REG - Athelney Trust plc - Net Asset Value(s)

Athelney TrustAnnouncement

04/10/2022 09:15

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RNS Number : 7014B  Athelney Trust PLC  04 October 2022

Athelney Trust PLC

 

Legal Entity Identifier:

213800ON67TJC7F4DL05

The unaudited net asset value of Athelney Trust was 198.9p at 30 September
2022.

Fund Manager's comment for September 2022

The fiscal stimulus plan and series of tax cuts and regulatory reforms
announced in the mini budget sent financial markets into a tailspin with the
pound reaching a record low and short-term interest rates and bond yields
moving sharply higher upon the news that the IMF viewed the strategy as likely
to increase inequality, and the rating agency, Moody, warning that unfunded
tax cuts were credit negative.  The yields on five-year government bonds are
now at levels similar to those of more heavily-indebted European economies
such as Italy and Greece. Commensurate with this rise in short and medium-term
interest rates, the quoted prices for income generating assets and REITs in
particular, declined materially.

In response to what it referred to as recent "dysfunction", the Bank of
England (BoE) announced an emergency intervention in the government bond
market to "restore orderly market conditions" but reiterated that it would not
hesitate to change rates by as much as is needed to ensure inflation returns
to the 2% target over the medium term.   As a result, yields on 10-year UK
government bonds started to decline from recent highs and continued this trend
when the PM and Chancellor reversed their decision to implement various tax
cuts, especially that for high income earners.

For most businesses the damage has already been done with a substantial
increase in US$ denominated input costs and a steep rise in borrowing costs.
However, as mentioned in last month's note, in spite of the negative outlook
at a macro level, recent results from companies in our portfolio and
associated industries other than REITs (which are included for their yield)
indicate that they have been able to partially withstand these inflationary
pressures by implementing appropriate business strategies. During the past
month our portfolio declined by 11.6% and, after providing for expenses and
the interim dividend, the NAV was down by 12.46%, notwithstanding that the
property related stocks comprising almost 30% of the portfolio were down on
average by 18%.  This compares with the broad market index, the FTSE 250
index which declined by 11.92%.  The AIM All-Share Index fared slightly
better, declining by 9.55%, while the FTSE100 declined by a lesser 5.53%.
The Small Cap Index and the Fledgling Index declined by 7.51% and 7.62%
respectively.

Viewed against a global backdrop, the broad UK market was clearly the worst
hit.  The MSCI Index declined by 9.46% during September, while in the US, the
S&P 500 Index declined by a similar amount, down by 9.34%. The Dow Jones
Industrial Average was down by 8.84% with the tech heavy Nasdaq Composite
declining by 10.5%.

 

During the month we sold our holding in Jarvis after it announced a review of
the systems and controls in its subsidiary, Jarvis Investment Management,
pursuant to a s166 notice.  The proceeds from the sale were used to acquire
additional shares in Impax Asset Management.  Cash comprised 12.3% of the
portfolio at month end.

 

Fact Sheet

An accompanying fact sheet which includes the information above as well as
wider details on the portfolio can be found on the Fund's website
www.athelneytrust.co.uk (http://www.athelneytrust.co.uk) under "About" then
select "Latest Monthly Fact Sheet".

Background Information

Dr. Emmanuel (Manny) Pohl AM

Manny is Chairman and Chief Investment Officer of E C Pohl & Co ("ECP"),
an investment management company and has been a major shareholder in Athelney
trust for many years.

E C Pohl & co is licensed by the Australian Financial services (licence
no.421704).

www.ecpohl.com (http://www.ecpohl.com)

www.ecpam.com (http://ecpam.com/)

Manny Pohl and the ECP group has AUD2.7bn (£1.5 billion) under its management
including four listed investment companies, three listed in Australia and one
in the UK:

·    Flagship Investments (ASX code:FSI)

AUD95m https://flagshipinvestments.com.au (https://flagshipinvestments.com.au)

·    Barrack St Investments (ASX code: BST)

AUD37m www.barrackst.com (https://www.barrackst.com/)

·    Global Masters Fund Limited (ASX code: GFL)

AUD33m www.globalmastersfund.com.au (http://www.globalmastersfund.com.au)

·    Athelney Trust plc (LSE code: ATY)

GBP6m www.athelneytrust.co.uk (http://www.athelneytrust.co.uk)
 

Athelney Trust plc Investment Policy

 The investment objective of the Trust is to provide shareholders with
prospects of long-term capital growth with the risks inherent in small cap
investment minimised through a spread of holdings in quality small cap
companies that operate in various industries and sectors. The Fund Manager
also considers that it is important to maintain a progressive dividend record.

The assets of the Trust are allocated predominantly to companies with either a
full listing on the London Stock Exchange or a trading facility on AIM or
ISDX. The assets of the Trust have been allocated in two main ways: first, to
the shares of those companies which have grown steadily over the years in
terms of profits and dividends but, despite this progress, the market rating
is favourable when compared to future earnings and dividends; second, to those
companies whose shares are standing at a favourable level compared with the
value of land, buildings or cash in the balance sheet.

Athelney Trust was founded in 1994. In 1996 it was one of the ten pioneer
members of the Alternative Investment Market ("AIM"). In 2008 the shares
became fully listed on the main market of the London Stock Exchange. Athelney
Trust has a successful progressive dividend growth record and the dividend has
grown every year since 2004. According to the Association of Investment
Companies (AIC) Athelney Trust is one of only "22 investment companies that
have increased their dividend every year between 10 and 20 years - the next
generation of dividend heroes" (as at 20/03/2018). See link

https://www.theaic.co.uk/income-finder/dividend-heroes
(https://www.theaic.co.uk/income-finder/dividend-heroes)

Website

www.athelneytrust.co.uk (http://www.athelneytrust.co.uk)
 

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