Cheaper gearing supports Brunner’s share price returns

Lucy Macdonald has managed Brunner’s overseas portfolio since 2005. Last year, she favoured firms that had digitalised their business models, such as Estée Lauder and United Health.

The Brunner Investment Trust (BUT) is managed by Allianz Global Investors. It o­ffers a one-stop shop for investors looking for a global portfolio of equities and a quarterly dividend. Its annual report for the year to 30 November 2017 shows shareholders’ assets of £318 million.

Lucy Macdonald, AGI’s chief investment officer for global equities, has managed Brunner’s overseas portfolio since 2005. Macdonald has concentrated Brunner’s portfolio down to her 74 best global ideas. She looks for quality companies o­ffering attractive growth. Last year, she favoured firms that had digitalised their business models, such as Estée Lauder and United Health.

At the end of November, North America accounted for 36 per cent of the portfolio, the UK 31 per cent, Europe 21 per cent, and Japan and Asia Pacific 10.9 per cent.

The January 2018 repayment of an expensive £18.2 million stepped-rate debenture reduced interest costs by £2.04 million. Since then the board has repaid a £30 million debenture due to mature in 2023, replacing part of it with much lower-cost debt. Both moves should boost earnings growth.

The net asset value (NAV) total returns last year were 19.5 per cent, compared with a gain of 15.1 per cent from Brunner’s composite benchmark of 70 per cent FTSE World ex UK and 30 per cent FTSE All-Share indices.

With the discount tightening, share price total returns were 35.4 per cent. The dividend was raised by 4.4 per cent to 16.5p, the 46th consecutive annual increase.

Visit brunner.co.uk

A graph for Brunner Investment Trust

 

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