29th May 2019 08:54
LONDON (Alliance News) - Caledonia Investments PLC lifted its dividend on Wednesday as it saw a total return ahead of inflation for the year, on strong portfolio returns and a strengthening US dollar.
For the year to the end of March, the FTSE 250 investment firm saw a net asset value total return of 10.9%, outperforming its internal annual performance target of Retail Price Index plus 3% to RPI plus 6%.
Net asset value per share as at March 31 was 3,582 pence, up 9.0% from 3,285p the same date the year before.
Caledonia attributed the solid net assets growth to strong returns from all sectors of its portfolio.
The Quoted pool saw an "exceptional" return of 21%, with high quality compounding US businesses performing consistently well despite the market turmoil.
The Income pool for the year produced a total return of 2.9%, although Caledonia said that the capital performance was "somewhat disappointing", as high yield UK equities which made up most of the pool remained at the lower end of valuation ranges.
The Unquoted pool saw a total return of 11.4%, as the investment firm purchased three new businesses and sold one. Companies within the Unquoted pool generally performed in line with expectations.
Funds meanwhile returned 15% in the year driven by a wider base of funds, and the US and Asian private equity portfolio fostering growth in valuations.
Caledonia Investments proposed a full-year dividend of 59.3 pence per share, up 4.0% from 57.0p the year before.
"Caledonia's investment portfolio delivered positive performance across all four pools, underpinning the 10.9% increase in NAV total return for the year. The Quoted pool in particular performed strongly, demonstrating the strength of Caledonia's conservative, long term approach," said Chief Executive Will Wyatt.
"Whilst we foresee a continuation of geopolitical tensions affecting markets in the coming year, we remain confident that our portfolio construction and underlying investments leave us well positioned to deliver our long term return targets and dividend growth," Wyatt added.
Shares in Caledonia Investments were down 0.4% at 2,919.39 pence on Wednesday.
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