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Dunedin Income Growth Investment Trust PLC on Tuesday said the outlook for the UK was better than at the start of the year as inflation was coming down with the prospect of further interest rate cuts. The UK-focused investment fund said net asset value per share rose 5.7% to 322.49 pence as at July 31 from 304.99p at January 31. NAV total return was 8.2% for the six months to July 31, underperforming against its benchmark, the FTSE All-Share index, which had a total return of 12.3% Chair David Barron said: ‘While performance can lag the benchmark in periods where businesses exposed to rising commodity prices and positively geared to rising interest rates are in favour, the investment manager believes that limiting exposure to the most cyclical companies with high financial and operating risks, while favouring those exposed to structural growth and stronger balance sheets will support long term shareholder total returns.’ Dividends in the first financial half amounted to 8.92p per share, up 8.1% from 8.25p a year ago. Further, Chair Barron said he will stand down from the board at the company’s next annual general meeting in 2025 to be held in May. He will be succeeded as chair by Director Howard Williams. Looking ahead, outgoing Chair Barron said the UK macroeconomic picture looked more encouraging than at the start of the year, noting falling inflation and the prospect of further interest rate cuts. ‘While the UK macro environment is showing signs of improvement, the US economy is projected to experience a moderation in growth, although it is expected to avoid a significant recession. Meanwhile, the Chinese economy faces substantial challenges, including weak domestic demand and an unstable real estate sector,’ he said. Dunedin Income shares were 0.2% higher at 284.50 pence each on Tuesday morning in London. Copyright 2024 Alliance News Ltd. All Rights Reserved.
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