risk of this happening is usually higher with bonds classified as ‘sub-investment grade’. These may produce a higher level of income but at a higher risk than investments in ‘investment grade’ bonds. In turn, this may have an adverse impact on funds that invest in such bonds. • Yields are estimated figures and may fluctuate, there are no guarantees that future dividends will match or exceed historic dividends and certain investors may be subject to further tax on dividends. • The Company invests in emerging markets which tend to be more volatile than mature markets and the value of your investment could move sharply up or down. Other important information: Issued by Aberdeen Asset Managers Limited which is authorised and regulated by the Financial Conduct Authority in the United Kingdom. Registered Office: 10 Queen’s Terrace, Aberdeen AB10 1YG. Registered in Scotland No. 108419. An investment trust should be considered only as part of a balanced portfolio. Under no circumstances should this information be considered as an offer or solicitation to deal in investments. FTSE International Limited (‘FTSE’) © FTSE 2016. ‘FTSE®’ is a trade mark of the London Stock Exchange Group companies and is used by FTSE International Limited under licence. RAFI® is a registered trademark of Research Affiliates, LLC. All rights in the FTSE indices and/ or FTSE ratings vest in FTSE and/or its licensors. Neither FTSE nor its licensors accept any liability for any errors or omissions in the FTSE indices and/or FTSE ratings or underlying data. No further distribution of FTSE Data is permitted without FTSE’s express written consent. PAGE 47 OF 56
Investment Trust
Aberdeen Japan Investment Trust PLC Performance Data and Analytics to 30 September 2016
Investment objective To achieve long-term capital growth principally through investment in listed Japanese companies which are believed by the Investment Manager to have above average prospects for growth.
Benchmark Topix Index (in sterling terms) - from 8 October 2013 MSCI All Countries Asia Pacific (including Japan) Index (in sterling terms) - to 7 October 2013
Cumulative performance (%) as at 30/09/16 Share Price 505.0p NAV Benchmark A
573.3p
Since change of mandate 5 years cumulative 105.3 51.4
1 month 3.9
3 months 8.4
6 months 13.9
1 year 15.5
3 years 50.0
2.0 3.3
8.4 11.7
13.1 21.8
26.6 32.2
58.1 45.7
95.4 81.7
56.7 45.3
30/09/14 12.5 18.6 3.7
30/09/13 10.1 5.7 15.8
30/09/12 24.3 17.0 7.6
Discrete performance (%) Year ending: Share Price NAVA Benchmark
30/09/16 15.5 26.6 32.2
30/09/15 15.5 5.3 6.3
The investment objective of the Company changed on 7 October 2013, with the Company moving from an All Asia to a Japan only mandate. The performance figures shown, therefore, reflect periods of time when the Company ran with these 2 different objectives. Total return; NAV to NAV, net income reinvested, GBP. Share price total return is on a mid-to-mid basis. Dividend calculations are to reinvest as at the ex-dividend date. NAV returns based on NAVs with debt valued at fair value. Source: Aberdeen Asset Managers Limited, Lipper and Morningstar. Past performance is not a guide to future results.
Fund managers’ report Market Review Japanese equities ended mixed in September. Initially, sentiment was buoyed by the US Federal Reserve’s decision to hold interest rates steady, as well as the Bank of Japan’s policy review. But gains were capped by the receding likelihood of production cuts by major oil exporters and worries over Deutsche Bank’s troubles. In economic news, second quarter GDP was upgraded; capital spending rose but missed expectations. Sentiment among large manufacturers improved in the third quarter, as leading indicators showed the sector returning to expansion. Industrial output expanded by more than expected. Tourism continued to show solid growth in the first half of 2016, with arrivals reaching a high of 11.5 million visitors. Conversely, exports tumbled in August, whereas imports also fell sharply. Core consumer prices eased, largely due to lower energy prices. Although household incomes edged higher, average household spending deteriorated in tandem with a worse-than-expected jobless rate. Unsurprisingly, retail sales contracted, with large retailers suffering the brunt of the decline.
Ten largest equity holdings % 5.4 4.9 4.8 4.6 4.1 4.0 3.8 3.6 3.5 3.5 42.2
Shin-Etsu Chemical Japan Tobacco Seven & i Keyence KDDI Nabtesco Amada Fanuc Chugai Pharmaceutical Toyota Motor Total
Sector allocation (%) Consumer Goods Industrials Financials Consumer Services Health Care Basic Materials Technology Telecommunications Oil & Gas Utilities Cash Total
Trust Benchmark 25.7 23.7 18.5 21.7 13.2 15.1 13.0 11.9 9.9 7.3 9.5 6.2 4.6 5.0 4.1 6.3 – 0.8 – 2.0 1.5 – 100.0 100.0
Sterling hedge (%) % of portfolio net assets hedged through forward contracts
46.5
Investment policy provides for the Board to arrange an appropriate hedge for the underlying Yen net exposure in Sterling terms using rolling forex forward contracts. Approximately 45% of the Company's Yen net assets are hedged against fluctuations in the Yen/Sterling exchange rate.
Total number of investments
40
The Bank of Japan (BoJ) tweaked its policy on long term rates because the introduction of negative short-term rates had flattened the yield curve and this was hurting banking sector profits. We believe the policy fine tuning will have minimal impact on most of our holdings, whose net cash balance sheets make it are unlikely for them to require bank loans.
All sources (unless indicated): Aberdeen Asset Managers Limited 30 September 2016.
Fund managers' report continues overleaf A
Including current year revenue.
Private investors 0500 00 00 40 Institutional investors Andrew Leigh +44 (0)20 7463 6312 or Kenneth Harper +44 (0)131 528 4224 PAGE 48 OF 56
Investment Trust
Aberdeen Japan Investment Trust PLC Performance Data and Analytics to 30 September 2016
Fund managers’ report - continued
Portfolio Review In corporate news, retail conglomerate Seven & i continued restructuring its businesses; it lowered its full-year net profit guidance, largely owing to impairments from its struggling department store and general merchandise store businesses. Separately, shareholders of catalogue retailer Nissen approved Seven & i’s acquisition via a share swap. We view these developments favourably. Outlook Looking ahead, stock valuations appear broadly fair, with the government’s asset buying programme helping to underpin share prices. However, headwinds persist. In particular, British PM Theresa May’s decision to start Brexit negotiations next March has placed the UK at a distinct disadvantage. This is likely to cause the yen to appreciate given its safe haven status and thwarting the BoJ’s efforts to lift inflation and make Japanese exports more competitive. Adding to currency volatility are question marks over the US Federal Reserve’s next policy move and a nail-biting outcome to the presidential election in early November. Meanwhile, oil prices will remain soft in the medium term as OPEC’s attempt to address the oversupply through an output freeze is in disarray. At home, leading indicators for manufacturing and services continue to vacillate between growth and contraction. With monetary policy losing its efficacy, the Abe government seems set to launch new fiscal stimulus to jumpstart the economy. Corporate earnings are likely to stay weak and wages anaemic, especially in light of the IMF’s muted outlook for global growth. However, we expect our holdings to overcome these problems because of their solid fundamentals and able leadership. They are also backed by robust balance sheets and good cash generation, while corporate governance standards are improving steadily.
Fund risk statistics 3 Years 5 Years Annualised Standard Deviation of Fund Beta Sharpe Ratio Annualised Tracking Error Annualised Information Ratio R-Squared
12.97 12.48 1.01 0.98 1.24 1.00 6.14 5.42 0.56 0.40 0.78 0.81
Source: Aberdeen Asset Management, BPSS & Thomson Reuters Datastream. Basis: Total Return, Gross of Fees, GBP. Please note that risk analytics figures are calculated on gross returns whereas the performance figures are based on net asset value(NAV) returns. In addition, the risk analytics figures lag the performance figures by a month.
Key information Calendar Year end Accounts published Annual General Meeting Dividend paid Launch dateB Fund manager Ongoing chargesC Annual management fee Premium/(Discount) YieldD Net gearingE Excluding FX hedge effect Including FX hedge effect Active shareF
31 March June July July October 1998 Asian Equities Team 1.29% 0.95% on first £50m net assets 0.75% thereafter (11.9)% 0.8% 12.3% 12.1% 80.9%
AIFMD Leverage Limits Gross Notional Commitment
2.5x 2x
Assets/Debt (£m) Gross assets Debt Cash
102.3 12.9 1.9
Capital structure Ordinary shares Treasury shares
15,589,072 232,500
Allocation of management fees and finance costs Capital Revenue
60% 40%
Trading details Previously managed by Gartmore Investment Limited. Expressed as a percentage of average daily net assets for the year ended 31 March 2016. The Ongoing Charges Figure (OCF) is the overall cost shown as a percentage of the value of the assets of the Company. It is made up of the Annual Management Fee and other charges. It does not include any costs associated with buying shares in the Company or the cost of buying and selling stocks within the Company. The Ongoing Charges figure can help you compare the annual operating expenses of different Companies. D Calculated using the Company’s historic net dividends and month end share price. E Net gearing is expressed as a percentage of gross assets, which includes current year revenue, less cash/cash equivalents divided by shareholders' funds. F The ‘Active Share’ percentage is a measure used to describe what proportion of the Company's holdings differ from the benchmark index holdings. B
C
The risks outlined overleaf relating to gearing and exchange rate movements are particularly relevant to this trust but should be read in conjunction with all warnings and comments given. Important information overleaf
Reuters/Epic/Bloomberg code ISIN code Sedol code Stockbrokers Market makers
AJIT GB0003920757 0392075 J.P. Morgan Cazenove CANA, CFEP, INV, JPMS, STFL, WEST, WINS
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Investment Trust
Aberdeen Japan Investment Trust PLC
Important information Risk factors you should consider prior to investing: • The value of investments and the income from them can fall and investors may get back less than the amount invested. • Past performance is not a guide to future results. • Investment in the Company may not be appropriate for investors who plan to withdraw their money within 5 years. • The Company may borrow to finance further investment (gearing). The use of gearing is likely to lead to volatility in the Net Asset Value (NAV) meaning that any movement in the value of the company's assets will result in a magnified movement in the NAV. • The Company may accumulate investment positions which represent more than normal trading volumes which may make it difficult to realise investments and may lead to volatility in the market price of the Company's shares. • The Company may charge expenses to capital which may erode the capital value of the investment. • Derivatives may be used, subject to restrictions set out for the Company, in order to manage risk and generate income. The market in derivatives can be volatile and there is a higher than average risk of loss. • Movements in exchange rates will impact on both the level of income received and the capital value of your investment. • There is no guarantee that the market price of the Company's shares will fully reflect their underlying Net Asset Value. • As with all stock exchange investments the value of the Company's shares purchased will immediately fall by the difference between the buying and selling prices, the bid-offer spread. If trading volumes fall, the bid-offer spread can widen. • Yields are estimated figures and may fluctuate, there are no guarantees that future dividends will match or exceed historic dividends and certain investors may be subject to further tax on dividends. Other important information: Issued by Aberdeen Asset Managers Limited which is authorised and regulated by the Financial Conduct Authority in the United Kingdom. Registered Office: 10 Queen’s Terrace, Aberdeen AB10 1YG. Registered in Scotland No. 108419. An investment trust should be considered only as part of a balanced portfolio. Under no circumstances should this information be considered as an offer or solicitation to deal in investments. The MSCI information may only be used for your internal use, may not be reproduced or redisseminated in any form and may not be used as a basis for or a component of any financial instruments or products or indices. None of the MSCI information is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such. Historical data and analysis, should not be taken as an indication or guarantee of any future performance analysis forecast or prediction. The MSCI information is provided on an “as is” basis and the user of this information assumes the entire risk of any use made of this information. MSCI, each of its affiliates and each other person involved in or related to compiling, computing or creating any MSCI information (collectively, the “MSCI” Parties) expressly disclaims all warranties (including without limitation, any warranties of originality, accuracy, completeness, timeliness, non-infringement, merchantability and fitness for a particular purpose) with respect to this information. Without limiting any of the foregoing, in no event shall any MSCI Party have any liability for any direct, indirect, special, incidental, punitive, consequential (including, without limitation, lost profits) or any other damages (www.msci.com). PAGE 50 OF 56
Investment Trust
The North American Income Trust plc Performance Data and Analytics to 30 September 2016
Investment objective To provide investors with above average dividend income and long term capital growth through active management of a portfolio consisting predominantly of S&P 500 US equities. Dividends are paid quarterly.
Reference benchmarks Russell Value 1000 Index and S&P 500 Index.
as at 30/09/16 1 month 3 months 6 months
Since change of strategy 1 year 3 years 5 years (31/05/12)
Share Price
1090.0p
0.8
14.9
25.2
48.8
45.5
118.0
NAVA
1187.2p
0.2
6.3
20.3
44.2
61.1
123.9
89.1
S&P 500
0.8
6.9
17.7
34.6
71.2
156.0
115.1
Russell 1000 Value
0.6
6.5
19.7
35.5
64.6
153.5
113.9
89.6
Discrete performance (%) 30/09/16
30/09/15
30/09/14
30/09/13
30/09/12
Share Price
48.8
(7.0)
5.1
22.2
22.7
NAV
44.2
(1.5)
13.4
16.0
19.7
S&P 500
34.6
6.4
19.6
19.0
25.6
Russell 1000 Value
35.5
2.3
18.8
22.0
26.3
A
Total return; NAV to NAV, net income reinvested, GBP. Share price total return is on a mid-to-mid basis. Dividend calculations are to reinvest as at the ex-dividend date. NAV returns based on NAVs with debt valued at fair value. Source: Aberdeen Asset Managers Limited, Lipper and Morningstar. Past performance is not a guide to future results. The investment objective of the Company changed on 29 May 2012, with the Company moving to an objective “to provide investors with above average dividend income and long term capital growth through active management of a portfolio consisting predominately of S&P 500 US equities” from its previous objective “to invest in a portfolio designed to track closely the S&P 500 Index, both in terms of capital and income.” The performance figures shown, therefore, reflect periods of time when the Company ran with these 2 different objectives.
Fund managers’ report
The performance of major North American equity indices was somewhat mixed in September amid periods of volatility surrounding US Federal Reserve (Fed) monetary policy and economic data reports. The energy and information technology sectors garnered the highest returns within the broader-market S&P 500 Index in September. Conversely, the consumer staples and financials sectors lost ground and were the weakest performers. The U.S. investment-grade fixed-income market, as represented by the benchmark Barclays U.S. Aggregate Bond Index, returned -0.06% in September. Investment-grade corporate bonds underperformed comparable-duration Treasuries, with both markets sectors recording modest negative returns for the month. US Treasury yields moved slightly lower in all but the longest segments of the curve in September. Yields on two- and five-year notes declined by corresponding margins of 3 and 5 basis points (bps) to 0.77% and 1.14%, respectively. Despite rising steadily through the first half of September, the yield on the 10-year note ended the month just 2 bps higher at 1.60%. As generally expected, the Fed left its benchmark interest rate unchanged following its meeting of 20-21 September, noting that household spending has been growing steadily while business fixed investment has remained sluggish. However, the decision was not unanimous; three of the ten Fed governors voted for a 25-basis point increase. The US Commerce Department revised its estimate of second-quarter GDP upward from 1.1% to 1.4% due to upturns in nonresidential fixed investment, private inventory investment, Fund managers' report continues overleaf Including current year revenue. Source: CME Group, August 27, 2016. Copyright © 2016 Morningstar UK Ltd. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is not a guide to future results. D Represents cash being used as collateral against open equity options positions, and therefore not available for investment. A
B
C
Morningstar RatingTM for Funds Morningstar rates funds from one to five stars based on how well they’ve performed (after adjusting for risk and accounting for all sales charges) in comparison to similar funds.
C
Ten largest equity holdings
Cumulative performance (%)
Year ending:
Morningstar RatingTM
% 4.0 3.6 3.6 3.5 3.5 3.2 3.2 3.2 3.2 3.1
Pfizer CME Dow Chemical Microsoft Molson Coors Brewing Verizon Communications Wells Fargo & Co BB&T Chevron Rockwell Automation Total
34.1
Sector allocation % 23.0 12.8 11.6 9.1 8.8 8.7 8.4 8.4 6.0 3.2 100.0
Financials Information Technology Consumer Staples Energy Materials Industrials Consumer Discretionary Health Care Telecommunication Services Utilities Total
Geographic breakdown % 87.7 9.1 1.8 1.4
USA Canada Cash available for investment Other cashD Total
100.0
Total number of investments Total number of equity investments Total number of fixed income investments Total
45 10 55
All sources (unless indicated): Aberdeen Asset Managers Limited 30 September 2016.
Private investors 0500 00 00 40 Institutional investors Colin Edge +44 (0)20 7463 5881 or Jonathon McManus +44 (0)20 7618 1444 PAGE 51 OF 56
Investment Trust
The North American Income Trust plc Performance Data and Analytics to 30 September 2016
Fund managers’ report - continued and exports. The West Texas Intermediate crude oil price rallied sharply towards the end of September, reaching a three-month high of more than US$48.00 per barrel after the Organization of the Petroleum Exporting Countries (OPEC) members unexpectedly reached a preliminary agreement to limit oil production amid the ongoing global supply glut. In portfolio-related corporate news during the month, diversified financial services company Wells Fargo & Co. agreed to pay $185 million in fines to settle allegations of deceptive sales practices involving its retail banking accounts. Canadian Western Bank saw improving third-quarter results compared to the previous quarter despite the ongoing negative impact of lower oil prices on its loan book, particularly in Alberta. Management was able to diversify the loan book away from energy-related business into other sectors and geographical regions, as well as closing on the acquisition of GE Capital’s Canadian franchise finance business. Several trust holdings initiated notable dividend actions in September. Lockheed Martin boosted its quarterly payment by 10.3% to US1.82 per share—the 14th consecutive year that the defence contractor has provided a double-digit increase. Microsoft announced an 8.3% hike in its dividend to US$0.39 per share, representing a 2.7% yield at its closing stock price on 30 September. In contrast, Canadian fertiliser maker PotashCorp, cut its payout by 60% to US$0.10 per share, as the company’s business remains hampered by the prolonged weakness in commodity prices. We believe that Potash’s management made the right decision in continuing to reduce the company’s payout to support more effectively its business and balance sheet going forward. Regarding portfolio activity during the month, we added to the trust’s positions in commercial bank BB&T and diversified telecom Verizon Communications. Conversely, we reduced holdings in Wells Fargo & Co. and regional utility company CMS Energy.
Key information Calendar Year end Accounts published Annual General Meeting Dividend paid Established Fund managers Ongoing chargesE Annual management fee Premium/(Discount) YieldF Net gearingG Net gearingGH Active shareI
Gross Notional Commitment
Gross assets Debt Cash
From a bottom up perspective, this summer has brought what appears to be a slowdown in consumer spending; time will tell whether it is a fluke or a more important change in trajectory. In addition, we remain mindful of the effects of volatile commodity prices and the strong US dollar. More importantly, we closely track how these issues impact our companies in the long run as it relates to their competitive positioning and secular changes to the supply and demand dynamics. More relevant for NAIT holdings, wage inflation and the aforementioned slower top-line growth remain headwinds for companies to achieve higher levels of profitability and may impact dividend paying companies. Taken together with the prolonged low interest rate environment, companies may remain opportunistic in further expanding their balance sheets and push for mergers and acquisitions as a means to find growth or to fund other capital return programs.
Capital structure
The risks outlined overleaf relating to exchange rate movements is particularly relevant to this trust, but should be read in conjunction with all warnings and comments given. Important information overleaf
2.5x 2x
Assets/Debt (£m)
Assets
Expressed as a percentage of average daily net assets for the year ended 31 January 2016. The Ongoing Charges Figure (OCF) is the overall cost shown as a percentage of the value of the assets of the Company. It is made up of the Annual Management Fee and other charges. It does not include any costs associated with buying shares in the Company or the cost of buying and selling stocks within the Company. The Ongoing Charges figure can help you compare the annual operating expenses of different Companies. F Calculated using the Company’s historic net dividends and month end share price. G Gearing is defined as a percentage, with net debt (total debt less cash/cash equivalents) divided by shareholders’ funds. H Excludes cash being used as collateral against open option positions from cash/cash equivalents. I The ‘Active Share’ percentage is a measure used to describe what proportion of the Company's holdings differ from the benchmark index holdings. J Calculated as notional principal of outstanding divided by gross equity assets.
(8.2)% 3.1% 10.2% 11.6% 82.2%
AIFMD Leverage Limits
Outlook With the Fed’s September announcement behind us and as we head into the final stretch of the US presidential election, our broader outlook from prior months is largely unchanged. The company fundamentals have generally remained stable through a trickle of US economic data showing slow and steady improvement as global growth has maintained a more measured pace. What this has meant for many US companies is slower organic top-line growth, which, paired with profitability levels that have already seen significant improvement since the financial crisis, broadly means a more tempered environment for earnings growth.
E
31 January March May February, May, August, November 1902 Ralph Bassett Fran Radano 1.03% 0.8%
Equities Fixed Income
387.8 47.0 12.4
% £m 96.1 3.9
360.6 14.8
Options Number of open options positions Equity sleeve optionisedJ
Ordinary shares
3 1.82%
28,789,134
Allocation of management fees and finance costs Capital Revenue
70% 30%
Trading details Reuters/Epic/Bloomberg code ISIN code Sedol code Stockbrokers Market makers
NAIT GB0000293620 0029362 WINS Investment Trusts SETSmm
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Investment Trust
The North American Income Trust plc Performance Data and Analytics to 30 September 2016
Fund managers’ report - continued For the overall US equity market, valuations have expanded in aggregate but still appear to be fair in the context of underlying earnings growth, in our opinion. However, we believe that valuations of high–dividend-paying companies remain extended beyond fundamental fair value as a result of their favorable yield spreads compared to risk-free U.S. Treasury securities. Amid this landscape, we feel that the task for us active managers is to remain carefully selective as we sift through the investable universe. Nonetheless, we remain confident that companies owned by the trust are more reliant on their own performance than their role as a “bond proxy” in investor portfolios.
Important information
Risk factors you should consider prior to investing: • The value of investments and the income from them can fall and investors may get back less than the amount invested. • Past performance is not a guide to future results. • Investment in the Company may not be appropriate for investors who plan to withdraw their money within 5 years. • The Company may borrow to finance further investment (gearing). The use of gearing is likely to lead to volatility in the Net Asset Value (NAV) meaning that any movement in the value of the company's assets will result in a magnified movement in the NAV. • The Company may accumulate investment positions which represent more than normal trading volumes which may make it difficult to realise investments and may lead to volatility in the market price of the Company's shares. • The Company may charge expenses to capital which may erode the capital value of the investment. • Derivatives may be used, subject to restrictions set out for the Company, in order to manage risk and generate income. The market in derivatives can be volatile and there is a higher than average risk of loss. • Movements in exchange rates will impact on both the level of income received and the capital value of your investment. • There is no guarantee that the market price of the Company's shares will fully reflect their underlying Net Asset Value. • As with all stock exchange investments the value of the Company's shares purchased will immediately fall by the difference between the buying and selling prices, the bid-offer spread. If trading volumes fall, the bid-offer spread can widen. • Certain trusts may seek to invest in higher yielding securities such as bonds, which are subject to credit risk, market price risk and interest rate risk. Unlike income from a single bond, the level of income from an investment trust is not fixed and may fluctuate. • Yields are estimated figures and may fluctuate, there are no guarantees that future dividends will match or exceed historic dividends and certain investors may be subject to further tax on dividends. Other important information: Issued by Aberdeen Asset Managers Limited which is authorised and regulated by the Financial Conduct Authority in the United Kingdom. Registered Office: 10 Queen’s Terrace, Aberdeen AB10 1YG. Registered in Scotland No. 108419. An investment trust should be considered only as part of a balanced portfolio. Under no circumstances should this information be considered as an offer or solicitation to deal in investments. PAGE 53 OF 56
Investment Trust
Aberdeen UK Tracker Trust plc Performance Data and Analytics to 30 September 2016
Investment objective To invest in a portfolio designed to track closely the FTSE All-Share Index, both in terms of capital and income.
Morningstar RatingTM Morningstar RatingTM for Funds Morningstar rates funds from one to five stars based on how well they’ve performed (after adjusting for risk and accounting for all sales charges) in comparison to similar funds. B
Benchmark FTSE All-Share Index.
Ten largest equity holdings
Cumulative performance (%) as at 30/09/16
1 month
3 months
6 months
1 year
3 years
5 years
Capital return share price
320.0p
1.8
8.5
10.0
10.5
7.0
40.4
Capital return NAV
340.7p
1.6
7.0
10.9
12.8
8.9
40.9
1.6
6.8
10.6
12.6
9.0
41.5
FTSE All-Share Total return share price
320.0p
1.8
10.7
14.0
14.6
19.8
68.1
Total return NAVA
343.5p
1.7
7.8
12.8
16.6
19.9
65.2
1.7
7.8
12.8
16.8
21.1
68.9
FTSE All-Share
Discrete performance (%) Year ending:
30/09/16
30/09/15
30/09/14
30/09/13
30/09/12
Capital return share price
10.5
(4.5)
1.3
13.5
15.6
Capital return NAV
12.8
(5.8)
2.5
14.7
12.8
FTSE All-Share
12.6
(5.6)
2.6
14.8
13.0
Total return share price
14.6
(1.2)
5.8
17.2
19.7
Total return NAVA
16.6
(2.6)
5.6
18.2
16.6
FTSE All-Share
16.8
(2.3)
6.1
18.9
17.2
Capital Return; NAV to NAV, GBP. NAV returns based on NAVs excluding income and with debt valued at fair. Total return; NAV to NAV, net income reinvested, GBP. Share price total return is on a mid-to-mid basis. Dividend calculations are to reinvest as at the ex-dividend date. NAV returns based on NAVs with debt valued at fair value. Source: Aberdeen Asset Managers Limited, Lipper and Morningstar. Past performance is not a guide to future results.
Fund managers’ report Performance The total return NAV of the trust rose by 1.7% in September which was in line with the total return from the FTSE All-Share Index. The trust bought back 120,500 shares for Treasury during the month.
% 5.2 4.2 3.8 3.7 3.6 3.4 2.9 2.7 2.5 2.1 34.1
HSBC British American Tobacco BP Royal Dutch Shell 'A' GlaxoSmithKline Royal Dutch Shell 'B' AstraZeneca Vodafone Diageo Reckitt Benckiser Total
Sector allocation Financials Consumer Goods Oil & Gas Consumer Services Industrials Health Care Basic Materials Telecommunication Services Utilities Technology Total
% 23.6 17.3 11.6 11.5 10.4 9.9 6.1 4.4 3.9 1.3 100.0
Total number of investments
616
The UK stock market rose during September, coming close to hitting its 2016 high point. This was in contrast to the direction of the pound, which at one point slumped below its post-Brexit nadir. Sterling has fallen around 12% against the dollar and just over 10% against the euro since the UK’s vote to leave the European Union. These contrasting market movements are connected. Many of the UK’s biggest companies make most of their profits overseas. As sterling weakens, the value of these foreign-currency revenues increases when converted back to sterling. So the falling pound has been good news for some of the UK’s main exporters. Meanwhile, domestic economic news was reasonably positive, allaying some of the worst fears about the short term consequences of the vote to leave the European Union. Recent surveys of businesses and consumers have been encouraging, rebounding strongly after slumping in July. However, uncertainties remain over the timing and nature of any Brexit deal, and its long-term implications for the UK economy. Fund managers' report continues overleaf Including current year revenue. Copyright © 2016 Morningstar UK Ltd. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is not a guide to future results.
A B
The risks outlined overleaf should be read with all warnings and comments given. Important information overleaf
All sources (unless indicated): Aberdeen Asset Managers Limited 30 September 2016.
Private investors 0500 00 00 40 Institutional investors Colin Edge +44 (0)20 7463 5881 or Jonathon McManus +44 (0)20 7618 1444 PAGE 54 OF 56
Investment Trust
Aberdeen UK Tracker Trust plc Performance Data and Analytics to 30 September 2016
Fund managers’ report - continued On a capital returns basis, the FTSE 100, the FTSE 250 and FTSE SmallCap Indices rose by 1.7%, 0.8% and 1.6% respectively over the month. Activity The FTSE UK index quarterly rebalancing occurred in September. This resulted in 2 additions to the FTSE 350 index. One of these new additions, GVC, was a new FTSE All-Share index entrant following a transfer to a premium listing on the LSE and was consequently purchased by the Trust. The other addition to the FTSE 350 Index was already held by the trust. Any significant shares in issue or investability weight changes to the underlying index constituents were also traded to realign portfolio positions to index weight. Strategy The trust’s portfolio replicates in full the constituents and weightings of the FTSE 350 Index and also holds most of the constituents of the FTSE SmallCap Index.
Key information Calendar Year end Accounts published Annual General Meeting Dividend paid Established Fund manager Ongoing chargesC Annual management feeD Premium/(Discount) YieldE Gearing
31 December March April April, August 1990 David Jones 0.29% 0.09% over £100m 0.2% under £100m (6.8)% 3.5% nil
AIFMD Leverage Limits
Expressed as a percentage of average daily net assets for the year ended 31 December 2015. The Ongoing Charges Figure (OCF) is the overall cost shown as a percentage of the value of the assets of the Company. It is made up of the Annual Management Fee and other charges. It does not include any costs associated with buying shares in the Company or the cost of buying and selling stocks within the Company. The Ongoing Charges figure can help you compare the annual operating expenses of different Companies. D 0.2% per annum of the total assets of the Company after deducting current liabilities and excluding commonly managed funds, on the value of total assets up to £100 million and reduced to 0.09% per annum of the value of total assets in excess of £100 million. E Calculated using the Company’s historic net dividends and month end share price. C
Important information Risk factors you should consider prior to investing: • The value of investments and the income from them can fall and investors may get back less than the amount invested. • Past performance is not a guide to future results. • Investment in the Company may not be appropriate for investors who plan to withdraw their money within 5 years. • The Company may accumulate investment positions which represent more than normal trading volumes which may make it difficult to realise investments and may lead to volatility in the market price of the Company's shares. • There is no guarantee that the market price of the Company's shares will fully reflect their underlying Net Asset Value. • As with all stock exchange investments the value of the Company's shares purchased will immediately fall by the difference between the buying and selling prices, the bidoffer spread. If trading volumes fall, the bid-offer spread can widen. • Yields are estimated figures and may fluctuate, there are no guarantees that future dividends will match or exceed historic dividends and certain investors may be subject to further tax on dividends. • Derivatives may be used, subject to restrictions set out for the Company, in order to manage risk and generate income. The market in derivatives can be volatile and there is a higher than average risk of loss. Other important information: Issued by Aberdeen Asset Managers Limited which is authorised and regulated by the Financial Conduct Authority in the United Kingdom. Registered Office: 10 Queen’s Terrace, Aberdeen AB10 1YG. Registered in Scotland No. 108419. An investment trust should be considered only as part of a balanced portfolio. Under no circumstances should this information be considered as an offer or solicitation to deal in investments. FTSE International Limited (‘FTSE’) © FTSE 2016. ‘FTSE®’ is a trade mark of the London Stock Exchange Group companies and is used by FTSE International Limited under licence. RAFI® is a registered trademark of Research Affiliates, LLC. All rights in the FTSE indices and/ or FTSE ratings vest in FTSE and/or its licensors. Neither FTSE nor its licensors accept any liability for any errors or omissions in the FTSE indices and/or FTSE ratings or underlying data. No further distribution of FTSE Data is permitted without FTSE’s express written consent.
Gross Notional 2.5x Commitment 2x Under the current investment policy the Company does not use gearing.
Assets/Debt (£m) Gross Debt Cash
340.8 nil 6.9
Capital structure 99,199,274 3,856,841
Ordinary shares Treasury shares
Allocation of management fees and finance costs Revenue
100%
Trading details Reuters/Epic/Bloomberg code ISIN code Sedol code Stockbrokers Market makers
AUKT GB0005596985 0559698 J.P. Morgan Cazenove SETSmm
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