North Atlantic Smaller Companies generated an 11.8% return on net assets for the six months ended 31 July 2015, well ahead of the return on comparable indices such as the S&P 500 which returned 1.7%, the Russell 2000 which returned 2.5% or the FTSE All-Share which returned 0.9%. The share price appreciated by 10.7%.
The fund’s holding in Oryx rose by 17.7%, significantly outperforming its benchmark index. Their holding in MJ Gleeson Group also performed notably well, rising by nearly 25% over the period. Nationwide Accident Repair Services and Essenden were both taken over on premiums of 28% and 23% respectively to the 31 January 2015 valuation, whilst Bioquell performed very strongly following the sale of a subsidiary, rising by nearly 65%. The only notable faller in the UK was Goals Soccer Centres which fell approximately 7%. Finally, Mecom Group was taken over at a good premium to cost whilst OMG announced substantial special dividends as a return of capital.
There was considerable activity in the unquoted portfolio, with Celsis AG in particular being sold in July 2015 at a 50% premium to the 31 January 2015 valuation. Avenue Financial went public and is currently trading at approximately a 26% premium to the 31 January 2015 valuation, whilst the B&G Equipment valuation was increased, reflecting good trading performance. Performance Chemical Company, despite the weak oil price, continues to achieve good profitability. The Bionostics Holdings escrow of approximately £4m was received in full. they wrote down the value of Hampton Investment Properties as realisations have been disappointing. They think they will have sold the last properties off by 31 January 2016.
NAS : North Atlantic Smaller more than 10% ahead of UK market