Interim Management Statement

RNS Number : 9725K

British Assets Trust PLC

25 July 2011

 



British Assets Trust plc

Interim Management Statement

For the Period from 1 April 2011 to 25 July 2011

Investment Objective

British Assets Trust plc aims to achieve a total return in excess of a composite index, weighted as to 75 per cent FTSE All Share Index and 25 per cent FTSE World (ex UK) Index, by investing principally in a diversified international portfolio of equities and equity-related securities.  Within this overall objective, the Company aims to maintain a progressive dividend policy which will be dependent upon, inter alia, the rate of revenue growth within the investment portfolio, and the level of dividend cover.

Performance Summary

Total Return1		Three months to 30/06/11
Net asset value2		+1.9%
Composite index3		+1.5%
Capital Values	As at  30/06/11	As at  31/03/11
Net asset value	140.5p	139.3p
Share price (mid market)	136.0p	133.8p
Discount  - Basic  - Debt adjusted4	3.2% 1.5%	3.9% 2.5%
Gearing  - Net of cash5  - Equity gearing6	18.1% 3.9%	17.7% 3.5%

Sources: F&C Investment Business Limited, Datastream.

1          All total return calculations are based on net dividends re-invested

2          Net asset value total return is calculated as the total return attributable to an Ordinary Share

3          Composite Index of 75 per cent FTSE All-Share Index and 25 per cent FTSE World (ex UK) Index

4          Net asset value adjusted to reflect market value of debt

5          Gearing net of cash: (investments-shareholders' funds)/shareholders' funds

6          Equity gearing: (equity investments-shareholders' funds)/shareholders' funds

Review for the Period

The Company's net asset value total return for the three months ended 30 June 2011 was 1.9%. This compares favourably with a return of 1.5% from the composite benchmark index of 75% FTSE All-Share Index and 25% FTSE World (ex UK) Index.

Equity markets recorded modest positive returns during the period under review but were volatile as the ongoing debt crisis in the Eurozone, in particular the problems faced by Greece, continued to create uncertainty.

During the period, the Company remained overweight in emerging markets and underweight global developed markets. Equity gearing, at 3.9%, was low, but the Managers consider this to be prudent given the current uncertain macro backdrop and the likelihood that the summer will be a quiet period for financial markets.

Outlook

Investors continue to question the sustainability of the global economic recovery. Growth in developed markets remains sub-trend because of the long lasting effects of the debt accumulation in the preceding years. However, as the effect of the adverse weather in the early part of the year, the Japanese earthquake and the political unrest in the Middle East and North Africa that led to a sharp spike in the oil price fade, the economic data should improve.

Companies continue to produce solid earnings growth, showing that the quoted corporate sector is managing the recovery more successfully than the private or government sectors. Thus, from a bottom up perspective the equity markets appear soundly based.

Dividends

First and second interim dividends in respect of the year ended 30 September 2011, each of 1.442p per share, were paid on 8 April 2011and 8 July 2011 respectively.

Top Ten Holdings as at 30/06/11

Company	Country	% of total assets
Rio Tinto	UK		4.6
GlaxoSmithKline	UK		4.0
HSBC Holdings	UK		3.6
Vodafone Group	UK		3.6
Royal Dutch Shell	UK		3.5
BP	UK		3.3
British American Tobacco	UK		2.3
Standard Chartered	UK		2.1
Tesco	UK		2.0
Scottish and Southern Energy	UK		2.0
Total			31.0

Geographical Analysis as at 30/06/11

			%of total assets
UK				62.8
Global Developed (ex UK) Markets				14.7
Emerging Markets				8.9
Corporate Bonds				11.8
Net Current Assets				1.8
Total				100.0

Management Arrangements

On 11 July 2011, the Board announced that it had been advised by F&C Asset Management plc that Julie Dent, who has been the Company's lead fund manager since 2001, has decided to retire with effect from 30 September 2011. She will be succeeded by Phil Doel who, from that date, will have full responsibility and accountability to the Board for all investment matters. The Board fully supports this change.

The Board is not aware of any other significant events or transactions which have occurred since 30 June 2011 and the date of publication of this statement which would have a material impact on the financial position of the Company.

Daily and Key Information

This statement and further information regarding the Company, including daily net asset values published since the end of the period and monthly factsheets, can be found at the Company's website www.british-assets.co.uk, or at www.fandc.com.

For further information please contact:

Julie Dent/Gordon Hay Smith

F&C Investment Business Limited

Tel: [phone]

 

END

 

 

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