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QuotedData’s morning briefing 16 June 2022

a cup of tea, a croissant and some magazines

In QuotedData’s morning briefing 16 June 2022:

  • The US central bank, the Federal Reserve has raised its base rate by 75 basis points (0.75%) to a target range of 1.50-1.75% and indicated that it would raise rates by between 0.5% and 0.75% at its next meeting, as it struggles to combat inflation.
  • NB Global Monthly Income (NBMI) has published more detail of its cash exit opportunity. After this one, the next one will be in December 2022 and then six-monthly thereafter. This time around, shareholders can redeem up to 25% of the shares that they hold on 30 June 2022. The exit price would be NAV less 2%. It may take between 30 and 90 days to raise the cash and pay exiting shareholders. The plan is to pay the exit proceeds in two instalments, the first being paid on or around 1 September 2022, and the second instalment being paid on or around 24 November 2022. If the size of the trust falls below £150m, the board would propose that the company is wound up. The board notes that as of 30 April 2022, the company has outperformed the 50%/50% S&P Loans/ICE BofA High Yield Index by +152, +242 and +275 basis points before fees (one basis point = 0.01%), respectively, over the year-to-date period, 1-year period and since inception of the revised investment strategy in September 2020.
  • Troy Income & Growth (TIGT) has a new £15m loan facility courtesy of Royal Bank of Scotland International Limited. The company has not had a gearing facility since April 2021. Having reviewed the situation, the board and managers concluded that a new facility should be instituted. The intention is for gearing to be used at a fairly low level on an ongoing basis, and from time to time more materially (up to around 10%) on a tactical basis. The company has the option to increase the level of the commitment from £15m to £20m at any time.
  • JPMorgan European Discovery (JEDT) lagged its benchmark over the year ended 31 March 2022, returning 0.3% against 3.8% for the MSCI Europe ex UK Small Cap Index. Discount widening meant that the return to shareholders was -1.3%. The managers say that top performers over the period include Italian luxury yacht manufacturer Sanlorenzo, which continued to see very strong demand; D’Ieteren, the Belgian holding company, which announced a minority stake deal with private equity funds for its main asset, Belron, at a much higher valuation than expected by the market; Alten, the French R&D consulting company, which is benefitting from the gradual recovery in the automotive and aerospace markets; Ipsos, the French market research company, which has seen increased demand for research and insights as companies and public entities need to adapt to a post-Covid world; and Reply, the Italian IT consulting company, as demand for digital solutions including cybersecurity and cloud infrastructure has only been accelerated by the Covid crisis. Stock detractors from performance included the Swiss software reseller, SoftwareOne, as their margins went under pressure following accelerated recruitment to build its services team; Aramis Group, the French used cars online platform, which suffered from shortages in the supply of cars and increased competition; and Tecan, the Swiss medical lab automation company, as investors took profit after a period where the company benefitted from strong Covid tailwinds. An underweight to Rheinmetall, the German defence company, also detracted after Germany announced a substantial increase in their military budget.
  • Standard Life Investments Property Income Trust has changed its name to abrdn Property Income Trust and has a new ticker – API.

We also have results from Syncona and JLEN Environmental Assets, plus an update from abrdn Private Equity Opportunities and the merger of Shaftesbury and Capital & Counties.

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