Supermarket Income REIT plc (LSE: SUPR), the real estate investment trust with secure, inflation-linked, long-dated income from grocery property, has today declared an interim dividend in respect of the period from 1 January 2025 to 31 March 2025 of 1.53 pence per ordinary share (the “Third Quarterly Dividend”).
The Third Quarterly Dividend will be paid on or around 23 May 2025 as a Property Income Distribution (“PID”) in respect of the Company’s tax-exempt property rental business to shareholders on the register as at 25 April 2025. The ex-dividend date will be 24 April 2025
Buy shares that pay a dividend and use those dividends to buy mores shares that pay a dividend.
Any share that drastically alters it’s dividend payment must be sold, even at a loss.
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The Snowball invests in mainly Investment Trusts as most Trusts that have reserves that can be used to ensure the dividend is paid in times of market stress.
Residential Secure Income PLC on Friday said it has achieved the full divestment of its local authority portfolio as it presses ahead with realisations for its remaining assets.
The investor in retirement living and shared ownership said it was committed to “driving earnings growth” as it reported 99% rent collection throughout the three months to December 31. It also reported rental growth of 3.3% on 472 properties, reflecting 25% of its portfolio.
Total EPRA return for its first-quarter fell 5.5%, said the firm, giving EPRA net tangible assets per share of 69.6 pence at December 31, down 6.7% from 74.6p at September 30.
It added that its valuation decline over the period was driven by the impact of rising government bond yields.
The investment trust also reported progress with the continued realisation of the assets in its portfolio, noting that 99.7% of shareholders voted in favour of a managed wind-down and portfolio realisation strategy at its general meeting in December.
It said the full divestment of its local authority portfolio was realised in January,
with the remaining asset sold for net consideration of around GBP15.0 million, marginally above the carrying values in March last year and September 2023.
With regard to its remaining assets, Residential Secure Income noted that it has completed the tender process to select key sales agents and advisers to assist with the sale of the assets, adding that the formal launch timing of the sale of the assets is being evaluated to ensure maximisation of shareholder returns.
The firm also declared an interim dividend of 1.03p, flat with the previous year’s figure.
Its shares were 2.1% at 59.00p on Friday afternoon in London.
Chair Rob Whiteman said: “Both the investment manager and the board remain focussed on driving earnings growth, as evidenced this quarter through high levels of rent collection, sustained record occupancy and rent growth, while balancing maximising returns for shareholders with timing of disposals, ensuring the interests of our residents are protected throughout.”
Even the global financial crisis couldn’t tarnish this trust’s premium.
This debt-seeking vehicle treads where others dare not James Carthew
Questor is The Telegraph’s stockpicking column, helping you decode the markets and offering insights on where to invest.
Debt is huge across investment companies right now – in a good way. Trusts offering access to this sector come with the obvious attraction of rising dividends, which have been buoyed thanks to higher interest rates. Better still, the dividend yields on these trusts are well ahead of those that an investor would receive from a government bond, but achieving this requires taking on additional risk in some form.
While many managers rely on leverage to achieve the desired result, CQS New City High Yield Fund looks for debt issues that would normally be considered too small for most debt investors and those that have not been assessed by a credit rating agency. These relatively overlooked issues tend to trade on higher yields, but require the manager to run its own credit assessments to ensure the yields on offer are not too good to be true.
The trust pays a quarterly dividend and can boast a track record of increasing dividends every year since its inception more than two decades ago. The trust’s financial year runs to June 30, and at the interim stage the board said that it thought this year’s dividend would be covered by earnings.
In addition to providing a high yield, preservation of capital is an important part of the investment objective and to that end the manager’s approach is conservative.
The team is headed up by Ian Francis, who brings more than three decades of experience and can draw on the substantial resources of Manulife CQS Investment Management’s credit analysis team. The portfolio is fairly diversified, with exposures to more than 100 different issuers, but thanks to the detailed research of his team Mr Francis is comfortable with a high concentration of roughly 40pc of assets in the 10 largest positions.
Some of the names in that list will be familiar: Co-op Bank, Virgin Money and Barclays. Some of the more unusual ones are subsidiaries of more well-known brands. For example, other top 10 positions are TVL Finance, which issues debt on behalf of Travelodge, and Galaxy Bidco, a financing arm for Domestic & General Insurance and a longstanding position in the portfolio.
The overall bias is to sterling-denominated issues, which comprise more than 70pc of the portfolio. Some readers may be comforted that just 16pc of the portfolio was exposed to US dollars at the end of December 2024, given President Trump’s ambition to weaken the currency.
The portfolio also includes some exposure to preference shares, convertibles and high-yielding equities (about 13pc of the trust at end January 2025). At the end of 2024, there was a position in NextEnergy Solar Fund, which is trading on a yield of 12.4pc, for example.
CQS New City High Yield has peers with higher returns, but these tend to come with higher Nav volatility. It has built up a loyal fanbase and, if you are already a shareholder in the trust, you are probably happy to hang on. However, new investors will have to stomach the premium that the shares trade on.
CQS New City High Yield Fund’s shares have traded at a premium to net asset value for almost all of the trust’s life, even during 2008’s financial crisis, reflecting the impressive work of the manager. Notable exceptions were the Covid panic five years ago, when the discount briefly breached 18pc but returned to a premium a few days later, and the early part of 2021. It is worth remembering that five-year performance figures are currently misleading, thanks to the Covid anniversary.
The 2021 event was significant because this was the point when some investors began to suspect that we were headed for higher inflation, which began to show up in the figures in April of that year – higher inflation meant higher interest rates were on the way. In the long run, that would be good for trusts like CQS New City High Yield as it fed through into the revenue account, but in the short term it meant higher yields and lower prices for the debt in the portfolio.
To mitigate against the risk of this the manager keeps the duration of the portfolio (a measure of time-weighted cashflows) relatively low. Issues with long maturities tend to be more volatile.
Mr Francis feels there is a risk that the UK economy enters a period of stagflation this year, and believes further UK rate cuts are possible. However, with the increasing likelihood that interest rates will stay higher for longer (or, perhaps more accurately, a return to conditions that prevailed over the decade before the financial crisis), Questor feels that CQS New City High Yield Fund will continue to offer attractive long-term returns.
London-based developer and manager of retail infrastructure – Swings to pretax profit of GBP8.2 million in half-year to September 30, from GBP2.6 million loss year-on-year. Net tangible assets per share fell to 106 pence at September 30, down 8% from 115p at March 31. NewRiver is cuts half-year dividend to 3.0p per share, versus 3.4p the year prior. Half-year revenue has drops to GBP31.8 million from GBP33.2 million last year.
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The company said a dividend of 1.5 pence per share was approved, in line with its 6.0p per share target for financial year 2025, up 3.4% from 5.8p a year prior.
Five ways to generate an income from your investments
Dan Coatsworth
Invest with AJ Bell
One of the key attractions of investments is the potential to earn a regular income, and for many people it’s the number one priority.
There isn’t a one-size-fits-all approach for income investing and product innovation in the asset management industry has increased the choices available to investors.
It’s important to understand the various strategies, how they work, and to whom they might appeal. Here are five of the most popular ones used today.
1. High yield
For decades, investors have looked to investment markets to see if they can find something that offers a better yield than available on cash in the bank. The current benchmark to beat is 5%, being the best-buy savings account rate. That might seem a high bar to clear, yet qualifying opportunities are widespread across stocks, bonds, funds and investment trusts.
The UK stock market is a treasure trove of high yielding stocks thanks to the plethora of low growth, yet highly cash-generative industries. Life insurance, tobacco and property feature heavily, with approximately one fifth of the FTSE 100 offering a prospective yield above 5%.
Investment trusts are also a popular hunting ground, with big yields from companies across the property, renewable energy and debt sectors.
While it is tempting to sit back and let the cash roll in, the income stream only forms part of the returns from an investment. It is important to also look at capital gains or losses.
There’s no point owning a share, trust or fund if you’re consistently losing more money than you make from dividends. Total return is a term that looks at both capital gains/losses and income, and the goal is for that figure to be positive on a long-term basis.
Yields can look high as a result of big share price declines. A falling share price reflects market concerns about something — such as tougher trading conditions or a lack of faith in earnings forecasts. If a company struggles for a long time, it might cut or cancel the dividend.
Just because an investment offers a high yield doesn’t mean that dividend is sustainable — in fact, the high yield could be a red flag. It’s as important to weigh up what could go wrong with an investment as what could go right.
2. Monthly dividend payers
People receive their salary like clockwork throughout their working life. While it’s reassuring to know that money is coming in on a regular basis to cover monthly bills, it can be a shock when someone retires and they no longer have that money topping up their bank account. Investments play a role in replacing that income — either selling small chunks to generate capital or, ideally, using dividends to pay the bills.
Individual stocks typically pay dividends twice a year but that frequency might not suit someone who has monthly bills to settle. An investor could create a portfolio with dividends trickling in across different months. Alternatively, there is a growing number of funds and investment trusts paying dividends monthly to investors.
3. Dividend Aristocrats
While income hunters may judge an investment on its dividend yield, it’s also worth considering dividend growth.
The cost of living typically goes up each year so it’s important that dividends grow at least in line with inflation to ensure you maintain spending power. The ability of a company to grow dividends each year can also be a sign it’s a high-quality business.
There are two ways to quickly identify investments with dividend growth. One is to look at investment trusts classified as ‘Dividend Heroes’ which are names that have consistently raised their dividends for at least 20 years in a row, including F&C Investment Trust and City of London Investment Trust.
The other is to look at tracker funds labelled as ‘Dividend Aristocrats’. This is a term to describe companies with a long record of raising their dividend each year, often by 25 years or more. The term will appear in the fund name, or sometimes you might see a variation such as ‘Dividend Leaders’.
There are us ETFs which track a basket of companies classified as Dividend Aristocrats in Europe and the US.
Not all investors need to take the income from their investments and they might choose to reinvest any dividends to enjoy compounding benefits. The prospect of owning an investment that aims to deliver consistent dividends or even dividend growth — such as Dividend Aristocrats – might appeal to them.
4. Enhanced income
Income-hungry investors are often happy to receive the bulk of their returns from dividends rather than capital gains. There is a specific type of fund that might appeal to this type of person.
Enhanced income funds (also known as ‘income maximiser’ funds) have a clever trick up their sleeve to boost their dividend power. They might generate a 4% or 5% yield from their underlying portfolio but have a neat way to pay even more to investors.
They sell call options on stocks held in the portfolio to generate additional income. These options are contracts that give the buyer the right, but not the obligation, to buy the underlying asset at a specific price on or before a certain date.
For example, an investment bank buys an option on Company X from an enhanced income fund for a fee. This entitles the investment bank to any rise in the price of the underlying share above a certain level over a set period, typically three months. The enhanced income fund uses the option fee to top up its dividends, but in doing so it sacrifices part of the capital growth from the stock holding.
Enhanced income funds might underperform traditional equity income funds when markets are rising but potentially outperform in a falling market.
Call options can be difficult to understand and charges on enhanced income funds are often much higher than a traditional equity income fund. That means these types of funds won’t suit everyone.
5. Blending income and growth
The blended approach of income and growth is increasingly popular with investors who want a happy medium of dividends and capital gains.
Someone in retirement looking to make their pension last longer might use this approach. So might an individual who wants their investments to grow and use cash from dividends to fund additional investments down the line.
