TIDMSIHL
RNS Number : 3118G
Symphony International Holdings Ltd
05 August 2016
Not for distribution, directly or indirectly, in or into the
United States or any jurisdiction in which such distribution would
be unlawful.
Symphony International Holdings Limited
5 August 2016
Symphony International Holdings Limited ("Symphony", "SIHL" or
the "Company") (LSE: SIHL.L), a leading investor in
consumer-related businesses, primarily in the healthcare,
hospitality, lifestyle, and lifestyle/real estate sectors in the
Asia-Pacific region, today issues the following Shareholder
Update.
Highlights
-- Symphony's unaudited Net Asset Value ("NAV") at 30 June 2016
was US$712,465,351 and NAV per share was US$1.3472. This compares
to NAV and NAV per share at 31 March 2016 of US$683,247,482 and
US$1.2938, respectively
-- The change in NAV and NAV per share was predominantly due to
a strengthening in the share price of Minor International Pcl
("MINT") during the quarter
-- Symphony's share price increased by 4.2% during the quarter
to US$0.76 at 30 June 2016. The discount to NAV on the same date
was 43.6%
-- During the quarter, Symphony acquired, as part of a
consortium, Financier CL SAS, the holding company of the Christian
Liaigre Group ("CLG"). The Liaigre brand is synonymous with
discreet luxury, and has become one of the most sought-after luxury
furniture brands
-- Temporary investments (which includes cash net of working
capital) and listed investments amounted to US$524.7 million, or
US$0.99 per share. Symphony's share price on the same date
represents a discount of 23.4% to temporary and listed
investments
Anil Thadani, Chairman of Symphony Asia Holdings Private Limited
and a Director of Symphony, said:
"With the 4.3% NAV growth during the quarter and excluding the
impact of the US$40 million dividend announced in March, Symphony's
NAV during the first half of 2016 would have increased by 8.2%
despite volatile conditions. Aside from the solid growth in NAV, we
are also pleased that Symphony completed the acquisition of the
Christian Liaigre Group with a co-investor during the second
quarter. The Christian Liaigre Group is a strong business with a
brand that is synonymous with discreet luxury that complements
Symphony's portfolio and core focus. We see strong opportunity to
grow this business."
For further information:
Anil Thadani +65 6536 6177
Symphony Asia Holdings Pte. Ltd.
About Symphony
Symphony is a London listed strategic investment company that
invests in consumer businesses in the healthcare, hospitality and
lifestyle ("HH&L") sectors (including branded real estate
developments), which are principally in Asia. It offers a way for
investors to gain exposure to the rising disposable incomes and
wealth in fast growing economies. Symphony's objective is to
provide superior capital growth by investing in high quality
companies and forming long-term business partnerships with talented
entrepreneurs. Symphony is managed by Symphony Asia Holdings
Private Limited, which has a team of investment professionals with
a broad range of expertise - many of them have been working in Asia
for more than 25 years. For more information, please visit our
website at www.symphonyasia.com
MARKET OVERVIEW
There were various geopolitical and economic events that caused
renewed volatility in the financial markets during the second
quarter of 2016. In particular, the United Kingdom's ("UK") vote to
withdraw from the European Union ("EU"), a deterioration in the
economic environments of China and Japan, and further developments
in the presidential election process in the US all affected
investor sentiment. Overall and despite volatility during the
quarter, the MSCI AC Asia, World and MSCI Thailand and Singapore
indices ended the quarter predominantly flat.
In June, Britain unexpectedly voted to leave the EU ("Brexit'),
ending months of vacillation. The Brexit vote caused a depreciation
in the British pound against major currencies and stock market
declines globally in its immediate aftermath. There remains
uncertainty around Britain invoking article 50 and negotiating an
exit agreement with the EU, which, depending on the outcome, could
have a further negative impact on UK, EU and global economic
growth.
Japan and China saw further economic deterioration during the
second quarter. The weakness in Japan is stoking fears of
"quantitative failure" in which central banks easing efforts fail
under the current negative interest rate environment, which would
effectively limit the tools available to steer economic conditions.
In China, the central bank devalued the Chinese yuan by the largest
amount since August 2015 in reaction to volatile currency markets
and weak exports.
In the US, Hillary Clinton and Donald Trump passed the threshold
required to become the presidential nominees for the Democratic and
Republican party, respectively. Both candidates have starkly
different positions on global trade with Trump seeking to
re-negotiate trade pacts and Clinton looking to maintain the status
quo. The protectionist stance of the Trump campaign continues to
cause concern should his presidential bid become successful.
Despite the uncertainty, financial markets in the US have been
partially supported by the Federal Reserve's deferment of a rate
increase in June due to weaker than expected economic indicators
and Brexit.
In July, the International Monetary Fund ("IMF") updated its
economic forecasts. The IMF revised down its forecast for global
growth to 3.1% from 3.2% and 3.4% from 3.5% for 2016 and 2017,
respectively, whereas for Emerging and Developing Asia, it
maintained its growth forecasts at 6.4% and 6.3% for 2016 and 2017,
respectively, largely due to Brexit and the effect of disappointing
growth in advanced economies. The IMF's forecasts for China's 2016
growth increased to 6.6% from 6.5% and remained at 6.2% for 2017,
and for India decreased to 7.4% from 7.5% for both years. Forecast
for growth in the ASEAN-5 also remained stable at 4.8% and 4.5% for
both years.
Symphony's listed investments that include MINT, IHH Healthcare
Berhad ("IHH"), and Parkway Life Real Estate Investment Trust
("PREIT") continued to build their respective portfolios during the
second quarter of 2016. MINT announced new acquisitions in Africa
and hotel developments in the United Arab Emirates and India. In
addition, IHH announced two acquisitions which makes it the leading
private operator in Bulgaria.
During the quarter, Symphony acquired, as part of a consortium,
Financier CL SAS, the holding company of the Christian Liaigre
Group ("CLG"). The Liaigre brand is synonymous with discreet
luxury, and has become one of the most sought-after luxury
furniture brands. CLG has a strong intellectual property portfolio
and offers a range of bespoke furniture, lighting, fabric &
leather, and accessories through a network of 26 showrooms in 11
countries across Europe, the US and Asia.
Symphony's other unlisted lifestyle investments that include the
Wine Connection Group ("WCG") and C Larsen continue to focus on
building their operations. With respect to Symphony's land related
investments, the Desaru Amanresorts development is ongoing and we
continue to explore strategic options for property investments in
Thailand and Japan.
Symphony continues to support the management teams of its
portfolio companies and is currently evaluating several
opportunities to grow its portfolio.
COMPANY UPDATE
Symphony International Holdings Limited's ("Symphony" or the
"Company") unaudited Net Asset Value ("NAV") at 30 June 2016 was
US$712,465,351 and NAV per share was US$1.3472. This compares to
NAV and NAV per share at 31 March 2016 of US$683,247,482 and
US$1.2938, respectively. The change in NAV and NAV per share was
predominantly due to a strengthening in the share price of Minor
International Pcl ("MINT") during the quarter. On a fully-diluted
basis (adjusting for in-the-money vested options), the NAV per
share was US$1.3315 on the same date.
Symphony's change in NAV per share (up 4.1%) outperformed the
MSCI Singapore (down 1.2%), MSCI AC Asia (neutral 0.0%), MSCI AC
World (up 0.3%), and MSCI Thailand (up 1.6%) indices during
2Q16.
Symphony's listed investments accounted for 73.1% of NAV at 30
June 2016 (or US$0.985 per share), which is down from 73.4% of NAV
at 31 March 2016. The marginal change is predominantly due to an
increase in the share price of Minor International Pcl ("MINT"),
which was offset by the sale of 9.5 million MINT shares during the
quarter and a new investment in the Lifestyle sector. On a per
share basis, the value of Symphony's unlisted investments
(including property) comprised a further 26.4% of Symphony's NAV
(or US$0.355 per share), while the remaining 0.5% of NAV (or
US$0.007 per share) represented temporary investments.
Symphony's share price continued to trade at a discount to NAV
in 2Q16. At 30 June 2016, Symphony's share price was US$0.76,
representing a discount to NAV per share of 43.6%.
As of 30 June 2016, the sum of Symphony's temporary investments
(which includes cash net of working capital) and listed investments
amounted to US$524.7 million, or US$0.99 per share. Symphony's
share price on the same date represents a discount of 23.4% to
temporary and listed investments.
PORTFOLIO DEVELOPMENTS
Minor International Pcl ("MINT") is one of the largest
hospitality and restaurant companies in the Asia Pacific region.
MINT owns 67 hotels and manages 80 other hotels and serviced suites
with 19,006 rooms. In addition to owning hotels under the Four
Seasons, St. Regis and Marriott brands, MINT owns and manages
hotels in 22 countries under its own brand names that include
Anantara, Oaks, Elewana, AVANI, Per AQUUM and Tivoli. MINT also
owns and operates 1,859 restaurants (comprising 961 equity-owned
outlets and 898 franchised outlets) under brands that include The
Pizza Company, Swensen's, Sizzler, Dairy Queen, Burger King,
Beijing Riverside, Thai Express, The Coffee Club, Veneziano Coffee
Roasters, and Breadtalk.
MINT's operations also include contract manufacturing and an
international lifestyle consumer brand distribution business at 307
retail points focusing on fashion, cosmetics, wholesale and direct
marketing channels under brands that include GAP, Esprit, Bossini,
Red Earth and Henckels amongst others.
Update: MINT continued to see growth on a consolidated basis in
1Q16 year-over-year. Revenue, EBITDA, and net profit (excluding
fair value adjustments) increased by 21%, 23%, and 9%,
respectively, during the period. Growth was attributable to the
outstanding performance of MINT's restaurant and hotel businesses,
plus incremental revenues from new investments.
MINT's hotel & mixed-use business grew revenues by 18% in
1Q16 year-over-year, driven by the strong performance of Thailand
hotels, additional revenues from recently-acquired hotels, and
sales of The Residences by Anantara Layan in Phuket. In April, MINT
announced two new properties in Abu Dhabi- Anantara Jebel Dhanna
and AVANI Jebel Dhanna, along with Oaks Bodhgaya in Bihar, India.
In May, MINT acquired eight hotels in Southern Africa. In June,
MINT signed two management agreements, one each in Thailand and the
United Arab Emirates.
Mixed-use business, which includes property development
operations and plaza and entertainment, saw an overall increase in
revenues in 1Q16. Property development revenue increased by 20% due
to the sale of two villas in The Residences by Anantara in Phuket,
offset by a 4% decrease in plaza and entertainment revenue due to
lower consumer spending power.
In 1Q16, MINT's total number of restaurants reached 1,859,
representing an increase of 8 outlets during the quarter. 64% of
the total restaurants are in Thailand with the remainder in other
Asia-Pacific countries and the Middle East. Total system sales in
1Q16 increased by 8.8% year-over-year primarily due to performance
in Thailand and China and outlet expansion of 8%
year-over-year.
The fair value of Symphony's investment in MINT at 30 June 2016
was US$383.2 million, up from US$362.2 million at 31 March 2016.
The change was primarily due to the increase in the share price of
MINT from THB36.75 to THB40.00 during the quarter, which was offset
by the sale of 9.5 million MINT shares that generated net proceeds
of approximately US$10.7 million.
Minuet Limited ("Minuet") is a joint venture between Symphony
and an established Thai partner. Symphony has a direct 49% interest
in the venture and is considering several development and/or sale
options for the land owned by Minuet, which is located in close
proximity to central Bangkok, Thailand.
Update: The Company's investment cost (net of shareholder loan
repayments) was approximately US$60.9 million at 30 June 2016.
The value of Symphony's interest in Minuet at 30 June 2016 was
US$83.0 million based on an independent third party valuation on 30
June 2016. The change in value from US$82.5 million at 31 March
2016 is predominantly due to a marginal appreciation in the value
of land during the quarter.
Parkway Life Real Estate Investment Trust ("PREIT") invests in
income generating healthcare-related properties in the Asia-Pacific
region including three of Parkway's Singapore hospitals, which are
leased back to Parkway on long leases. Established by Parkway
Holdings Limited, PREIT is the largest listed healthcare REIT in
Asia by asset size and generates an inflation-linked yield of
around 4-5% based on current valuations and historic
distributions.
Update: PREIT reported an increase in gross revenue and net
property income by 6.8% and 6.4% to S$27.4 million and S$25.5
million, respectively, in 2Q16 year-over-year. The increase was due
to full quarter rental contribution from acquisitions completed in
1Q16, higher yielding properties from the asset recycling
initiative in 1Q15, higher rent from Singapore properties and
appreciation of the Japanese yen.
Following the acquisition of a nursing home facility in March
2016 in Japan, PREIT's portfolio increased to 48 properties. The
portfolio includes 44 properties in Japan, three in Singapore and
strata titled units/lots within Gleneagles Medical Centre, Kuala
Lumpur, Malaysia.
As at 30 June 2016, PREIT had a gearing ratio of 37.8%, which is
well within the 60% limit allowed under the Monetary Authority of
Singapore Property Funds Guidelines and will allow for further
yield accretive acquisitions.
As at 30 June 2016, the fair value of Symphony's investment in
PREIT was US$69.1 million, compared to US$68.2 million at 31 March
2016. The change is predominantly due to a marginal increase in the
unit price of PREIT.
IHH Healthcare Berhad ("IHH") is one of the largest healthcare
providers in the world by market capitalisation. Its portfolio of
healthcare assets includes Parkway Holdings Limited, Pantai
Holdings Berhad, International Medical University, Acibadem Saglik
Yatirimlari Holding A.S. ("Acibadem") and a minority shareholding
in Apollo Hospitals Enterprises Limited. IHH has a broad footprint
of assets in Asia as well as Turkey, Abu Dhabi, Central and Eastern
Europe that employ 30,000 people and operate close to 10,000
licensed beds in 49 hospitals worldwide.
Update: IHH reported 1Q16 revenue and EBITDA growth of 24% and
22% to MYR2.5 billion and MYR0.6 billion, respectively, compared to
the same period a year earlier. The improvement in performance is
due to organic growth in IHH's existing hospitals and ramp up of
its newer hospitals: Acibadem Atakent and Acibadem Taksim Hospitals
in Turkey and Pantai Manjung, Gleneagles Kota Kinabalu, and
Gleneagles Medini in Malaysia. The consolidation of Continental and
Global Hospitals in India also contributed revenue in 1Q16.
Revenues at Parkway Pantai hospitals grew 30% in 1Q16
year-over-year to MYR1.5 billion, driven partly by the continued
ramp-up of Mount Elizabeth Novena Hospital in Singapore and
contribution from newly opened hospitals in Malaysia and new
acquisitions in India. In June, the company entered into a land
contract for a 450-bed hospital in Shanghai.
Acibadem's revenues grew in 1Q16 by 14% due to an increase the
continued ramp up of Acibadem Atakent Hospital, contribution from
Acibadem Taksim, and organic growth but was partially offset by a
1.1% decrease in the Malaysian Ringgit against the Turkish Lira. In
April, Acibadem announced an acquisition of Bulgaria-based Tokuda
Hospital and a merger with City Clinic.
IMU Health, the medical education arm of IHH, increased revenue
by 2% during 1Q16, which was due to higher tuition fees.
At 30 June 2016, the fair value of Symphony's investment in IHH
was US$68.7 million down from US$71.0 million at 31 March 2016. The
change is primarily due to a weakening of the Malaysian ringgit by
3.3% during 2Q16.
Property Joint Venture in Malaysia: Symphony has a 49% interest
in a property joint venture in Malaysia with an affiliate of
Destination Resorts and Hotels Sdn Bhd, a hotel and destination
resort investment subsidiary of Khazanah Nasional Berhad, the
investment arm of the Government of Malaysia. The joint venture is
developing a beachfront country club and private villas on the
south-eastern coast of Malaysia that will be branded and managed by
Amanresorts.
Update: Symphony invested US$29.0 million in January 2012 for
its interest in the joint venture company. Symphony's interest in
the joint venture at 30 June 2016 was US$24.1 million, which
compares to US$24.8 million at 31 March 2016. The change in value
is predominantly due to a decrease of the Malaysian ringgit by 3.3%
during the quarter. The project is ongoing, but there have been
rectification delays that will postpone launch to 2Q17.
SG Land Co. Ltd ("SG Land") is a joint venture company that owns
the leasehold rights for two office buildings in downtown Bangkok -
SG Tower and Millenia Tower. The two buildings in SG Land's
portfolio have high occupancy rates and offer attractive rental
yields. Symphony holds 49.9% of the venture.
Update: SG Land continues to generate stable rental income on
its two office towers. The value of SG Land at 30 June 2016 was
US$10.4 million based on an independent third party valuation at 30
June 2016. The change from US$13.4 million at 31 March 2016 is
predominantly due to the reduced term of the lease, and lower
forecast occupancy rates that are used to determine fair value.
Christian Liaigre Group ("CLG"): Symphony announced in May 2016
that it acquired, as part of a consortium, Financier CL SAS, the
holding company of the Christian Liaigre Group ("CLG"). The Liaigre
brand is synonymous with discreet luxury, and has become one of the
most sought-after luxury furniture brands. CLG has a strong
intellectual property portfolio and offers a range of bespoke
furniture, lighting, fabric & leather, and accessories through
a network of 26 showrooms in 11 countries across Europe, the US and
Asia. In addition, CLG also undertakes exclusive interior
architecture projects for select yachts, hotels, restaurants and
private residences.
Update: The consortium is working closely with management to
support the business plan for CLG and also explore new
opportunities for the business. CLG is valued at more than 5% of
NAV but due to strategic concerns, specific valuation information
will not be disclosed.
Property Joint Venture in Japan: Symphony invested in a property
development venture that has acquired two hotels in Niseko,
Hokkaido, Japan. Symphony has a 37.5% interest in the property
development venture.
Update: The property is located in the Hirafu area of Niseko
which continues to gain traction as a premium winter sports
destination and for its popularity as an off-ski season activity
destination. We expect the number of visitors to increase
year-over-year during the current summer period and 2016/2017 ski
season, which should continue to drive demand for regional vacation
properties. The joint venture continues to evaluate options with
respect to the property site in order to maximize profits for its
shareholders.
Wine Connection Group ("WCG"): At the end of April 2014,
Symphony invested in the Wine Connection Group ("WCG"), Southeast
Asia's leading wine themed Food and Beverage chain with currently
over 70 outlets in Singapore, Thailand and Malaysia.
Update: WCG continues to expand its business and increase
efficiency. There have been strong headwinds in the food and
beverage sector in the markets that WCG operates, but we have seen
improvement during the second quarter of 2016. We expect stronger
consumer sentiment to continue to benefit the overall market
environment.
Structured Transaction: In February 2014, Symphony completed a
structured transaction, which provides a minimum return of 15% per
annum. The investment amount is less than 2% of NAV.
C Larsen Singapore Pte Limited ("C Larsen") is a luxury
hospitality company which primarily sells several high-end U.S. and
European furniture brands and is based in Thailand. The current
portfolio of furniture brands includes Christian Liaigre, Barbara
Barry, Baker, Thomasville, Herman Miller, Minotti, Bulthaup
kitchens, Puiforcat, and St. Louis. It also provides FF&E
solutions to drive additional furniture sales to various real
estate and hotel projects. Recently, a new F&B business was
added to the company under the brand of Clinton Street Baking
Company.
Update: Continuing growth in the luxury real estate market in
Thailand supported C Larsen's furnishing and outlet businesses. The
company has fine tuned the operations of the Clinton Street Baking
Company franchise in Singapore and expects to open an outlet in
Bangkok later this year.
OUTLOOK
We remain confident that growing wealth in the region will
continue to drive consumerism. Symphony's portfolio is well
positioned to benefit from these changes. The volatility in
financial markets should provide opportunities to further expand
Symphony's portfolio.
IMPORTANT INFORMATION
A more detailed Shareholder Update is available on request from
the Company and can be accessed via www.symphonyasia.com.
This document is not for release, publication or distribution,
in whole or in part, directly or indirectly, in or into the United
States or any other jurisdiction into which the publication or
distribution would be unlawful. These materials do not constitute
an offer to sell or issue or the solicitation of an offer to buy or
acquire securities in the United States or any other jurisdiction
in which such offer or solicitation would be unlawful. THE
securities referred to in this document have not been and will not
be registered under the securities laws of such jurisdictions and
may not be sold, resold, taken up, transferred, delivered or
distributed, directly or indirectly, within such jurisdictions.
No representation or warranty is made by the Company or its
Investment Manager as to the accuracy or completeness of the
information contained in this document and no liability will be
accepted for any loss whatsoever arising in connection with such
information.
This Document contains (or may contain) certain forward-looking
statements with respect to certain of the Company's current
expectations and projections about future events. These statements,
which sometimes use words such as "anticipate", "believe", "could",
"estimate", "expect", "intend", "may", "plan", "potential",
"should", "will" and "would" or the negative of those terms or
other comparable terminology, are based on the Company's beliefs,
assumptions and expectations of its future performance, taking into
account all information currently available to it at the date of
this document. These beliefs, assumptions and expectations can
change as a result of many possible events or factors, not all of
which are known to the Company at the date of this announcement or
are within its control. If a change occurs, the Company's business,
financial condition and results of operations may vary materially
from those expressed in its forward-looking statements. Neither the
Company nor its Investment Manager undertake to update any such
forward looking statements
Statements contained in this DOCUMENT regarding past trends or
activities should not be taken as a representation that such trends
or activities will continue in the future. The information
contained in this document is subject to change without notice and,
except as required by applicable law, neither the Company nor THE
INVESTMENT MANAGER assumes any responsibility or obligation to
update publicly or review any of the forward-looking statements
contained herein. You should not place undue reliance on
forward-looking statements, which speak only as of the date of this
announcement.
This document is for information purposes only and does not
constitute an invitation or offer to underwrite, subscribe for or
otherwise acquire or dispose of any securities of the Company in
any jurisdiction. All investments are subject to risk. Past
performance is no guarantee of future returns. Shareholders and
prospective investors are advised to seek expert legal, financial,
tax and other professional advice before making any investment
decisions.
This DOCUMENT is not an offer of securities for sale into the
United States. The Company's securities have not been, and will not
be, registered under the United States Securities Act of 1933 and
may not be offered or sold in the United States absent registration
or an exemption from registration. There will be no public offer of
securities in the United States.
Neither the content of the Company's website (or any other
website) nor the content of any website accessible from hyperlinks
on the Company's website (or any other website) is incorporated
into, or forms part of, this DOCUMENT.
The Company and the Investment Manager are not associated or
affiliated with any other fund managers whose names include
"Symphony", including, without limitation, Symphony Financial
Partners Co., Ltd.
End of Announcement
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCZZLFBQVFXBBD
(END) Dow Jones Newswires
August 05, 2016 02:00 ET (06:00 GMT)
Symphony International H... (LSE:SIHL)
Historical Stock Chart
From Apr 2024 to May 2024
Symphony International H... (LSE:SIHL)
Historical Stock Chart
From May 2023 to May 2024