30th Apr 2014 13:44
LONDON (Alliance News) - Aberdeen New Thai Investment Trust PLC Wednesday said its fortunes took a turn for the worse over the course of its most recently ended financial year, with net asset value per share declining by 25.6% on a total return basis amidst political upheaval in Thailand.
In its report for the year ended February 28, the trust, managed by Aberdeen Asset Management Asia Ltd, said NAV per share on a total return basis fell to 418.64 pence, while its benchmark, the Stock Exchange of Thailand Index, adjusted for sterling, declined by 26.6%. The investment manager said the portfolio's marginal outperformance was driven by picking stocks that were "relatively resilient."
The trust's objective is to provide shareholders with a high level of long-term, above average capital growth through investment in Thailand.
The share price fell by 33.3% on a total return basis to 353.75 pence, reflecting a widening of the discount to the NAV including income per share to 15.5% from 5.6%.
Chairman Nicholas Smith called the results "a dramatic reversal" from a year earlier, when its share price total return was 77.2% and its NAV per share total return was 59.6%.
Nevertheless, the trust increased its dividend per share by 1.0 pence to 8.0 pence.
Smith said the Thai stockmarket had been one of the best performers globally when "Fed stimulus led investors on a hunt for yield."
"But the imminent end of easy money resulted in bouts of indiscriminate selling of emerging market assets, and Thailand was among the hardest hit. Compounding the decline was the Baht's fall of 20% against sterling over the year ended 28 February 2014, in tandem with many of its peers in the developing world," Smith said in a statement.
Despite the tough year for Thailand, Smith said he remains "confident" of the country's prospects.
Prime Minister Yingluck Shinawatra administration's attempt to push through an amnesty bill that could have paved the way for the return of deposed former premier Thaksin Shinawatra was met with mass protests. In February, Thailand's elections were annulled, but the country's Election Commission and the caretaker government Wednesday agreed to hold new elections on July 20 after several months of political turmoil and uncertainty.
Election Commission Chairman Supachai Somcharoen announced the date after meeting with members of Yingluck Shinawatra's cabinet, local media reported.
In his statement, written before news of the election date, Aberdeen New Thai's Smith said "matters will be resolved through national consensus."
"Thailand should rebound and be stronger for it. Improving external conditions, namely a recovery in the US and Europe, could help buttress exports this year, partially mitigating the impact of the political unrest. In the longer term, the nation is poised to be a beneficiary of rising regional trade. Its strategic geographical location gives it access to fast-growing frontier economies, such as Vietnam and Myanmar, whose young populations will be the future drivers of Southeast Asian growth," Smith said.
The trust's shares were Wednesday quoted at 390.16 pence, down 0.1%
By Samuel Agini; [email protected]; @samuelagini
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