Alliance Trust PLC : AGM Statement
27 April 2012
ALLIANCE TRUST PLC
Annual General Meeting
Alliance Trust PLC is holding its Annual General Meeting in Dundee today, at which the Board of Directors will update shareholders on the 2011 performance and address the resolutions to be voted on.
At the AGM, the Company will specifically provide an update on:
Investment performance
Investment strategy
Subsidiaries
Share buy backs and
Dividend policy
Investment performance
Alliance Trust's investment performance continues to improve. As announced in March, for the financial period to 31 December 2011, the Company ranked 6/32 in its sector on a Total Shareholder Return basis and 10/32 on a Net Asset Value Total Return basis, outperforming the Global Growth Sector in both cases. Alliance Trust continues to outperform the sector over 1, 2, 4 and 5 years demonstrating further progress towards a consistent and sustainable long-term performance.
Investment strategy
The Board of Alliance Trust always seeks to act in the best long-term interests of shareholders in order to maximise investor returns. The Company's aim is to provide a home for the safe and productive long-term management of investors' capital.
As part of this commitment to shareholders, the Board regularly reviews the management structure and investment strategy to ensure that the business is being operated in order to best drive long-term returns, and will continue to do so. The existing strategy is starting to deliver consistent and sustainable long-term performance and consequently the Board has concluded that the existing management arrangements are the most appropriate for achieving the Trust's aims at this time.
Subsidiaries
The Board believes through the successful development of the Company's subsidiary businesses, it will generate not only a new revenue and earnings stream, but also a more diversified dividend. These businesses offer sustainable growth potential in a world of lacklustre growth. Today, they are a small part of Alliance Trust's net asset value but they have the potential to be value accretive.
Alliance Trust Savings has made great progress over the past few years with significant developments made to the business to enhance processes and customer service. The Board expects it to be profitable on a monthly basis by the end of the calendar year and be earnings enhancing in 2013.
Through Alliance Trust Investments, the Company has been able to attract third party assets which provides an additional revenue stream to the Company. Most importantly, it has created a platform which makes it possible for the Trust to attract, retain and motivate high calibre investment managers, whose principal priority is to ensure that the Trust performs better than in the past.
Share buy backs
Over the last 14 months, the Company has bought back over £290m of its shares. This has acted both to narrow the discount and to reduce its volatility. The Board intends to continue its present share buyback policy with the aim of sustaining these improvements. It believes that the primary driver of closing the discount, on a sustainable basis, while maintaining long-term shareholder value, is to stimulate demand for shares through performance and a prospective dividend.
Dividend policy
Alliance Trust is acutely aware of how pressing the demand for income has become and recognises the importance to shareholders of a sustainably rising dividend alongside capital growth. The dividend for the 11 month period increased over 7% on the year before, and represents the 45th consecutive year of dividend increases.
The recent change in regulations governing investment trusts will permit greater flexibility in making distributions to shareholders. The Board is considering the implications of this and the other options available to the Company. However, it is mindful that it needs to deliver a sustainable and progressive dividend being consistent with its investment objectives and shareholders' needs over the long term.
The Board expects to be able to update shareholders further on the Group's dividend policy at the interim results in August.
Commenting on today's announcement, Karin Forseke, Chairman, said:
"Alliance Trust exists to grow the value of the capital that its shareholders have invested with the Company. Through a combination of improving investment performance, a sustainable and growing dividend, ongoing share buybacks, and subsidiaries which will begin to contribute, the Trust is creating an appealing, differentiated proposition for both existing and potential investors."
- ENDS -
| Contacts | |
| James Leviton / Clare Dundas | |
| RLM Finsbury | |
| Tel: +44 (0)20 7251 3801 | |
| Email:alliancetrust@rlmfinsbury.com | |
| Web: www.rlmfinsbury.com |
The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and other applicable laws; and
(ii) they are solely responsible for the content, accuracy and originality of the
information contained therein.
Source: Alliance Trust PLC via Thomson Reuters ONE
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