The Scottish Investment Trust invests in global equities for above-average long-term returns and dividend growth ahead of UK inflation.
The Scottish Investment Trust (SCIN) invests in international equities for above-average long-term returns and dividend growth ahead of UK inflation. SCIN’s report and accounts for the year to 31 October 2018 shows shareholders’ assets of £715 million, after deducting long-term borrowings of £83.8 million.
Alasdair McKinnon has been the trust’s lead manager since July 2014 and has introduced a high-conviction, global contrarian approach. The portfolio has been concentrated down to 50 holdings, focused on unfashionable and unpopular companies ripe for improvement.
At 31 October 2018, the UK accounted for 27% of the invested portfolio, North America 38%, Europe 17%, Japan 12% and Asia-Pacific 6%. Financials represented the largest sector exposure, followed by energy and consumer discretionary. Net gearing into equities was reduced to nil in August 2018, having been 5% for several years. Ongoing charges were 0.52%.
Net asset value (NAV) and share price total returns were 1.1% and 1.9% respectively, compared to a gain of 3.4% from the MSCI AC World index, and a fall of 1.3% from the MSCI UK All Cap index. SCIN’s regular dividend was raised 6% to 2.2p, and a 4p special dividend was also declared. This was the 35th consecutive increase in the regular dividend, which is paid quarterly. The board’s commitment to further increases is underpinned by substantial revenue reserves. Share buybacks aim to keep the discount to NAV below 9%.