Strategic Equity Capital shares up as it weathers volatile year

(ShareCast News) - Strategic Equity Capital posted its full-year results for the year to 30 June on Wednesday, with net asset value per ordinary share dropping 9% year-on-year to 198.06p.At the same time, the London-listed firm's mid-market share price was 178p, down 22.7% on a year earlier, making for a discount of 10.1% compared to a 5.8% premium at the end of the 2015 financial year.Over the period, the stock averaged a 1% price-to-value premium, compared to a 1.1% discount in the prior year.Looking at performance, Strategic Equity Capital's total return for the year was an 8.7% loss, swinging significantly from a 25.8% return, and its ongoing charges increased slightly to 1.4% from 1.38%.Revenue return per ordinary share was 0.44p, less than half of 2015's 0.99p, though dividend yield was in line with 2015 at 0.4%.The board proposed a final dividend also in line with the prior year, at 0.78p."Despite recent market volatility, the long-term performance of the company remains strong on an absolute and relative basis," said chairman Richard Hills."Over the past three years, the share price total return per share of 73.6% has comfortably exceeded the 30.9% return from the FTSE Small Cap Index while the NAV total return of 59.2% has also been encouraging."Hills said the end of the latest financial year was marked by a sharp increase in market volatility driven by speculation over the likely outcome of the UK referendum, which increased further when the result became known."As well as navigating these issues, the investment manager has been active in working with other stakeholders to help stabilise certain underperforming companies," he explained."The benefits of these initiatives started to come through in the period and we expect this trend to continue."The board pointed out that over the 12 months to 30 June, the company's share price declined by 22.4% on a dividends-reinvested basis, while NAV fell by 8.7% on the same basis and the FTSE Small Cap Index declined by 3.7%."The board and the investment manager believe market conditions are likely to present good long term investment opportunities which the company will be able to capitalise on, particularly given its closed-ended structure," Hills explained.At 0844 BST, shares in Strategic Equity Capital were up 1.41% to 200.28p.