The investment company Alliance Trust has reported profits of £468 million for the year ending January 31, turning around a £523m loss for the previous year.
The trust reported a marked upswing in its performance in the second half of last year but said it is looking increasingly to overseas markets against the fear that “political and fiscal uncertainty” in the UK will affect profits.
Over the financial year just ended, the net asset value of the trust rose by 19.2% while the share price rose by 16.8% and dividend increased for the 43rd successive year, according to results released by the company yesterday.
The share price total return for the year ranked 34/43 when compared to similar organisations. However, over two years it ranked 11/37, pointing, says the trust, to its ability to invest for the long term and protect shareholders’ capital in a time of extreme volatility.
The company also cut costs by 4.8% to £16 million and bought back 10.85 million shares 1.6% of those issued for £35 million, leading to an uplift of 7p per share for remaining shareholders.
“Following a challenging first six months, our performance improved significantly during the second half of the year and continues into the current year,” said chief executive Katherine Garrett-Cox, who said the company had benefited from the decision to reinvest in equities.
“Looking forward, we remain alert to the possibility of a double-dip recession,” she continued.
“However, Asia and emerging markets are recovering faster than the west and we are increasingly looking to those regions to deliver superior returns.
“We are reducing our weighting in the UK as we are concerned that the political and fiscal uncertainty will impact market returns.”
Shares in Alliance Trust closed 0.3p higher at 346.5p.