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Capital Gearing Trust Beats Inflation Target In Encouraging Year.

LONDON (Alliance News) - Capital Gearing Trust PLC said Wednesday it had an encouraging year, with its performance outstripping inflation due to a weaker pound and some assets performing very well.

Capital Gearing Trust saw a net asset value total return of 7.9% for the financial year ended April 5, outperforming the UK retail price index, which rose 2.4% year-on-year.

Net asset value per share as at April 5 was 4,082.0 pence, up 7.1% from 3,809.8p on the same date a year before.

The investment firm's share price then was 4,170.0 pence, reflecting a 2.2% premium to net asset value.

Shares in Capital Gearing Trust was marginally higher on the day Wednesday at 4,243.56 pence, having improved further since the year-end.

Capital Gearing said that despite the very defensive position of its portfolio, several of the trust's holdings performed well, including US inflation-linked government bonds, European property companies, and infrastructure funds.

Specific examples of strong performers were Castellum AB, due to increased demand over supply for office space in Sweden, and John Laing Infrastructure Fund, which delisted from the London market to go private.

Capital Gearing Trust declared an ordinary dividend of 23.00 pence, up 9.5% from 21.00p the year before.

In addition, the trust doubled the payout of its special dividend to 12.00 pence from 6.00p.

"Central banks have recently blinked when confronted by investor reaction to the possibility of higher short-term rates. This has provided some temporary relief, but major unresolved issues such as Brexit, the rise and impact of populist politics, the Sino-US trade negotiations and conflicting signs of a slowdown in global growth, could at any time lead to an evaporation of this market rally," said Chair Graham Meek.

"Pockets of value do occur from time to time in the markets we survey, though in the investment trust field discounts are very tight and liquidity often non-existent. It will come as no surprise to our shareholders that in this climate it is the preservation of capital value which remains our priority," Meek added.

By Dayo Laniyan; dayolaniyan@alliancenews.com

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Publication:Alliance Newswire
Geographic Code:4EUUK
Date:May 29, 2019
Words:367
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