Witan Investment Trust : Strong growth, ahead of benchmark, in Witan Investment Trust’s NAV per share in the first half of 2021

Strong growth, ahead of benchmark, in Witan Investment Trust's NAV per share in the first half of 2021

Tuesday, 10 August 2021

A summary of the results is below:

• Witan's NAV total return was 12.4%, 1% ahead of the company's composite global benchmark
• Gearing was maintained at over 10% during the period and was a significant contributor to returns
• The discount widened, along with others in the sector; we continued with our active buyback policy, with 4.1% of our shares bought into treasury, at an average discount of close to 7%. The Board retains its long-term commitment to achieving a share price which trades in line with the NAV
• A second interim quarterly dividend of 1.36p per ordinary share will be paid in September. Total dividends paid in respect of the period are 2.72p per ordinary share (2020: 2.68p)
• Dividends have increased every year for 46-years providing a reliable and growing income source for investors¹
• Engagement deepened with our managers on ESG issues and further investments were made in positions which will benefit from businesses committed to combatting climate change

Andrew Ross, Chairman of Witan Investment Trust plc said:

'Despite the improving outlook over the year as the vaccine rollout gathered pace in the Northern Hemisphere, sentiment proved changeable. Cyclical sectors were strong in the first quarter but lost momentum in the second, while growth stocks did the opposite. Asian and emerging markets lagged the global average while the UK, having outperformed in the first quarter, lagged in the second.

Witan outperformed in both quarters, with our NAV total return of 12.4% to the end of June being 1% ahead of the benchmark. All Witan's managers delivered positive returns, with notable contributions from managers whose portfolios were positioned for a cyclical recovery. Those with quality and growth-focused styles delivered less strong returns, due to the markets' focus on the pace of economic recovery. In the specialist section of the portfolio, the global portfolio managed by Latitude and the GMO Climate Change portfolio delivered strong returns, as did the portfolio of direct holdings in specialist investment companies, while the emerging market portfolio managed by GQG lagged, as did the Matthews Asia-Pacific portfolio (which was reallocated to other managers in April).

After the significant portfolio restructuring during 2020, there was only one manager change in the first half of 2021. The Asia-Pacific portfolio managed by Matthews was sold in April, with the proceeds used to increase our US exposure. We retain exposure to the Asia-Pacific region via our global managers and the GQG Emerging markets portfolio.

Recent years have seen a rapid rise in the investment focus on ESG. Witan has become more demanding of its managers in this field, and we will continue to work with them to ensure the portfolio is at the forefront of sustainable investing.

The Company's revenue earnings per share for 2021 have so far shown a 9% recovery from the first half of 2020, despite the lower-yielding nature of our restructured global portfolio. The Company began 2021 with carried forward revenue reserves amounting to over 1.2 times the annual dividend and has stated its willingness to continue to use these reserves to support dividend payments, as the revenue account recovers. The Company has increased its dividend every year since 1974 (a 46-year record of increases), recognising the importance for many of its investors of a reliable and growing income. The Board's policy remains to grow the dividend each year and the full year's dividend for 2021 is expected to show a further year of growth.

It seems likely that central banks and governments will be true to their recent announcements that economic stimulus will be maintained until the recovery has become fully established. This should be a conducive environment for equity performance, although high valuations in some markets and sectors (even allowing for the low level of interest rates) mean that a selective approach and thorough risk evaluation are called for.'

A video interview with Andrew Bell, Chief Executive Officer of Witan Investment Trust, discussing the 2021 half year results and the current outlook is available on the Company's website at www.witan.com/witan-half-year-results-2021.

For further information please contact:

Andrew Bell, Chief Executive Officer
Witan Investment Trust plc
Tel: [phone]
[email protected]

James Hart, Investment Director
Witan Investment Trust plc
Tel: [phone]
[email protected]

Alexis Barling, Director of Marketing
Witan Investment Trust plc
Tel: [phone]
[email protected]

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Notes to Editors

Witan Investment Trust plc

Witan Investment Trust plc

Established in 1909, Witan is one of the UK's largest investment trusts, managing £2.0bn (source: Witan, as at 30.06.2021) on behalf of over 25,000 investors. Witan operates a multi-manager structure and currently has 7 principal managers. For further details please visit www.witan.com.

¹Issued and approved by Witan Investment Services Limited. Witan Investment Trust is an equity investment. Please remember that past performance is not a guide to future performance. The value of an investment and the income from it can fall as well as rise as a result of currency and market fluctuations and you may not get back the amount originally invested.

Investment trusts and closed-ended funds are allowed to borrow. This is known as 'gearing'. In a rising market, it will tend to enhance returns because of the investment fund's increased exposure to the market. By the same token, however, it will tend to increase losses triggered by a falling market and a sufficiently large fall in value could mean you get nothing back at all. Funds may, however, increase or decrease their levels of gearing to suit market conditions. The share price may trade above and below the NAV per share representing either a premium or discount to the share price respectively.

Discrete Performance*	Q2 2016 Q2 2017	Q2 2017 Q2 2018	Q2 2018 Q2 2019	Q2 2019 Q2 2020	Q2 2020 Q2 2021
Share Price (Total Return)	36.2%	10.9%	0.6%	-11.6%	34.7%
Net Asset Value (Total Return)	28.0%	8.7%	2.8%	-8.9%	37.3%
Benchmark (Total Return)**	22.8%	8.5%	6.1%	2.3%	24.5%

<sup>* Source: Morningstar, percentage growth to 30th June each year. Total return includes the notional investment of dividends.

** Witan's benchmark is a composite of 85% Global (MSCI All Country World Index) and 15% UK (MSCI UK IMI Index). From 01.01.2017 to 31.12.2019 the benchmark was 30% UK, 25% North America, 20% Asia Pacific, 20% Europe (ex UK), 5% Emerging Markets. From 01.10.2007 to 31.12.2016 the benchmark was 40% UK, 20% North America, 20% Europe (ex UK) and 20% Asia Pacific. For more information go to www.witan.com/support/legal-information.</sup>