12th Jul 2024 09:04
(Alliance News) - Twentyfour Income Fund Ltd on Thursday said it will focus on western European assets following a year of recovery in financial 2024.
The Guernsey-based investment company invests in less-liquid asset-backed securities across Europe and the UK.
In the financial year that ended March 31, net asset value increased 7.7% to 108.97 pence per share from 100.97p the previous year, while NAV total return was positive 18%, compared to negative 3.7% in financial 2023.
Twentyfour Income Fund announced a record full-year dividend payment of 9.96p per share, up 5.3% from 9.46p the year before and ahead of its 8p per annum target.
Cash and cash equivalents stood at GBP13.1 million on March 31, down 52% from GBP27.3 million.
As at June 30, NAV per share stood at 109.67p, up 0.6% from March 31. For the first quarter of financial 2025, Twentyfour Income Fund declared a unchanged dividend of 2.00p per share.
The company said markets were calmer over the year in the aftermath of the turmoil created by the US regional banking crisis, energy crisis, and 2022 UK mini budget.
"Spreads had started the year relatively wide as the market was still recovering...However, the [ABS] sector's fundamental performance proved better than expected as borrowers coped well with the higher rate environment, helped by solid wage growth and a strong labour market, resulting in spreads narrowing and a strong performance for the year," said portfolio manager Aza Teeuwen.
Over the year, consumer confidence began to rise with increased engagement in the property market as rates started for fall from their peaks, the company said.
Mezzanine residential mortgage-backed securities and collateralised loan obligations were fund's strongest performers, whilst commercial mortgage-backed securities lagged behind in comparison.
Going forward, Twentyfour Income Fund is placing focus on secured collateral including mortgages, senior secured corporate loans, and auto loans from Western European countries due to the "proven track record" of governments aiding consumers and businesses during periods of recession.
"We expect current strong supply-demand to continue to drive performance over the medium term, whilst longer term we will continue to position the portfolio flexibly, given heightened geopolitical risk," manager Teeuwen added.
Twentyfour Income Fund shares were down 0.3% to 105.93 pence each in London on Friday morning.
By Elijah Dale, Alliance News reporter
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