Interim Management Statement

RNS Number : 2479S

Acorn Income Fund Ld

16 November 2011

 



ACORN INCOME FUND LIMITED (the "Company")

Interim Management Statement for the period 1 July 2011 to 16 November 2011 ("the Period").

Investment Objectives and Policy

The objectives of the Company are to provide the Company's shareholders with a high income and also the opportunity for capital growth.

The Company's portfolio is invested in equities and high income and fixed interest securities in order to achieve its investment objectives.  It is the aim of the Company to provide both income and capital growth predominantly through investment of approximately 70% of the portfolio in smaller capitalised United Kingdom companies, admitted to the Official List of the United Kingdom Listing Authority and traded on the London Stock Exchange or traded on AIM; and by investing approximately 30% of its assets in high yielding securities which will be predominantly fixed interest securities (including corporate bonds, preference and permanent interest bearing shares, convertible and reverse convertible bonds and debentures) but may include up to 15% of the portfolio (measured at the time of acquisition) in high yielding investment company shares.

Financial Highlights

	30 June 2011	31 October 2011	% change or return
Ordinary share NAV	224.90p	192.13p	-14.57%
Ordinary share mid price	200.50p	161.00p	-19.70%
Total return on Gross Assets (adjusted for debt repayment)			-10.59%
Hoare Govett Smaller Companies Index (ex Investment Companies) - total return	10,342	9,217.90	-10.87%

Material Events and Transactions

During the period the smaller companies portfolio holdings in Berensden, Acal and Phoenix IT were increased while the holdings in RPC and Spirax Sarco were partially reduced. The entire holding in Laird Group was sold following failed bid talks. Renishaw and Acal underperformed during the period as investors focused on Europe's economic problems. British Polythene was the largest riser as raw material prices fell with profits likely to grow. The company also benefited from the closure of an EU competition investigation.

During the period from 1 July 2011 concerns escalated over sovereign debt levels in Europe and the implications for the future of the euro.  Risk aversion increased and credit spreads widened. Both senior and subordinated financials led in this widening. The income portfolio is overweight in financials as our managers believe that current yields on financial bonds offer a very attractive investment opportunity over the medium to long term.

On the 27 October 2011 the Directors of the Company announced that they are contemplating a potential issue of non-equity securities such as Zero Dividend Preference Shares to replace the borrowing facilities which are due to expire in February 2012 and to increase the gross assets.

Issued share capital of the Company:

With effect from 31 October 2011, the issued share capital of the Company was 8,939,790 Ordinary Shares (including 215,000 Ordinary Shares held in Treasury).

Dividends

The Company announced an interim dividend on 16 November 2011 of 1.75 pence per share, which is to be paid on 23 December 2011.  

Largest holdings (% of Gross Assets) as at 31 October 2011

Smaller Companies Portfolio	%
RPC Group PLC	6.06%
James Halstead PLC	4.95%
Castings PLC	4.65%
VP PLC	3.94%
Diploma PLC	3.53%
Devro PLC	3.46%
Stobart Group LTD	3.45%
Lupus Capital PLC	3.44%
Consort Megical PLC	3.41%
Fenner PLC	3.37%
Income  Portfolio
LBG Capital No.1 PLC	1.37%
Standard Life UK	1.17%
Invesco Leveraged High Yield	1.16%
Greenwich Loan Income Fund Limited	1.06%
ICAP Group Holdings PLC	0.98%
Electra Private Equity	0.92%
ECOFIN WTR & PWR Opportunities	0.90%
ING BANK NV	0.85%
Credit Suisse	0.82%
HSBC Holdings PLC	0.41%
Cash	4.17%

For further information contact:

Premier Fund Managers Limited

Investment Adviser

Tel: [phone]

Anson Fund Managers Limited

Secretary

Tel: [phone]

A copy of the document can be found at : http://www.anson-group.com/P12.pdf

16 November 2011

E&OE - in transmission

 

END

 

 

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