Results analysis from Kepler Trust Intelligence

Henderson European Trust Plc

12 December 2024

 

Henderson European Trust (HET)

12/12/2024

Results analysis from Kepler Trust Intelligence

Henderson European Trust's (HET) annual results to 30/09/2024 report NAV and share price total returns of 16.6% and 20.5% respectively, outperforming the benchmark, the FTSE World Europe (ex UK) index, which produced a total return of 15.3%.

In July 2024, HET, formerly called Henderson European Focus Trust (HEFT), completed a combination (merger) with stablemate Henderson EuroTrust (HNE). The combined trust was promoted to the FTSE 250 index in July and at the year-end had net assets of c. £664m (2023: £379m). The combination provided both sets of shareholders with a partial exit opportunity and was implemented at no cost to ongoing shareholders, largely due to the exit being at 2% below FAV, and in small part due to a contribution to costs from the manager.

Lead fund manager John Bennett retired during the year after managing the trust (as HEFT) for ten years, and the board is confident that his ex-colleagues and now co-managers Tom O'Hara and Jamie Ross will continue with the same approach to active management.

The last few weeks have seen a general widening of discounts in European equity trusts including HET. This volatility is not limited to European trusts and broadly it appears that investors are worried about the approach that the incoming US administration will take to global trade. This came on the back of market concerns in the run up to October's Autumn budget. The key takeaway for HET investors is that, in the short term, the board has continued with buybacks in response to the discount, and in the medium term HET's portfolio is centred on companies that are global leaders in their fields and, in our view, well-positioned to navigate whatever transpires. As such, we think investor sentiment could rapidly turn around and HET's current discount could provide a good opportunity to acquire this flagship trust at an attractive level.

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