Henderson Value Trust interim results for the half-year ended 31 March 2015 show a NAV total return of 0.4% which compares against a 12.4% rise in its FTSE World Index benchmark. However, the managers that this this masks some encouraging developments within the investment portfolio. They say that new investments made by Henderson, which were in the portfolio during the half-year, have in fact generated a six-month gross total return of 3.6% and that this was achieved despite the fact that some of these holdings were either still in capital deployment mode or were not part of the Company’s portfolio over the full half-year period. The manager’s also say that they estimate that, in the 18-month period to 31 March 2015, new investments made by Henderson have themselves generated a gross total return of 12.4% (8.1% annualised). This period excludes the first six months of Henderson’s management of the Company’s portfolio during which a detailed review of existing holdings took priority over new investment activity. They suggest that, as additional new investments are made over the coming months and the portfolio restructuring is completed, they believe this level of performance bodes well for the Company’s future NAV growth prospects.
Strong performers during the period were the BlackRock European Hedge Fund Limited (a Henderson selection) and two inherited holdings which we hold in high regard, being Value Partners China Greenchip Limited and Oryx International Growth Fund Limited. Key detractors were BlackRock World Mining Trust plc (the trust has sold its entire holding during the period) and Baring Vostok Investments (reflecting Russia’s difficult macro and political backdrop – although the managers say that they continue to believe that, over the medium-term, the quality of the underlying assets in this vehicle combined with the manager’s experience and outstanding track record will generate attractive returns from current valuation levels).
The Company passed its triennial continuation vote in December 2014 and a tender offer for up to 10% of the Company’s shares, which was conditional upon the passing of the continuation vote, was fully subscribed and completed in January. This returned a total of £12.8 million to tendering shareholders at a discount of 2% to NAV less costs. Following the continuation vote and the completion of the tender offer there was some selling pressure on the Company’s shares and the discount to NAV per share widened to 20.8% by the half-year end.
The Board is recommending that the trust changes its name to Henderson Alternative Strategies Trust plc. They say that this will better reflect the composition of the Company’s portfolio of alternative and specialist investments and that they are seeking to deliver global equity market returns.
HVTR : Henderson value trust underperformance masks portfolio developments