REG - CQS New City HighYld - Monthly Fact Sheet as at 30 April 2025

CQS New City High Yield FundAnnouncement

23/05/2025 16:00

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RNS Number : 0446K  CQS New City High Yield Fund Ltd  23 May 2025

23 May 2025

CQS New City High Yield Fund Limited

("NCYF" or the "Company")

Monthly Factsheet as at 30 April 2025

The Company's Fact Sheet as at 30 April 2025 has been submitted and is
available for inspection on the Company's
website, https://ncim.co.uk/cqs-new-city-high-yield-fund-ltd/
(https://ncim.co.uk/cqs-new-city-high-yield-fund-ltd/) .

Investment Manager's Report

Ian 'Franco' Francis, Investment Manager at New City High Yield Fund comments:

In recent weeks, global markets have been focused on the multitude of tariffs
introduced and subsequently delayed by US President Trump. The US treasury
markets signalled displeasure over the effects that tariffs would have on the
economy and inflation in the US. Most investors dislike tariffs as they create
uncertainty in all markets, be it government bonds, currency markets,
corporate debt or equities. They contribute to inflation, which is ultimately
passed on to the consumer, and cutting margins for companies if they cannot
pass on the full costs. Additionally, they create poorer productivity in the
country implementing the tariffs as their economy cannot produce the same
product as cheaply as those with lower wage costs. It will likely motivate
countries who have had these tariffs imposed to look for other trade partners
for their goods and do trade deals away from the US. Whatever the final
outcome, it appears the fundamentals that support world trade will change.

 

In the UK, the collapse in business confidence was only to be expected as
higher staffing costs kicked in with a higher minimum wage and increased
National Insurance payments. The S&P Global Flash UK PMI Composite Output
Index cratered to 48.2, down from 51.5 in March, as higher costs are
negatively impacting major spending plans amongst customers, both domestically
and in export markets. The employment outlook was also poor as job cutting was
seen by many companies as one of the options to offset higher costs and lower
order books. The net result in the short-term has been an interest rate cut
from the Bank of England with more expected later in the year.

 

Europe in contrast saw manufacturing hold up better-than-expected despite the
10% general tariff and 25% auto tariff imposed by the US. Falling energy costs
helped, as did the increase in defence spending and infrastructure as Europe
took more responsibility for its overall defence, reducing its reliance on
America. Whilst the service sector has proved a consistent poor performer
since February 2024, there is a hope of recovery with the defence and
infrastructure spending, which should benefit all sectors of the economy.

 

The US witnessed a marked slowdown of activity alongside a fall in optimism
about the future growth of the economy. Inflation, led by tariffs and
increasing wage costs, has led to output prices in manufacturing increasing by
the most in over two years. This likely gives the Federal Reserve a headache
as a cooling economy appears in need of a rate cut. The tariffs will also hit
supply chains for many US industries as many of their components come from
countries with high tariffs. West Coast ports will likely see a large fall in
cargos which in turn will put a lot of logistics jobs at risk. A lot depends
on how trade deals develop by the end of the 90 day "cooling off" period
announced by the President following the market sell-off witnessed after the
2nd April "reciprocal tariff" announcement.

 

For the Company, we announced the third interim dividend of 1p per share and
went ex-dividend at the end of the month. It was a quiet month for
transactions given the volatility and wide spreads associated with the market
turmoil. We added to Boparan 9 3/8% 2029, the only purchase in the month.
Selling was limited to a scrap of Co-op Bank 11 ¾ 2034 as they had not
participated in the market fall. The beginning of May looks to be settling
down with more liquid markets returning.

 

 

-ENDS-

 

 For Further Information

 CQS New City High Yield Fund Limited    T: +44 (0) 20 7201 6900

                                         E: contactncim@cqsm.com

 Singer Capital Markets                  T: +44 (0) 20 7496 3000

 Cardew Group                            T: +44 (0) 20 7930 0777

 Tania Wild                              M: +44 (0) 7425 536 903

 Henry Crane                             M: +44 (0) 7918 207 157

 Liam Kline                              M :+44 (0) 7827 130429

                                         E: ncyf@cardewgroup.com (mailto:ncyf@cardewgroup.com)

                                         https://www.cardewgroup.com/ (https://www.cardewgroup.com/)

 Company Secretary and Administrator     T: 01534 813 959

 BNP Paribas S.A., Jersey Branch

 Guerhardt Lamprecht

 

About CQS New City High Yield Fund Limited

 

CQS New City High Yield Fund Limited aims to provide investors with a high
dividend yield and the potential for capital growth by investing in
high-yielding, fixed interest securities. These include, but are not limited
to, preference shares, loan stocks, corporate bonds (convertible and/or
redeemable) and government stocks. The Company also invests in equities and
other income-yielding securities.

Since the Fund's launch in 2007, the Board has increased the level of
dividends paid every year. As at 31 December 2024, the Company's dividend
yield was 8.79%. In addition to quarterly dividend payments, the Fund seeks to
deliver investors access to a high-income asset class across a
well-diversified portfolio with low duration to help mitigate interest rate
risk.

Further information can be found on the Company's website
at https://ncim.co.uk/cqs-new-city-high-yield-fund-ltd/
(https://ncim.co.uk/cqs-new-city-high-yield-fund-ltd/)

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