REG-Temple Bar Inv.Tst: Investment Update

Temple Bar Investment TrustAnnouncement

25/03/2020 11:40

TEMPLE BAR INVESTMENT TRUST PLC

INVESTMENT UPDATE

As at COB 23/03/20 the company had the following asset exposure.

               £            
 Total Assets  580,066,575  
 Debt          113,000,000  
 Equities      393,679,179  
 Gold/Silver   56,339,124   
 Cash          130,048,272  

Commentary

Going into 2020 the Temple Bar portfolio was almost fully invested, including
borrowings. The portfolio manager believed, supported by historical data, that
value equities were very cheap relative to history and that UK equities were
cheap relative to world equity markets.

Most cheap value equities offered some level of cyclicality which the
portfolio manager accepted as those stocks had, in general, underperformed and
were discounting only moderate economic growth.

The trust’s assets were particularly focused on stocks earning the majority
of their revenues in the UK. The portfolio manager expected an expansionary
budget and expected this to generate better than expected economic activity in
2020.

At the year end, approximately 6% of the portfolio was invested in precious
metals (bullion and shares) as the manager believed we were approaching a new
period of fiscal and monetary policy which would presage a period in which
Independent Central Banks were less focused on inflationary targeting than
they had been for many years.

The COVID-19 outbreak and the consequent extreme market volatility has proved
an exceptionally difficult backdrop for the portfolio with many of the
trust’s holdings falling significantly.

After lengthy discussion, the manager and board decided to increase
significantly the liquidity on the portfolio thus immunizing the gearing on
the Trust. This was conducted through sales of the least cyclically exposed of
the stocks on the portfolio. This maintained much of the sensitivity to a
market, and in particular to a value recovery.   

The top ten holdings are as follows:

 Travis Perkins PLC                6.2%  
 Royal Dutch Shell PLC Class B     4.6%  
 BP PLC                            4.4%  
 Royal Bank of Scotland Group PLC  3.7%  
 Grafton Group PLC                 3.6%  
 Barclays PLC                      3.3%  
 Kingfisher PLC                    3.3%  
 TP ICAP PLC                       2.8%  
 Forterra PLC                      2.8%  
 Capita PLC                        2.6%  



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