Interim Management Statement

RNS Number : 0641A

British Assets Trust PLC

25 January 2011

 



British Assets Trust plc

Interim Management Statement

For the Period from 1 October 2010 to 25 January 2011

Investment Objective

British Assets Trust plc aims to achieve a total return in excess of a composite index, weighted as to 75 per cent FTSE All-Share Index and 25 per cent FTSE World (ex UK) Index, by investing principally in a diversified international portfolio of equities and equity-related securities.  Within this overall objective, the Company aims to maintain a progressive dividend policy which will be dependent upon, inter alia, the rate of revenue growth within the investment portfolio, and the level of dividend cover.

Performance Summary

Total Return1		Three months to 31/12/10
Net asset value		+8.6%
Composite index2		+8.0%
Capital Values	As at  31/12/10	As at  30/09/10
Net asset value	139.2p	129.8p
Share price (mid market)	135.3p	125.5p
Premium/(discount)  - Basic  - Debt adjusted	(2.8)% 0.6%	(3.3)% (1.1)%
Gearing  - Net of cash3  - Equity gearing 4	18.6% 5.2%	21.0% 6.2%

Sources: F&C Investment Business Limited, Datastream.

¹           All total returns are based on net dividends re-invested

²           Composite Index of 75 per cent FTSE All-Share Index and 25 per cent FTSE World (ex UK) Index

³           Gearing net of cash: (investments-shareholders' funds)/shareholders' funds

⁴           Equity gearing: (equity investments-shareholders' funds)/shareholders' funds

Review for the Period

The Company's net asset value total return for the three months ended 31 December 2010 was 8.6%. This compares favourably with a return of 8.0% from the composite benchmark index of 75% FTSE All-Share Index and 25% FTSE World (ex UK) Index.

During the quarter, equities significantly outperformed bonds as investors favoured risk assets. Stock selection and gearing contributed positively to performance.

Stock markets made good progress during the quarter, buoyed by improving economic news and positive corporate profit statements. Markets rallied strongly in December following a setback in November, when the sovereign debt crisis in the peripheral European countries took centre stage culminating in Ireland requesting financial assistance following weeks of turbulence and speculation.

UK stocks made good gains as growth stocks, particularly in commodity-related sectors, performed well. Despite concerns over the impact of the Government's austerity programme, there was encouraging news on the economy.

US stocks enjoyed a strong quarter as the authorities moved to inject further funds into the system to boost employment and head off deflation, buoying investor sentiment.  European equity markets lagged as concerns increased about a renewed financial crisis in the eurozone.

Emerging market equities posted good returns over the quarter but underperformed developed markets, as larger markets such as China, Brazil and India were relatively weak. The Company remains overweight emerging markets where the strong growth prospects suggest that they should continue to perform well.

Dividends

A third interim dividend in respect of the year ended 30 September 2010, of 1.442p per share, was paid on 8 October 2010. A final dividend for the year, of 1.786p per share, was paid on 7 January 2011.

Top Ten Holdings as at 31/12/10

Company	Country	% of total assets
Rio Tinto	UK		4.5
Vodafone Group	UK		3.8
GlaxoSmithKline	UK		3.6
BP	UK		3.5
Royal Dutch Shell	UK		3.3
HSBC Holdings	UK		3.1
British American Tobacco	UK		2.7
Tesco	UK		2.2
Scottish and Southern Energy	UK		2.1
Standard Chartered	UK		1.7
Total			30.5

Geographical Analysis as at 31/12/10

			%of total assets
UK				61.6
Global Developed (ex UK) Markets				14.4
Emerging Markets				10.6
Corporate Bonds				11.0
Net Current Assets				2.4
Total				100.0

The Board is not aware of any significant events or transactions which have occurred since 31 December 2010 and the date of publication of this statement which would have a material impact on the financial position of the Company.

Daily and Key Information

This statement and further information regarding the Company, including daily net asset values published since the end of the period and monthly factsheets, can be found at the Company's website www.british-assets.co.uk, or at www.fandc.com.

For further information please contact:

Julie Dent/Gordon Hay Smith

F&C Investment Business Limited

Tel: [phone]

 

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