Kathleen Gallagher, Investment Week, 26 January 2023:
Literacy Capital trust saw a total NAV return in the final three months of 2022 of 9.3%, as it continues to shift its portfolio to more mature companies.
In its quarterly trading update the trust said that its total NAV return for the year was 51.7%.
The trust, which invests in private businesses, donates 0.9% of its annual NAV to charities focused on improving UK literacy in children. In the final quarter £733k was donated, bringing the total to £5.8m since its launch…
The company had 10% gross assets in growth capital investments six months ago.
The update said the remaining 5% exposure relates solely to Butternut Box, which provides dog food delivery. The trust said the company is “performing strongly” and the trust is “comfortable with the current construction of the portfolio”.
Pindar added it will continue to shift away from growth and “investments in profitable businesses will remain our focus, due to the favourable returns that can be generated, whilst taking lower levels of risk”.
The trust is on a 4.7% discount, according to Morningstar. The trading update acknowledged the discount, describing it as “rare”, adding the board is “monitoring this situation closely and will take action to improve returns for shareholders if necessary”.
James Carthew of QuotedData said in his morning briefing that it seems the trust’s NAV is “just rising too fast for the share price to keep up”.
“The latest NAV takes the size of the company through £250m, which may help broaden its appeal amongst larger investors,” he added.
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