Scottish American says the net asset value total return for the first six months of 2016 was 14.0% and the share price total return was 12.0%. The total return of the global equities, as measured by the FTSE All World Index in sterling, was 12.0%. Over the six month period 235,000 shares were issued at a premium to net asset value. Earnings per share for the six months were 5.77p compared to 6.18p in the same period last year. While the underlying trend in income from SAINTS’ assets continued to show solid growth year on year, two specific factors were the primary drivers of the fall in earnings for the first half of 2016 as compared to 2015: a significantly lower contribution from special dividends, and reduced rental income from the property portfolio as a result of the sale of some higher-yielding properties in the second half of 2015.
A first interim dividend of 2.70p was paid at the end of June and a second interim dividend of 2.70p will be paid at the end of September. The total amount of dividends, 5.4p, is 1.4% higher than the amount paid for the corresponding period in 2015. The rate of increase in the dividend exceeds the current annual rate of CPI inflation of 0.3% as at the end of June 2016. Their expectation is that income for the full year will show a modest fall compared with the 10.47p earned in the year to 31 December 2015. Revenue reserves stand at 9.92p per share.
They say NAV performance exceeded the comparative FTSE All World Index return mainly due to strong performance from the equity portfolio, with solid operational performance from the majority of companies held. The healthcare and financial services sectors were areas of particular strength with, for example, holdings of Cochlear, the hearing implant company, and BM&F Bovespa, the Brazilian stock exchange, performing well. General operational resilience has also enabled almost all of SAINTS’ equity holdings to deliver continued dividend growth. In common with the broader UK equity market, the recent vote in favour of Brexit was a setback to progression in the share prices of SAINTS’ UK-listed stocks. However, as a globally-invested Company the portfolio’s overseas stocks have, in sterling terms, benefited from the related currency movements. In the fixed income portfolio a strong rebound in the Brazilian inflation-linked bond in both local currency and sterling terms further contributed to strong total portfolio performance.
SCAM : Scottish American ahead in H1