Monday, 3 April 2017

Dunedin Income Growth Trust - Final Results

I hold this UK income trust in my ISA portfolio.

They have recently issued results for the full year to 31st January 2017( link via Investegate).

I am pleased to see the figures for the year are an improvement on the previous year when NAV had fallen by 11.5% - NAV per share on a total return basis is up by a respectable 19.2%  - yet still underperforming against its benchmark the FTSE all-share index by 0.9% over the year.

Underlying income per share saw a modest increase to 12.55p.

The Board is recommending a final dividend of 3.975p, which will make a total of 11.7p for the full year (2016 - 11.4p) - an increase of 2.6%. As with last year, the uplift is a little disappointing and just about keeping pace with inflation. Dividend growth over the past 5 yrs is one of the weakest in the sector at an average of just 1.2% p.a. - maybe the trust needs a new name!

I am pleased to see dividend reserves have again increased to £25.7m (2016 £23.9m) and now represents 149% of dividends paid out over the past 12 months.

Ongoing charges for the trust are 0.68% (2016 0.74%) - around the average for the UK income sector.

3 Yr Performance -v- Vanguard Equity Income
(click to enlarge)

At the current share price of  255p, the trust yields a handy 4.5% but share price appreciation has been below par for the past couple of years. One of my Vanguard index funds I use as a benchmark to evaluate my collective investment is their UK Equity Income Fund which I updated last month. As can be seen from the chart, the Dunedin trust does not compare too well over the past 3 years.

I will retain my ISA holding for the time being for the income but without any real enthusiasm. This seems to offer yet another example of passive index funds outperforming the managed investment trust. My strategy transition in 2015 towards lower cost index funds is looking increasingly a good move

As ever, please DYOR.


Unfortunately my computer crashed at the weekend and it looks terminal so normal service will be resumed as soon as I have a replacement.........  :-(


  1. There seems to be a very close correlation between the shape of the graphs. Does this indicate that Dunedin is not actually adding any value - just tracking the index with more or less the same holdings ....and underperforming?

  2. Ouch, it is not nice to have your computer crashed on you! I hope you got a backup for the files on the computer?

    1. No, not the best of days last weekend however I now have a replacement laptop and, as you suggest, I have been a bit complacent regarding backup and will certainly adopt a regular routine from now onwards!

      I think I will need to try and extract some files from the crashed HD and then back everything up to an external in progress.