TIDMSJG
RNS Number : 7378U
Schroder Japan Growth Fund PLC
08 April 2021
8 April 2021
Half Year Report
Schroder Japan Growth Fund plc hereby submits its Half Year
Report for the period ended 31 January 2021 as required by the UK
Listing Authority's Disclosure Guidance and Transparency Rule
4.2.
The Half Year Report is also being published in hard copy format
and an electronic copy of that document will shortly be available
to download from the Company's webpages
www.schroders.co.uk/japangrowth . P lease click on the following
link to view the document:
http://www.rns-pdf.londonstockexchange.com/rns/7378U_1-2021-4-7.pdf
The Company has submitted its Half Year Report to the National
Storage Mechanism and it will shortly be available for inspection
at https://data.fca.org.uk/#/nsm/nationalstoragemechanism .
Enquiries:
Benjamin Hanley
Schroder Investment Management Limited Tel: 020 7658 3847
Half Year Report and Accounts
for the six months ended 31 January 2021
Interim Management Report - Chairman's Statement
P erformance
During the six-month period to 31 January 2021, the Company's
net asset value ("NAV") produced a total return of 19.9%,
outperforming the Benchmark total return of 17.9%. In addition, as
sentiment towards the Japanese market improved, and the discount
narrowed, the share price produced a total return of 26.7%.
It is pleasing to see an improvement in performance over the
half year and subsequent to the period under review. While longer
term, returns to shareholders remain unsatisfactory, the Manager
must be credited for consistently applying his stock-picking
investment approach, rather than chasing momentum. It appears that
market sentiment has shifted away from aggressive growth companies
and is focusing more on quality. If the green shoots we are
witnessing at the moment continue, we would hope to see a sustained
improvement in performance.
Further performance details are set out in the Manager's Review
on page 4 of the 2021 Half Year Report.
Share purchases and discount management
I reported in my last annual report to shareholders that the
share buyback facility would be more extensively utilised as the
Board believes that when shares trade at wider discount levels,
buybacks help to create excess return for shareholders and to
improve liquidity. Subsequently, the Board has been active in
buying back shares and, in the six months to 31 January 2021,
1,646,878 shares were bought back at an average discount of 12.9%.
By the end of the period, the discount had significantly narrowed
to 10.2% and since the period end, the Company has continued to be
active in the market and a further 986,560 shares have been brought
back (as at 6 April).
Gearing
The Manager actively used gearing throughout the period. The
Company's term loan remained fully utilised whilst the revolving
credit facility was undrawn. The average gearing during the six
months to 31 January 2021 was 11.8% and as at 6 April, the gearing
was 10.7%.
Outlook
Equity market sentiment globally has improved significantly in
the last six months, driven by vaccine approvals and roll-outs,
together with the additional economic stimulus measures introduced
around the world. Japan has also successfully navigated a change in
Prime Minister following the resignation of Mr Abe, who had been
the main architect of Japan's economic policies for the previous
eight years. Improving expectations for a global economic recovery
have also had a positive impact on Japan's stock market, while the
domestic economy has continued to be less adversely affected than
many other developed countries. Nevertheless, the investment
approach of our Manager, which has a bias towards value, continued
to be out of favour until near the end of 2020. Subsequently we
have seen some changes in market leadership, and less emphasis on a
narrow group of growth-style stocks, which has created a better
environment for portfolio performance.
While we are not complacent about the risk of further
pandemic-related economic shocks, it does seem that visibility on
Japan's corporate earnings' recovery is now beginning to improve.
We believe this, coupled with the longer-term structural
improvements in Japan's corporate governance, can continue to
generate more focus on individual company valuations, which would
benefit our Manager's investment style.
Anja Balfour
Chairman
7 April 2021
Interim Management Report - Manager's Review
Market background
The Japanese market was strong for most of the period,
particularly from November onwards, recording a total return of
22.1%. The yen/sterling exchange rate was volatile in September,
but, for the period as a whole, there was a net weakening of the
yen, which restricted the total market return in sterling to
17.9%.
Domestically, the early part of the review period was dominated
by the change in Japan's prime minister. Shinzo Abe announced his
resignation as prime minister of Japan on 28 August, due to the
resurgence of a long-standing health problem, just four days after
he recorded the longest continuous term of any Japanese prime
minister. Although Mr Abe's health had clearly deteriorated, his
popularity had also declined recently, primarily due to his
handling of Japan's response to the pandemic. Following his
resignation, the Liberal Democratic Party opted for the simplest
method to elect their next party president. Yoshihide Suga, the
Chief Cabinet Secretary, quickly emerged as the frontrunner within
a few days of Mr Abe's announcement and he duly won the leadership
election on 14 September. His position as the new prime minister
was then confirmed in a special Diet session on 16 September.
Domestic factors then took a back seat to global drivers,
especially the positive news flow on the results from various
vaccine trials. Equity investors responded very positively in
November to the idea that tackling the virus could eventually
become a logistical exercise, albeit an extremely complex one. The
slow-motion results of the US presidential election ultimately
reduced one potential source of uncertainty.
All the available data during the period showed that Japan's
experience of COVID-19, in terms of incidence and mortality,
continued to be markedly different from the US and Europe. As a
result, the government was able to continue to encourage private
consumption through its "Go To" campaign for domestic travel. In
October, this was supplemented by the launch of "Go To Eat"
discounts to support local restaurants in each prefecture. Although
the absolute levels of virus infection in Japan remained
significantly below other developed countries, there was a pick-up
towards the end of the year, leading to further public criticism of
government policy. During December, these concerns began to impact
on the popularity of new Prime Minister Suga and ultimately led to
the suspension of the "Go To" campaigns. Early in 2021, a state of
emergency was re-imposed for the first time since May, although
even this imposed significantly lighter restrictions than those
seen in Europe.
In the final weeks of the year, there was an increased focus on
the likelihood of further stimulus measures being passed in the US.
Japan's cabinet also approved a large additional fiscal package, to
be funded by a further supplementary budget.
Nevertheless, survey data released in December, including the
Bank of Japan's Tankan and the Economy Watchers' Survey,
highlighted the fragility of consumer confidence as a result of
rising infections. Japan has also dipped back into deflation,
although this is currently due to a series of temporary factors,
including lower utility prices and mobile phone charges. Although
survey data on economic conditions remained somewhat weak early in
2021, actual GDP data for the fourth quarter of 2020, which was
released in mid-February, was stronger than expected.
The corporate results season for the October to December quarter
was completed in mid-February. The proportion of results that were
ahead of consensus expectations was unusually high for Japan and
this has continued to drive a positive revision cycle for corporate
profits. These revisions, coupled with strong net buying of
Japanese equities from foreign investors, helped push the main
Topix Index to an almost 30 year high just after the end of the
period.
The Company's NAV rose 19.9% over the six months, ahead of the
17.9% increase in the Benchmark (Source: Morningstar, cum-income
NAV with dividends reinvested, 31 January 2021 data, net of
fees).
Although the market environment changed somewhat in the latter
part of the period, there was a positive impact from the gearing
throughout. Among individual stocks, there was a strong positive
contribution from Ibiden, a ceramic producer specializing in
semiconductor packaging. Conversely, Pan Pacific International, a
discount retailer operating under the Don Quijote brand was
relatively weak in the last six months, as consumption remained
under pressure.
Activity
Our research team has been particularly focused on new ideas
generated by the market turmoil in 2020. One example of this is
Toho, which was added to the portfolio. This is one of the largest
media groups in Japan, engaged in both movie production and
distribution, together with the operation of theatres. The company
posted over 80% operating profits decline earlier in 2020, but
monthly box-office figures subsequently showed a clear recovery
from the worst period.
We also initiated a position in AEON Financial Service, which
provides comprehensive financial services, including credit cards
and banking. A dividend cut was announced at the time of first
quarter results, which led to a significant share price correction
but we expect that the company will restore dividend payments much
faster than their earnings recovery.
Amada, a major producer of machine tools, was also added to the
portfolio as a beneficiary of the recovery we anticipate in both
domestic and overseas markets.
One small cap position was sold in Nafco, a home furnishing
retailer, after a period of strong relative performance. The
remaining position in Japan Post Holdings, covering post, insurance
and banking, was also sold as some of the positive changes we were
expecting to see from the company may now be delayed. Lastly, the
holding in Hitachi Capital was sold. The company provides consumer
financing services, including loan guarantees and credit cards, and
has recently announced a merger with MUFG Lease. We feel some of
the specific advantages of Hitachi Capital, especially its strong
UK franchise, may become diluted within the larger merged
entity.
This information is not an offer, solicitation or recommendation
to buy or sell any financial instrument or to adopt any investment
strategy.
Outlook
With Japan's state of emergency due to be lifted during March,
we see limited additional impact for the equity market given the
scale of economic dislocation will be less dramatic than that seen
in early 2020. We also expect reduced impact on supply chains
across Asia and, ultimately, a clearer route out of restrictions
via the vaccine roll-out.
After additional safety tests required under Japanese
regulations, the Pfizer vaccine was approved for use from 15
February and 3.7m healthcare professionals are now being
prioritised in the initial roll-out. The general population is
likely to be offered a vaccine in the April to June quarter. It is
still unclear what impact the domestic, and global, vaccination
programmes will have on the final decision to be taken on the
hosting of the delayed Tokyo Olympics. The current political
statements still support a scaled-back version of the games,
starting in July as planned, although the general public seems to
be increasingly sceptical. Although the government is facing a
difficult political choice, we do not see any significant economic
impact, whichever way the final decision goes. Most of the impact
would be seen in a far lower number of tourist arrivals than
originally expected, but this has already been fully discounted by
the equity market and we don't see any great scope for
surprise.
However, developments around both the Olympics and the vaccine
roll-out could also affect the political timetable in Japan.
Although the transfer of power from Mr Abe to Mr Suga has not led
to any unexpected policy changes, a general election is due by
October 2021 at the latest and it is still possible that we could
see a snap election called earlier in the year. In any event, we
expect the ruling Liberal Democratic Party to retain power, and for
Mr Suga to remain as prime minister.
The short-term outlook for the domestic economy in Japan
therefore centres on a rebound in activity as the state of
emergency is lifted, together with the impact of the vaccine
roll-out. Beyond these near-term issues, Japan is well-placed to
benefit from a medium-term recovery in both the domestic and global
economy.
In the absence of any further dramatic deterioration in economic
conditions, we see scope for a significant recovery in corporate
earnings in fiscal year 2021. Coupled with the underlying strength
of corporate balance sheets, this should also lead to a quick
return to pre-COVID levels of shareholder pay outs, including share
buybacks.
While overall market valuations look reasonable, we do note that
some cyclical stocks may already be discounting much of the initial
expectations for earnings recovery. However, beyond these cyclical
dynamics, we continue to see positive structural tailwinds
supporting the Japanese equity market, including company-specific
efforts to improve Return on Equity. Despite the challenging
environment, Japanese companies have remained committed to
increasing spending on IT and software, in particular, in order to
improve future productivity.
Policy
Until late 2020, market dynamics favoured a relatively narrow
range of stocks, reflecting global macro and political issues.
While many global markets then saw some style reversal from
November, this effect was very muted in Japan within the review
period, and value stocks, those stocks trading at a lower price
relative to fundamentals, underperformed the broader market to the
end of 2020. Small cap had initially rallied strongly in September
2020 but then underperformed the broader market significantly over
the following four months.
In early 2021, Japan finally saw some rebound in value indices,
but even this was primarily a rally in lower quality cyclical
stocks, those stocks affected by macroeconomic or systematic
changes in the economy, with banks also outperforming. However, as
we move further into the recovery phase, improving visibility on
corporate earnings encourages us to maintain our longer-term views
on Japan. We should ultimately expect a return to a more normal
environment in which individual stock factors are the primary
driver of long-term stock price returns, and the Company is well
placed to benefit from this.
The Company remains underweight in the Electric Appliance
sector, although this is balanced by the overweight positions in
some specific stocks in other sectors that have the same underlying
drivers. The Company is neutrally weighted in financials overall
but, within this, we have a strong preference for insurance and
leasing companies, while underweighting banks.
Net gearing (ratio of the Company's debt to equity) at the end
of January 2021 was 11.8% (cum income).
Although we should see a strong overall profit recovery over the
next two years, we do not expect any step-change in Japan's
long-term trend growth. Instead, we anticipate that Japan's
relative undervaluation will be narrowed through better corporate
governance, leading to sustainable improvements in
Return-on-Equity. The most pervasive element for this change is the
stronger pressure being applied to company managements from
institutional investors to improve capital allocation and
ultimately deliver better shareholder remuneration. We expect these
factors to have a strong positive influence on the Company.
Schroder Investment Management Limited
7 April 2021
Interim Management Report
Principal risks and uncertainties
The principal risks and uncertainties with the Company's
business fall into the following risk categories: strategic;
investment management; financial and currency; custody; gearing and
leverage; accounting, legal and regulatory; service provider; and
cyber. A detailed explanation of the risks and uncertainties in
each of these categories can be found on pages 16 and 17 of the
Company's published annual report and accounts for the year ended
31 July 2020.
The Board has continued to keep under review the effect of the
COVID-19 pandemic on the Company's principal risk and
uncertainties. Although it was assessed to be an emerging risk in
the annual report, the Board now considers that the Company's
existing principal risks and uncertainties are sufficiently
comprehensive. COVID-19 continues to affect the Company, affecting
the value of the Company's investments due to the disruption of
supply chains and demand for products and services, increased costs
and cash flow problems, and changed legal and regulatory
requirements for companies. The pandemic has had a significant
impact on prospects for global growth as measured by GDP and it
continues to create uncertainty in many sectors.
The Board notes the Manager's investment process has been
unaffected by the COVID-19 pandemic. The Manager continues to focus
on long-term company fundamentals and detailed analysis of current
and future investments. COVID-19 also affected the Company's
service providers, who implemented business continuity plans in
line with government recommendations. However, the Board has been
pleased to note that to date the Company's service providers have
been able to operate on a business as usual basis, despite the
pandemic.
The Company's principal risk and uncertainties have not
materially changed during the six months ended 31 January 2021.
Going concern
Having assessed the principal risks and uncertainties, and the
other matters discussed in connection with the viability statement
as set out on page 18 of the published annual report and accounts
for the year ended 31 July 2020, as well as considering the
additional risks related to COVID-19, and where appropriate, action
taken by the Company's service providers in relation to those
risks, detailed above, the Directors consider it appropriate to
adopt the going concern basis in preparing the accounts.
Related party transactions
There have been no transactions with related parties that have
materially affected the financial position or the performance of
the Company during the six months ended 31 January 2021.
Directors' responsibility statement
The Directors confirm that, to the best of their knowledge, this
set of condensed financial statements has been prepared in
accordance with United Kingdom Generally Accepted Accounting
Practice and with the Statement of Recommended Practice, "Financial
Statements of Investment Companies and Venture Capital Trusts"
issued in October 2019 and that this Interim Management Report
includes a fair review of the information required by 4.2.7R and
4.2.8R of the Financial Conduct Authority's Disclosure Guidance and
Transparency Rules.
Income Statement
for the six months ended 31 January 2021 (unaudited)
(Unaudited) (Unaudited)
For the six months For the six months (Audited)
ended 31 January ended 31 January For the year
2021 2020 ended 31 July 2020
Revenue Capital Total Revenue Capital Total Revenue Capital Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
---------------------- -------- -------- -------- -------- -------- -------- -------- --------- ---------
Gains/(losses)
on investments
held at fair
value through
profit or loss - 43,166 43,166 - 84 84 - (37,752) (37,752)
Net foreign
currency gains - 1,134 1,134 - 2,624 2,624 - 1,602 1,602
Income from
investments 3,477 - 3,477 4,076 - 4,076 8,276 - 8,276
Other interest
receivable
and similar
income - - - 4 - 4 4 - 4
---------------------- -------- -------- -------- -------- -------- -------- -------- --------- ---------
Gross return/(loss) 3,477 44,300 47,777 4,080 2,708 6,788 8,280 (36,150) (27,870)
Investment
management
fee (285) (665) (950) (309) (721) (1,030) (564) (1,317) (1,881)
Administrative
expenses (267) - (267) (318) - (318) (552) - (552)
---------------------- -------- -------- -------- -------- -------- -------- -------- --------- ---------
Net return/(loss)
before finance
costs and taxation 2,925 43,635 46,560 3,453 1,987 5,440 7,164 (37,467) (30,303)
Finance costs (42) (97) (139) (41) (96) (137) (84) (196) (280)
---------------------- -------- -------- -------- -------- -------- -------- -------- --------- ---------
Net return/(loss)
on ordinary
activities
before taxation 2,883 43,538 46,421 3,412 1,891 5,303 7,080 (37,663) (30,583)
Taxation on
ordinary activities
(note 3) (348) - (348) (408) - (408) (828) - (828)
---------------------- -------- -------- -------- -------- -------- -------- -------- --------- ---------
Net return/(loss)
on ordinary
activities
after taxation 2,535 43,538 46,073 3,004 1,891 4,895 6,252 (37,663) (31,411)
---------------------- -------- -------- -------- -------- -------- -------- -------- --------- ---------
Return/(loss)
per share (note
4) 2.04p 35.02p 37.06p 2.40p 1.51p 3.91p 5.00p (30.13)p (25.13)p
The "Total" column of this statement is the profit and loss
account of the Company. The "Revenue" and "Capital" columns
represent supplementary information prepared under guidance issued
by The Association of Investment Companies. The Company has no
other items of other comprehensive income and therefore the net
return on ordinary activities after taxation is also the total
comprehensive income for the period.
All revenue and capital items in the above statement derive from
continuing operations. No operations were acquired or discontinued
in the period.
Statement of Changes in Equity
For the six months ended 31 January 2021 (unaudited)
Called-up Capital Warrant Share
share Share redemption exercise purchase Capital Revenue
capital premium reserve reserve reserve reserves reserve Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------- ---------- --------- ------------ ---------- ---------- ---------- --------- ---------
At 31 July 2020 12,478 7 23 3 96,807 119,595 7,215 236,128
Repurchase of the
Company's own shares
for cancellation (165) - 165 - (3,231) - - (3,231)
Net return on ordinary
activities - - - - - 43,538 2,535 46,073
Dividend paid in the
period (note 5) - - - - - - (6,106) (6,106)
----------------------- ---------- --------- ------------ ---------- ---------- ---------- --------- ---------
At 31 January 2021 12,313 7 188 3 93,576 163,133 3,644 272,864
----------------------- ---------- --------- ------------ ---------- ---------- ---------- --------- ---------
For the six months ended 31 January 2020 (unaudited)
Called-up Capital Warrant Share
share Share redemption exercise purchase Capital Revenue
capital premium reserve reserve reserve reserves reserve Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------- ---------- --------- ------------ ---------- ---------- ---------- --------- ---------
At 31 July 2019 12,501 7 - 3 97,205 157,258 6,838 273,812
Net return on ordinary
activities - - - - - 1,891 3,004 4,895
Dividend paid in the
period (note 5) - - - - - - (5,875) (5,875)
----------------------- ---------- --------- ------------ ---------- ---------- ---------- --------- ---------
At 31 January 2020 12,501 7 - 3 97,205 159,149 3,967 272,832
----------------------- ---------- --------- ------------ ---------- ---------- ---------- --------- ---------
For the year ended 31 July 2020 (audited)
Called-up Capital Warrant Share
share Share redemption exercise purchase Capital Revenue
capital premium reserve reserve reserve reserves reserve Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------- ---------- --------- ------------ ---------- ---------- ---------- --------- ---------
At 31 July 2019 12,501 7 - 3 97,205 157,258 6,838 273,812
Repurchase of the
Company's own shares
for cancellation (23) - 23 - (398) - - (398)
Net (loss)/return
on ordinary activities - - - - - (37,663) 6,252 (31,411)
Dividend paid in the
year (note 5) - - - - - - (5,875) (5,875)
----------------------- ---------- --------- ------------ ---------- ---------- ---------- --------- ---------
At 31 July 2020 12,478 7 23 3 96,807 119,595 7,215 236,128
----------------------- ---------- --------- ------------ ---------- ---------- ---------- --------- ---------
Statement of Financial Position
at 31 January 2021 (unaudited)
(Unaudited) (Unaudited) (Audited)
At 31 January At 31 January At 31 July
2021 2020 2020
GBP'000 GBP'000 GBP'000
--------------------------------------- -------------- -------------- -----------
Fixed assets
Investments held at fair value through
profit or loss 305,102 303,943 268,080
--------------------------------------- -------------- -------------- -----------
Current assets
Debtors 1,747 1,617 1,643
Cash at bank and in hand 9,668 10,457 11,814
--------------------------------------- -------------- -------------- -----------
11,415 12,074 13,457
--------------------------------------- -------------- -------------- -----------
Current liabilities
Creditors: amounts falling due within
one year (note 6) (43,653) (1,190) (2,172)
--------------------------------------- -------------- -------------- -----------
Net current (liabilities)/assets (32,238) 10,884 11,285
--------------------------------------- -------------- -------------- -----------
Total assets less current liabilities 272,864 314,827 279,365
Creditors: amounts falling due after
more than one year - (41,995) (43,237)
--------------------------------------- -------------- -------------- -----------
Net assets 272,864 272,832 236,128
--------------------------------------- -------------- -------------- -----------
Capital and reserves
Called-up share capital (note 7) 12,313 12,501 12,478
Share premium 7 7 7
Capital redemption reserve 188 - 23
Warrant exercise reserve 3 3 3
Share purchase reserve 93,576 97,205 96,807
Capital reserves 163,133 159,149 119,595
Revenue reserve 3,644 3,967 7,215
--------------------------------------- -------------- -------------- -----------
Total equity shareholders' funds 272,864 272,832 236,128
--------------------------------------- -------------- -------------- -----------
Net asset value per share (note 8) 221.61p 218.25p 189.24p
Notes to the Accounts
1. Financial statements
The information contained within the accounts in this half year
report has not been audited or reviewed by the Company's
independent auditor.
The figures and financial information for the year ended 31 July
2020 are extracted from the latest published accounts of the
Company and do not constitute statutory accounts for that year.
Those accounts have been delivered to the Registrar of Companies
and included the report of the auditors which was unqualified and
did not contain a statement under either section 498(2) or 498(3)
of the Companies Act 2006.
2. Accounting policies
Basis of accounting
The accounts have been prepared in accordance with United
Kingdom Generally Accepted Accounting Practice and with the
Statement of Recommend Practice "Financial Statements of Investment
Trust Companies and Venture Capital Trusts" issued by the
Association of Investment Companies in October 2019.
All of the Company's operations are of a continuing nature.
The accounting policies applied to these accounts are consistent
with those applied in the accounts for the year ended 31 July
2020.
3. Taxation on ordinary activities
The Company's effective corporation tax rate is nil, as
deductible expenses exceed taxable income. The tax charge comprises
irrecoverable overseas withholding tax.
4. Return/(loss) per share
(Unaudited) (Unaudited)
Six months Six months (Audited)
ended ended Year ended
31 January 31 January 31 July
2021 2020 2020
GBP'000 GBP'000 GBP'000
-------------------------------------- ------------ ------------ ------------
Revenue return 2,535 3,004 6,252
Capital return/(loss) 43,538 1,891 (37,663)
-------------------------------------- ------------ ------------ ------------
Total return/(loss) 46,073 4,895 (31,411)
-------------------------------------- ------------ ------------ ------------
Weighted average number of shares in
issue during the period 124,307,203 125,008,200 124,998,055
Revenue return per share 2.04p 2.40p 5.00p
Capital return/(loss) per share 35.02p 1.51p (30.13)p
-------------------------------------- ------------ ------------ ------------
Total return/(loss) per share 37.06p 3.91p (25.13)p
-------------------------------------- ------------ ------------ ------------
5. Dividends paid
(Unaudited) (Unaudited)
Six months Six months (Audited)
ended ended Year ended
31 January 31 January 31 July
2021 2020 2020
GBP'000 GBP'000 GBP'000
----------------------------------------- ----------- ----------- ----------
2020 final dividend paid of 4.9p (2019:
4.7p) 6,106 5,875 5,875
----------------------------------------- ----------- ----------- ----------
No interim dividend has been declared in respect of the year
ending 31 July 2021 (2020: nil).
6. Creditors: amounts falling due within one year
(Unaudited) (Unaudited)
Six months Six months (Audited)
ended ended Year ended
31 January 31 January 31 July
2021 2020 2020
GBP'000 GBP'000 GBP'000
------------------------------------------ ----------- ----------- ----------
Bank Loan 41,734 - -
Securities purchased awaiting settlement 1,300 553 1,595
Other creditors and accruals 619 637 577
------------------------------------------ ----------- ----------- ----------
43,653 1,190 2,172
------------------------------------------ ----------- ----------- ----------
The bank loan is a yen 6.0 billion three-year term loan from
Sumitomo Mitsui banking Corporation, expiring in January 2022 and
carrying a fixed interest rate of 0.64% per annum.
7. Called-up share capital
(Unaudited) (Unaudited)
Six months Six months (Audited)
ended ended Year ended
31 January 31 January 31 July
2021 2020 2020
GBP'000 GBP'000 GBP'000
--------------------------------------- ----------- ----------- ----------
Opening balance of ordinary shares
of 10p each 12,478 12,501 12,501
Repurchase and cancellation of shares (165) - (23)
--------------------------------------- ----------- ----------- ----------
Closing balance of ordinary shares
of 10p each 12,313 12,501 12,478
--------------------------------------- ----------- ----------- ----------
Changes in the number of shares in issue during the period were
as follows:
(Unaudited) (Unaudited)
Six months Six months (Audited)
ended ended Year ended
31 January 31 January 31 July
2021 2020 2020
---------------------------------------- ------------ ------------ ------------
Ordinary shares of 10p each, allotted,
called-up and fully paid
Opening balance of shares in issue 124,776,700 125,008,200 125,008,200
Repurchase and cancellation of shares (1,646,878) - (231,500)
---------------------------------------- ------------ ------------ ------------
Closing balance of shares in issue 123,129,822 125,008,200 124,776,700
---------------------------------------- ------------ ------------ ------------
8. Net asset value per share
Net asset value per share is calculated by dividing
shareholders' funds by the number of shares in issue of 123,129,822
(31 January 2020: 125,008,200 and 31 July 2020: 124,776,700).
9. Financial instruments measured at fair value
The Company's financial instruments that are held at fair value
comprise its investment portfolio. At 31 January 2021, all
investments in the Company's portfolio were categorised as Level 1
in accordance with the criteria set out in paragraph 34.22
(amended) of FRS 102. That is, they are all valued using unadjusted
quoted prices in active markets for identical assets (31 January
2020 and 31 July 2020: same).
10. Events after the interim period that have not been reflected
in the financial statements for the interim period
The Directors have evaluated the period since the interim date
and have not noted any significant events which have not been
reflected in the financial statements.
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