Adamas Finance Asia Ltd’s (LON:ADAM) investment manager made significant progress restructuring the portfolio last year and invested in a number of SME businesses the board believes have "strong prospects".
Net asset value remained largely flat at US$93mln over the course of 2018, having started the year at US$93.6mln, while NAV per share fell to US$1.13 from US$1.22.
The dip in NAV resulted from the swing to a net loss of US$3.5mln from the US$11.7mln profit the prior year amid the portfolio restructuring, which principally included the completion of the disposal of China-based private equity assets, partly offset by an increase in the value of Adamas’ stake in Hong Kong Mining Holdings (HKMH) by US$3.1m from 79% to 85%.
Investment changes orchestrated by Hong Kong-based manager Harmony Capital saw the Chinese assets exchanged for a convertible bond in the Fook Lam Moon chain of restaurants in Hong Kong and another US$3mln was received from the disposal of Global Pharm.
New investments in the period were made in Singapore-headquartered DocDoc, which offers a “doctor discovery platform” across eight Asian countries and received a US$2mln cash injection from Adamas, and a US$4m loan paying 17.5% coupon made to support the development of a premium ski accommodation project in Niseko, Japan.
With Adamas counting year-end cash of US$8.8mln, Harmony was eyeing new investments including a US$5mln convertible bond for innovative needle-free injectors developer PharmaJet.
Chairman John Croft said the board was “extremely encouraged by the considerable progress” made by the Harmony in seeking out new income generating investment opportunities, while NAV should benefit from mining operations at HKMH restarting in the second half of 2019.
Croft said increasing the liquidity of Adamas stock was “a key priority, one we will continue to take further actions to improve during the coming year”.