Henderson European Focus Trust outperformed its benchmark over the six months ended 31 March 2015, generating a return on net assets of 14% compared to a 10.0% return on the FTSE World Europe ex UK Index. Shareholders did even better than that as the discount narrowed, giving them a return of 16.9%. The interim dividend was increased from 6p to 7p.
The manager’s report mentions strong performance from certain themes within the portfolio including health care and smart car technology. They highlight Fresenius and Novartis as well as Autoliv, Continental and Valeo in this regard. The portfolio is biased to large cap companies but some of their small cap names have been doing well – the report says BIC, IMA, Interpump, Tessenderlo Chemie and Veidekke were particularly strong performers.
The Board has relaxed the restriction on investment outside of Continental Europe from 5% to 10%. Two UK stocks were purchased in the six months under review, Imperial Tobacco and Legal and General. Both were identified for their undervalued cash flow as well as dividend paying attributes. A further holding in BG Group has been purchased since the period end.
HEFT : Strong stock selection benefits Henderson European Focus