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(Alliance News) - Mercantile Investment Trust PLC on Tuesday reported a lower net asset value in the financial year that ended on January 31, noting Russia's war in Ukraine and resulting higher inflation amid pressures on energy and commodity markets.
The London-based investment company focused on medium and smaller sized companies in the UK said NAV per share at January 31 fell 15% to 236.1 pence from 277.7p a year prior.
Total return was negative 11%, underperforming against its benchmark, UK medium and smaller companies, which returned negative 7.5%.
Mercantile Investment declared a final dividend of 3.1p per share, up 8.8% from 2.85p a year ago. This brings the total dividend to 7.15p, up 3.6% from 6.9p.
Looking ahead, Chair Angus Lennox said: "Although the tragic war in Ukraine drags on, its impact on energy and commodity prices is beginning to ease. There are signs that inflation may be peaking, and while central banks are unlikely to begin easing monetary policy any time soon, interest rates may stabilise, while monetary authorities take time to assess the medium-term inflation outlook.
"In addition, forecasts suggest that the UK economy, will, at worst, experience a mild recession this year. Furthermore, the UK's political climate has calmed considerably, with an improvement in relations with the EU and a new Pan Pacific trade agreement. The potential for UK companies to increase business is encouraging."
Mercantile Investment Trust shares were 0.5% higher at 199.10 pence each in London on Tuesday morning.
By Tom Budszus, Alliance News reporter
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