The Edinburgh Investment Trust
Interim Results to Period Ending 30 September 2021
22 November 2021- Edinburgh . The Directors of The Edinburgh Investment Trust plc (Ticker EDIN, “the Company”) announce the interim results for the period ending 30 September 2021.
- Net Asset Value in total return terms1 has risen by 9.8%, compared to 8.0% rise of FTSE All-Share
- Since Majedie became the day-to-day manager of the Company at the end of March 2020, Net Asset Value has risen by 48.0%, compared with 36.8% for the FTSE All-Share
- Share price discount to NAV widened from 4.5% to 9.3%
- First interim dividend of 6.0p per share to be paid on 26 November 2021 (2020: 6.0p per share)
- Existing £100m debenture refinanced, and additional £20m raised, with blended average cost across all new debt of 2.44% per annum vs 7.75% previously
- Net gearing as at 30 September of 7.8%. Implied pro rata gross gearing of 10.9% if post period £20m of borrowings included
A video of the Manager of the Company, James de Uphaugh, explaining performance over the six months may be viewed at the Company's website: www.edinburghinvestmenttrust.com.
Comment
Glen Suarez, Chair, said:
“This has been a period of improving fortunes for the Company's portfolio. In the last six months, the Company's Net Asset Value in total return terms has risen by 9.8%, compared with the index return of 8.0%. It is encouraging to see the foundations of a strong long-term track record beginning to take shape. While growth in NAV has been encouraging, over the last six months the discount has widened.
“Finally, we are very pleased to have secured much more efficiently priced debt, and we are optimistic that the portfolio's long-term returns should be enhanced.”
James De Uphaugh, Manager, said:
“There are several compelling reasons to think that the UK equity market can generate further attractive returns on a medium-term view. The gains we are reporting on for the last six months were despite a combination of tempering growth rates here and abroad, ongoing supply bottlenecks, and rising energy prices. There is no question pricing pressures are more prevalent now than in other inflationary spikes over the last decade, but we take reassurance from the fact that the portfolio is dominated by companies that have pricing power and strategic strength that we believe will afford greater protection against cost inflation.
“Overall, the UK is widely regarded as a great place to do business with strong companies. The return of overseas/marginal investors, boosted by the growing appetite for takeovers from foreign companies or private equity funds, is a positive endorsement of the UK market. Furthermore, the valuation discounts relative to other equity markets highlight the opportunity in UK equities. We believe the market is taking a short-term view of the prospects for many businesses in the UK, which provides opportunities for investors willing to look through the current macroeconomic headwinds.”
1 After deducting debt at market value
Ends