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Alliance Trust boosts value despite tough market, chair steps down

28th Jul 2023 10:47

(Alliance News) - Alliance Trust PLC on Friday said its net asset value outperformed its benchmark despite "volatile market conditions," allowing it to also raise its interim payout.

Also on Friday, the company announced that Chair Gregor Stewart will step down at the end of 2023 after a nine-year tenure. He will be replaced by Non-Executive Director Dean Buckley, who joined Alliance in 2021.

The FTSE 250-listed investment trust, which invests in global equities to obtain long-term capital growth and income, said its NAV per share increased 9.8% to 1,086.5 pence at June 30 from 989.5p on December 31.

Shares in Alliance Trust were down 0.3% at 1,037.48p in London on Friday.

The NAV total return for the half year ended June 30 was positive 11.1%, up from negative 7.1% for the second half of 2022 and outperforming the positive 7.8% return delivered by its benchmark, the MSCI All Country World Index.

"I am pleased to report that the company significantly outperformed the market and most of its peers in the first half of 2023, despite volatile market conditions," Chair Stewart commented. "This demonstrates the benefit of our diversified, high conviction approach."

Alliance also swung to a GBP317.7 million pretax profit in the first half of 2023 from a GBP348.2 million loss the prior year.

Alliance also declared a 6.34p per share second interim dividend, up from 6.18p for the first interim and from 6.00p the previous year. It expects to maintain the increased level at least through the next two quarters, resulting in a total dividend for 2023 of at least 25.20p.

The company said results were "pleasing" so far in the current year, and that its portfolio should deliver continued long-term growth. However, it warned that the next few months still carry a risk of "economic disappointment".

Factors affecting market conditions during the first half of 2023 included "sticky" inflation and rising interest rates. However, Alliance said global markets rose regardless, all major economies delivered positive growth, and corporate earnings were "stronger than expected."

Stewart said: "Although the economic outlook remains highly uncertain, the board believes [our] strategy is well designed to navigate different market environments and continue delivering attractive capital growth and a rising dividend."

By Emma Curzon, Alliance News reporter

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Copyright 2023 Alliance News Ltd. All Rights Reserved.

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