Alliance Trust equity portfolio outperforms market

Katherine Garrett-Cox hailed 'pretty strong set of results'. Picture: Contributed
Katherine Garrett-Cox hailed 'pretty strong set of results'. Picture: Contributed
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Alliance Trust boss Katherine Garrett-Cox yesterday said the fund is making moves to ditch its “boring” reputation after its equity portfolio outperformed the market.

Garrett-Cox hailed the Dundee-based firm’s half-year performance, as its report for the six months to 30 June showed its equity investments enjoyed growth of 14.5 per cent.

Garrett-Cox said: “This [is] a pretty strong set of results after coming to the market with a decent full year a few months ago.”

The firm has focused its equity portfolio, reducing the number of direct equity holdings from 200 to just over 110.

She added that it was “quite helpful” that the £2.5 billion trust has also reduced its exposure to UK companies in favour of US-based firms where economic recovery is thought to be moving at a faster pace. Holdings include Viagra maker Pfizer and Walt Disney.

She confirmed that since the end of June, the company has seen investors pump an extra £300 million into its Alliance Trust Savings subsidiary bringing assets under management near to £5bn. Alliance Trust said the savings business generated an operating profit before tax from continuing operations of £200,000 in the first half of the year, confirming expectation the business is on track to become profitable this year.

It added that it was sticking to its progressive dividend policy, with the ordinary payout for the year expected to rise “by at least 3 per cent to 9.5p per share”.

Garrett-Cox said: “It is all about outperformance from here. For many years we have dealt with a barrage of criticism that we were boring, we were underperforming, we were complicated.

“We are now exciting, we are outperforming and we are very simple and transparent.”