- an increase of the Net Asset Value per share by more than the growth in the FTSE All-Share Index; and,
- growth in dividends per share by more than the rate of UK inflation.
20% of the portfolio comprise overseas listed holdings including Swiss pharma, Roche and US tobacco firms Reynolds and Altria.
Edinburgh has been one of the cornerstones of my income portfolio held in both Sipp drawdown and ISA. It has today issued its results for the full year to 31st March 2015 (link via investegate).
The Company's net asset value, including reinvested dividends, rose by 16.5% during the year, compared to a rise of 6.6% (total return) by the FTSE All-Share Index..
|2 yr chart EDIN v FTSE All Share|
The board have proposed a final dividend of 8.6p making a total of 23.85p for the full year - an increase of just 1.5% on the previous year which is a little disappointing. However, I have no complaints with an overall return some 10% above the FTSE All Share.
Due to the 15% increase in the share price over the past 12 months, the yield has now fallen to 3.45% based on the current price of 690p.
In his report, new manager Mark Barnett said :
"The recent performance of the UK equity market has seen further strong positive returns, with the FTSE All-Share Index recently hitting a new all-time high, which makes the near term outlook more subdued.
The continued rerating of equities primarily as a result of the policies of central banks has resulted in boosting asset values to the point where the market looks more fully valued than for many years. This high level of valuation coupled with a low level of earnings growth is the primary risk to the current level of share prices".
Shareholders have benefitted from a reduction in charges - £7.6m compared to £12.5m last year and £18.2m the previous year. This is largely due to removing the performance fee. This is the first year that performance fees have been abolished and replaced with a flat fee of 0.55%. Ongoing charges for the year was a more modest 0.61% (2014 1.0%).
Shareholders have further gained from the significant savings of ~£8m in borrowing costs as the £100m 11.5% debenture was replaced from last June.
All in all, a very pleasing outcome - share price up 15%, a modest increase in the dividend and a big reduction in charges. I am happy to continue with this trust for the duration.