In The Media
2 top-performing investment trusts for growth and income
30th September 2017
For investors looking for growth and income from smaller companies, I reckon the Acorn Income Fund (LSE: AIF) deserves a closer look. The fund is a standout performer in the UK small-cap space, boasting some of the best figures across the board.
An investor who had bought shares in the investment trust five years ago would have earned a total return of 176%, a significantly better performance than the FTSE SmallCap (excluding investment companies) benchmark’s total return of 112%.
Dividends and biotech: a blockbuster combination?
14th August 2017
Anyone in doubt about the revitalising effect dividends can have on an investment trust’s share price need only look at International Biotechnology Trust (IBT).
Managers of the £223 million closed-end fund hope it may soon be able to issue shares for the first time in over a decade. That’s because of the apparently enthusiastic response to its proposal last September to start paying shareholders a 4% dividend from capital.
Trust in a third way for returns on biotech | The Times
23rd May 2017
Biotechnology companies tend to come in two types: those like Glaxosmithkline and Astrazeneca that offer investors a good and reliable income, and those that pay no dividends but are attractive prospects for that blockbuster drug that might, or might not, get through the regulatory process.
International Biotechnology Trust’s declares first dividend payment
13th December 2016
We are delighted to inform you that International Biotechnology Trust has today, 13 December 2016, declared the first interim dividend of 11.5p per share. The dividend will be payable to all shareholders on the register at the close of business on Friday 6 January 2017. Please see the RNS for further information.
The intention to pay dividends out of capital was first announced by International Biotechnology Trust on 9 September 2016 and approved by shareholders on 29 September 2016. It is our view that investors will find a dividend attractive in a current environment of generally low and contracting income, both in the equity and the debt markets. With prospects for continued high growth in the biotechnology sector for the foreseeable future we believe that meeting the increasing demand for yield will add to the attractiveness of International Biotechnology Trust as an investment vehicle.
The final dividend is expected to be declared and paid in August 2017. The sum of the interim and final dividend is equivalent to 4 per cent of IBT’s Net Asset Value as at the last day of the preceding financial year (31 August), paid through two equal distributions.
If you have any questions please contact the IBT Team
The good times aren't over for biotech
Biotech trust bargain: New dividend 'set to boost share price
23rd September, 2016
Interview with Laura Suter for the Daily Telegraph
An investment trust focused on profiting from new developments in medicines and science is undergoing a change that could mean the share price is set to rise.
The International Biotechnology trust has net assets of £220m, and is currently trading on a hefty 15.3pc discount to its value.
However, the trust, which invests in the pharmaceutical and biotechnology industry, has just announced that it will begin paying a dividend.
If the plans are approved by shareholders at the end of this month, the investment trust will start paying out a 4pc dividend to investors, in January and August. However, it will not begin investing in assets that pay out an income, but will instead use the investment trust structure to convert the capital returns it sees on its holdings into dividends for investors.
In a statement, SV Life Sciences, the venture capital company behind the trust, said: “It is our view that investors will find a dividend attractive in the current environment of generally low and contracting income, both in the equity and the debt markets.
“With prospects for continued high growth in the biotechnology sector for the foreseeable future we believe that meeting the increasing demand for yield will add to the attractiveness of International Biotechnology Trust as an investment vehicle.”
The trust will also calculate the dividend at the end of each financial year, to ensure that it is not adversely hit by a fall in net asset value.
Simon Elliott, head of investment trust research at Winterflood Securities, said the move is intended to reduce the discount on the trust, by attracting more investors to the fund.
JP Morgan Global Growth and Income investment trust made a similar move in July pledging a dividend of 4pc that it will generate from capital.
Will more investments trusts will make this move?
Mr Elliott says it depends on the success of first-movers such as JP Morgan and International Biotechnology.
“It is very early days. If those that adopt it do see a re-rating and their discounts tighten, then more could follow. If there is no pick-up in demand then they will not try it. But typically trusts with higher yields trade at lower discounts,” he said.
At the same time, the International Biotechnology trust is also changing its investment policy, allowing it to invest in venture capital funds, which invest in companies that are not quoted on stock markets.
Again subject to shareholder approval, it plans to convert its existing 10pc allocation to unquoted investments into a 10pc position in a venture capital fund, also run by SV Life Sciences.
While the fund may be poised to narrow its discount, the biotechnology market remains relatively risky, with many expecting a crackdown if Hillary Clinton becomes the US President. She has already talked about her desire to put pressure on drug pricing, which could have a knock-on effect on the sector.
While Winterflood thinks the fears over a drug price crackdown have been overdone, it does predict this trust could see some volatility in the run-up to election day, which investors would have to withstand.
Stellar biotech trust to pay dividends in strategy rejig
12th September 2016
By Sean Butters for Citywire
International Biotechnology Trust (IBT) has introduced a dividend policy alongside a broadened investment mandate.
Following a period of what the trust board termed ‘strong long-term performance’, a dividend equivalent to 4% of net asset value (NAV) will be paid in semi-annual distributions, pending shareholder approval.
Doctor, analyst... and grand master at the biotech 'slow game of chess'
21st August 2016
By Jeff Prestridge for The Mail on Sunday
Fund boss Carl Harald Janson describes investing in biotechnology companies as akin to playing a ‘slow game of chess’.
He says it is about taking stakes in businesses in the hope that at some stage in the future they will make a big medical breakthrough, catapulting their earnings into the stratosphere.