Interim Management Statement

RNS Number : 8977E

Jupiter European Opps. Trust PLC

15 April 2014

 



Jupiter European Opportunities Trust PLC

Interim Management Statement for the three months ended 28 February 2014

The Board of Jupiter European Opportunities Trust PLC (the 'Company') is pleased to announce its Interim Management Statement for the three months ended 28 February 2014. 

During the period from 1 December 2013 to 28 February 2014, the Company's net asset value per share excluding income and expenses rose by 7.8% to 452.89p, which compares with a rise of 2.8% for the Company's benchmark, the FTSE World Europe ex-UK Total Return Index, over the same period.

Investment Manager's Report for the three months ended 28 February 2014

During the three months under review, stock markets in the West and the emerging markets experienced contrasting fortunes. The S&P500, the FTSE All Share and the FTSE World Europe ex UK Total Return Index (the benchmark index) rose in low single digits in Sterling terms, while stock markets in Asia, Russia and Latin America posted mid-single to double-digit declines. On this occasion, the divergence can be explained by contrasting economic data: the IMF has revised down GDP estimates for emerging and developing economies, while developed market economies are expected to grow faster in 2014. The European economy is indeed growing, albeit modestly. Within Europe, the best performing stock markets were in the peripheral countries of Greece, Portugal and Italy, whose economies are returning to growth.

Your Company outperformed the benchmark over the three months under review. By sector, Healthcare was the biggest contributor to performance. Novo Nordisk was the standout performer after reporting stronger than expected full year results. The company's diabetes care products are much in demand the world over, with the highest reported growth coming from North America and China. Coloplast, a healthcare company providing ostomy, continence, urology and wound care, also performed strongly, reporting robust growth in Brazil and China.

Syngenta was the principal detractor from returns over the period. The shares fell after the global agrochemical leader missed earnings estimates following a write-down in seed inventory and higher production costs in an environment of lower soft commodity prices. We maintain our confidence in the company's yield-enhancing technology for farmers and its global reach. CGG, the oil services company, also detracted from returns after reporting lower profitability than expected and booking an impairment charge relating to the decommissioning of vessels.

The performance of your Company was enhanced by net gearing of 11 per cent., amounting to £47.5 million as at the end of the period. Turnover was modest during the period. We sold holdings in adidas and trimmed back the position in Dassault Systèmes. We added to the holding in Novo Nordisk.

Our aim continues to be to try to identify companies that, in our view, have strong business models, provide differentiated products or services and, as dominant operators in niche areas, get well rewarded for doing so. For the most part, these businesses delivered strong profits in 2013. They tend to operate globally, including in emerging markets, as these economies continue to grow in significance, and we remain confident that our holdings are well placed to succeed in many of these markets.

Alexander Darwall

Fund Manager

Jupiter Asset Management Limited

Total Assets as at 28 February 2014: £407,720,206

Ordinary shares in issue as at 28 February 2014: 90,026,474

	Net Asset Value per share excluding income/expenses(p)	Net Asset Value per share including income/expenses(p)	Market Price (p)	Premium / Discount
Ordinary Shares*	452.89	449.98	450.00	-0.6%

Portfolio Distribution as at 28 February 2014

Percentage of Total Assets plus short term loans/overdraft

Country	%
United Kingdom	21
Germany	19
Denmark	17
The Netherlands	11
France	8
Switzerland	7
Norway	4
Others	12
Cash and fixed interest	1
Total	100

The Company's exposure to other UK listed investment companies was nil as at 28 February 2014.

Top Ten Holdings as at 28 February 2014

Company	Country of Listing	% of Portfolio
Wirecard	Germany	8.9
Novo-Nordisk	Denmark	8.9
Provident Financial	United Kingdom	7.3
Reed Elsevier	The Netherlands	6.6
Novozymes	Denmark	6.5
Syngenta	Switzerland	6.3
Experian	United Kingdom	6.1
Fresenius SE	Germany	5.5
Croda International	United Kingdom	5.2
Intertek Group	United Kingdom	4.6
Total		65.9

Comparative Performance as at 28 February 2014

	1 Month %	3 Months %	1 Year %	3 Years %	5 Years %	Since Launch %	Since Last Annual Report %
Total Assets*	6.5	7.8	15.5	50.6	247.6	274.8	12.2
FTSE World Europe Ex-UK Index Total Return	5.4	2.8	15.4	23.6	110.5	90.5	9.9
FTSE World Europe Inc-UK Index Total Return	5.2	2.9	13.9	24.7	111.9	85.6	8.5
Ordinary Share NAV	6.5	7.8	15.5	50.6	247.6	349.2	12.2
Ordinary Share Total Return ( NAV & Dividend)	6.5	7.7	16.4	51.8	251.0	380.0	13.1
Ordinary Share Price	5.2	6.0	13.4	63.6	341.2	343.3	9.8

*Adjusted for changes to share capital and amounts borrowed.

Investment Objective

The objective of the Company is to invest in securities of European companies and in sectors or geographical areas which are considered by the Investment Manager to offer good prospects for capital growth, taking into account economic trends and business development.

Investment Policy

The Investment Manager adopts a stock picking approach in the belief that a thorough analysis and understanding of a company is the best way to identify long-term superior growth prospects. This understanding begins with identifying those companies where the ownership structure and incumbent management are conducive to the realisation of the aim of achieving superior long-term earnings growth. The Investment Manager will seek to identify companies which enjoy certain key business characteristics including some or all of the following:

- a strong management record and team, and the confidence that the Investment Manager has in that management's ability to explain and account for its actions;

- proprietary technology and other factors which indicate a sustainable competitive advantage;

- a reasonable expectation that demand for companies' products or services will enjoy long-term growth; and

- an understanding that structural changes are likely to benefit rather than negatively impact that company's prospects.

There may be sectors which do not enjoy the business characteristics described above and in such circumstances the Investment Manager will seek to identify companies that are expected to generate superior earnings growth within that sector.

In analysing potential investments, the Investment Manager will employ differing valuation techniques depending on their relevance to the business characteristics of a particular company. However, the underlying feature will be the sustainability and growth of free cash-flow in the long-term.

Material Events

During the period under review the Company issued 525,000 Ordinary shares representing 0.6% of the issued share capital.

Company Information

The Company's Ordinary shares are listed on the London Stock Exchange. The Ordinary share price is published in both the Financial Times and The Times under `Investment Companies'.

The Net Asset Values of the Company's Ordinary shares are calculated daily and can be viewed on the London Stock Exchange website at www.londonstockexchange.com (selecting 'News and Events' and then 'RNS').

For further information, please contact:

Richard Pavry

Head of Investment Trusts

Jupiter Asset Management Limited

[e-mail]  

020 7314 4822

15 April 2014

The Company's Registered office is at 1 Grosvenor Place, London SW1X 7JJ.

This interim management statement has been prepared solely to provide information to meet the requirements of the UK Listing Authority's Disclosure and Transparency Rules.

 

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