29th Jan 2025 11:08
(Alliance News) - Henderson Smaller Cos Investment Trust PLC on Wednesday said "too much doom and gloom" was priced into the market following the UK budget, as its net asset value total return underperformed its benchmark in the first half of its financial year.
Henderson Smaller Cos Investment Trust is a London-based company that aims to maximise shareholders' total returns by investing in smaller companies that are quoted in the UK.
The company said NAV per share was 947.1 pence on November 30, down 5.6% from 1,003.1 on May 31.
NAV total return with income reinvested fell by 3.8% in the financial half-year, underperforming against its benchmark, the Deutsche Numis smaller companies index, excluding investment companies, which had a positive total return of 0.8%
Henderson Smaller declared a dividend of 7.5p for the half-year, flat from a year before.
Chair Penny Freer said: "Performance continued to be challenged during the period under review, but there is evidence that too much doom and gloom has been priced into the market following the budget. Whilst interest rates may be cut more slowly, in contrast to the last decade, their relatively high starting point provides a strong and stimulating lever for policy makers to pull on should economic activity slow further. In the meantime, the fund managers are confident that starting valuations remain compelling and continued in-bound merger and acquisition activity suggests that the budget has not deterred domestic or international buyers."
Looking ahead, she said: "The board remains confident that our portfolio of quality companies is well positioned to prosper as economic conditions and market sentiment improve and we share our fund managers' belief that the company is well positioned to deliver strong total returns in this environment."
Henderson Smaller shares were 0.5% higher at 813.40 pence each on Wednesday morning in London.
By Tom Budszus, Alliance News slot editor
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