Henderson Far East Income says its net asset value total return per ordinary share was 5.8% for the six months ended 29 February 2016. This compares favourably with the 3.9% total return on the FTSE All-World Asia Pacific ex Japan Index (sterling adjusted) over the same period. The share price total return per ordinary share was 3.3%, which reflects the movement from a small premium to a small discount.
A first interim dividend of 4.90p per share was paid on 29 February 2016 and a second interim dividend of the same amount has been declared and will be paid on 31 May 2016. The Board says it remains confident that it will at least be able to maintain the same level of total dividends for the full year (19.2p) in this financial year.
The report states that the biggest contributor to performance was the weakness of sterling. In local currency terms, Asian markets fell over 4% but with the uncertainty of the United Kingdom’s continued membership of European Union, the 8.5% fall of sterling against Asian currencies turned that loss into a 3.9% return for the Index.
At the stock level, holdings in telecommunication stocks HKT Trust & HKT (Hong Kong), Telekomunikasi Indonesia (Indonesia) and Spark New Zealand (New Zealand) all performed well while the contributions from Korea Electric Power, Netease (China), AGL Energy (Australia), Scentre Group (Australia) and CapitaLand Mall Trust REIT (Singapore) were also beneficial. At the country level, the relatively low weightings in India and the reduction of the China weighting helped as these were the two worst performing markets while at the sector level the positive contributions from utilities and telecommunications were aided by the underweight position in energy and banks as these were the two worst performing sectors.
HFEL : Henderson Far East Income benefits from sterling weakness