Charles Clarke

This is versus the MSCI AC Asia Pacific ex Japan High Dividend Yield Index return of 7.5% and the MSCI AC Asia Pacific ex Japan Index return of 5.8%.

Over the twelve months ending June 2021, the comparative MSCI AC Asia Pacific High Dividend Yield ex Japan Index rose 13.9% in sterling terms, the MSCI AC Asia Pacific ex Japan Index rose 24.9% and the company’s NAV has outperformed both indices, returning 29.1%.

The board of the fund has also announced that two dividend payments totalling 4.5p will be distributed to Shareholders which translates to an annualised dividend yield of 4.0% in line with the MSCI AC Asia Pacific High Dividend Yield Index and exceeding the 1.9% yield of the MSCI AC Asia Pacific ex Japan index.

The company’s share price has echoed but not kept pace with NAV performance in the six months to 30 June 2021.

The share price ended at 230p, a 2.7% increase over the six month review period, resulting in a discount of 10.7% to the NAV per share.

Charles Clarke, chairman, Aberdeen Asian Income Fund, said: “This time last year, equity markets were near their low points following the market sell-off in response to the global pandemic and the Company reported a challenging set of results. Subsequently markets have been buoyant, hitting new highs in late 2020 and on an absolute basis, Aberdeen Asian Income Fund has performed well, outpacing the MSCI All Countries Asia Pacific ex Japan Index’s performance.

“Since the end of this interim reporting period, we have seen that Asian markets have corrected sharply, following sudden developments in the regulation of private education companies in China, that have sparked a broader sell-off on fears that similar policies may be rolled out more widely. This reaffirms the Company’s Investment Manager’s long-held belief that the quality of management and business model is crucial to investing in China over the long term.

“Aberdeen Asian Income Fund’s portfolio has a modest weight to China, having not invested in the internet stocks that do not pay dividends and steering clear of companies that do not pass the quality filter. While markets remain volatile at the time of writing, the Company has been defensive relative to the comparative indices during this time.”

Commenting on the outlook, he added: “The pandemic remains the primary cause for concern. While broadening vaccinations could bring forward global recovery, many challenges persist. The emergence of more virulent strains of the Covid-19 virus has resulted in renewed lockdowns across several Asian countries, including previous success stories, such as Singapore and Taiwan. Indonesia is experiencing a spike in fresh infections too, which has put its healthcare under pressure, as it did in India in March. If such conditions persist, however, the world could see a more uneven recovery.

“Beyond the pandemic, governments face the challenge of maintaining policy support for their economies, while staying watchful for key risks of spiralling levels of prices and debt. Fortunately, most Asian countries enjoy solid fiscal fundamentals that provide leeway for more stimulus, if the situation requires. Reassurances from major central banks about maintaining their accommodative stances should bolster sentiment as well. Elsewhere, geopolitical developments remain a perennial concern, especially with President Biden’s sustained pressure to contain China.

“While these are real risks, it is worth pausing to remember that Asia is still relatively well-positioned for a recovery. Knowledge about the virus has advanced from a year ago.”