13th Dec 2022 09:12
(Alliance News) - Global Smaller Cos Trust PLC on Tuesday said net asset value per share and pretax net return were down, while it declared an increased interim dividend to shareholders.
The London-based investment trust said net asset value per share on October 31 was down 14% to 158.52 pence from 183.62p a year earlier.
Shares in Global Smaller Cos were down 0.9% to 142.71p in London on Tuesday morning.
The total return of NAV per share with debt at fair value was negative 6.4%, compared to a benchmark of negative 3.8%. The benchmark index comprised 30% of Numis UK Smaller Companies excluding investment companies Index and 70% of MSCI All Country World ex UK Small Cap Index.
Pretax net return in the six months that ended October 31 was a loss of GBP68.5 million, swinging from a profit of GBP54.6 million a year earlier. This was largely due to a total investment swing to a loss of GBP74.8 million from a gain of GBP54.2 million.
Despite this, Global Smaller Cos declared an interim dividend of 0.63p, up 11% from 0.57p. It said this was due to a revenue return per share of 16% compared to the same half-year period a year ago.
It still recognised the half-year period was challenging in terms of share prices and its portfolio, arguing tighter monetary policy has led to a deteriorating growth outlook.
"Going into this financial year, we were very conscious of the risks facing equity markets. Inflation was moving up on a widespread basis, the war in Ukraine had further stoked this by driving gas prices significantly up, while the move to higher interest rates had already commenced," said Lead Manager Peter Ewins.
"While the underlying background for equities is hardly ideal, this is already well recognised. Many share prices have fallen a long way from their peaks, especially in the more cyclical parts of the markets. We think that there are some good opportunities to take advantage of in this environment."
Global Smaller Cos said market conditions meant it expected poor earnings performance during its financial 2023.
By Greg Rosenvinge, Alliance News reporter
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