17th Mar 2020 11:48
(Alliance News) - Baillie Gifford Shin Nippon PLC on Tuesday reported growth in assets over 12 months, but was unable to match the rise of its benchmark.
At January 31, Baillie Gifford Shin Nippon's NAV per share stood at 173.0 pence, up 8.9% compared to 158.8p at the same point a year before.
The trust's net asset rose 11% over the 12-month period to GBP483.7 million from GBP434.2 million. Baillie Gifford Shin Nippon issued 6.1 million shares in the period.
The trust did not declare a dividend.
Shin Nippon's benchmark - the MSCI Japan Small Cap Index - gained 9.5% in the same period.
Chair Neil Donaldson said: "There is no doubt that 2019 was a difficult period for small cap companies in Japan. Ongoing trade tariff disputes between China and the US naturally affected sentiment within Japan. The year-end date unfortunately coincided with the escalating concerns surrounding the coronavirus in China and time will yet tell as to how this will affect inbound tourism and the Japanese economy in general."
Contributors to positive performance included longstanding holding M3 Inc, which more than doubled its share price over the year as its core online drug marketing business saw an acceleration in sales. Infomart Corp, which operates an online food ordering system for restaurants, and second-hand housing renovation specialist Katitas Co Ltd also were strong performers.
The largest detractors from performance included online cosmetics retailer Istyle Inc, which has seen a collapse in sales from its key Hong Kong and Chinese markets, and Japan's leading online takeaway operator Demae-Can Co Ltd - formerly known as Yume No Machi - also suffered from a weak share price as management continue to make heavy upfront investments.
Donaldson added: "As I write this, the coronavirus continues to be a significant risk and one cannot possibly foresee the longer-term consequences for the Japanese economy, inbound tourism, the labour market or indeed the Olympic and Paralympic games. The Rugby World Cup in Japan last year was a huge success, with the eyes of the world on Japan. I sincerely hope that they will again have the opportunity to portray a strong and positive image to the outside world this summer."
Shares in Baillie Gifford Shin Nippon were 1.9% higher in London on Tuesday late-morning at 112.40 pence each.
By Paul McGowan; [email protected]
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