LONDON (Alliance News) - The Scottish American Investment Co said Thursday it saw a strong net asset value return in 2016, as it raised its dividend slightly.
Scottish American, which is managed by Edinburgh-based fund manager Baillie Gifford, reported a net asset value total return of 29.9% in 2016. Scottish American noted this was slightly ahead of a benchmark global equities index return of 29.6%.
Scottish American's net asset value per share in fair value terms stood at 309.30 pence at December 31, up from 247.50p at the same date in 2015. Net assets as a whole rose to GBP431.6 million from GBP348.5 million.
Shares in Scottish American Investment were broadly flat at 326.12p Thursday morning.
Earnings per share for 2016 totalled 10.54p, slightly up from 10.47p in 2015.
The company recommended a final dividend of 2.725p, bringing its full-year dividend to 10.825p. This is 1.2% ahead of the 10.70p dividend the prior year. Scottish American noted this means it has raised its dividend for 37 consecutive years, although the dividend was not fully covered this year.
"In recent years the company has effected a significant shift in its allocation away from fixed income investments and towards 'real assets' where income is expected to grow in the future. Your board is confident that this growth will permit both further increases in the company's dividend and a return to a fully covered dividend," said Peter Moon, chairman of Scottish American.
"In the meantime, in an environment where increases in interest rates are increasingly likely, the marked reduction in exposure to fixed income investments should be helpful to total returns," added Moon.
By Adam Clark; adamclark@alliancenews.com
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