7th Jul 2016 15:29
LONDON (Alliance News) - Schroder UK Growth Fund PLC on Thursday said its net asset value total return outperformed its benchmark in its financial year ended April 30.
The fund said its net asset value produced a total return of negative 4.4% for the financial year, compared to the negative 5.7% returned by the FTSE All-Share Index over the same period.
Schroder UK Growth said it was proposing a final dividend of 2.60 pence per share, taking the total dividend to 5.20p per share for the year, up 4.0% on the 5.00p offered a year earlier.
"The past twelve months have been a difficult and volatile period for UK equities as a number of global uncertainties weighed on markets. Initial concerns surrounding negotiations between Greece and its international creditors and a potential exit from the European Union (formalised by the referendum vote after the end of the financial year) were supplemented by fears about emerging markets, the outlook for China and latterly the durability of US growth," said Schroder Investment Management Ltd, Schroder UK Growth Fund's investment manager.
"We suspect UK equity investment will remain challenging. The result of the EU referendum has created one more major immediate uncertainty for company managements and investors and there is still a structural lack of growth in many economies worldwide. While these issues are undeniable, they also provide an opportunity," Schroder Investment Management said.
"At a corporate level the weakness of sterling after the referendum has made UK companies more competitive internationally, and increases the value of their overseas profits. For the company, a world of low nominal growth makes outperformance of a benchmark more appealing to investors, while high market volatility makes consistency of that outperformance even more appealing. There will always be a sustained future for any investment trust that can supply both," the investment manager added.
Shares in Schroder UK Growth were down 0.5% at 150.00p on Thursday.
By Hannah Boland; [email protected]; @Hannaheboland
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