Invesco Asia Dragon Trust plc (formerly Invesco Asia Trust plc)
Half-Yearly Financial Report Announcement for the Six Months to 31 October 2025
The following text is extracted from the Half-Yearly Financial Report of the Company for the six months to 31 October 2025. All page numbers below refer to the Half-Yearly Financial Report which will be made available on the Company’s website.
This announcement contains regulated information.
· The first full six months since the transformational combination of Invesco Asia Trust with Asia Dragon Trust show strong absolute and relative performance.
· Over the six months to 31 October 2025 NAV total return of +34.1% and share price total return of +37.2% were both significantly ahead of our benchmark (MSCI AC Asia ex Japan Index) total return of +31.4%.
· The sudden pivot of American relations with China provides a new and exciting opportunity to invest in Asia.
· With a strong Investment Case and a strong Corporate Proposition, our aim is to make Invesco Asia Dragon the `go to’ Asian trust, trading on a premium rating, growing organically and through further combinations.
Investment Objective
The Company’s objective is to provide long-term capital growth and income by investing in a diversified portfolio of Asianand Australasian companies. The Company aims to achieve growth in its net asset value (`NAV’) total return inexcess of the Benchmark Index, the MSCI AC Asia ex Japan Index (totalreturn, net of withholding tax, in sterling terms).
Financial Information and Performance Statistics
The benchmark index of the Company is the MSCI AC Asia exJapan Index (total return, net of withholding tax, in sterling terms).
| Six Months to | Year ended | |
| 31 October | 30 April | |
| Total Return Statistics(1) (dividends reinvested) | 2025 | 2025 |
| Net asset value (`NAV’) total return(2) | 34.1% | 2.8% |
| Share price total return(2) | 37.2% | 7.1% |
| Benchmark index total return(3) | 31.4% | 3.9% |
Capital Statistics
| At | At | ||
| 31 October | 30 April | ||
| 2025 | 2025 | change % | |
| Net assets (£’000) | 954,614 | 729,912 | 30.8% |
| NAV per share | 468.83p | 356.31p | 31.6% |
| Share price(1) | 430.00p | 320.00p | 34.4% |
| Benchmark index (capital) | 1,306.16 | 1,005.56 | 29.9% |
| Discount(2) per ordinary share | (8.3)% | (10.2)% | |
| Average discount over the six months/year(1)(2) | (9.2)% | (11.2)% | |
| Gearing(2): | |||
| – gross | 2.6% | 6.0% | |
| – net | 2.0% | 5.7% |
(1) Source: LSEG Data & Analytics.
(2) Alternative Performance Measures (`APM’), see pages 16 to 18 for the explanation and reconciliations of APMs. Further details are provided in the Glossary of Terms and Alternative Performance Measures in the Company’s 2025 Annual Financial Report.
(3) Index returns are shown on a total return basis, with dividends reinvested net of withholding taxes.
Chairman’s Statement
Highlights:
· The first full six months since the transformational combination of Invesco Asia Trust with Asia Dragon Trust show strong absolute and relative performance.
· Over the six months to 31 October 2025 NAV total return of +34.1% and share price total return of +37.2% were both significantly ahead our benchmark (MSCI AC Asia ex Japan Index) total return of +31.4%.
· The sudden pivot of American relations with China provides a new and exciting opportunity to invest in Asia.
· With a strong Investment Case and a strong Corporate Proposition, our aim is to make Invesco Asia Dragon the go-to Asian trust, trading on a premium rating, growing organically and through further combinations.
Review of the six months to 31October 2025
Over the six months to 31 October 2025 NAV total return of +34.1% was significantly ahead of our benchmark (MSCI AC Asia ex Japan Index) total return of +31.4%. The share price total return was +37.2% with the discount narrowing from 10.2% to 8.3% over the period.
Some of the appreciation (around 2%) can be attributed to the weakness of sterling. Some can be pinned on earnings growth from the companies in the region, with 15%(1) forecast for the full calendar 2025. This is more than was expected six months ago, with technology earnings driven by AI capital expenditure a particular feature. But the bulk of the explanation is in a rerating upwards of Asian markets. This is partly a reaction to Asian markets having been trading at an unusually attractive discount to global markets after fifteen years of underperformance and partly the markets becoming accustomed to President Trump’s tariff diplomacy. It’s also partly a new optimism about future Asian growth fuelled by domestic policy decisions such as China’s measures to tackle deflation and stimulate domestic growth and South Korea’s “Korea Up!” policy to improve governance and shareholder returns. Taiwan’s exposure to technology and AI (particularly our largest holding Taiwan Semiconductor Manufacturing) helped. Hong Kong appears to be starting to regain its confidence. Even laggard Indonesia has started to move as interest rates were finally cut. India underperformed after becoming a late target for American tariffs.
Attribution analysis shows that stock selection and country selection contributed roughly evenly to the outperformance over the six month period. Fiona and Ian analyse performance further in their Managers’ Report.
In accordance with our new dividend policy to pay out 1% of prior year end unaudited NAV quarterly (i.e. 4% over a full year) we paid out dividends of 3.95p on both 25 July 2025 and 24 October 2025.
For the six months to 31 October 2025, a total of 1,235,000 shares were bought back into Treasury at a total cost of £4,301,000, representing 0.6% of the starting number of shares in issue (excluding treasury shares). This has been accretive to NAV by 0.06%.
Cumulative Total Return (dividends reinvested) to 31 October 2025(2)
| One | Three | Five | Ten | |
| Year | Years | Years | Years | |
| Net asset value (`NAV’) | 29.7% | 65.0% | 68.7% | 221.4% |
| Share price | 34.0% | 79.7% | 80.7% | 244.3% |
| Benchmark index(3) | 25.6% | 63.4% | 36.7% | 157.2% |
(1) Source: Bloomberg.
(2) Source: LSEG Data & Analytics.
(3) The benchmark index of the Company is the MSCI AC Asia ex Japan Index (total return, net of withholding tax, in sterling terms).
The Investment Case and the Corporate Proposition
Shareholders will be aware that we believe that the discount is determined by the combination of demand for Asian equity investment vehicles, the Investment Case for the Company and the Corporate Proposition that we offer. In order to stimulate more demand for the Company’s shares, we aim to provide a strong Investment Case and a strong Corporate Proposition at the same time.
The Investment Case rests on accessing the attractions of Asian equity markets through the institutional expertise of Fiona Yang and Ian Hargreaves’ team at Invesco. The Co-Portfolio Managers’ investment process can be summarised as `valuation not value’ and has been very successful in attracting institutional investors such as pension funds and sovereign wealth investors. In times like these of great change, we would argue that this forward-looking active approach (as opposed to a backward-looking index or passive style) is exactly what is needed. The Company is the only way for individual investors to access Fiona and Ian’s expertise.
The Board has continued to review and adopt measures intended to create additional demand for the Company’s shares, both from existing and new shareholders, and to reduce the discount. We have been careful to ensure that the measures chosen are in the best interests of all shareholders. The intention is that these gains will combine to make the Corporate Proposition as compelling as the Investment Case. A full explanation is in the Annual Financial Report’s Chairman’s Statement. In summary they include:
· The new three-yearly unconditional tender through which shareholders can redeem as many of their shares as they wish at a 4% discount to NAV every three years, the first opportunity being in 2028.
· The enhanced dividend policy, paying out approximately 1% of the Company’s unaudited year-end NAV quarterly over the subsequent four quarters.
· Helped by being one of the largest investment trusts at £955m of net assets, a blended management fee of 0.57% based on 31 October 2025 net asset value and a projected annual ongoing charges level of 0.72% (once the Invesco fee waiver that was part of the merger process has expired in November 2025), makes us one of the lowest cost ways of investing in Asia.
· There is a strong integrated ESG approach, explained fully in the Annual Financial Report.
· We aim to keep engaging more individual shareholders and, unlike open-ended funds, offer the ability for all shareholders to meet both the Co-Portfolio Managers and the Directors every year at the annual general meeting.
· There is also the active use of gearing (or borrowings) to enhance portfolio returns, the `skin in the game’ of Directors’ and Managers’ shareholdings and the authority granted annually by shareholders to buy back shares if necessary.
Update
From 31 October 2025 to 19 January 2026, the NAV total return has been 3.1%, underperforming the index return of 3.3%. The share price total return has been 4.0%, with the discount narrowing to 7.5%.
With the Investment Case and strength of the Corporate Proposition being key to delivering the Company’s objective to shareholders, we appreciate that it’s important to ensure that you’re aware of the thoughts and views of our Manager as well as important announcements from your Board. Whilst information is available from many different sources, I would recommend shareholders sign up for the regular email service, which will deliver insights from your Manager direct to your inbox. If you haven’t already, then you can do this by focussing your smart device camera over the QR code below. This should present you with a yellow box on your camera screen with a link which once clicked, will take you to a sign-up page. Alternatively, you can sign-up for this service at the Company’s website.
Outlook
Every two years the Board accompanies the Managers on a week of company visits in Asia. The trip is designed to aid our evaluation of the Managers by observing them in action but also to give us first-hand exposure to some of the companies in which we invest. The Board travelled to Hong Kong, Shenzhen and Shanghai in November. What was unusual about this trip was that it felt like we were right in the middle of a major market turning point.
There had already been during 2025 a warming of the Chinese government’s attitude towards Chinese technology companies. President Xi Jinping’s meeting with Alibaba’s founder Jack Ma was a clear sign that the government wants (perhaps needs) the growth of technology companies. The DeepSeek moment, when that Chinese company unexpectedly announced an advanced AI model, was felt around the world. There has been state sponsored buying of market ETFs in China. So conditions were already improving. But what was particularly exciting was President Xi’s summit with President Trump in South Korea on 30 October. A 12-month tariff pause was the main headline at the time, but further summits and meetings are planned within these 12 months that could herald a major warming in Sino-US relations. It seems that President Trump, having tried and failed to secure agreements with the Russians, has now pivoted his attention to China. AI and rare earths dominated the initial headlines but now that the two countries appear to be ramping up their engagement there is huge potential for agreements in areas where China is already a global leader, such as electric vehicles, battery technology and solar panels all of which would boost US growth if allowed. It is also probable that the Chinese have been unwilling to declare their full hand of domestic stimulatory measures until after agreeing tariff terms with the Americans.
Elsewhere South Korea’s “Korea Up!” policy continues to gather momentum. Rather than a Chinese military invasion of Taiwan, some experts have started to talk about a voluntary reunification, perhaps based on Hong Kong which is now 28 years through its 50 year period covered by the Joint Declaration between China and the UK and is showing green shoots of regaining its self-confidence. Indonesia’s demographics and domestic demand outlook now look positive. Singapore remains as resilient as ever. Thailand is benefitting from an easing in monetary policy and growing tourism. Only India isn’t participating in the improving sentiment. President Trump’s imposition of 50% tariffs on India in retaliation for its purchases of Russian oil has been a significant setback, although we should note that it might turn out just to be a negotiating position.
But the dominant economy in the region is China. It’s also the biggest market in the MSCI Asia-Pacific ex-Japan Index. If we really are about to experience a major long-term turning point in US-China relations then it would necessitate a major adjustment in investment thinking and positioning towards Asia. The tail risk, the black swan, is now a market melt-up.
Neil Rogan
Chairman
22 January 2026