11th Apr 2019 11:57
LONDON (Alliance News) - North American Income Trust PLC on Thursday reported a rise in net asset value per share as the US equity investment company outperformed its index and hiked its final dividend.
The investment trust's NAV per share at January 31 stood at 1,402.22 pence compared to 1,377.57p, a 1.8% rise.
In the year to January 31, the trust paid 42.50p per share in dividends, 9.0% higher than the payout for financial 2018. The rise in total dividend stems from a 13% increase in the trust's final dividend to 18.0p.
North American Income's NAV total return in the year was positive 4.8%, lower compared to its benchmark, the S&P 500 Index, gaining 5.6%. The trust noted it outperformed its primary reference index, the Russell 1000 Value Index, which gained 2.9%. The Russell 1000 index measures the performance of the 1,000 largest listed companies in the US.
The trust's manager, Aberdeen Asset Management, said: "The outperformance of the trust's equity portfolio relative to the Russell 1000 Value Index was due primarily to strong stock selection in the information technology, materials, financials and industrials sectors. The most notable contributors to performance among individual holdings were derivatives exchange operator CME Group, freight railway operator Union Pacific Corp, and specialty agricultural products maker Nutrien."
At the company's upcoming annual general meeting, the trust is proposing a resolution to sub-divide its existing shares, with a nominal value of 25p, into new shares with a value of 5p each.
The trust said: "The company has a large number of private investors who invest through regular savings plans and this sub-division, which will result in a lower price per share, will enable small sums to be invested regularly in a more efficient manner."
The trust stressed shareholders will retain the same proportionate interest in the company following the share split.
Chair James Ferguson added: "The price reactions in equity markets witnessed in 2018 appeared to be an adjustment of investor expectations, with fundamentals remaining broadly healthy, although decelerating. This slowing is not unexpected given where we are in the economic cycle. Market sentiment has improved since the beginning of this year but remains volatile and, whilst risks remain, there are positive developments worth highlighting. It appears that there has been some progress in US-China trade talks, and the consensus of opinion points to a compromise between the two countries being reached, though that is far from certain. Additionally, while it is still early in the year, US corporate earnings have been strong overall thus far, and the outlook for dividend growth in 2019 is encouraging."
As of January 31, the trust's portfolio was composed of 40 equity holdings and 11 corporate bonds.
Shares in North American Income Trust were up 0.9% Thursday at 1,471.75 pence each.
Related Shares:
North American