Mercantile Investment Trust PLC on Thursday said net asset value grew in the first half of its financial year, as UK equity markets begin to show signs of recovery.
The London-based investment company focused on medium and smaller sized companies said net asset value per share on July 31 was 276.3 pence, up 20% from 230.5p the year before.
Net asset value total return for the six months ended July 31 was 17.6%, compared to the UK mid & small-cap companies benchmark return of 15.0%.
The company said it was ‘heartening’ to see UK equity markets benefitting from ‘a resurgence in interest’, which was supported by ‘real wage growth and an improvement in business and consumer confidence’.
Mercantile Investment Trust declared a second quarterly dividend of 1.50p per share. This brings the total dividend for the year to 3.00p, up 3.4% from 2.90p last year.
The company also announced on Thursday that Chair Angus Gordon will retire following its 2025 annual general meeting, to be succeeded by Rachel Beagles. Beagles has been a director at the company since 2021, and served as chair of the Association of Investment Companies for three years.
Portfolio Managers Guy Anderson and Anthony Lynch said: ‘We believe we are in the early phases of a potential market recovery, with an improving domestic economic outlook and low valuations of UK-listed assets providing an exciting investment opportunity. We will maintain our focus on investing in structurally robust businesses that operate in growing end markets and possess the ability to invest capital at attractive returns while being able to adapt to the changing environments in which they operate. We believe that a portfolio of companies with these characteristics offers the best prospect of delivering compelling returns and outperformance for our shareholders over the long-term, just as it has done in the past.’
The company is optimistic for further market recovery in the UK for 2024 and beyond.
Shares in Mercantile Investment Trust were up 0.9% at 240.07 pence each in London on Thursday morning.
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