11th Feb 2025 10:52
(Alliance News) - Diverse Income Trust PLC on Tuesday said its managers are "exceptionally positive" on the portfolio's outlook as it reported increased total returns in the first half.
The investor in small and medium-sized UK listed companies said adjusted net asset value total return was 4.9% over the six months to the end of November, ahead of the Deutsche Numis All-Share Index which rose 2.1%, and the peer group which climbed 0.9%.
The NAV per ordinary share was 100.25 pence on November 30, up 1.4% from 98.87 pence on May 31.
Chair Andrew Bell said the share prices of smaller firms and AIM stocks remained under pressure in the period, despite improvements in the interest rate environments.
"Although the UK economy grew at a modest rate (putting behind earlier fears of recession) there was persistent selling of UK equities by domestic investors, amid uncertainties over forthcoming tax rises by the new government, during the prolonged lead-up to the October budget," Bell said.
Revenue return per ordinary share climbed 11% to 2.63 pence from 2.38 pence in the previous year.
The company declared a second interim dividend of 1.05 pence, giving a total dividend for the period of 2.05 pence, up 2.5% from 2.00 pence in the prior year.
Diverse Income Trust said it anticipates the four dividends for the current year increasing over the previous year.
Looking ahead, Bell said sentiment was "relatively sober" outside of the US due to weak economic growth and geopolitical, political and macroeconomic uncertainty.
Bell said the UK market has been disproportionately sidelined for many years, and is lowly rated compared to international peers.
He said investments in UK funds recently saw a first monthly inflow flowing 41 consecutive monthly outflows.
Bell said: "With valuations looking attractive relative to other regions, with the regulatory discussion shifting towards encouraging investment in the UK market and with UK and global interest rates on a declining trend, the prospective risk-reward from UK equities, particularly the neglected second liners and smaller companies, warrants consideration on a contrarian view."
Shares in Diverse Income Trust were up 0.3% to 94.92 pence in London on Tuesday morning.
By Michael Hennessey, Alliance News reporter
Comments and questions to [email protected]
Copyright 2025 Alliance News Ltd. All Rights Reserved.