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Tavistock Investment (TAVI)

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Wednesday 08 April, 2020

Tavistock Investment

Trading Update

RNS Number : 0917J
Tavistock Investments PLC
08 April 2020
 

Tavistock Investments Plc

("Tavistock" or the "Company")

Trading Update

8th April 2020

The Company is pleased to advise that its trading result for the year ended 31 March 2020 is expected to be in line with the market's expectation for continued growth in reported EBITDA.

One particular highlight of the year has been the superb performance of the Company's new range of protected UCITS funds. They were designed specifically to shield clients from the potentially disastrous consequences of sudden and sustained falls in market values, offering investors an alternative, more prudent approach to medium to long term investing.

The ACUMEN Capital Protection Portfolio and the ACUMEN ESG Protection Portfolio provide a guaranteed level of protection for investors equivalent to 90% of each fund's highest ever value (Net Asset Value or NAV). These guarantees are contractually underwritten by Morgan Stanley & Co International Plc.

By way of illustration, between 1st January and 31st March 2020, the FTSE fell 24%. By contrast, these two protected funds fell by less than 5% and 3% respectively.

As of Monday, an investment made in the ACUMEN Capital Protection Portfolio risked a maximum potential loss of only 3.6% of the initial investment, whilst still benefiting from the 90% high watermark guarantee going forward.

However, the COVID-19 pandemic has caused commercial conditions to become extremely challenging. It is inevitable that adverse economic and market performance, together with the commercial consequences of social distancing and the Government imposed lock-down, will combine to have a detrimental effect on the Company's performance in the new financial year. The impact of the pandemic will be felt for some considerable time, potentially through several iterations, and at the moment it is impossible to accurately assess the consequences.

In light of this uncertainty, the Board has adopted a number of measures to protect profitability and ensure that the business emerges from the current crises in the best working order. No dividend will be paid at the present time and a comprehensive strategic review is also being undertaken with a view to removing cost from the business.  This exercise will encompass a pragmatic impairment review of the carrying value of intangible assets on the Company's Balance Sheet.

Every member of the executive team has volunteered to waive a significant proportion of their income, with immediate effect, so that everyone in the business understands that we will deal with the challenges ahead together.

Pending stability in the financial markets, the Company has withdrawn its guidance for market expectation in the year to 31 March 2021.

Brian Raven, the Company's Chief Executive, said:

"The key measure of leadership is how well it performs under difficult circumstances. Tavistock is led by a strong, experienced and unified team who have clearly demonstrated their commitment to the business and its staff.

We continue to look after the financial advice needs of our tens of thousands of underlying clients, and to manage their assets in our customary active, efficient and disciplined manner.

Market turbulence is far from over and a potentially very deep recession lies ahead.

A great many clients, particularly the less well off, cannot afford to risk further significant losses to savings or pension pots. These clients need security, ahead of investment upside potential. I believe that Tavistock's ACUMEN Protection Portfolios offer a safe haven solution for these cautious investors in these very difficult times. Whilst the funds primary purpose is to protect the downside, they will also be automatically, but gradually, reinvested from cash into higher risk assets, as market volatility reduces."

 

Ends

 

Enquiries

Tavistock Investments Plc

Oliver Cooke

Brian Raven

Tel: 01753 867000

 



Arden Partners Plc

Paul Shackleton

Tel: 020 7614 5900



Allenby Capital Limited

Nick Naylor

Nick Athanas

Tel: 020 3328 5656



Vested

Elspeth Rothwell

Tel: 020 3890 8118

 

(Mobile): 07811 375 998 

Amelia Graham

(Mobile): 07393 477 057 

 


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