4th Feb 2014 12:26
LONDON (Alliance News) - Mid Wynd International Investment Trust PLC Tuesday said its returns over the half year were significantly better than those of its benchmark, as good stock selection and higher share prices boosted the company's performance.
In a statement, Mid Wynd, which is managed by Edinburgh-based fund manager Baillie Gifford & Co, said its net asset value total return was a "very satisfactory" 12.5%, compared to the FTSE World Index's 6.6%, both in the six months ended December 31, 2013.
The company said its returns were helped by ASOS PLC, which it said has continued to take market share from "moribund bricks and mortar" clothing retailers, and IP Group PLC, which works with universities to develop intellectual property into commercial business.
However, it said that it had mostly "belatedly" cut back on its positions in domestically exposed emerging markets consumption led businesses, such as Odontoprev, Santos Brasil Participacoes, BIM Birlesik Magazalar, and East African Breweries.
"If the big picture appears complex and somewhat challenging still, we can say again this year that we are optimistic about the scale and breadth of the specific opportunities facing our portfolio of companies with or without an economic or market tailwind to help them. Strong sales growth at worthwhile margins and involving high returns on capital is unlikely to go out of fashion even if share price volatility is a fact of life with equity investment," the manager's report read.
The company, which targets growth through both income and capital appreciation, said it made GBP2.4 million in gains on sales of investments over the half year, compared with GBP296,000 for the corresponding period last year, while its gains on investment holdings amounted to GBP5.6 million, against GBP882,000 for the corresponding reporting period last year.
Income from investments and interest rose to GBP661,000 from GBP575,000.
"Things are looking up for our income stream even if capital performance has come nearly entirely from companies too young or growing too fast yet to be paying dividends," the manager's report read.
"Kone, the Finnish elevator maker, a mainstay of the portfolio for many years and one of our largest holdings, has paid a special dividend for the third year in a row. Eastern Tobacco, the Egyptian tobacco manufacturer of Cleopatra cigarettes, is a large yielder. Insurers Amlin and Lancashire both pay worthwhile dividends and Marine Harvest, the Norwegian salmon farmer, is in the process of increasing its payout significantly," the report continued.
Mid Wynd International's dividend remained at 1.30 pence, while earnings per share grew to 1.52 pence from 1.27 pence.
Mid Wynd International shares were Tuesday quoted at 275.75 pence, down 1.00 pence, or 0.4%.
By Samuel Agini; [email protected]; @samuelagini
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Ip GroupMid Wynd International Investment TrustLancashire HoldingsASOSAston Martin Lagonda