BARING EMERGING EUROPE PLC
Interim Management Statement
Review of the period from 1 October 2013 to 31 December 2013
This Interim Management Statement for the period from 1 October 2013 to 31
December 2013 contains information which covers that period, unless otherwise
stated.
INVESTMENT OBJECTIVE
The investment objective of the Company is to achieve long-term capital growth,
principally through investment in Emerging European securities.
MATERIAL EVENTS OR TRANSACTIONS DURING THE PERIOD
The directors confirm the following material events and transactions which have
occurred since the Company's year end on 30 September 2013.
Portfolio:
The company participated in the IPOs of the Russian consumer lender Tinkoff
Credit Services, the electric utility Energa in Poland and the secondary
offering in Banco Santander's subsidiary in Poland, BZ WBK.
The inclusion of the Greek index in the MSCI Emerging Europe Index in November
extended the investment universe and lead to the purchase of state lottery
OPAP, Bank Piraeus and oil refiner Motor Oil Hellas for the portfolio.
Exposure to the Energy sector was further reduced as holdings in the Russian
oil company Lukoil, one of the largest positions in the portfolio, and in the
Turkish refiner Tupras were sold.
The Central European part of the portfolio saw modest activity. The Hungarian
generic pharmaceuticals producer Gedeon Richter was added while profits were
taken in the Polish Real Estate Developer PHN and the satellite subscription
broadcaster Cyfrowy Polsat.
Discount:
The share price discount to net asset value at 31 December 2013 was 10.2% (30
September 2013: 11.9%)
Share Capital:
During the period from 1 October 2013 to 31 December 2013 the Company bought
back 750,000 ordinary shares at a cost of £5.86 million. At 31 December 2013
the Company's issued share capital consisted of 19,498,043 ordinary shares
(excluding the 3,318,207 ordinary shares held in treasury).
Results for the Year Ended 30 September 2013
On 28 November 2013 the Company announced its final results for the year ended
30 September 2013. The annual report and accounts for the year ended 30
September 2013 was mailed to shareholders on 10 December 2013.
ANNUAL GENERAL MEETING HELD ON 14 JANUARY 2014
Resolutions
All the resolutions set out in the Notice of Meeting were duly passed. The
resolutions approved included those which authorise the Company to issue shares
for cash, including shares held in treasury, to make market purchases of the
Company's own shares and to amend the Company's investment policy to include
Greece within the definition of Emerging Europe.
Annual Dividend
Shareholders approved the payment of an annual dividend of 19.0p per ordinary
share for the year ended 30 September 2013 to be paid on 3 February 2014 to
members on the register at the close of business on 20 December 2013. The
shares were marked ex-dividend on 18 December 2013.
The directors are not aware of any other significant events or transactions up
to the date of this report which would have a material impact on the financial
position of the Company.
COMPANY STATISTICS
31 December 2013 13 February 2014
Gross Assets £159.8 million £145.6 million
Net Asset Value Per Ordinary Share 819.59p 746.60p
Share Price 736.00p 680.25p
Discount to Net Asset Value 10.2% 8.9%
CUMULATIVE PERFORMANCE TO 31 DECEMBER 2013 (Total Return in percentage terms)
Performance Over 3 months 1 Year 3 Years
Share Price* +1.3% +2.2% -5.3%
Net asset Value* -0.9% +1.7 % -4.3%
Benchmark + -3.6% -6.1 % -4.5 %
* Source - Barings
+ Source - Barings. MSCI EM Europe 10/40.
PORTFOLIO INFORMATION AT 31 DECEMBER 2013
Ten largest holdings:
% of Total Assets Geographical breakdown
%
Sberbank 11.6
Lukoil Holdings 9.2 Russia 72.4
Gazprom 7.7 Turkey 11.5
Mobile Telesystems 5.6 Poland 6.3
PKO 4.6 Czech Republic 0.3
VTB Bank 4.6 Ukraine 2.3
Sistema 4.3 Hungary 2.1
Norilsk Nickel 3.3 Other 2.5
Novatek 3.2 Cash and equivalents 2.6
Halk Bank 3.2 Total 100.0
17 February 2014
