Contrasting fortunes of F&C and Witan in 2018

F&C Investment Trust has reported an NAV total return of -3.3% for 2018, marginally better than its benchmark’s -3.4% return (it uses the All-World Index). Shareholders benefited from a narrowing discount, however and the trust delivered a share price total return of -0.6%. The annual dividend per share was up 5.8% to 11.0p, well above the 2.1% rise in inflation as measured by the Consumer Price Index; and the 48th consecutive annual increase.

By contrast, Witan delivered an NAV return of -8.4%, underperforming its benchmark’s return of -6.5% by 1.9% (it uses a blend of the All-World and All-Share indices). The share price total return was -8.1 %. The good news was that the dividend increased by 11.9% to 23.5 pence, more than double that paid in 2008 and an unbroken run of increases since 1974. A flat performance from Lindsell Train and positive returns from Veritas were offset by poor returns from Artemis and Crux.

F&C has been focused on cutting its running expenses and this year its ongoing charges ratio declined from 0.79% to 0.65%, helped by a switch out of global multi-manager funds portfolio and a new tiered fee arrangement with its manager. Witan’s ongoing charges ratio fell to 0.75% from 0.76%.

For the first time since 2002, no shares were bought back by F&C and the company made its first issue of shares since 1959!.

Witan is proposing to split its shares. Shareholders will receive five shares in place of every share currently held. In addition, the current voting arrangement whereby shareholders have one vote for every four shares held will be replaced by one vote for each new share. The stated intention is to make Witan’s shares more accessible, particularly for those making regular savings or reinvesting dividends. However, Witan will be closing the Witan Wisdom and Jump savings plans in May 2019 and is offering planholders the choice between a transfer to Hargreaves Lansdown, a move to the investor’s preferred platform, a transfer to the main register or closure.

The AGMs are at the same venue – Merchant Taylor’s Hall in the City but one day apart. Details of Witan’s AGM are here and F&C’s here.

WTAN / FCIT : Contrasting fortunes of F&C and Witan in 2018


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