Capital Gearing Trust PLC on Wednesday said its market capitalisation is now less than £1.0 billion, due to a ‘significant increase’ in share buybacks during the first half of its current financial year.

Capital Gearing Trust is a Belfast-based investment trust that targets long-term growth in shareholders’ assets by investing in a range of commodities, equities and bonds.

The group said its market capitalisation had reduced 6.9% by September 30, to £959.0 million from £1.03 billion on March 31. This was a result of ‘the significant increase in buybacks, reflecting the operation of the [discount control policy]’.

Shares in Capital Gearing Trust were up 0.1% at 4,760.00 pence each in London on Wednesday morning.

Chair Jean Matterson said: ‘The operation of the DCP insulates shareholders from the reduced secondary market liquidity often associated with smaller trusts and puts the company in a strong position to grow again as shareholder sentiment improves.

‘The board has recently completed a review of the company’s investment remit and concluded that it remains appropriate and that the company represents a compelling investment vehicle for those seeking to preserve and, over time, grow real wealth over the medium term.

‘Our investment managers consider the preservation of wealth to be a central objective and view the medium-term outlook with caution. This comes not only from the many geopolitical concerns that surround us, but the threat from persistent inflation impacting interest rates and economic growth both here and abroad. While this makes for a challenging time, our investment managers will, as always, be alert to market opportunities as and when they arise.’

Net asset value total return for the six months that ended September 30 was 2.4%, compared to the consumer price index return of 0.9%. NAV per share on September 30 was 4,847.70 pence, up 0.8% from 4,810.50p on March 31.

The company does not have a formal benchmark but uses the CPI as a relative measure over the medium to longer term.

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