Publication of monthly factsheet

RNS Number : 9124V

UIL Limited

12 August 2022

 

12 August 2022

UIL LIMITED

(LEI Number: 213800CTZ7TEIE7YM468)

Publication of monthly factsheet

The latest monthly factsheet for UIL Limited ("UIL" or the "Company") will shortly be available through the Company's website at:

https://www.uil.limited/investor-relations/factsheet-archive

Monthly commentary

PERFORMANCE

UIL's NAV total return was up slightly by 0.8% for the month, underperforming the FTSE All Share total return Index which was up by 4.4% over the same period.

During July, the majority of global equity markets saw a rebound as the US Federal Reserve indicated that the pace of policy tightening that has been witnessed recently may relent from here, implying that interest rate cuts could be on the horizon in 2023. This anticipated pivotal change in policy arose as the US reported a second quarter of negative GDP growth of 0.9% implying that the US is technically in recession, albeit the strong labour market means that it is unlikely to be formally declared. Nevertheless, strong inflationary pressures remain with the US in July reporting a consumer price index increase of 9.1%.

The change in direction of the Federal Reserve's interest rate policy supported growth assets, helping the S&P Index increase by 9.1% in July and supported the Eurozone which saw the Eurostoxx up by 7.3%, the CAC 40 up by 8.9% and the DAX Index up by 5.5%. The European Central Bank during July did increase interest rates more than expected by 50bps, taking the eurozone out of negative rates.

Heightened concerns remain over energy supplies within Europe as Nord Stream 1 pipeline (a pipeline that supplies gas from Russia to Germany), which was closed for maintenance, did re-open during July but at reduced capacity. July also witnessed the collapse of the Italian government, with Mario Draghi resigning following the failure of his national unity government. The UK also saw the end of Boris Johnson as Prime Minister, triggering a leadership contest.

The Chinese market was one of the outliers in July with the Shanghai Composite down by 4.3% and the Hang Seng Index was down by 7.8%. President Xi's zero tolerance Covid-19 policy continued to dampen the markets as the spread of the Omicron variant resulted in tight new covid lockdown measures being implemented across several cities. Concerns around the property sector also continued to increase, whilst economic data published in July was mixed with 2Q GDP expanding at its slowest rate since 2020 at 0.4% year on year, yet June's exports data reported 17.9% growth year on year.

Sterling performance in July was mixed, appreciating by 2.7% against the Euro and marginally up against the US Dollar by 0.2%, but depreciated by 1.3% against the Australian Dollar and 0.4% against the Brazilian Real.

The Brent Crude oil price continued to give up some of the gains witnessed earlier in the year, ending July at USD 110.01, a decline of 4.2% for the month with copper also declining by 3.8%. Gold declined by 2.3%, ending the month at USD 1,765.94/oz.

PORTFOLIO

There was one change to the top ten constituents in July with Carebook Technologies replacing Starpharma, on the back of Starpharma's weaker share price performance. Carebook is a Canadian healthcare software company that provides digital health solutions and virtual care for pharmacies, insurance providers, governments, and businesses.

Somers' valuation increased by 7.7%, primarily due to a 15.7% increase in Resimac's share price, its largest holding. Zeta's share price declined by 19.7% during the month as a result of weakening commodity prices whilst UEM's NAV increased marginally, and its share price remained the same. Resolute Mining's share price rose by 22.2%, Panoramic Resources' share price was down by 2.6% and AssetCo's share price was down by 11.1% for the month of July.

Somers announced on 8 July 2022 that its board of Directors was recommending the offer by SNB Investments (of which UIL is a major shareholder) to acquire all of the Somers' shares that the SNB shareholders do not own. Somers' shareholders voted in favour of the offer at the Special General Meeting on 20 July 2022 and the merger with SNB Investments Limited has now completed.

Purchases during the month for the portfolio totalled £4.5m and realisations amounted to £8.9m.

DEBT

The bank debt positions in July remained marginally the same and the facility was drawn as AUD 33.5m, USD 26.3m and EUR 10.4m with the liability in Sterling terms reducing from £51.1m at the end of June to £49.6m as at 31 July 2022.

For July, the foreign exchange hedge positions for the Australian Dollar and Euros was unchanged at AUD 52.1m and EUR 9.0m. The CAD 27.5m was reduced from CAD 44.3m as at 30 June 2022.

OTHER

UIL's ordinary share price decreased by 2.4% to 183.00p. The discount to NAV was 30.4% as at 31 July 2022.

The share price of the 2022 ZDP shares was unchanged. The share price of the 2024 ZDP shares was up slightly by 0.4%, and the share prices of the 2026 and 2028 ZDP shares were down 0.9% and 2.0% respectively.

Name of contact and telephone number for enquiries:

Charles Jillings

ICM Investment Management Limited  [phone]

 

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