REG-Ashmore Group Plc Preliminary Results - Part 2

Released : 15/09/2009

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Part 2 : For preceding part double-click [nRn1O0444Z]  
headcount increase during the first half, growing from 93 to 138 employees at 31 
December 2008. Subsequently, the Group has added a further 4 heads, taking the 
year end headcount to 142, of whom 41 are employed in relatively newly 
established local asset management operations. The increased headcount has been 
focused on two areas: first, improving the Group's infrastructure; and secondly, 
expanding the number of investment professionals based in overseas 
jurisdictions, in keeping with the Group's strategy establishing local asset 
management operations in emerging economies.  
  
The Group's investment in infrastructure initiatives to support the development 
of the business have also affected other operating costs, which increased by 
£5.8 million (52%) to £16.9 million during the period. As reported in last 
year's annual report, an additional £1.8 million was incurred in respect of full 
year charges on the Group's new premises in London and amortisation of the 
deferred acquisition costs (DAC) associated with the launch of AGOL in December 
2007. In addition, a further £1.3 million of the increment on FY07/08 relates to 
enhancing information technology capabilities across the business; £0.8 million 
to legal and professional fees, including corporate development and due 
diligence activities; and £0.8 million to higher travel costs, reflecting the 
Group's increased headcount.  
  
As a result, the operating profit margin for the year ended 30 June 2009 was 
74.5% (2008: 76.0%).  
  
Taxation    
  
The vast majority of the Group's profit is subject to UK taxation, and typically 
the Group has a limited number of non-tax deductible expenses. Consequently the 
Group's effective tax rate (27.8%) has historically tracked close to the UK 
corporation tax rate (currently 28.0%).  
  
There is a £14.0 million deferred tax asset on the Group's balance sheet at 30 
June 2009, as a result of timing differences in the recognition of the 
accounting expense and actual tax deductions in connection with share price 
appreciation on share based awards.    
  
Dividend  
  
In recognition of the financial performance during the period, and our 
confidence in the Group's future prospects, the directors are recommending a 
final dividend of 8.34 pence per share for the year ended 30 June 2009 which, 
subject to shareholder approval, will be paid on 4 December 2009 to all 
shareholders who are on the register on 6 November 2009.    
  
An interim dividend for the six month period to 31 December 2008 of 3.66p 
(2007:3.66p) was paid on 24 April 2009. Together, these result in a full year 
dividend of 12.0p (2008: 12.0p).  
  
Purchase of Ashmore Group plc shares  
  
In line with authorities granted at the AGM in October 2008, the Company 
purchased 5,368,331 shares, for an aggregate consideration of £6.9 million, 
which are held in treasury.   
  
Balance sheet management and cash flow  
  
It is the Group's policy to maintain a strong balance sheet in order to support 
regulatory capital requirements, to meet the commercial demands of current and 
prospective investors, and to fulfil the development needs across the business. 
Development needs include funding the establishment costs of local asset 
management ventures, seeding new funds and other strategic initiatives.   
  
As at 30 June 2009, total equity attributable to shareholders of the parent was 
£308.5 million, as compared to £271.8 million at 30 June 2008. There is no debt 
on the Group's balance sheet.  
  
Cash  
  
The Group's cash and cash equivalents balance increased by £9.2 million in the 
period to £288.4 million. The Group continues to generate significant cash from 
operations, totalling £150.9 million in the year (year to 30 June 2008: £195.5 
million), from which it paid the following significant items: £81.9 million in 
cash dividends (FY07/08: £70.1 million); £47.7 million of taxation (FY07/08: 
£46.5 million); £11.6 million for new seed investments (FY07/08: £15.1 million); 
£6.9 million for Ashmore Group plc shares held in treasury (FY07/08: nil); £3.7 
million to acquire new subsidiaries (FY07/08: nil); and £2.1 million to purchase 
property, plant and equipment, largely IT-related (FY07/08: £3.5 million).    
  
The Group's cash balances are invested with the objective of optimising returns 
within a strict framework which emphasises capital preservation, security, 
liquidity and counterparty risk. Cash is invested only in institutions with 
approved credit ratings of A or better.  Typically, during the financial year, 
investments have been in short-term cash deposits.  Based on the level of cash 
balances at 30 June 2009, a 1% change in UK interest rates would have a £2.8 
million impact on the Group's profit before tax.  
  
Seeding   
  
The Group supports the creation of new business by seeding new funds where 
necessary.  As at 30 June 2009 the amount invested was £26.6 million (at cost), 
with a market value of £32.2 million, and an aggregated annualised return for 
FY08/09 of 13% (including FX).    
  
Foreign exchange management   
  
The Group's long-standing policy is to hedge up to two-thirds of the foreign 
exchange exposure in connection with its net management fee cash flows, using a 
combination of forward foreign exchange contracts and options for up to two 
years forward.    
  
The period to 30 June 2009 was characterised by extreme currency volatility, 
with the GBP/USD exchange rate ranging between GBP1.00:1.43-1.98USD. In the 
first half there was a significant strengthening of the US Dollar relative to 
sterling, with the exchange rate closing on 31 December 2008 at GBP1:1.46USD. As 
we set out in our Interims, this volatility resulted in a £41.4 million loss 
being recognised in the first half in respect of the unrealised marked-to-market 
of US$265 million open forward foreign exchange contracts. The overall foreign 
exchange loss for the first half was £49.8 million, comprising £54.2 million 
relating to hedging activity, partially offset by £4.4 million of gains on 
revaluation of other non-sterling denominated assets and liabilities.    
  
During the second half US$165 million of these contracts matured, with the 
crystallised losses offsetting gains on the translation of the US Dollar 
management fees back into sterling at the prevailing rate, relative to the 
budgeted rate of GBP1:2.00USD. The weakening of the US Dollar during the second 
half to close at a 30 June 2009 rate of GBP1:1.65USD contributed to 
hedging-related losses being reduced by £11.8 million to £42.4 million, within 
an overall foreign exchange loss for the year of £38.6 million.  
  
The level of FX hedges in place as 30 June 2009 is US$180 million. This includes 
the US$120 million of forward foreign exchange contracts in respect of FY09/10 
net management fee cash flows, and US$60 million of options in respect of 
FY10/11 net management fee cash flows. These have been marked-to-market at the 
year end rate of GBP1:1.65USD.    
  
The options effectively operate as a collar, protecting the sterling value of 
US$60 million of the Group's forecast management fee revenue cash flows for 
FY10/11 from being impacted by currency movements outside of a range from 
GBP1:1.52-1.70USD.  As designated hedges the mark-to-market movement in the 
value of the options will be taken through reserves, until such time as they and 
the associated hedged revenues mature, so long as the hedges are assessed as 
being effective. If assessed as ineffective, the mark-to-market of the options 
will be taken through the income statement.   
  
Deferred acquisition costs ("DAC")  
  
As we indicated last year, Ashmore was appointed investment manager of Ashmore 
Global Opportunities Limited ("AGOL"), a newly incorporated publicly listed 
closed-ended investment company on 12 December 2007. This vehicle raised E500 
million capital, with the purpose of investing in Ashmore's special situations 
and multi strategy funds. During 2008, the shares of the company have, for the 
most part, traded at a discount to the net asset value of its balance sheet, 
although this discount was significantly less than many of its peer group. Where 
this discount is in excess of 10% for 12 consecutive months, an EGM is required 
to consider whether AGOL should be wound up. Such an EGM was held on 5 May 2009, 
with 80% of the voting shareholders voting against the resolution. Should the 
discount continue to exceed 10% for a further 12 consecutive months, an EGM 
would once again be required.    
  
The Group holds on its balance sheet unamortised DAC in respect of the launch of 
AGOL which amounted to £11.3 million at 30 June 2009. Any such future vote would 
not result in an escalation of the recognition of these costs, as an early 
termination of the company triggers full recovery of the set up costs (including 
the portion previously amortised - £2.1 million per annum, and £3.3 million 
cumulative to 30 June 2009).  
  
Regulatory capital  
  
As a UK listed asset management group, Ashmore is subject to regulatory 
supervision by the Financial Services Authority (FSA) under the Prudential 
Sourcebook for Banks, Building Societies and Investment Firms. The Group has one 
UK regulated entity, Ashmore Investment Management Limited ("AIML"), on behalf 
of which quarterly capital adequacy returns are filed. AIML held surplus capital 
resources relative to its requirements at all times during the period under 
review.    
  
Further, with effect from 1 January 2007, the Group has been subject to 
consolidated regulatory capital requirements, whereby the Board is required to 
assess the degree of risk across the business, and hold sufficient capital 
within the Group against them. The Board has assessed the amount of capital 
required to cover such risks as £28.0 million.  Thus, given the considerable 
balance sheet resources available to the Group, the Board is satisfied that the 
Group is adequately capitalised to continue its operations effectively. Further 
information regarding the Group's capital adequacy status can be found in the 
Group's Internal Capital Adequacy Assessment Process (ICAAP) Pillar III 
disclosures, which are available on our website at www.ashmoregroup.com.  
  
Graeme Dell  
  
Group Finance Director   
  
Ashmore Group plc  
  
Consolidated income statement   
  
Year ended 30 June 2009  
  
 
                                                          
                                                          
                                         2009     2008    
                                 Notes   £m       £m      
                                                          
  Management fees                        186.8    186.7   
  Performance fees                       52.5     44.7    
  Other revenue                          6.4      10.1    
  Total revenue                          245.7    241.5   
  Less: Distribution costs               (3.6)    (4.7)   
  Less: Foreign exchange         2       (38.6)   3.2     
  Net revenue                            203.5    240.0   
                                                          
  Personnel expenses             3       (36.0)   (47.7)  
  Other expenses                 4       (16.9)   (11.1)  
  Operating profit                       150.6    181.2   
                                                          
  Interest income                        9.2      15.0    
  Profit before tax                      159.8    196.2   
                                                          
  Tax expense                            (44.3)   (55.2)  
  Profit for the year                    115.5    141.0   
                                                          
  Attributable to:                                        
                                                          
  Equity holders of the parent           115.0    140.8   
  Minority interests                     0.5      0.2     
  Profit for the year                    115.5    141.0   
                                                          
  Earnings per share:                                     
                                                          
  Basic                          5       17.12p   21.03p  
  Diluted                        5       15.99p   19.89p  
                                                          
  
  
 
                                                                                             
  Ashmore Group plc                                                   As at       As at      
  Consolidated balance sheet                                          30 June     30 June    
                                                                      2009        2008       
                                                                                             
                                                                                             
                                                              Notes   £m          £m         
                                                                                             
  Assets                                                                                     
  Property, plant and equipment                                       4.6         3.3        
  Intangible assets                                                   6.7         4.1        
  Deferred acquisition costs                                          11.3        13.4       
  Other receivables                                                   0.9         -          
  Deferred tax assets                                                 14.0        13.8       
                                                                                             
  Total non-current assets                                            37.5        34.6       
                                                                                             
  Trade and other receivables                                         33.1        34.7       
  Available-for-sale financial assets                                 4.8         -          
  Derivative financial instruments                                    0.8         1.2        
  Cash and cash equivalents                                           288.4       279.2      
  Total current assets                                                327.1       315.1      
                                                                                             
  Non current assets held for sale                            7       34.8        16.4       
                                                                                             
  Total assets                                                        399.4       366.1      
                                                                                             
  Equity                                                                                     
  Issued capital                                                      -           -          
  Share premium                                                       0.3         0.3        
  Retained earnings                                                   308.2       271.5      
                                                                                             
                                                                                             
  Total equity attributable to equity holders of the parent           308.5       271.8      
                                                                                             
  Minority interests                                                  2.0         1.5        
                                                                                             
  Total equity                                                        310.5       273.3      
                                                                                             
  Liabilities                                                                                
  Deferred tax liabilities                                            1.5         3.8        
  Total non-current liabilities                                       1.5         3.8        
                                                                                             
  Current tax                                                         24.0        24.5       
  Derivative financial instruments                                    5.0         0.7        
  Trade and other payables                                            51.0        63.7       
  Total current liabilities                                           80.0        88.9       
                                                                                             
  Non current liabilities held for sale                       7       7.4         0.1        
                                                                                             
  Total liabilities                                                   88.9        92.8       
  Total equity and liabilities                                        399.4       366.1      
                                                                                             
  
  
Mark Coombs      Graeme Dell  
  
Chief Executive Officer        Group Finance Director  
  
 
  Ashmore Group plc                                                                                                    Total equity attributable to equity holders of the parent                                        
                                                                                                                                                                                                                        
  Consolidated statement of changes in equity                                                                                                                                                                           
                                                               Issued capital    Share premium    Retained earnings                                                                Minority interests    Total equity   
                                                               £m                £m               £m                   £m                                                          £m                    £m             
                                                                                                                                                                                                                        
  Balance at 1 July 2007                                       -                 0.3              195.6                195.9                                                       0.1                   196.0          
  Net gains on available-for-sale financial assets including   -                 -                0.4                  0.4                                                         -                     0.4            
  deferred tax                                                                                                                                                                                                          
  Total income and expense recognised directly in equity       -                 -                0.4                  0.4                                                         -                     0.4            
  Profit for the year                                          -                 -                140.8                140.8                                                       0.2                   141.0          
  Total recognised income and expense                          -                 -                141.2                141.2                                                       0.2                   141.4          
  Issue of share capital                                       -                 -                -                    -                                                           1.2                   1.2            
  Share based payments                                         -                 -                8.8                  8.8                                                         -                     8.8            
  Current tax related to share based payments                  -                 -                (1.3)                (1.3)                                                       -                     (1.3)          
  Deferred tax related to share based payments                 -                 -                (2.7)                (2.7)                                                       -                     (2.7)          
  Dividends to equity holders                                  -                 -                (70.1)               (70.1)                                                      -                     (70.1)         
  Balance at 30 June 2008                                      -                 0.3              271.5                271.8                                                       1.5                   273.3          
                                                                                                                                                                                                                        
  Exchange adjustments on translation of foreign operations    -                 -                0.5                  0.5                                                         -                     0.5            
  Net gains on available-for-sale financial assets including   -                 -                2.3                  2.3                                                         -                     2.3            
  deferred tax                                                                                                                                                                                                          
  Total income and expense recognised directly in equity       -                 -                2.8                  2.8                                                         -                     2.8            
  Profit for the year                                          -                 -                115.0                115.0                                                       0.5                   115.5          
  Total recognised income and expense                          -                 -                117.8                117.8                                                       0.5                   118.3          
  Own shares                                                   -                 -                (0.8)                (0.8)                                                       -                     (0.8)          
  Treasury shares                                              -                 -                (6.9)                (6.9)                                                       -                     (6.9)          
  Share based payments                                         -                 -                8.2                  8.2                                                         -                     8.2            
  Current tax related to share based payments                  -                 -                0.2                  0.2                                                         -                     0.2            
  Deferred tax related to share based payments                 -                 -                0.1                  0.1                                                         -                     0.1            
  Dividends to equity holders                                  -                 -                (81.9)               (81.9)                                                      -                     (81.9)         
  Balance at 30 June 2009                                      -                 0.3              308.2                308.5                                                       2.0                   310.5          
                                                                                                                                                                                                                        
  
  
Ashmore Group plc  
  
Consolidated cash flow statement  
  
Year ended 30 June 2009   
  
 
                                                                                          
                                                                         2009     2008    
                                                                 Notes   £m       £m      
                                                                                          
                                                                                          
  Operating activities                                                                    
  Cash receipts from customers                                           198.9    242.8   
  Cash paid to suppliers and employees                                   (48.0)   (47.3)  
                                                                                          
  Cash generated from operations                                         150.9    195.5   
                                                                                          
  Taxes paid                                                             (47.7)   (46.5)  
                                                                                          
  Net cash from operating activities                                     103.2    149.0   
                                                                                          
  Investing activities                                                                    
  Interest received                                                      9.3      15.4    
  Acquisition of subsidiary                                              (3.7)    -       
  Net purchase of non-current assets held for sale                       (6.9)    (15.1)  
  Purchase of available-for-sale financial assets                        (4.7)    -       
  Purchase of deferred acquisition costs                                 -        (14.6)  
  Purchase of property, plant and equipment                              (2.1)    (3.5)   
                                                                                          
  Net cash used in investing activities                                  (8.1)    (17.8)  
                                                                                          
  Financing activities                                                                    
                                                                                          
  Dividends paid                                                 6       (81.9)   (70.1)  
  Purchase of own shares                                                 (0.9)    -       
  Purchase of treasury shares                                    9       (6.9)    -       
                                                                                          
  Net cash used in financing activities                                  (89.7)   (70.1)  
                                                                                          
  Effect of exchange rate changes on cash and cash equivalents           3.8      0.1     
                                                                                          
  Net increase in cash and cash equivalents                              9.2      61.2    
                                                                                          
  Cash and cash equivalents at beginning of year                         279.2    218.0   
                                                                                          
  Cash and cash equivalents at end of year                               288.4    279.2   
                                                                                          
                                                                                          
  Cash and cash equivalents comprise:                                                     
  Cash at bank and in hand                                               288.4    279.2   
                                                                         288.4    279.2   
  
  
Notes to the Group Financial Statements  
  
1  Basis of preparation and significant accounting policies   
  
In preparing the financial information in this statement the Group has applied 
policies which are in accordance with IFRSs as adopted by the European Union at 
30 June 2009.   
  
Certain comparative amounts relating to foreign exchange have been reclassified 
to conform to the current year presentation. None of the changes are significant 
in nature.  
  
In addition to consistently applying the accounting policies applied in the 
Group's annual report for the year ended 30 June 2008, which is available on the 
Group's website, the following accounting policies were adopted:  
  
Financial assets  
  
The Group may, from time-to-time, invest in funds where an Ashmore Group 
subsidiary is the Investment Manager or an Adviser ('seeding'). Where the 
holding in such investments is deemed to represent a controlling stake and is 
acquired exclusively with a view to subsequent disposal through sale or 
dilution, these seed investments are recognised as non-current assets 
held-for-sale in accordance with IFRS 5. Where control is not deemed to exist, 
and the assets are readily realisable, they are recognised as available-for-sale 
financial assets. The recognition policy for both is set out below:  
  
 
 * Financial assets held as non current assets held for sale  
  
Non-current assets held for sale are measured at the lower of their carrying 
amount and fair value less costs to sell except where measurement and 
re-measurement is outside the scope of IFRS 5, the relevant policy is set out in 
Financial Instruments.  Where investments that have initially been recognised as 
non-current assets held-for-sale, because the Group has been deemed as holding a 
controlling stake, are subsequently disposed of or diluted such that the Group's 
holding is now insufficient to be deemed a controlling stake, the investment 
will subsequently be reclassified as an available-for-sale financial asset. Any 
such reclassification will crystallise any gain or loss previously recognised 
directly through equity within the income statement. Subsequent movements will 
be recognised in accordance with the Group's accounting policy for the newly 
adopted classification.   
  
 
 * Financial assets held as available-for-sale  
  
For available-for sale financial assets, gains and losses arising from changes 
in their fair value are recognised directly in equity, until the security is 
disposed of or is impaired, at which time the cumulative gain or loss previously 
recognised in equity is taken to the income statement for the accounting period. 
   
  
Hedge accounting  
  
The Group applies cash flow hedge accounting when the transactions meet the 
specified hedge accounting criteria. To qualify the following conditions must be 
met:  
  
 
 * Formal documentation of the relationship between the hedging instrument(s) 
and hedged item(s) must exist at inception. 
 * The hedged cash flows must be highly probable and must present an exposure to 
variations in cash flows that could ultimately affect profitability. 
 * The effectiveness of the hedge can be reliably measured. 
 * The hedge must be highly effective, with effectiveness assessed on an ongoing 
basis.  
  
For qualifying cash flow hedges, the change in fair value of the effective 
hedging instrument, is initially recognised in equity and is released to the 
income statement in the same period during which the relevant financial asset or 
liability affects profit or loss.   
  
Where highly effective, any ineffective portion of the hedge is immediately 
recognised in the income statement. Where the instrument ceases to be highly 
effective as a hedge, or is sold, terminated or exercised, hedge accounting is 
discontinued.  
  
  Treasury shares  
  
Treasury Shares are recognised in equity and are measured at cost. Consideration 
received for the sale of such shares is also recognised in equity, with any 
difference between the proceeds from the sale and original cost being taken to 
revenue reserves.  
  
2 Foreign exchange   
  
The only foreign exchange rate which has a material impact on the reporting of 
the Group's results is the US dollar.  
  
 
              Closing rate    Closing rate    Average rate    Average rate   
              as at           as at           year ended      year ended     
              30 June         30 June         30 June         30 June        
              2009            2008            2009            2008           
  US dollar   1.6458          1.9923          1.6044          2.0119         
  
  
 
  Analysis of foreign exchange                                                           
                                                           Year ended       Year ended   
                                                           30 June          30 June      
                                                           2009             2008         
                                                           £m               £m           
  Realised and unrealised hedging (losses)/gains           (42.4)           3.1          
  Translation gains on non-Sterling denominated monetary   3.8              0.1          
  assets and liabilities                                                                 
                                                                                         
  Total foreign exchange (losses)/gains                    (38.6)           3.2          
  
  
3  Personnel expenses  
  
 
  Analysis of employee benefits expense                                 
                                          Year ended       Year ended   
                                          30 June          30 June      
                                          2009             2008         
                                          £m               £m           
  Wages and salaries                      8.9              5.3          
  Performance related bonuses             10.1             23.5         
  Share based payments                    11.9             10.0         
  Social security costs                   3.2              7.3          
  Pension costs                           0.6              0.3          
  Other costs                             1.3              1.3          
  Total employee benefits                 36.0             47.7         
  
  
4 Other expenses  
  
 
  Other expenses                                                                
                                                  Year ended       Year ended   
                                                  30 June          30 June      
                                                  2009             2008         
                                                  £m               £m           
  Travel                                          3.3              2.5          
  Professional fees                               3.0              2.2          
  Information technology and communications       2.1              1.4          
  Deferred acquisition costs charges              2.1              1.2          
  Operating leases                                1.9              1.0          
  Premises related costs                          0.8              0.6          
  Insurance                                       0.6              0.5          
  Auditors' remuneration                          0.6              0.7          
  Depreciation of property, plant and equipment   0.8              0.3          
  Other expenses                                  1.7              0.7          
  Total other expenses                            16.9             11.1         
  
  
5 Earnings per share  
  
Basic earnings per share is calculated by dividing the profit for the financial 
year attributable to equity holders of the parent of £115.0m (2008: £140.8m) by 
the weighted average number of ordinary shares in issue during the year.  
  
Reconciliation of the figures used in calculating basic and diluted earnings per 
share:  
  
 
                                                                   Year ended       Year ended   
                                                                   30 June          30 June      
                                                                   2009             2008         
                                                                                                 
  Weighted average number of ordinary shares used in calculation   671,667,998      669,671,683  
  of basic earnings per share                                                                    
  Effect of dilutive potential ordinary shares - share options     47,330,538       38,322,426   
  Weighted average number of ordinary shares used in calculation   718,998,536      707,994,109  
  of diluted earnings per share                                                                  
  
  
 6 Dividends  
  
An analysis of dividends is as follows:  
  
 
                                                        2009      2008  
                                                                        
  Dividends declared/proposed in respect of the year:                   
  Interim dividend declared per share (p)               3.66      3.66  
  Final dividend proposed/declared per share (p)        8.34      8.34  
                                                                        
  Dividends paid in the year:                                           
  Interim dividend paid(£m)                             24.9      24.9  
  Interim dividend per share (p)                        3.66      3.66  
                                                                        
  Final dividend paid(£m)                               57.0      45.2  
  Final dividend per share (p)                          8.34      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.   
  
On 15 September 2009 the Board proposed a final dividend of 8.34p per share for 
the year ended 30 June 2009. This has not been recognised as a liability of the 
Group at the year end as it has not yet been approved by shareholders. Based on 
the number of shares in issue at the year end which qualify to receive a 
dividend, the total amount payable would be £56.7m (2008:£57.0m).  
  
7  Non-current assets and non-current liabilities held for sale  
  
Where Group companies inject seed capital into funds operated and controlled by 
the Group, then the fund is classified as being held for sale. Typically, if the 
fund remains under the control of the Group for more than one year from the 
original investment date it will cease to be classified as held for sale, and 
will be consolidated line by line. In determining whether to execute the 
reclassification, the Group will have regard to the proximity of loss of 
control, and the extent to which consolidation of the fund on a line by line 
basis would be material to the presentation of the Group's financial statements. 
  
  
 
                                                   2009       2008   
                                                   £m         £m     
  Non-current assets held for sale                 34.8       16.4   
  Non-current liabilities held for sale            (7.4)      (0.1)  
  Seed capital classified as being held for sale   27.4       16.3   
  
  
The Group's maximum exposure to credit, liquidity, interest rate, foreign 
exchange and price risk in respect of these assets and liabilities is 
represented by their carrying value.  
  
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 34,293,185 (2008: 
34,012,500) ordinary shares of 0.01p with a nominal value of £3,429.32 (2008: 
£3,401.25) and shareholders' funds are reduced by £6.2m (2008: £5.4m) in this 
respect. It is the intention of the directors to make these shares available to 
employees by way of sale through the share based compensation plans.  
  
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   2009      2008  
  Cost of treasury shares:                    £m        £m    
  Ashmore Group plc ordinary shares           6.9       -     
  
  
 
                                                             
                                      Number         Number  
  Ashmore Group plc ordinary shares   5,368,331      -       
  
  
 
                                                             
  Reconciliation of treasury shares   Number         Number  
  At beginning of year                -              -       
  Purchase of own shares              5,368,331      -       
  At end of year                      5,368,331      -       
  
  
 
                                                   
  Market value of treasury shares:   £m        £m  
  Ashmore Group plc                  10.2      -   
  
  
10 Group risks  
  
The Group's principal risks are as detailed within the Business Review and 
Corporate Governance sections of the Group's Annual Report and are categorised 
as strategic and business, investment and operational.  
  
11 Post balance sheet events  
  
There are no post balance sheet events for the year ended 30 June 2009.  
  
12 Statutory accounts  
  
The financial information set out above does not constitute the company's 
statutory accounts for the years ended 30 June 2009 or 2008. Statutory accounts 
for 2008 have been delivered to the registrar of companies, and those for 2009 
will be delivered in due course. The auditors have reported on those accounts; 
their reports were (i) unqualified, (ii) did not include a reference to any 
matters to which the auditors drew attention by way of emphasis without 
qualifying their report and (iii) did not contain a statement under section 237 
(2) or (3) of the Companies Act 1985 in respect of the accounts for 2008 nor a 
statement under section 498 (2) or (3) of the Companies Act 2006 in respect of 
the accounts for 2009.  
  
13 Forward-looking statements  
  
This news release contains certain forward-looking statements with respect to 
the Ashmore Group's financial condition, operations, and business opportunities. 
These forward-looking statements represent the Group's expectations or beliefs 
concerning future events, and involve known and unknown risks, and uncertainty, 
that could cause actual results, performance, or events to differ materially 
from those expressed or implied in such statements. Past performance cannot be 
relied on as a guide to future performance.  
  
 
This information is provided by RNS  
  
The company news service from the London Stock Exchange  
  
  END  
  
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