30th May 2019 17:09
LONDON (Alliance News) - Henderson European Focus Trust PLC boosted its interim dividend Thursday despite lagging its benchmark as the value of its assets fell.
For the six months ended March, net asset value per share fell 8.2% to 1,255.15 pence from 1,366.57p six months earlier. During the period, total return stood at negative 6.5% compared to negative 3.8% from its FTSE World Europe ex UK Index benchmark return.
Gearing stood at 0.7% at the end of March, down from 5.5% six months earlier.
Fund Manager John Bennett explained there had been a "sell-off in markets in the latter stages of 2018. During that period, our small-mid-cap positions were particularly harshly punished, perhaps signifying an element of panic-selling among investors. While this contributed much to the portfolio's underperformance versus the company's benchmark, we remain committed to an overweight stance in this section of the market."
Henderson European Focus proposed a 9.60 pence per share interim dividend, up 1.1% from 9.50p the year prior.
"Equity markets have staged a strong rebound from the lows of December 2018," Chair Rodney Dennis said. "The basis for this has been renewed monetary accommodation by central banks, as the US Federal Reserve, the European Central Bank and the People's Bank of China have sought to reassure markets and/or stimulate their respective economies. This has encouraged the view that a rebound in both economies and corporate earnings will follow in the second half of 2019."
"Pulling the other way are bond markets, which signify a continuing disinflationary environment and so the tug of war between bonds and equities continues," Dennis added. "The European equities market remains deeply out of favour among investors. However, the company believes there are opportunities in the market and the current negligible portfolio gearing brings the capacity to capitalise on those opportunities should we see a repeat of last year's sell-off."
Shares in Henderson European Focus closed 1.1% higher at 1,190.00 pence on Thursday.
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