Foreign and Colonial Investment Trust announced today its 47th consecutive annual dividend increase, with a dividend having been paid to shareholders in each of its 150 years since the firm was founded in 1868.
The proposed annual dividend for the year is 10.4 pence per share, an increase of 5.6% on the previous year. Subject to shareholder approval, a final dividend of 2.7 pence per share will be paid on 1 May.
With a share price total return of 21%, the company managed to outperform the 13.8% return from its benchmark index, the FTSE All-World index. The net asset value (NAV) total return for the year was 16.9%*. The Board looks to the longer term and over a 10-year period the share price total return for the company is 156.1%, the equivalent to 9.9% per annum, while over 20 years it is 453.4%, or 8.9% per annum.
Commenting on the results, Paul Niven, fund manager of Foreign and Colonial Investment Trust, said “The global economy entered 2017 with modest positive momentum. Importantly, recent quarters have seen the recovery gain breadth such that a synchronised upturn in corporate earnings across major regions was delivered for the first time since 2010. This improvement in corporate earnings, combined with low inflation and interest rates, has supported equity markets after a period of patchy performance and general rise in market valuations. It is encouraging to note that growth globally is not restricted to a particular region or single economic powerhouse.
“The bullish earnings and growth backdrop looks set to continue into 2018. There is little, at present, to suggest a material slowdown in the overall growth trajectory in the global economy. Indeed, financial indicators suggest strong momentum continuing for the next twelve months, reflecting still supportive monetary and credit conditions. Barring some shock, it now looks more likely than not that the US economic cycle will extend to the longest on record, into 2019.”
Chairman Simon Fraser commented: “It is remarkable to think that the original purpose of Foreign & Colonial Investment Trust has remained relevant throughout its long history. Indeed, the investment trust that launched an industry is as relevant today as it ever was.”