AVI Global Trust (AGT) H2 2022 earnings summary

Executive summary

• Investment objective: long-term capital growth through a focused, mainly listed portfolio, especially investments trading at discounts to estimated underlying asset value; active engagement aims to unlock value and narrow discounts.

• FY22 NAV total return was -7.3%, ahead of the MSCI AC World ex-US benchmark at -9.6%; five-year NAV return was +41.9% vs +15.4%, and ten-year return +144.6% vs +94.5%.

• Portfolio approach remains bottom-up and long-term; the manager reported a return to approximately full investment after a temporary net cash position, while retaining capacity to deploy gearing.

Financial highlights

• Investment income rose to £23.10m from £20.40m; revenue earnings per share increased to 3.24p from 2.74p.

• Capital earnings per share were -25.30p vs +54.62p; total earnings per share were -22.06p vs +57.36p.

• Total dividends were maintained at 3.30p per share; a final dividend of 2.1p was proposed, following an interim dividend of 1.2p.

• Share price total return was -10.8% vs +40.3% in FY21; benchmark total return was -9.6% vs +18.8%.

Outlook and guidance

• Inflation and further central-bank rate rises create uncertainty over the balance between controlling inflation and avoiding recession; no smooth market recovery is assumed.

• Manager remains confident in the portfolio, citing wider discounts and attractive valuations; patient capital deployment and engagement are expected to support long-term returns as volatility subsides.

• The portfolio’s weighted-average discount widened from 29% to 38% over the year, which the manager views as a source of potential opportunities.