Pacific Assets say that, during the year ended 31 January 2016, the company’s net asset value per share total return was -6.6%. For comparison, the MSCI All Country Asia ex Japan Index, measured on a total return, sterling adjusted basis, fell by 13.1%. A narrowing of the discount of the company’s share price to its net asset value per share meant that the share price total return decline was less at -2.5%. The dividend has been cut to 2.2p from 2.6p as the Board decided that it didn’t make sense to keep topping the dividend up from reserves – earnings were 2.2p, up from 2.1p last year.
The -6.6% return was driven by a negative decline of 5.4% in the value of the assets and an aggregate decline of 1.2% in currency. The top 10 performers in the portfolio contributed to a 6.4% gain while the bottom 10 saw a decline
of 8.7%.
The managers say, in terms of positive absolute contribution, the top-three performing companies address interrelated sustainability headwinds of health and hygiene. Over the past 12 months, the best performing company in the portfolio has been Vitasoy which is a company they have held since 2010. The company continues to benefit by selling healthy soy-based drinks to Asia Pacific markets and they remain convinced that health tailwinds will continue to provide robust demand growth for products like these. Standard Foods was the second best performer in the portfolio; by providing healthy oats and oils to China and Taiwan, the company should benefit from similar long-term health tailwinds in Asia. The third best performer was Marico an Indian consumer goods company followed by its subsidiary Marico Bangladesh. The other investment of note in the top-ten is Globe Telecom. Globe is a member of the Ayala Group and they believe it to be well-managed and providing essential telecoms services however they felt that valuations could no longer justify the increasingly competitive landscape and sold the position.
PAC : Pacific Assets outperforms falling market