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The Company currently conducts its affairs so that securities issued by Shires Income PLC can be recommended by financial advisers to ordinary retail investors in accordance with the FCA’s rules in relation to non-mainstream pooled investment products (NMPIs) and intends to continue to do so for the foreseeable future.
The Company’s securities are excluded from the FCA’s restrictions which apply to non-mainstream investment products because they are securities in an investment trust.
The Alternative Investment Fund Manager Directive (“AIFMD”) requires Aberdeen Fund Managers Limited, as the alternative investment fund manager of Shires Income PLC, to make available to investors certain information prior to such investors’ investment in the Company.
The AIFMD is intended to offer increased protection to investors in investment products that do not fall under the existing European Union regime for regulation of investment products known as “UCITS”.
The value of investments and the income from them may go down as well as up and investors may get back less than the amount invested. The tax benefits relating to ISA investments may not be maintained. Please refer to the Key Facts documents contained in the ISA/Share Plan Brochure & Application form for general and specific investment risks attaching to the individual trusts.Read the detailed Risk Warning
Past performance is not a guide to future results.
See latest monthly factsheet below for performance history.
At close 25-Nov-2014Ord
|Net Dividend Yield||4.76%|
Source: Morningstar, NAV = Net Asset Value, excluding income.
Bow Bells House
One Bread Street
Registered in England as an Investment Company Number 386561
To provide for shareholders a high level of income, together with growth of both income and capital from a portfolio of investments substantially invested in UK Equities
In this webcast, Ed Beal gives an update on a wide range of subjects including performance, a sector breakdown, the largest investments and an outlook for the Trust.
Equities declined during October, though the fall of 0.7% on a total return basis masks much greater volatility during the month. What caused the sell off in the early part of the month is unclear. However, an announcement from the Bank of Japan that they were going to extend their stimulus package served to re ignite investors’ appetite for equities. Meanwhile, in the US the recovery was on-going and the Federal Reserve felt able to terminate its asset purchase programme. This was at odds with what was being seen in Europe where deflation remained a threat, the weakness of the recovery was spreading to Germany and the ECB was disappointing investors by not giving them more clarity on the likely scale of their intended asset purchases. There was some good news in the region as the authorities concluded their Asset Quality Review. 80% of the region’s banks passed the test and in reality the results were better than that because a number of the troubled institutions had already raised some of the additional capital they will require. A number of the companies in the portfolio experienced difficulties during the month. In many cases these were the continuation of problems that were already at least partially known.
Standard Chartered announced a pick up in impairment charges as some clients were impacted by weakening commodity prices. We believe that their problems are resolvable. They have already announced a $400m cost saving plan. Additional detail will be provided in due course. In the meantime we note that it retains its unique positioning as an emerging markets focused lender, benefitting from significant barriers. It is also now, trading below book value.
Rolls-Royce announced a weak trading update, noting weakness in their Energy and Power Systems divisions. They cited delays and cancellations arising as a result of the tough economic conditions. This caused expectations for this year and next to be revised downwards. One positive is that aerospace defence, which had been the cause of the profit warning earlier in the year is now looking a little better. Whilst disappointing, we remain of the view that the long term opportunity that results from the after-market work they will secure on their growing installed base, especially of aerospace engines, remains intact. Tesco's travails are well known. Their recent accounting irregularities were a problem of their own making and the Chairman has subsequently stepped down. The new CEO has stated that he will release the results of his strategic review in the early part of 2015. In the shorter term he has made it clear that the company will seek to return to the foundations of its previous success. Namely by providing the customer with what they actually want. BG’s third quarter updates indicated that although Brazilian production was up, Egypt and Kazakhstan had been more disappointing. The decline in the oil price was also unhelpful, whilst LNG profits declined due to high spot purchase prices. A new CEO, Helge Lund, has been recruited from Statoil.
There was limited activity in the portfolio during the month. We topped up our holding in Schroders and took advantage of weakness in some share prices to sell some puts. These included Sage, Experian and Centrica.
With Central Banks around the world taking different paths investors are focussing on the expected actions of the ECB. Some form of stimulus package is expected. There is therefore the potential for disappointment in the event that the quantum or timing of stimulus fails to meet expectations. Companies across a range of industries are finding life tough. Growth is hard to secure and is often reduced by the impact of foreign exchange on the translation of results. The lower oil price will provide support for the global economy but the challenges of a weak Europe and slowing China are sizable obstacles. We continue to believe that our investments are well positioned to prosper over the long term but the short term outlook is more difficult to divine.