(Alliance News) - Scottish American Investment Co PLC on Friday lifted its interim dividend as its first half stayed in line with its global equities benchmarks.
The Edinburgh-based trust managed by Baillie Gifford reported a net asset value total return of 11.3% in the first half that ended June 30.
That was marginally behind the 11.4% returned by global equities measured by the FTSE All-World Index but slightly above the 10.6% return for the Global Equity Income sector.
Shares in Scottish American were trading down 0.4% at 507.00 pence each in London on Friday morning, in line with the wider FTSE 250 index, which was down 0.6%.
The investment trust said its property portfolio outperformed its overall results, delivering a 12.9% return.
A significant contributor was the sale of its largest holding - a data centre in Milton Keynes - at a large premium to its book value, the company said.
However, according to Scottish American the "main driver" of total returns was its global equity portfolio, which provided an 11.0% total return in the first half, as economic confidence continued following the pandemic.
Major contributors included two logistics holdings, UPS and Kuehne + Nagel Int AG, the trust said.
"Both companies benefited from the rapid rebound in global trade, as companies sought to respond to pent-up consumer demand," the company added.
Scottish American's net assets jumped 35% to GBP845.8 million in the first half from GBP624.5 million a year prior. Half-on-half, net assets rose 16% from GBP721.2 million.
Net asset value per ordinary share hit 492.4p at June 30, up 9.5% from 449.7p at the end of 2020 and up 21% year-on-year from 405.9p.
Meanwhile, net return before finance costs and tax reached GBP85.2 million in the first half, up sharply from GBP11.0 million the previous year.
Amid the largely positive interim results, the trust issued a second interim dividend of 3.075p. Taken with the first interim dividend, its total payout for the period reached 6.125p, up 2.1% from 6.00p a year before.
Consumer demand is expected to recover in the second half, the company said, although inflation remains of concern.
Scottish American said: "The best defence [against inflation] is likely to be investing in companies where, due to strong underlying demand for their superior products and services, profit and dividend growth is likely to run significantly ahead of whatever the [consumer price index] figure might be."
"Finding these companies continues to be our focus, and to us it seems that the opportunity set is only getting larger and more exciting," the trust added.
By Scarlett Butler; scarlettbutler@alliancenews.com
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