Henderson Opportunities has published interim results for the six months ended 30 April 2015. Over that period the FTSE All-Share Index returned 9.2% but the fund’s net asset value returned almost double that, 17.6%. Unfortunately for shareholders though, the discount widened from 3% to 12.1% and so the return to shareholders was just 7.5% – the report points out though that the discount has narrowed since. The dividend for the period was increased from 3.7p to 5p.
The manager says the principal contributors to their relative performance were holdings in 4D pharma, the developer of biological treatments targeting auto-immune diseases, which has continued to make good progress and attract new and substantial investors as we draw near to the publication of the first trial data and the market saw corporate transactions in the USA which help to validate the valuation; Oxford Pharmascience, where preliminary figures for its proprietary tablet coating look highly encouraging and have driven the share price higher; e2v technologies, a manufacturer of high technology electronic components, which has responded well to new management initiatives to enhance performance with improved profitability and greater resilience; Johnson Service, the textile rental and dry cleaning business, which has made great strides with recent commercial laundry acquisitions which have materially enhanced profits; and Ricardo, the engineering and technical consultancy, which has seen not only an expanding order book but has complemented this with an accretive acquisition in the global railway market.
On the downside, Velocys, the technology provider for development of small scale gas to premium liquids (jet fuel etc.) projects, saw its share price fall as the weak oil price has dented near term demand for alternative sources of supply – they believe this will reverse when the oil price recovers; Flybe, the regional airline, having made good progress in its operational turnaround story has nevertheless so far failed to deal with its grounded aircraft legacy from the previous management team – they think that, until this is resolved, it will remain a drag on performance. In addition, Vodafone, BT and Shire, all FTSE 100 constituents, were not owned during the period and performed well therefore impacting performance relative to the benchmark but had no impact on the NAV. As they say, an opportunity lost rather than an absolute cost to shareholders.
HOT : Another great performance from Henderson Opportunities