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The Company currently conducts its affairs so that securities issued by Aberdeen Smaller Companies High Income Trust PLC can be recommended by financial advisers to ordinary retail investors in accordance with the FCA’s rules in relation to non-mainstream investment products and intends to continue to do so for the foreseeable future.
The Company’s securities are excluded from the FCA’s restrictions which apply to non-mainstream investment products because they are securities in an investment trust.
The value of investments and the income from them may go down as well as up and investors may get back less than the amount invested. The tax benefits relating to ISA investments may not be maintained. Please refer to the Key Facts documents contained in the ISA/Share Plan Brochure & Application form for general and specific investment risks attaching to the individual trusts.Read the detailed Risk Warning
Past performance is not a guide to future results.
See latest monthly factsheet below for performance history.
At close 06-Mar-2014Ord
|Net Dividend Yield||2.79%|
Source: Morningstar, NAV = Net Asset Value, excluding income.
40 Princes Street,
Registered in Scotland as an Investment Company Number 137448
The objective of the Company is to provide a high and growing dividend and capital growth from an investment in a portfolio invested principally in the ordinary shares of smaller UK companies and UK fixed income securities.
In this webcast, Phil Webster gives an update covering the half yearly report to 30 June 2013. The update will cover a wide range of subjects including performance, a sector breakdown, twenty largest investments and an outlook.
Smaller companies delivered another month of strong returns. The FTSE SmallCap (ex Investment Companies) index rose 3.3% on a total return basis contrary to the fall in the FTSE 100 Index and FTSE 250 Index. The earnings season has kicked off and we are seeing the effects of a slowdown in emerging markets and currencies drag on reported numbers. Whilst we like smaller companies with geographic diversification and developed market exposure there is no doubt it’s harder to access this exposure at the small end of the market cap range. This perhaps explains part of the reason for the outperformance against larger peers although coupled with an improvement in the economic backdrop. The trust's earnings are skewed to the UK and Europe so an improved outlook would be supportive of earnings growth. Whilst this is important we remain focused on company fundamentals which will be the driver of performance.
Turning to the earnings season so far it’s been broadly positive for the trust. Earnings have been in line with expectations although the all-important outlook statements continue to err on the side of caution. Earning growth expectations look high across the board and we wouldn’t be surprised to see the outlook for companies moderate as we go through the year. We have also spoken about extended valuations on a number of occasions and with this in mind we have continued to take profits on strength. We reduced our positions in Wilmington, RPC, and Oxford Instruments. We used the proceeds to add to a few positions. Firstly, we increased the weight in one of our recent introductions Anite. We also increased Victrex pre an upbeat set of results. It’s still early in the cycle for Victrex but their market dominance will come through when markets recover.
There has been no activity in the bond portfolio through the month. Despite the Federal Reserve tapering bond markets have continued to hold firm. Demand for new issuance remains high and with that yields continue to look depressed. The bond commentary is beginning to sound like a broken record but for now we are comfortable with the portfolio. The Preference shares have performed especially the General Accident and Aviva holdings. Both have rallied strongly and are at post financial crisis highs.
In summation we remain comfortable with our positioning. Valuation remains at the forefront of our discussions as we continue to recycle cash out of companies where multiples look high. We are also happy with the earnings season to date with few surprises.