21st Aug 2018 11:16
LONDON (Alliance News) - EP Global Opportunities Trust PLC said Tuesday it saw a small drop in its net asset value in the first half of the year as a result of a sluggish first half and a weak performance from its banking investments.
As at June 30, the trust's net asset value per share stood at 333.2 pence per share, having dipped 1.3% from 337.7p at the end of 2017. EP Global's total return for the six month period was 0.3%, trailing a fair way behind the 2.1% recorded by the FTSE All-Share Index.
"The weakest performing sector within the portfolio was the financial sector with Bank Mandiri, Commerzbank and ING being the stocks that were most adversely affected," said EP Global Chairman Teddy Tulloch.
Despite the relative underperformance of banking shares during the period, Tulloch maintained that these have selective value and noted that they are trading at significant discounts to their book values.
"Subsequent to the half-year end, we added to the holdings in Commerzbank and ING having considered that the recent share price falls have been overdone," he said.
The company sank to a total GBP2.1 million loss on investments during the period from an GBP8.8 million gain the year before.
At the end of June company's share price discount to net asset value had widened to 7.6% from 5.2% on December 31. The volatility of the discount resulted in EP Global instigating a buyback programme, wherein it purchased 1.8% of its shares at a cost of GBP2.4 million and now holds them in treasury.
The company did not declare an interim dividend but did pay its 2017 final dividend of 5.3p per share in May. When the 1.0p per share special dividend is included, which was paid in 2017 but not 2018, dividend payments on a per-share basis were flat year-on-year.
A significant event of the six month period was the sale of EP Global's holding in its investment manager, Edinburgh Partners Ltd, reducing the trust's exposure in the UK from 12.7% to 8.9%.
"The portfolio continues to maintain a significant position in the oil & gas sector, which performed strongly during the period as the oil price continued to rise. This is in contrast to the view of a number of commentators that believe the world is on the brink of a significant slowdown. We continue to remain confident on the structure of the portfolio and will use the current relatively high level of cash balances to invest in new stocks or add to existing investments when opportunities occur," Tulloch said.
Shares in EP Global were untraded at 324.00 pence on Tuesday.
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