Interim Management Statement

RNS Number : 3332S

New City High Yield Fund Limited

15 May 2009

 



To: RNS

Date: 15 May 2009

From: New City High Yield Fund Limited

Interim Management Statement 

For the Three Month Period from 31 December 2008 to 31 March 2009

Investment Objective

The investment objective of the Company is to provide investors with a high dividend yield and the potential for capital growth by investing mainly in high yielding fixed interest securities. 

Performance Summary

Total Return	For the three month period ended 31 March 2009
Net asset value per share	+2.0%
Ordinary share price	-4.7%

Capital Values	As at  31 March  2009	As at 31 December  2008	% Change
Net assets	£54.7 million	£54.8 million
Net asset value per share	39.27p	39.31p	-0.1%
Share price	39.0p	41.75p	-6.6%
(Discount)/premium	-0.7%	6.2%
Gearing (100 = nil geared position) *	129	129

* Gearing = Total assets ÷ Equity Shareholders' Funds

Review for the Period:

The Global background to the first quarter of 2009 was dire to say the least, with highly volatile equity and currency markets. Commodities too had wide trading ranges. The net result of this was very wide market price spreads and very little liquidity in all markets.

Governments led by the US Treasury's bank bailout plan pumped vast amounts of money into Banks shoring up some very precarious and stressed balance sheets plus the removal of their troubled assets. The Bank of England and US Federal Reserve also introduced 'Quantative Easing' in an attempt to kick start the global economy and provide a boost to the money supply.  Towards the end of the quarter all Risk assets started an impressive rally, most notable in Equities and Commodities. This has continued after the end of the quarter, with leading economic indicators sending positive signals, although we do not have adequate confirmation that an economic recovery has started.  As such, the Company continues to review its gearing strategy and short term borrowing arrangements.

During the quarter to 31 March 2009, the Company invested a further £3.6 million into new and existing holdings. These investments included £1.5 million into First Hydro Finance, and their 9% 31/7/21 bonds. During the quarter, investment realisations totalled £5.7 million which included a partial redemption of Xinhua Finance 10% 21/11/11.  

Dividend:

A second interim dividend for the year to 30 June 2009 of 0.85p per share was paid on 20 February 2009 to shareholders on the register on 30 January 2009.

Top Ten Holdings as at 31 March 2009

Company	Sector	Percentage of total assets
Balfour Beatty 10.75% CCP	Construction	7.7
REA Finance 9.5% 31/12/17	Palm oil	4.8
First Hydro Finance 9% 31/07/21	Financial	3.7
Cable & Wireless 8.625% 25/03/19	Telecom	3.3
Collins Stewart Tullett 8.25% 12/08/14	Financial	3.2
Antares Energy CV 10% 31/10/13	Oil & Gas	3.1
Care First Group 11.8% 30/06/14	Healthcare	2.7
Alliance Pharma 8% CV 31/12/13	Pharmaceuticals	2.5
Iron Mountain 7.25% 15/04/14	Commercial Services	2.2
FMG Finance 9.75% 01/09/13	Mining	2.0
Total		35.2

Analysis of Total Assets as at 31 March 2009

	Percentage of total assets
Bonds	50
Convertibles	24
Cash	15
Preference shares	9
Equities	2
Total	100

Analysis of Investments by Currency as at 31 March 2009

	Percentage of total investments
Sterling	55
Euro	14
Australian Dollar	12
US Dollar	8
Canadian Dollar	6
Norwegian Krone	5
Total	100

Analysis of Investments by Quotation as at 31 March 2009

	Percentage of total investments
Listed/Quoted on a recognised investment exchange	86
Unquoted (convertible into a security quoted on a recognised exchange)	8
Unquoted	6
Total	100

Significant Events or Transactions since 31 March 2009

A third interim dividend for the year to 30 June 2009 of 0.85p per share was declared on 22 April 2009. This dividend is payable to shareholders on the register on 1 May 2009 and will be paid on 29 May 2009.

The Board is not aware of any other significant events or transactions which have occurred since 31 March 2009 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

Further information regarding the Company including the share price and the recent monthly fact sheet, can be found at the Investment Manager's website www.ncim.co.uk 

For further information please contact:

Richard Lockwood or Ian Francis 

New City Investment Managers Limited

020 7201 6900

 

END

 

 

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