Caledonia Investments full year NAV jumps

Caledonia Investments increased net asset value, after strong gains across its investment portfolio, but noted that markets will be left vulnerable as quantitative easing measures are wound down.

Caledonia Investments increased net asset value, after strong gains across its investment portfolio, but noted that markets will be left vulnerable as quantitative easing measures are wound down.

The FTSE 250 international investment trust said net asset value per share total return rose to 18.9% from minus 7.0% a year earlier.

Pre-tax profit stood at £201.9m compared to a loss of £95.6m while revenue increased to £39.4m from £33.3m the last time.

Net asset value per share climbed to 2299p from 1977p before.

Chief Executive Will Wyatt said: "This has been a strong year for the company, in which our shareholders have seen a 19% total return, capping a 202% return since we became an investment trust ten years ago."

"The actions we have taken over the last three years have ensured that we have a balanced portfolio tailored to our shareholders' requirements and capable of delivering long term outperformance in the current macroeconomic environment."

Commenting on the economic outlook, Caledonia added: "Economic growth in developed markets is proving to be slower than governments would like, but in response central banks globally are cutting rates to historically low levels to stimulate growth, though with modest success."

"Thus a degree of stability has been created to allow time to deal with structural problems. Central bank initiatives via QE are driving holders of cash to reinvest in risk assets due to negligible bank interest rates, which leave markets vulnerable to the eventual withdrawal of QE stimulus."

Caledonia noted that inflation remains the key risk that could derail current stimulus efforts, though is probably some way off.

Otherwise it said markets are currently responding positively to policy initiatives, but "clearly remain vulnerable unless economic growth gains traction in the coming year."

The company has recommended a 10% increase in its annual dividend to 47.2p per share.

CJ

Recommended

Avoid easyJet shares – there are better airlines to invest in
Share tips

Avoid easyJet shares – there are better airlines to invest in

EasyJet used to be one of Europe’s most impressive airlines. But now it is facing challenges on all fronts and losing out to the competition. Rupert …
16 May 2022
Britain’s ten most-hated shares – w/e 13 May
Stocks and shares

Britain’s ten most-hated shares – w/e 13 May

Rupert Hargreaves looks at Britain's ten-most hated shares, and what short-sellers are looking right now.
16 May 2022
Anna Macdonald and Mikhail Zverev: Investing in innovative new frontiers
Investment strategy

Anna Macdonald and Mikhail Zverev: Investing in innovative new frontiers

Merryn talks to Anna Macdonald and Mikhail Zverev of Amati about investing in growth-focused innovation in the teeth of a tech-stock selloff, and the …
12 May 2022
BT is making progress and the dividend is back – but is it time to buy yet?
Share tips

BT is making progress and the dividend is back – but is it time to buy yet?

Investors in telecoms giant BT have seen dismal returns over the last 15 years. But there are signs that it is starting to turn things around, says Ru…
12 May 2022

Most Popular

Get set for another debt binge as real interest rates fall
UK Economy

Get set for another debt binge as real interest rates fall

Despite the fuss about rising interest rates, they’re falling in real terms. That will blow up a wild bubble, says Matthew Lynn.
15 May 2022
High inflation will fade – here’s why
Inflation

High inflation will fade – here’s why

Many people expect high inflation to persist for a long time. But that might not be true, says Max King. Inflation may fall faster than expected – and…
13 May 2022
What the Ukraine crisis might mean for ESG investing
Advertisement Feature

What the Ukraine crisis might mean for ESG investing

The Ukraine crisis has brought many of the issues around ESG investing into sharper focus. Where does the sector go from here?
3 May 2022