BACIT charitable donations pass £13m

For the year to 31 March 2016 BACIT‘s Net Asset Value total return per share was -0.2% and the share price total return was 8.5%. This compares to falls in the MSCI World Index of 3.5% and the FTSE All-Share of 3.9%. BACIT will pay a scrip dividend of 2.2 pence per share on 19 August 2016. Shareholders will have the option to elect to receive this dividend in cash.

This year they are making charitable donations of GBP2.38 million (31 March 2015: GBP 2.20 million) to The Institute of Cancer Research and GBP2.38 million (31 March 2015: GBP2.20 million) to The BACIT Foundation for onward distribution to the nominated charities. Including these donations since launch they will have made charitable donations of more than GBP13.3 million.

The proportion of NAV allocated to managers running hedged strategies was stable at 60.6%, from 61.4% twelve months earlier, while within the long biased managers the proportion allocated to unlisted assets more than doubled during the year (from 3.0% to 7.7%). As the quantum of uncalled capital on private equity investments (GBP43 million, compared with GBP46 million at 31 March 2015) suggests, this proportion of NAV may increase. As a consequence of these holdings in particular, during the ten worst months for the FTSE All Share Total Return Index since BACIT’s inception, BACIT has shown a relative outperformance of 26.2% against that index’s cumulative loss of 34.2% during these months.

In late February, the decision was taken to protect returns from a violent swing back to the pound/dollar exchange rate when BACIT was launched ($1.60), which would have negatively impacted BACIT’s returns and the volatility of those returns, and to lock in some of the gains for BACIT. They therefore hedged half of the US Dollar exposure at $1.394 – leaving them with about 25% of the total assets in dollars.

On a look-through basis BACIT ended the year approximately 48% net long in equity equivalents, in the middle of the 37-57% range since inception. The portfolio remains predominantly invested into funds whose focus is listed equities: 55.7% vs 53.9% twelve months ago.

BACIT has committed GBP20 million to the Pioneer Fund (funding research into new cancer treatments), which has now in turn invested GBP17 million of a total of GBP70 million into seven investments. The Pioneer Fund is in late stage due diligence on two additional drug candidates, thus well on the way to its target portfolio of fifteen investments over the life of the fund. The Pioneer Fund’s first two investments (CHK1 – clinical trial initiation and MPS1 – preclinical candidate nomination) each moved through significant scientific and value creation milestones, whilst a third is due to enter a Phase II clinical trial in the next quarter.  In aggregate, this positive technical progress has led to a significant write up in the fair value of the pipeline at the year end.

BACT : BACIT charitable donations pass £13m