Lg943270025
Contact: Camille Lepre
(617) 563-9171
For Immediate Release
FIDELITY ADVISOR EMERGING ASIA FUND ANNOUNCES ITS INVESTMENT PERFORMANCE;
INTERIM EARNINGS; ANNUAL DISTRIBUTIONS; COUNTRY ALLOCATIONS AND TOP TEN
EQUITY HOLDINGS
BOSTON, December 16, 1994--- Fidelity Investments released the following
information regarding Fidelity Advisor Emerging Asia Fund, Inc., (NYSE:
FAE), a closed end fund.
Details regarding the investment performance for the three month period
ended October 31, 1994 and for the period from the commencement of
operations (March 25, 1994) to October 31, 1994 are as follows:
The fund's net asset value per share was $16.01 as of the close of business
on October 31, 1994. This represents an increase of $0.91 per share from
the net asset value per share of $15.10 reported on July 29, 1994. The
fund's share price as traded on the New York Stock Exchange (NYSE) at
October 31, 1994 was $15.125. This represents an increase of $1.25 per
share from the share price of $13.875 on July 29, 1994. The fund had a
cumulative total return of 6.03% for the three months ended October 31,
1994 based on net asset value, and 9.01% based on NYSE share price.
From commencement of operations to October 31, 1994, the fund's net asset
value per share increased $1.91 per share from the net asset value of
$14.10 on March 25, 1994. From commencement of operations to October 31,
1994, the fund's share price as traded on the NYSE increased $0.125 per
share from the share price of $15.00 on March 25, 1994. The fund had a
cumulative total return of 14.27% based on net asset value, and 0.83% based
on NYSE share price. Net asset value return excludes the effect of initial
offering expenses, one time sales load and net asset value increase due to
exercise of over-allotment option.
For the three months ended October 31, 1994, the fund had net realized
gains of $1,507,255 on investment transactions and net unrealized
appreciation of $6,509,621 on investments held. The fund's net investment
loss (consisting of dividend and interest income less operating expenses)
for the same period was $116,500.
From commencement of operations to October 31, 1994, the fund had net
realized gains of $856,462 on investment transactions and net unrealized
appreciation of $16,020,417 on investments held. The fund's net investment
income (consisting of dividend and interest income less operating expenses)
for the same period was $218,384.
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FINANCIAL HIGHLIGHTS
Quarter Ended March 25, 1994
October 31, 1994 (commencement of
operations) to
October 31, 1994
Total Net Assets $135,272,787 $135,272,787
Net Asset Value Per Share $16.01 $16.01
Gross Investment Income $483,423 $1,562,102
Per Share $0.06 $0.19
Net Investment Income $(116,500) $218,384
Per Share $(0.01) $0.03
Net Realized Gain (Loss) $1,507,255 $856,462
on Investments $0.18 $0.10
Per Share
Change in Net Unrealized $6,509,621 $16,020,417
Gain (Loss) on Investments $0.76 $1.87
Per Share
Net Increase (Decrease) $7,900,376 $17,095,263
in Net Assets Resulting
from Operations
Per Share $0.93 $2.00
ANNUAL DISTRIBUTION
The Board of Directors declared a dividend on November 30, 1994 of
substantially all of the fund's net investment income and realized capital
gains. The fund will pay a net investment income dividend of $0.12 per
share, and a short-term capital gain distribution of $0.13 per share,
payable to shareholders of record on December 28, 1994. The payment date
will be January 13, 1995.
COUNTRY ALLOCATIONS AND TOP 10 EQUITY HOLDINGS
As of October 31 1994, the fund's total net assets were $135.3 million.
The fund's investments were allocated as follows: 98.00 percent was in
common and preferred stocks, 0.70 percent was in bonds, and 1.30 percent
was in cash equivalents.
The top five country allocations were as follows: 1) Hong Kong -- 23.4
percent, 2) Taiwan -- 21.8 percent, 3) Malaysia -- 12.4 percent, 4)
Thailand -- 10.4 percent, and 5) Singapore -- 9.3 percent.
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The top 10 equity holdings were as follows: 1) Hutchison Whampoa Ltd.
Ord. -- 3.5 percent, 2) Hong Kong Telecommunications -- 2.9 percent, 3)
Bangkok Bank Ltd. -- 2.8 percent, 4) Sun Hung Kai Properties Ltd. -- 2.6
percent, 5) Resorts World BHD -- 2.1 percent, 6) United Overseas Bank --
2.0 percent, 7) Hang Seng Bank -- 1.9 percent, 8) Swire Pacific Ltd. Cl A
- -- 1.8 percent, 9) Himalayan Fund NV, ISI -- 1.8 percent, 10) Development
Bank of Singapore - 1.7 percent.
Peter Phillips, portfolio manager of Fidelity Advisor Emerging Asia Fund,
has provided the following investment review of the Fund's top country
allocations:
HONG KONG: "I have reduced the fund's holdings in Hong Kong over the past
several months because of Hong Kong's relative underperformance. Its poor
showing was largely due to the overheated economy in China - which is
closely linked to Hong Kong's economy - and a drop in the Hong Kong
property market. One property company that still looked good was Sun Hung
Kai, a well-managed property company that owns some income-producing
shopping centers. Another Hong Kong company that looked good was Hutchison
Whampoa, a conglomerate that was benefiting from the overall pickup of the
global economy. This company was also interesting because it was expanding
its container handling operations in Southern China and Shanghai. Another
fund holding, Hong Kong Telecommunications, is also expanding in China,
where it is attempting to take part in building China's communication
infrastructure."
INDIA: "Over the past six months, I've added about 1% to 1.5% each month
in Indian investments. Now the country makes up 8.4% of the fund. During
the period, I invested mostly in small to medium-sized companies on a
stock-by-stock basis. One interesting company was Zee Telefilms, a
successful producer of Hindi language television programs. Another example
was the software company Infosys Technology of Bangalore, a southern city
that is considered to be the software capital of India."
TAIWAN: "Even though this market has been quite volatile during the past
six months, the earnings story was still strong. Taiwanese export
companies benefited from the pickup in major economies, especially the
United States'. Electronics companies, which make up a major part of the
fund's exposure there, did particularly well. Taiwan Semiconductor, a
company that produces integrated chips for international customers, was
very attractive. I should point out that this popular company is a joint
venture between Phillips and the Taiwan government. Another exciting
company was Standard Foods, a breakfast cereal and health drink
manufacturer that went public in April."
THAILAND: "Thai banks and financial stocks have turned in exceptionally
strong performance over the past six months. In fact, more than half of
the fund's Thai investments were in banks. That is because stocks, like
Bangkok Bank, were cheap, while loan growth was strong. Many market
watchers thought that higher U.S. interest rates would hurt financial
companies there, but that didn't happen."
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The following macroeconomic overview discussion has been provided by Peter
Philips, portfolio manager of the Fund, via conference call held on
November 9, 1994. Peter's thoughts are as follows:
"While inflation remains high in China, I still have a lot invested there
indirectly. That's because I think there is tremendous growth potential in
China. But right now inflation is still too high, and the government is
trying to slow the economy down. In addition, it can be a pretty tough
investment environment. Many companies find it difficult to make money
there because costs in China are much higher than they expected."
It is also clear that China has a lot to gain when it takes over Hong Kong
in 1997. However, we often don't think about how much Hong Kong gains
every day from its connection to China, its major trading partner. On the
most basic level, Hong Kong gets all its water and much of its food from
China. There are 19 million visits each year to China by Hong Kong
residents - even though Hong Kong has only six million people. In terms of
economies, I see the two countries as pretty integrated, and the
distinctions between them are becoming increasingly blurred.
" I would also like to address the benefit of being a closed-end fund.
The fund's closed-end charter definitely helped it invest in many
attractive illiquid markets. Keep in mind that in developing Southeast
Asian countries, liquidity - or the ability to buy or sell a stock on a
daily basis - can sometimes be an issue. I should also note that it takes
quite a while to build up meaningful positions in these countries. To do
this, the fund manager must be confident that his fund's assets can't be
depleted by shareholder redemptions."
