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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 pooled investment products (NMPIs) 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 Alternative Investment Fund Manager Directive (“AIFMD”) requires Aberdeen Fund Managers Limited, as the alternative investment fund manager of Aberdeen Smaller Companies High Income Trust PLC, to make available to investors certain information prior to such investors’ investment in the Company.
The AIFMD is intended to offer increased protection to investors in investment products that do not fall under the existing European Union regime for regulation of investment products known as “UCITS”.
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 25-Nov-2014Ord
|Net Dividend Yield||3.54%|
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 2014. The update will cover a wide range of subjects including performance, a sector breakdown, twenty largest investments and an outlook.
The FTSE SmallCap (ex Investment Companies) Index fell 2% in October on a total return basis. This was a decent outcome after markets sold off sharply in the first half of the month before rebounding into the month end. The Trust outperformed over the period and is benefitting from our investment in quality companies and a positive return from the bond portfolio. It is pleasing to see us outperform through a period of heightened volatility with downside protection at the forefront of our thoughts.
We are in the midst of third-quarter earnings season and we are encouraged that performance has been broadly stable with earnings in line with expectations. The oil & gas sector has been under particular pressure with the weakening oil price but also activity levels have been weaker of late across some regions. Aveva, held at 1.5% in the fund, has seen the effects of some specific market weakness in Brazil and Korea. The former saw contracts delayed by Petrobras during the elections whilst Korean shipyards sales fell against a strong comparative period. Aveva is a quality company and with a net cash balance sheet we have increased our position on weakness. More positively we have seen some strong performances from companies we have been adding to including RPC, Devro and Dignity. The equity portfolio has a period of weakness where some of the larger holdings faced some headwinds but this has reversed of late aiding the outperformance that we have delivered. This is over a short time period but I’ve also been encouraged by meetings with the majority of the portfolio over the last six months where trading has remained broadly positive. This has to be seen against a tough backdrop and with returns hard won at the moment low single digit growth in revenue is a decent outcome.
Through this more volatile period we have been more active than usual as opportunities have presented themselves. We have added to RPC and Oxford Instruments. We continue to focus on valuations and with this in mind have reduced Bellway, Greggs, BBA and Close Brothers having performed well over the last year and with valuations looking fuller. The bond portfolio has seen no changes although we are actively monitoring a number of additions but as a more broad comment we are struggling to find value and attractive yields without lowering our quality hurdle.
Whilst we are experiencing a more volatile period we are encouraged by the performance of the companies. We have seen pressure on earnings growth but valuations are looking more attractive and a number of companies that we are monitoring are more appropriately valued against underlying growth. Downside protection remains our focus but we feel valuations are reflecting a lot of these concerns so remain positive on the medium term outlook.