Alliance Trust reducing UK exposure

19th Apr 2010 07:16

The performance of Alliance Trust last year was in the lowest quartile of its peer group after the investment trust made a slow start to 2009.Net asset value in the year to 31 January 2010 improved by 16.8% to 377.7p, while the total return advanced 22.2%.The total return put the company's ranking at 34 out of its 43-strong peer group, though over a two-year period the trust ranks 11 out of 37 trusts in the Association of Investment Companies' Global Growth and Global Growth & Income sectors."Following a challenging first six months, our performance improved significantly during the second half of the year and continues into the current year. We benefited from our decision to reinvest back into equities, ending the year 4.7% geared compared to 11.6% cash in January 2009. As a result, at the year end, the trust held a greater proportion of its assets in listed equities (94.7%) than it has reported for the last 8 years," said Katherine Garrett-Cox, the trust's chief executive.The full year dividend has been increased by 1.9% to 8.15p, representing the 43rd year in a row that the dividend has been increased.During the course of the year the trust bought back 10.85m shares, representing 1.6% of the issued share capital of the company. The buybacks resulted in a 7p per share uplift in the net asset value per share.Looking forward, the trust has not discounted the possibility of a double dip recession and is looking to reduce the weighting of its UK holdings, as it is concerned that the political and fiscal uncertainty will impact market returns.Alliance Trust expects Asia and emerging markets to recover faster than the West.