Aurora has published its first set of interims since changing its investment approach and its year end. Because the Company’s year end has been brought forward to December 31st , this report covers the four month period from March 1st to June 30th. Since the year-end on February 29th , the NAV per share declined by 8.8% and the share price declined by 2.5%. The FTSE All Share Index rose by 6.7% over the same period. As at June 30th , the shares were trading at a 6.7% premium to NAV.
Brexit hit the portfolio hard. The FTSE All Share fell by 7% over the two days following the referendum, with the sharpest declines coming in the house building and banking sectors that form a meaningful proportion of the portfolio. The share prices of Barratt Developments, Bellway and Lloyds (which are all Aurora stocks) fell by over 20% the day after the vote (and considerably more, intraday). Clearly, this impacted the NAV, and the negative moves in those three stocks accounted for the vast majority of the decline.
In the 2016 annual report balance sheet, dated Feb 29th , they declared a cash weighting in the portfolio of 21.7%. At the end of June, the cash weighting had declined to 15.2%, with most of that cash invested after the Brexit vote as they topped up holdings in house builders, Lloyds and Sports Direct.
ARR : Aurora hit hard by Brexit vote