Majedie Investments just managed to beat the MSCI AC World Index over the 12 months ended 30 September 2021. The NAV return for the period was 22.5% against a return for the index of 22.1%. However, a narrowing discount delivered a return to shareholders of 37.1%. The dividend was maintained at 11.4p, but this was still uncovered by earnings – revenue per share was 9.4p.
The dividend received from Majedie Asset Management was £4.0m, the same as in the previous year and the income from MAM Funds was £2.1m compared to £1.9m in 2020. Total administration costs and management fees were £1.6m compared to £1.7m and finance costs were unchanged at £1.5m.
During the year ended 30 September 2021 the value of the Majedie Asset Management shareholding fell from £31.0m to £25.2m. However, since the period end, as we have reported, Liontrust bid for Majedie Asset Management. On completion of this deal, the trust expects to be paid £7.7m in the form of dividends and special dividends. It will also get shares in Liontrust. At the share price of Liontrust on 7 December 2021, the value of the share consideration is £14.7m. This initial consideration of £22.4m is £2.8m below the year end valuation of Majedie Asset Management in the trust’s NAV. However, there is the potential for a further deferred consideration of cash and shares of up to £5.6m which may potentially be due three years after completion and dependent on future investment performance and growth in assets under management.
Elsewhere in the portfolio, the global and UK equity portfolios beat their respective benchmarks. The International equity fund just failed to beat its benchmark and the Tortoise Fund returned an impressive 36.0%.
MAJE : Majedie helped by narrower discount