HFL – Posting of half-year update

Henderson
Far East
Income Limited
Update for the half-year ended
28 February 2022

Henderson Far East Income Limited
Objective
The Company seeks to
provide shareholders with a
growing total annual dividend
per share, as well as capital
appreciation, from a diversified
portfolio of investments from
the Asia Pacific region.
This update contains material extracted from the Company's unaudited half-year results for the
six months ended 28 February 2022. The unabridged results for the half-year are available on the
Company’s website:
www.hendersonfareastincome.com
“The current environment supports
our investment strategy of producing
attractive levels of income for our
shareholders with an enhanced
prospect of sound capital performance"
John Russell, Chairman

Total return performance for the six months to 28 February 2022
Performance highlights
Total return performance
6 months
%
1 year
%
3 years
%
5 years
%
10 years
%
NAV
1
-0.1-0.36.314.476.7
Share price
2
-0.7-3.03.713.776.5
AIC sector
5
average NAV-1.5-1.825.439.9133.3
FTSE All-World Asia Pacific ex Japan Index*-6.3-6.525.236.6113.0
MSCI AC Pacific ex Japan High Dividend Yield Index*3.16.616.022.988.2
*The Company does not have a formal benchmark. It uses the FTSE All-World Asia Pacific ex Japan and MSCI AC Asia
Pacific ex Japan High Dividend Yield indices (sterling adjusted with dividends reinvested) for reference purposes only.
1
Net asset value per ordinary share total return (including dividends reinvested and excluding the cost of reinvestment).
2
Share price total return (with dividends reinvested) using mid-market closing price.
3
Dividend yield based on a share price of 288.00p and dividends for the twelve months to 28 February 2022 totalling 23.60p per ordinary share.
4
Dividend yield based on a share price of 301.50p and dividends for the twelve months to 31 August 2021 totalling 23.40p per ordinary share.
5
The AIC sector is the Asia Pacific Equity Income sector.
Sources: Morningstar Direct, Refinitv Datastream
NAV per ordinary share
28 Feb 2022 287.40p
31 Aug 2021 299.58p
Dividend yield
28 Feb 2022
3
8.2%
31 Aug 2021
4
7.8%
Share price
28 Feb 2022 288.00p
31 Aug 2021 301.50p
Dividends paid and payable
1st interim 5.90p
2nd interim 5.90p
NAV
1
-0.1%
Share price
2
-0.7%
1

Performance
Performance for the six months to 28 February
2022 was mixed, with NAV total return
performance negative 0.1%, which was markedly
better than the FTSE World Asia Pacific ex Japan
Index of negative 6.3%, but behind the MSCI AC
Asia Pacific ex Japan High Dividend Yield Index of
3.1%. This reflected the rotation from growth to
value, alongside the portfolio’s increased
allocation to the financials, materials and energy
sectors. The underperformance against the high
yield index was predominantly down to the
oversized weighting of BHP following the
consolidation of the UK stock line into the
Australian listing.
Dividends
The first and second interim dividends for the
current financial year have been declared in the
amount of 5.90p per ordinary share each. This
represents a 1.7% increase on the dividends paid
or payable for the same period last year. The
period saw the Company’s dividend yield finish
at 8.2%.
Outlook
Investors always face challenges, but it is even
more difficult to remain focused when in the midst
of a humanitarian crisis. Volatility is high and likely
to remain so. The consequences of the war in
Ukraine are largely unknowable. These shocking
events tend to draw attention away from personal
considerations in sympathy for those in severe
distress.
We cannot ignore, however, the risks and
opportunities we are now exposed to. This crisis
coming so close to the pandemic is a further
serious blow to global growth. The OECD*
recently noted ‘The moves in commodity prices
and financial markets seen since the outbreak of
the war could, if sustained, reduce global GDP
growth by over 1 percentage point in the first year,
with a deep recession in Russia, and push up
global consumer price inflation by approximately
2.5 percentage points’.
The impact of these developments will be felt
unevenly throughout the world. Weak global
growth is a negative for exporting countries,
significantly higher commodity prices a negative
for importers, and lower disposable incomes and
uncertainties negative for consumption levels and
tourism. Rising rates of inflation will be a problem
for everybody.
We are investors in the Asia Pacific region and
what does it mean for us? The role of Russia and
Ukraine in the global economy is small accounting
for only about 2% of global GDP. However, they
are major suppliers of commodities to the world
and supply disruption will cause some severe
problems. Russia and Ukraine together account
for about 30% of global exports of wheat, 20% for
corn, mineral fertilisers and natural gas and 11%
for oil. Indonesia and the Philippines are
dependent on wheat imports and Vietnam is
dependent on corn. The impact on the Middle
East will be severe as well. Farmers everywhere
will be impacted by much higher fertilizer prices
and supply disruption.
A bleak picture indeed. However, there are some
bright spots. China adopted more restrictive
monetary and fiscal policies in late 2020 but is
now easing policies and while credit growth has
been falling it now appears to be bottoming out.
This will support growth in China and should have
a cushioning effect on the region and on the rest
of the world. China provided significant support to
the global economy during the 2008 financial
Chairman’s Statement
2
*Economic and Social Impacts and Policy Implications of the War in Ukraine, March 2022.

crisis and played an important part in helping to
avoid a global depression. It seems it could play a
similar role today, although the recent lockdowns
following Covid-19 outbreaks may delay this.
The outlook for us is quite encouraging. We have
a large number of companies in a diverse
geographical setting to choose from. To achieve
our dividend objective, we invest largely in value
shares paying significant levels of dividend; this
has been something of a negative for our NAV
total return performance in the past two years as
investor preferences largely concentrated on
growth shares with low dividend payouts. In a
rising inflation environment value and income
become much more to the fore in meeting
investor needs. Our concentration on value is now
working in our favour. Since the beginning of the
2022 calendar year, the NAV total return has risen
to 4.9% and the dividend income generated by
the portfolio has risen 14.7% compared to the
same period last year.
As noted by the Fund Managers, we have
significant holdings in industrial metals and
energy. Prices of copper, aluminum, nickel, steel
and others have risen sharply on the back of
strong demand and constrained supply. Demand
levels reflect increased global fiscal stimulus via
infrastructure spending and long-term structural
growth from the transition to a low carbon world.
An example of this was demonstrated by a recent
report from Blackrock World Mining. The report
compared the resources to build a 100MW
natural gas fired turbine with a wind farm
equivalent. Twenty wind turbines would need to
be installed requiring 100 times more iron ore, 25
times more concrete and 10 times more specialty
metals including copper. This is a measure of the
challenge confronting the world and the strength
of demand for industrial metals.
The supply of industrial metals has been
constrained by significant underinvestment in
recent years. Short supply and high demand will
support rising prices for some time and mining
companies are experiencing high levels of free
cash flow which they are paying back to
shareholders in the form of higher dividends and/
or share buy backs. This is welcome news to us.
In summary, we are in an environment that
supports our investment strategy of producing
attractive levels of income for our shareholders
with an enhanced prospect of sound capital
performance. The recent shift towards more value
oriented investments should be a positive factor in
portfolio returns as we look ahead to the balance
of our financial year.
John Russell
Chairman
27 April 2022
Chairman’s Statement (continued)
3

Fund Managers’ Report
Review
Despite another extraordinary period, global
equity markets, with a few exceptions, have
proved to be remarkably resilient. Over the six
months to 28 February 2022, the MSCI World
Index is down almost 2% in sterling terms, the
S&P is practically unchanged, while the FTSE 100
is up just over 6%. In contrast, Asia Pacific was
less resilient with the FTSE All World Asia Pacific
ex Japan Index falling 6.3%.
For most of the last six months equity markets
have been struggling with the expectation of
rising interest rates, a reversal of central bank
asset purchases and inflation which has moved
from being transitory to something more long
lasting in nature. Although most of the world is
now learning to live with Covid-19, the impact on
supply chains through worker absence and
logistics disruptions has compounded the impact
on prices with effects likely to last well into 2022
and possibly beyond. The Russian invasion of
Ukraine in February this year has taken these
constraints to another level with spikes in prices
of oil, gas, industrial metals and agricultural
products putting further pressure on the cost of
living, especially in Europe, the UK and the US.
The resilience of equity markets is most likely a
function of excess liquidity and the diminishing
attractiveness of bonds and cash in an
increasingly negative interest rate environment. It
remains to be seen whether this resilience will
continue as rates rise and liquidity is withdrawn.
As a net importer of most of these products, Asia
is not immune to inflationary pressures from rising
energy, metals and food prices but in most cases
core inflation remains some way below the levels
in developed markets. Although this will most
likely rise in the region, real rates will remain close
to positive while the constraints in terms of
labour, logistics and asset prices are not nearly
as acute as elsewhere.
The best performing markets over the period were
in South Asia as the gradual easing of Covid-19
restrictions spurred expectations of the long-
awaited re-opening. Thailand, the Philippines and
Malaysia all posted positive returns while
Indonesia rose almost 20% in sterling terms as
the rise in demand for fossil fuels boosted coal
prices – one of the country’s major exports. The
performance of North Asia was much weaker as
China and Korea fell by 14.6% and 13.8%
respectively while Taiwan posted a small gain. At
the sector level, only energy, financials and utilities
posted positive returns with consumer and health
care down over 20%.
The weakness in China continues to dominate
the region. From its peak in February 2021 the
MSCI China Index has fallen 34% in US dollar
terms while the S&P Index by comparison has
risen 13%. The combination of regulatory
uncertainty, property defaults, Covid-19
disruptions and a slowing economy have
combined to undermine investors faith in Chinese
equities. While the government has now moved
to a stimulatory footing, the zero tolerance to
Covid-19 and ongoing lockdowns are stifling
recovery. The confirmation of a target GDP
growth of 5.5% for 2022 looks increasingly
unlikely unless restrictions are eased and
stimulus accelerated.
Performance
The NAV total return declined 0.1% in sterling
terms over the period, outperforming the FTSE All
World Asia Pacific ex Japan Index which fell
6.3%. The MSCI AC Asia Pacific ex Japan High
Dividend Yield Index rose 3.1%, boosted by an
oversize weighting of BHP as the UK shares
switched to the Australian line and a greater
exposure to the Taiwanese technology sector.
4

Fund Managers’ Report (continued)
The switch from growth to value as a driver of
returns was beneficial for the Company’s portfolio
while allocation to financials, materials and
energy added value. At the country level, the
reduction in the weighting to China in favour of
Australia was positive for absolute and relative
performance.
At the stock level the most significant contributors
to performance were from the financials and
energy sectors. CTBC in Taiwan, United
Overseas Bank in Singapore, and KB Financial in
Korea rose 20%, 19% and 12% respectively, but
the star of the show was Australian oil and gas
company Woodside Petroleum which rose 48%.
Detractors from performance were Chinese
mid-caps that were caught up in the issues
described earlier.
Revenue
Despite a difficult period for income in 2020, the
recovery in 2021 and into 2022 has been
impressive. With Covid-19 disruptions generally
easing, companies are feeling more confident on
committing to dividend increases. This is
especially true of the energy and material sectors
which were already benefiting from tight supply
and increased pricing prior to the Russian
invasion of Ukraine. Banks are also returning to
more progressive pay-out policies notably in
Australia, Korea and Singapore while we have
been pleasantly surprised by some significant
uplift in pay-out ratios in China and Taiwan.
Dividend income from the portfolio rose 14.7%
compared to the same period last year while total
income rose 11.9% as the contribution from
option income was 10.6% lower as less options
were written. Revenue per share rose 15.3%
reflecting a lower tax charge and a reduced
management fee despite a modest increase in
shares in issue.
Strategy
Throughout the period we have added exposure
to the energy, financials and materials sectors
and reduced exposure to China and real estate.
The case for energy and materials is not based
on demand, but in how the lack of investment in
recent years would lead to supply shortages,
rising prices, abundant cash flow and higher
dividends. These trends were beginning to
materialise with oil prices moving to US$80 a
barrel but have been brought more into focus
following the Russian invasion of Ukraine. Our
preference in this area is for gas companies
rather than oil and miners of the industrial metals,
such as copper, that will be in great demand in
the transition towards more energy efficient
power production and transportation. We own
BHP Group Limited, Rio Tinto Limited, Woodside
Petroleum, Santos and OZ Minerals in Australia,
Zijin Mining in China as well as ONGC and
Hindustan Petroleum in India which are exposed
to these themes.
Throughout most of 2020 and 2021, banks
globally have been impacted by low interest rates
and a fairly benign economic recovery. With
inflation rising and economies re-opening the
pressure on interest rates to rise is becoming
more intense. At the end of 2021 we added to our
positions in banks in Korea, Taiwan, Singapore
and Australia in order to benefit from these
improving trends in profitability. We added KB
Financial in Korea, CTBC and Yuanta in Taiwan,
UOB in Singapore and ANZ in Australia.
With input prices likely to remain elevated for
some considerable time, we continue to prefer
price makers rather than price takers. This leads
us to favour upstream producers while remaining
cautious of manufacturers and consumer facing
companies that don’t have pricing power. Our
high weights in energy and materials and low
weights in consumer sectors and industrials,
reflect these views.
5

6
Fund Managers’ Report (continued)
While interest rate increases are positive for
banks, they are less so for real estate leading to
the sale of Stockland in Australia and reduced
exposure to REITS in Singapore. Over the period,
we also reduced exposure to China by selling
Venustech, China Construction Bank and
Topsports as it became increasingly clear that
recovery in China would take longer than
originally expected.
Outlook
We are cautiously optimistic on the outlook for
Asia Pacific equities. Following a period of
underperformance Asia looks cheap compared
to its peers while earnings look to be well
underpinned by fundamentals. Dividends remain
the ‘bright spot’ with dividend growth likely to
exceed expectations as companiess regain some
confidence following an uncertain couple of
years.
China remains key for the region’s success. At
some point in 2022, once the Covid-19 outbreak
has been contained, the Chinese authorities will
embark on a concerted effort to revive the
economy. This will be focused on incentivising
consumption, promoting innovation alongside the
more traditional means of infrastructure spending.
Following the period of underperformance, there
is a lot of value in the Chinese equity market and
once there is greater clarity on policy, especially
regarding regulations, property market solvency
and living with Covid-19, we will look to add
exposure to the only major economy that is likely
to be loosening economic conditions in 2022.
We are also positive on the outlook for yield as an
investment style. The last few years have been
difficult with the focus clearly on thematics and
growth at the expense of fundamentals. The
spike in inflation and the impending rise in interest
rates has prompted a change in perception as
expensive growth stocks become more difficult
to justify and new areas of investment lose their
lustre. We expect dividend yield as a style to
perform better as we go through the year as
inflation erodes the returns available to savers.
The spread of dividend yield over cash and
bonds is still wide and attractive for pension
funds, insurance companies and individual
investors alike. The demand from aging
populations should be positive for the share
prices of high and sustainable yielding companies
which make up a large part of the portfolio.
Mike Kerley and Sat Duhra
Fund Managers
27 April 2022

7
Portfolio information
Investment portfolio at 28 February 2022
Company
Country of
incorporationSector
Valuation
£’000
% of
portfolio
Rio Tinto LimitedAustraliaBasic Materials22,2064.94
Samsung Electronics
1
South KoreaTechnology17,4033.87
Macquarie GroupAustraliaFinancials16,3553.64
BHP Group LimitedAustraliaBasic Materials15,2393.39
Macquarie Korea
Infrastructure Fund
South KoreaFinancials15,2093.39
Telekom Indonesia PerseroIndonesiaTelecommunications14,8353.30
Woodside PetroleumAustraliaEnergy14,2333.17
SantosAustraliaEnergy13,7123.05
VinaCapital Vietnam
Opportunity Fund
VietnamFinancials13,6903.05
Digital Telecommunications
Infrastructure Fund
ThailandTelecommunications13,6763.04
Top Ten Investments156,55834.84
Taiwan Semiconductor
Manufacturing
2
Ta iwa nTechnology13,4552.99
KB FinancialSouth KoreaFinancials12,8072.85
Spark New ZealandNew ZealandTelecommunications12,4232.77
United Overseas BankSingaporeFinancials12,3482.75
HKT Trust & HKTHong KongTelecommunications11,6762.60
Quanta ComputersTa iwa nTechnology11,5282.57
LG CorpSouth KoreaIndustrials10,8892.42
CTBC Financial HoldingsTa iwa nFinancials10,8822.42
CITIC SecuritiesChinaFinancials10,6542.37
SK Telekom
2
South KoreaTelecommunications10,5882.36
Top Twenty Investments273,80860.94
Oil & Natural Gas
Corporation
IndiaEnergy10,3412.30
Industrial Bank CoChinaFinancials9,8322.19
Singapore TelecommunicationsSingaporeTelecommunications9,7212.16
KT CorpSouth KoreaTelecommunications9,4112.10
Yuanta FinancialTa iwa nFinancials9,3672.09
OZ MineralsAustraliaBasic Materials9,1502.04
Taiwan CementTa iwa nIndustrials9,0852.02
Zijin MiningChinaBasic Materials9,0042.00
China National Building
Material Group
ChinaIndustrials8,7921.96
Ascendas REITSingaporeReal Estate8,7281.94
Top Thirty Investments367,23981.74

Portfolio information (continued)
8
Geographical exposure
Sector exposure
Financials
Te lecommunications
Te chnology
Basic Materials
Energy
Real Estate
Industrials
Consumer
Discretionary
Utilities
2022
%
28.2
18.3
13.0
12.4
9.9
6.9
6.4
3.4
1.5
2021
%
27.6
13.7
17.8
12.5
4.5
10.6
7.3
6.0
-
2
0
2
1
2
0
2
2
Australia
South Korea
Ta iwan
China
Singapore
Hong Kong
India
Indonesia
Vietnam
Thailand
New Zealand
2022
%
24.0
17.0
14.0
13.6
8.6
6.9
3.7
3.3
3.1
3.0
2.8
2021
%
21.4
14.4
18.6
15.4
5.9
11.8
2.9
2.5
3.1
2.0
2.0
2
0
2
1
2
0
2
2
at 28 February 2022 and 31 August 2021at 28 February 2022 and 31 August 2021
Company
Country of
incorporationSector
Valuation
£’000
% of
portfolio
YageoTa iwa nTechnology8,6921.93
Australia and New Zealand
Banking Corp
AustraliaFinancials8,6651.93
DexusAustraliaReal Estate8,3931.87
JD.comChinaConsumer Discretionary7,9721.77
Mapletree LogisticsSingaporeReal Estate7,6851.71
ChinasoftChinaTechnology7,5511.68
China Yongda AutomobilesChinaConsumer Discretionary7,2881.62
AIA GroupHong KongFinancials6,6261.48
Guangdong InvestmentsHong KongUtilities6,5751.46
Sun Hung Kai PropertiesHong KongReal Estate6,3121.41
Top Forty Investments442,99898.60
Hindustran PetroleumIndiaEnergy6,2911.40
China Forestry HoldingsChinaBasic Materials--
Total Investments449,289100.00
1 Preferred Shares
2 American Depositary Receipts
Investment portfolio at 28 February 2022 (continued)

9
Financial summary
Half-year endedHalf-year endedYear ended
Extract from the condensed Statement
of Comprehensive Income (unaudited
except for August 2021 figures)
28 Feb 2022
Revenue
return
£’000
28 Feb 2022
Capital return
£’000
28 Feb 2022
Total return
£’000
28 Feb 2021
Total return
£’000
31 Aug 2021
Total return
£’000
Investment income10,895-10,8959,49237,236
Other income1,093-1,0931,2233,103
(Losses)/gains on investments held
at fair value through profit or loss-(8,841)(8,841)23,328(1,791)
Net foreign exchange (losses)/gain
excluding foreign exchange
(losses)/gains on investments-(509)(509)670(216)
Total income11,988(9,350)2,63834,71338,332
Expenses, finance costs & taxation
(including management fees)(2,081)(1,161)(3,242)(3,626)(8,655)
Profit/(loss) for the period and
total comprehensive income9,907(10,511)(604)31,08729,677
Earnings/(losses) per ordinary
share – basic and diluted6.55p (6.95p)(0.40p)21.80p 20.40p
Half-years endedYear ended
Extract from condensed
Balance Sheet (unaudited
except August 2021 figures)
28 Feb 2022
£’000
28 Feb 2021
£’000

31 Aug 2021
£’000
Investments held at fair value through
profit or loss (excluding options)449,289472,644462,525
Current assets (other receivables
and cash and cash equivalents)32,62418,72119,044
Net current liabilities(46,306)(41,860)(28,925)
Net assets435,607449,505452,644
Net asset value per ordinary share287.40p 311.52p 299.58p
Dividends
A first interim dividend, in respect of the year ended 31 August 2022, of 5.90p per share was paid on
25 February 2022. The second interim dividend of 5.90p per share will be paid on 27 May 2022 to
shareholders on the register on 29 April 2022. The Company’s shares will be quoted ex-dividend on
28 April 2022.
Share Capital
During the six months under review the Company issued a total of 475,000 shares (half-year ended
28 February 2021: 2,800,000; year ended 31 August 2021: 9,600,000) for net proceeds of £1,412,000
(half-year ended 28 February 2021: £9,071,000; year ended 31 August 2021: £31,080,000) net of costs.
No new shares have been issued since the period end.

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Henderson Far East Income Limited
201 Bishopsgate
London EC2M 3AE
H050005_0422