The Results Round-Up: The week’s investment trust results
Another bumper pre-Xmas roundup! Personal Assets, Lowland, STS Global Inc&Gwth, BlackRock Frontiers, all outperform; Schroder AsiaPac posts 16.4% return; Lindsell Train & Finsbury’s Nick Train sees good prospects; Monks’ portfolio is in good shape; SDCL Energy Efficiency Inc puts in a stable showing; Sequoia Economic Infrastructure Inc has a robust H1; and Montanaro UK Smaller sees a silver lining

By Frank Buhagiar

Schroder AsiaPacific (SDP) outperforms over 10 years
SDP’s full-year+16.5% net asset value (NAV) total return may have fallen short of the benchmark’s +17.3%, but tables are reversed over ten years with NAV total return outperforming by an annualised +2.2%. The portfolio managers admit that “aggregate valuations for the region are no longer particularly cheap.” Not to worry, as “this masks a large variation across individual markets where Singapore, Hong Kong, Korea, Indonesia and the Philippines, look relatively cheap versus history, whilst India and Taiwan look relatively expensive.” Perfect conditions for an active manager with a track record of outperformance.
Numis: “Schroder AsiaPacific aims to take advantage of the domestic growth story in Asia through a bottom-up, stock-picking approach focused on quality companies. The fund has a strong long-term track record, with NAV returns of 8.6% pa over the past decade compared with 7.1% pa for the MSCI AC Asia ex Japan.”
Lindsell Train (LTI) looking for another three-bagger
LTI’s +2.7% share price total return over the latest half year almost matched the MSCI World Index’s +2.8%. NAV (-1.9%) couldn’t keep pace after the fund’s holding in LTL, the company’s investment manager, posted an -8.4% total return: clients have pulled funds following disappointing performance. Strip out LTL and the portfolio, which “is invested in a concentrated selection of global quoted equities”, generated a +1.4% total return. Most stocks have been held for years in line with portfolio manager, Nick Train’s, long-term approach, an approach that has paid off “In total, the current value of your portfolio, excluding the holding in LTL, has nearly trebled on its book cost. Including the holding in LTL the portfolio has quadrupled.” Train says he looks forward “to it trebling again over time.”
JPMorgan: “For investors that want exposure to the Lindsell Train management style in a closed end fund but do not want the risks associated with ownership of the LTL management company, we recommend FGT.”
Finsbury Growth & Income (FGT) thinks portfolio has great prospects
FGT’s consumer goods holdings to blame for the fund’s +8.2% full year NAV per share return falling short of the FTSE All-share’s +13.4%. Portfolio manager, Nick Train, admits “Candidly, the portfolio has been a victim of its previous success. The peak of our relative performance was in 2020. What drove the strong performance for much of the preceding decade were the strong returns from our investments in consumer branded goods.” So much so, they accounted for 50% of the portfolio by September 2020. “In hindsight, this was too high” particularly as consumer stocks have since gone into reverse. The portfolio has been repositioned towards technology and Train likes the look of the portfolio as he continues to buy the fund’s shares “When I look at the portfolio today, I am more enthused about its prospects than at any time this century.”
JPMorgan: “With a relatively wide discount vs peers, a proactive buyback policy, the new 2026 continuation vote, and early signs of an improvement in NAV performance, we give FGT the benefit of the doubt and remain Overweight.”
Numis: “We rate the manager and believe that the fund is well-placed to outperform over the longer term, whilst accepting that there will be periods of notable underperformance.”
Personal Assets (PNL) keeps powder dry
PNL’s +3.4% NAV per share return for the half year, almost double the FTSE All-share’s +1.8%. Defensive positions in gold (+2%) and US Treasury Inflation Protection Securities (+1.5%), the main drivers. The investment managers have no intention of reducing the defensive tilt, as “experience suggests an economic downturn is the more likely outcome.” What’s more, “The elevated starting valuations today suggest equity markets are likely to deliver poor returns for investors if a recession materialises or if interest rates are not cut as expected.” Although the managers note “The environment can change quickly and the Company holds substantial ‘dry powder’ that we expect to add to existing and new equity holdings when the opportunity arises.”
Winterflood: “Domestically, the manager suggests the UK budget raised concerns in relation to fiscal balance sheet, hence PNL’s preference to own businesses with geographically diverse sales remains.”
Monks (MNKS) sowing seeds
MNKS’s half-year NAV total return came in at +6.3% compared to the FTSE World’s +8.1%. The investment managers don’t sound too worried about the shortfall. That’s because they “have sown the seeds of future returns by investing in a range of overlooked growth companies in areas like cruise shipping, building materials, and auto parts. The resulting portfolio is in good shape.”
Winterflood: “Underperformance was driven by megacap underweight (MNKS holds Microsoft, NVIDIA, Meta and Amazon) and weak share price performance from a subset of Healthcare holdings.”
SDCL Energy Efficiency Income’s (SEIT) stable performance
SEIT’s half year NAV per share edged higher to 90.6p from 90.5p. A stable NAV performance then. According to investment manager, Jonathan Maxwell, that’s not the only stable performance “Our large and diverse portfolio delivered stable overall operational performance and cash inflows that covered our dividends.” Maxwell goes on to say “SEIT’s projects deliver energy that is cheaper, cleaner and more reliable”. Reliable, just another word for stable.
Jefferies: “The results feature some modest portfolio valuation gains, but news on potential transaction activity regarding Onyx and EVN remains keenly awaited, particularly given the limited balance sheet flexibility in the interim.”
Liberum: “This is a solid result and shows once again that SEIT is an attractive investment with stable cash flow generation, limited FX risks and a high and fully covered dividend. The shares deserve to trade at a significantly lower discount to NAV.”
Sequoia Economic Infrastructure Income’s (SEQI) robust half year
SEQI Chair, James Stewart, described the fund’s half-year performance as “robust”: +5.1% NAV total return/+1.3% NAV per share growth. Stewart believes the infrastructure debt provider “has demonstrated its adaptability, resilience, and ability to generate significant cash.” Seems shareholders agree too: 96.43% of votes cast at this summer’s general meeting were in favour of the company’s continuation.
Numis: “With a robust, diversified portfolio, we believe the shares continue to offer value at current levels (c.16% discount to NAV), underpinned by an attractive 8.6% yield (1.06x covered) and supportive buyback programme.”
Lowland (LWI) building a track record of outperformance
LWI outperformed over the full year courtesy of a +16.3% NAV total return that trumped the FTSE All-share’s +13.4%. As Chairman, Robert Robertson, points out, that’s “the second successive year, Lowland achieved a strong return, both in absolute terms and compared with its benchmark.” Despite the strong showing, Robertson notes “A meaningful re-rating of the UK market, and smaller companies in particular, has not really happened. A revaluation of the UK market should come in time with a material capital uplift when the fundamentals of UK equities are more widely appreciated.”
JPMorgan: “We like the overall Lowland proposition and also think it has a strong management team with an excellent long-term track record as stock pickers but overall, we think a Neutral recommendation remains fair in a crowded sector.”
STS Global Income & Growth’s (STS) good post-merger start
STS’s +3.8% half year NAV total return beat the Lipper Equity Global Income Index’s +2.5%. A good start for the fund following its merger with Troy Income & Growth in March. It’s also a vindication of the investment manager’s “cautious view. Investors have been drawn to the type of dependable, predictable businesses we favour, as a result of both decent valuations and concerns about the economic outlook.”
Winterflood: “Share price TR +3.9% as discount narrowed marginally from 1.66% to 1.65%; 12.4m shares repurchased for £27.4m as part of zero discount policy.”
BlackRock Frontiers (BRFI) generating alpha
BRFI posted a +16.5% NAV per share total return (US Dollars) for the full year compared to the benchmark’s +15.7%. That brings total NAV growth since launch to +132.9%, more than double the benchmark’s +64.4%. The investment managers think there’s more to come “We find significant value in currencies and equity markets across our investment opportunity set. Our investment universe, in absolute and relative terms, also remains under-researched and we believe this should present compelling alpha opportunities.”
Numis: “We rate the management team highly and the fund is differentiated through its five yearly exit opportunity at NAV, with the next taking place in 2026.”
Montanaro UK Smaller’s (MTU) silver lining
MTU +4.2% NAV increase for the half year couldn’t match the benchmark’s +10.6%. As Chairman, Arthur Copple, explains, that’s largely down to the continued outperformance of value over growth investing. This has “posed challenges for Growth managers, including our Manager, as SmallCap Growth stocks underperformed SmallCap Value by more than 7%.” Fund manager, Charles Montanaro, offers a silver lining “SmallCap as a whole has outperformed LargeCap over the past six and twelve months, suggesting that the worst may indeed be behind us.”
Winterflood: “Share price TR +7.3% as discount narrowed from 15.1% to 12.8%. With effect from 31 December 2024, MTU will pay regular quarterly dividend equivalent to 1.5% of NAV (previously 1.0%).”
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