REG-Ashmore Group Plc Interim results - Part 2

Released : 24/02/2009

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Part 2 : For preceding part double click [nRn1X7618N]  
                                            31 December 2008    31 December 2007    30 June        
                                                                                    2008           
  Interim dividend declared per share (p)   3.66                3.66                3.66           
  Final dividend declared per share (p)     -                   -                   8.34           
                                                                                                   
                                                                                                   
  Interim dividend paid(£m)                 -                   -                   24.9           
  Dividend per share (p)                    -                   -                   3.66           
                                                                                                   
  Final dividend paid(£m)                   57.0                45.2                45.2           
  Dividend per share (p)                    8.34                6.70                6.70           
  
  
Dividends are recognised in the accounts in the year in which they are paid, or 
in the case of a final dividend when approved by the shareholders.   
  
The board has approved an interim dividend for the six months to 31 December 
2008 of 3.66p per share (six months 2007: 3.66p). This will be payable on 24 
April 2009 to shareholders on the register on 27 March 2009.  
  
5. Intangible assets  
  
 
                           6 months to         6 months to         12 months to   
                           31 December 2008    31 December 2007    30 June        
                                                                   2008           
                           £m                  £m                  £m             
  Cost                                                                            
  At beginning of period   4.1                 4.1                 4.1            
  Additions                2.6                 -                   -              
  At end of period         6.7                 4.1                 4.1            
                                                                                  
  Net book value           6.7                 4.1                 4.1            
  
  
The goodwill balance of £4.1 million at the beginning of the period relates to 
the acquisition of the business from ANZ in 1999. Goodwill arising in the year 
relates to the acquisition of Dolomite on 3 November 2008. For further details 
on this acquisition please refer to note 7.  
  
The annual impairment review of goodwill was undertaken at 30 June 2008, and has 
subsequently been re-performed as at 31 December 2008, in recognition of the 
extent of subsequent market turmoil.  The recoverable amounts of the business 
are determined based upon future forecast profitability and cash flow 
projections. The key assumptions on which management has based their projections 
are the expected fund flows and growth of AuM, which determine management and 
performance fee income. No impairment was deemed necessary.    
  
The business of the Group is managed as a single unit, with asset allocations, 
research and other such operational practices reflecting the commonality of 
approach across all fund themes. Therefore, no further split into smaller cash 
generating units is possible, and the impairment review is conducted for the 
Group as a whole.  
  
6. Deferred acquisition costs  
  
 
                                    6 months to         6 months to         12 months to   
                                    31 December 2008    31 December 2007    30 June        
                                                                            2008           
                                    £m                  £m                  £m             
  Cost                                                                                     
  At beginning of period            14.6                14.5                14.6           
  At end of period                  14.6                14.5                14.6           
                                                                                           
  Accumulated charge                                                                       
  At beginning of period            1.2                 -                   -              
  Charge for the period             1.0                 -                   1.2            
  At end of period                  2.2                 -                   1.2            
                                                                                           
  Carrying value at end of period   12.4                14.5                13.4           
  
  
7. Acquisitions   
  
On 3 November 2008, the Group acquired a 75% stake in Dolomite Capital 
Management ("Dolomite"). In addition to the consideration to date outlined in 
the following table, the Group has made arrangements to be able to acquire the 
remaining equity of Dolomite Capital Limited, using call and put options. The 
call option allows the Group to acquire the minority interest stake in full 
after 2013 whilst the put option allows the minority to sell their ownership 
interest in full to the Group from 2016. The value of both options is capped, 
and based on the performance of the underlying business, and will be 
marked-to-market and held on the Group's balance sheet. At 31 December 2008 this 
value was negligible.    
  
Dolomite is an emerging markets focused fund-of-funds manager and independent 
advisor on  emerging market investments based in New York and had approximately 
US$0.1 billion of assets under management at 31 December 2008. In the two months 
to 31 December 2008 the subsidiary contributed net revenue of £0.1 million. Its 
profit before tax contribution for the same period was negligible.  Had the 
acquisition occurred on 1 July 2008, the impact on the Group's net revenue for 
the full period would have been £0.4 million accretive, with no impact on the 
profit before tax.  
  
Effect of acquisition  
  
The acquisition had the following effect on the Group's assets and liabilities.  
  
 
                                                         £m     
  Book value of assets and liabilities acquired at the          
  transactiondate:                                              
  Trade and other receivables                            0.2    
  Cash and cash equivalents                              0.1    
  Trade and other payables                               (0.1)  
                                                                
  Net identifiable assets and liabilities                0.2    
                                                                
  Goodwill arising in the Group on acquisition           2.6    
                                                                
  Consideration paid, satisfied in cash                  2.8    
  Prepaid compensation                                   0.9    
  Net cash outflow for the Group                         3.7    
                                                                
  
  
8. Own shares  
  
The Ashmore 2004 Employee Benefit Trust ("EBT") was established to encourage and 
facilitate the acquisition and holding of shares in the company by the employees 
of the company with a view to facilitating the recruitment and motivation of the 
employees of the company. As at the period end, the EBT owned 33,550,000 
ordinary shares of 0.01p with a nominal value of £3,355 and shareholders' funds 
are reduced by £5.3 million in this respect.   
  
9. Treasury shares  
  
In line with authorities granted at the AGM in October 2008 the Company 
purchased shares which are held in treasury. An analysis of treasury shares is 
as follows:  
  
 
  Treasury shares held by Ashmore Group plc   As at               As at               As at      
                                              31 December 2008    31 December 2007    30 June    
                                                                                      2008       
                                              £m                  £m                  £m         
  Ashmore Group plc ordinary shares           6.5                 -                   -          
  
  
 
                                                                   
                                      Number      Number   Number  
  Ashmore Group plc ordinary shares   4,966,587   -        -       
  
  
 
                                                                   
  Reconciliation of treasury shares   Number      Number   Number  
  At 1 July 2008                      -           -        -       
  Purchase of own shares              4,966,587   -        -       
  At 31 December 2008                 4,966,587   -        -       
  
  
 
                                                    
  Market value of treasury shares:   £m    £m   £m  
  Ashmore Group plc                  6.6   -    -   
  
  
10. Group risks  
  
The Group's principal risks remain as detailed within the Business review and 
Corporate governance report in the Group's Annual Report and are categorised as 
strategic and business, investment, and operational.  
  
11. Related party transactions  
  
There were no material changes to the related party transactions during the six 
months to 31 December 2008.  
  
12. Post balance sheet events  
  
There are no post balance sheet events for the six months to 31 December 2008.  
  
RESPONSIBILITY STATEMENT of the directors' in respect of the half-yearly 
financial report  
  
We confirm that to the best of our knowledge:  
  
* the condensed set of financial statements has been prepared in accordance with 
IAS 34 Interim Financial Reporting as adopted by the EU;   
  
* the interim management report includes a fair review of the information 
required by:   
  
(a) DTR 4.2.7R of the Disclosure and Transparency Rules, being an indication of 
important events that have occurred during the first six months of the financial 
year and their impact on the condensed set of financial statements; and a 
description of the principal risks and uncertainties for the remaining six 
months of the year; and  
  
(b) DTR 4.2.8R of the Disclosure and Transparency Rules, being related party 
transactions that have taken place in the first six months of the current 
financial year and that have materially affected the financial position or 
performance of the entity during that period; and any changes in the related 
party transactions described in the last annual report that could do so.  
  
Mark CoombsChief Executive Officer24 February 2009  
  
INDEPENDENT REVIEW REPORT to Ashmore Group plc  
  
Introduction  
  
We have been engaged by the company to review the condensed set of financial 
statements in the half-yearly financial report for the six months ended 31 
December 2008 which comprises the consolidated income statement, consolidated 
balance sheet, consolidated statement of changes in equity, consolidated cash 
flow statement and the related explanatory notes. We have read the other 
information contained in the half-yearly financial report and considered whether 
it contains any apparent misstatements or material inconsistencies with the 
information in the condensed set of financial statements.   
  
This report is made solely to the company in accordance with the terms of our 
engagement to assist the company in meeting the requirements of the Disclosure 
and Transparency Rules ("the DTR") of the UK's Financial Services Authority 
("the UK FSA"). Our review has been undertaken so that we might state to the 
company those matters we are required to state to it in this report and for no 
other purpose. To the fullest extent permitted by law, we do not accept or 
assume responsibility to anyone other than the company for our review work, for 
this report, or for the conclusions we have reached.   
  
Directors' responsibilities  
  
The half-yearly financial report is the responsibility of, and has been approved 
by, the directors. The directors are responsible for preparing the half-yearly 
financial report in accordance with the DTR of the UK FSA.  
  
As disclosed in note one, the annual financial statements of the Ashmore Group 
plc are prepared in accordance with IFRSs as adopted by the EU. The condensed 
set of financial statements included in this half-yearly financial report has 
been prepared in accordance with IAS 34 Interim Financial Reporting as adopted 
by the EU.  
  
Our responsibility  
  
Our responsibility is to express to the company a conclusion on the condensed 
set of financial statements in the half-yearly financial report based on our 
review.   
  
Scope of review  
  
We conducted our review in accordance with International Standard of Review 
Engagements (UK and Ireland) 2410 "Review of Interim Financial Information 
Performed by the Independent Auditor of the Entity" issued by the Auditing 
Practices Board for the use in the UK. A review of interim financial information 
consists of making enquiries, primarily of persons responsible for financial and 
accounting matters, and applying analytical and other review procedures. A 
review is substantially less in scope than an audit conducted in accordance with 
International Standards on Auditing (UK and Ireland) and consequently does not 
enable us to obtain assurance that we would become aware of all significant 
matters that might be identified in an audit. Accordingly, we do not express an 
audit opinion.   
  
Conclusion  
  
Based on our review, nothing has come to our attention that causes us to believe 
that the condensed set of financial statements in the half-yearly financial 
report for the six months ended 31 December 2008 is not prepared, in all 
material respects, in accordance with IAS 34 as adopted by the EU and the DTR of 
the UK FSA.  
  
KPMG Audit Plc  
  
Chartered AccountantsOne Canada Square  
  
London E14 5AG  
  
24 February 2009   
  
 
This information is provided by RNS  
  
The company news service from the London Stock Exchange  
  
  END  
  
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