23rd May 2018 13:11
LONDON (Alliance News) - Schroder Income Growth Fund PLC said on Wednesday it undeperformed against its benchmark index in the first half of its financial year.
The fund reported a net asset value negative return of 1.8% for the six months to the end of February, compared to the FTSE All-Share Index, which saw a negative return of 0.8% over the same period.
Schroder Income said its performance was due to negative stock selection, where although FTSE 250-listed Intermediate Capital Group PLC and FTSE 100-listed Lloyds Banking Group PLC performed well, Schroder's holding in Nordea Bank was weak due to increased spending on IT systems, and the fund suffered from not having an interest in Barclays.
The net asset value per share as at February 28 dipped to 302.36 pence from 303.58p the year before and from 315.51p as at August 31.
Total shareholder funds also slipped to GBP207.7 million from GBP216.7 million over the period.
Schroder Income Growth declared two interim dividends of 2.4 pence each.
Shares in the fund were down 1.1% at 306.75 pence on Wednesday.
"Whilst the companies in the portfolio are doing well, the prospects for dividends remain significantly influenced by currency movements. During a period when the pound is stronger, income earned outside the UK is reduced in sterling terms by currency appreciation. This has been particularly so in the first half of the current year, which anyway represents a seasonal low point in the timing of dividend payments. Forecasting currency movements is a difficult business as outcomes rely on a range of different factors both at home and abroad," said Chairman Ian Barby.
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