City have just announced full year results for the year to 30th June 2015 (link via Investegate). Share price total return has increased by 7.2% over the year compared to the FTSE All Share benchmark of 2.6%. Dividends have increased by 3.6% from 14.76p to currently 15.30p giving a yield of 4.0%. Reserves were bolstered by the addition of a further £3.83m. The dividend was increased for the 49th consecutive year.
|2 yr chart - City of London v Murray Income|
(click to enlarge)
Earnings per share rose by 9.8% to 16.84p, partly reflecting the underlying dividend growth from investments held - 7.2% - but also the rise in the US dollar compared with sterling, enhancing the sterling value of dividend payments from those UK companies which declare their dividends in US dollars. In addition, special dividends rose from £1.29m last year to £4.21m.
Ongoing charges are 0.42% and remain the lowest in the sector.
Over the year there was again a reduction in the weighting in large companies with a corresponding increase in the weighting of medium-sized companies. Large companies (FTSE 100) now account for 66% of the portfolio, medium companies 23% and overseas-listed companies 11%.
Relative to the FTSE All-Share Index, City of London benefited from being significantly underrepresented in the oil and mining sectors. The best three stocks held in the portfolio which contributed to performance were all housebuilders: Taylor Wimpey, Persimmon and Berkeley Group.
This trust is possibly the nearest proxy to a HYP portfolio often discussed on the Motley Fool discussion boards.
I first purchased CTY for my personal equity plan (PEP) in 1995 - it has served me well enough over the past two decades and it represents the largest weighting in my IT portfolio (ISA and SIPP drawdown)…and yes, it still feels like a dependable, faithful old carthorse. Total return over the past 10 years has been 9.5% p.a.
The trust has been managed by Job Curtis since 1991. This is a seriously long stretch as a fund manager and I am wondering how much longer he will carry on - maybe after 25 yrs he will decide to call it a day - who knows?
Unlike Murray Income trust and Murray International which have disappointed over the past couple of years, I am happy to continue holding CTY for the foreseeable…
As ever, please DYOR