(Alliance News) - Utilico Emerging Markets Trust PLC on Friday said its net asset value declined in its most recent financial year as the Covid-19 pandemic proved especially fraught for emerging markets.
Shares in Utilico Emerging Markets were up 1.9% at 182.38 pence in London in afternoon trading.
The emerging markets investor reported a NAV per share of 181.84p as at March 31, the end of its financial year. This represents a 27% fall from the previous year's NAV per share of 249.84p.
Investment Manager Charles Jillings said: "Emerging Markets saw an unprecedented and tumultuous final three months in the year to 31 March 2020. With countries representing nearly 90% of global GDP under lockdown, markets were stressed and virtually all asset classes, whether it be equities, commodities, currencies or debt, were in decline. The impact of Covid-19 has been very disruptive to normal life and the markets reflected this concern. Equity markets retreated from highs in February to lows in March at a rate that has been rarely seen.
"The US led the way lower, however, EM markets then retreated faster and further reflecting a risk-off bias, with most EM indices in negative territory. A notable exception was China where markets remained stable following significant government intervention."
The company increased its dividend per share for the year by 5.2% to 7.575 pence from 7.200p.
Chair John Rennocks said: "Despite market valuations having deteriorated sharply due to the impact of Covid-19, no [Utilico Emerging Markets] investee company has needed or is expected to require restructuring or refinancing. UEM's portfolio remains predominantly invested in relatively liquid, cash-generative companies with long-duration assets that the company's investment managers believe are structurally undervalued and offer excellent total returns.
"Although the outlook for the world is challenging and there is more uncertainty around business strategies, our Investment Managers look with optimism at the compelling opportunities that will undoubtably occur to add more resilient investments to the portfolio."
By Anna Farley; annafarley@alliancenews.com
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Utilico Emerging Markets (UEM)