Bankers Investment Trust Publish Half-Year Report

THE BANKERS INVESTMENT TRUST PLC

(‘the Company’)

Unaudited results for the half-year ended 30 April 2025

This announcement contains regulated information

INVESTMENT OBJECTIVE 

Over the long term, the Company aims to achieve capital growth in excess of the FTSE World Index and dividend growth greater than inflation, as measured by the UK Consumer Price Index (‘CPI’), by investing in companies listed throughout the world.

INVESTMENT POLICY

The following investment ranges apply:

• Equities: 80% to 100%

• Debt securities and cash investments: 0% to 20%

• Investment trusts, collective funds and derivatives: 0% to 15%

To achieve an appropriate spread of investment risk the portfolio is broadly diversified by geography, sector and company. The Manager (‘Janus Henderson’) has the flexibility to invest in any geographic region and any sector with no set limits on individual country or sector exposures and, therefore, the make-up and weighting of the portfolio may differ materially from the FTSE World Index.

The Manager primarily employs a bottom-up stock picking investment process, across four regional portfolios, to identify suitable opportunities. While each regional portfolio manager employs their own investment style, they all pay particular regard to cash generation and dividend growth over the medium term.

The Company can, but normally does not, invest up to 15% of its gross assets in any other investment companies (including listed investment trusts).

Derivatives

The Company may use financial instruments known as derivatives for the purpose of efficient portfolio management while maintaining a level of risk consistent with the risk profile of the Company.

Gearing

The Company can borrow to make additional investments with the aim of achieving a return that is greater than the cost of the borrowing. The Company can borrow up to 20% of net assets at the time of draw down.

PERFORMANCE HIGHLIGHTS

CHAIR’S STATEMENT

Dear shareholder,

Performance 

The first half of the year has been dominated by the impact on markets of Donald Trump’s election. The positive market enthusiasm which accompanied Trump’s victory in November had evaporated by early April when he announced a swathe of much higher-than-expected tariffs on all US trading partners. My last statement highlighted that the greatest uncertainty this year would be the outcome of US tariffs. Share prices fell from their peak in February, as the new administration started discussing plans for trade tariffs on imported goods to the US market. Markets do not like uncertainty and investors sold both bonds and equities, forcing down the value of the US dollar. Performance was positive in Europe and Japan where governments are finally tackling slower growth with more reforms and increased spending plans.

Your Company has delivered a net asset value total return over the six months ended 30 April 2025 of -4.0% (six months to 30 April 2024: +17.5%) and a share price total return of +0.1% (2024: +21.5%), compared with the FTSE World Index benchmark total return of -2.6% (2024: +16.6%) over the same period. Most of the underperformance in the portfolio happened in November, following a sharp rise in US stocks associated with the new administration’s policies. Over the remainder of the period, the portfolio outperformed its benchmark, and this outperformance continued through May. The Fund Manager discusses the key drivers of performance in his report.

Revenue and financial statements

Our net revenue for the six months was £12.6 million (2024: £15.9 million), equivalent to 1.16p per share (2024: 1.31p). We expected the reduction in revenue as a result of increasing investment into growth stocks. Companies in the Technology and Healthcare sectors have significant growth opportunities and are prioritising investment spending over dividends. The expectation is that profits will accelerate over time and ultimately lead to higher dividends. In the short term, drawing down on our revenue reserves will allow maintenance of a progressive dividend.

A first interim dividend of 0.686p per share (2024: 0.672p) was paid on 30 May 2025. The Board has declared a second interim dividend of 0.686p (2024: 0.672p) per share, an increase of 2.1%, which will be payable on 29 August 2025 to shareholders on the register on 25 July 2025. 

The Board’s current expectation is that the dividend for the full year will be at least 2% above the total dividend paid in 2024. This modest forecast reflects the current uncertainty in the market’s forecasts for corporate profits and therefore dividends. However, it will continue to deliver the Company’s progressive dividend policy of successive annual dividend growth which it has achieved every year over the past 58 years. 

Discount management

The Company’s share price has continued to trade at a discount to its net asset value and we have taken advantage of this opportunity to buy back shares from the market. This activity is beneficial to ongoing shareholders, as shares are only purchased when they are trading at a discount, thereby enhancing shareholder value. 

A total of 82,700,048 shares were bought back at an average discount of 10.2% to the net asset value in the six months ended 30 April 2025 (2024: 49,748,991 shares bought back at an average discount of 12.3%) for a total consideration of £97.1 million (2024: £53.4 million). The discount at 30 April 2025 was 9.8% (2024: 10.6%). 

Outlook

The hope is that the US will agree a reasonable level of tariffs with key trading partners. However, if the ongoing uncertainty extends through the summer, this will impact growth and ultimately profits. It would be premature to write off the US stock market at this point, given further reforms could well support growth in the economy.