19th Feb 2014 17:04
LONDON (Alliance News) - The City Of London Investment Trust PLC Wednesday said its total return on net asset value in the first six months of the year was behind that of the Average UK Growth & Income Investment Trust but slightly ahead of the FTSE All-Share Index.
In a statement, the trust said its net asset value total return was 11.6% for the six months to December 31 2013, compared with 12.7% in the Average UK Growth & Income Investment Trust and 11.3% in the FTSE All-Share Index.
"We were 1.1 percentage points behind the average for our investment trust sector mainly due to having less exposure to medium and small companies which have significantly outperformed. In addition, our gearing, which ranged between 6% and 8% and enhanced NAV performance, was less aggressive than some of our competitors," Philip Remnant, Chairman, said in a statement.
"Within the portfolio, there was particularly strong performance from holdings outside the FTSE 100 Index, such as Smiths News, Britvic and Greencore. On the other hand, the gas and electricity utilities, Centrica and SSE, were notable underperformers," Remnant added.
City of London's earnings per share increased by 5.7% to 5.95 pence, reflecting the dividend growth from investments.
"Share prices have risen faster than company profits over the last year and so the valuation of the market is less attractive than it was. However, equities should progress further as profits growth comes through. Moreover, dividend yields remain attractive relative to the alternatives in fixed interest and bank deposit rates and given dividend growth expected by consensus forecasts," Remnant said.
City of London Investment Trust shares Wednesday closed at 381.15 pence, down 1.25 pence, or 0.3%.
By Samuel Agini; [email protected]; @samuelagini
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