F&C INVESTMENT TRUST PLC
Unaudited Results for the half-year ended 30 June 2022
Legal Entity Identifier : 213800W6B18ZHTNG7371
Information disclosed in accordance with Disclosure Guidance and Transparency Rule 4.2.2
25 July 2022
F&C Investment Trust PLC ('FCIT' /the 'Company') today announces its results for the six months ended 30 June 2022.
- The Net Asset Value ('NAV') total return was -9.6%; ahead of the -10.7% return from the benchmark, the FTSE All-World Index.
- The share price total return was -11.8%, in part due to a widening of the discount during the period.
- Our private equity exposure, which is a strong differentiator for FCIT, posted a gain of 4.7%; ahead of the returns from listed markets.
- Adjustments to the fair value of the Company's debt added 2.5% to the performance from the investment portfolio, whilst gearing detracted 1.0%. Gearing was 6.5% at the end of the period.
- Making use of our investment trust structure and the ability to borrow to enhance returns, we have taken advantage again of low interest rates to draw £140m of borrowings through long-term private placement loans
- Over one year's worth of dividends is held in the revenue reserve and the Board aims to increase the total dividend again this year. The first interim dividend of 3.2 pence for 2022 will be paid on 1 August.
The Chairman, Beatrice Hollond, said:
“ We continue to focus on long term capital and income growth for our shareholders. Our diversified portfolio, investment trust structure, modest gearing, strong cash position and careful management of risk position the Company well against an extraordinarily demanding market backdrop.
The Board intends to increase dividends in real terms for shareholders over the long-term and our current aim is to raise our dividend again this year. If we do so, this will be the 52nd consecutive rise.
While we expect that the immediate outlook will continue to present a challenge, our portfolio is sufficiently diversified to provide protection from over-exposure to any one theme that is driving markets. “
Commenting on the markets, Paul Niven, Fund Manager of FCIT, said:
“The current backdrop is challenging for the global economy and for financial markets. Investors are increasingly concerned that recession will hit major developed economies later this year and into 2023 as central bankers increase interest rates and rein in excess liquidity. In addition, inflation is proving more problematic than many had originally envisaged, raising questions over the level that interest rates will reach and how deep the growth downturn will be.
Nonetheless, and despite a period which is likely to continue to see further volatility in returns, opportunities are emerging. Valuations have corrected and are more attractive for long-term
investors. While margins are at risk, equities will provide some hedge to inflation as corporates pass on price rises to consumers. With a relatively high holding of cash and diversified exposure across a range of different equity strategies we believe that the Company is appropriately positioned for the difficult market conditions that we expect. Given our longer-term perspective, we expect to be in a strong position to take advantage of investment opportunities as they emerge and to benefit from a recovery in equity markets in due course. “