Standard Life Investments

Standard Life UK Smaller Companies Trust PLC

Mex ID: ITSLS SEDOL: 0295958 Reuters: SLS.L

Price
397.00
NAV
419.26
Premium/(Discount)
-5.31%
Daily Price Change
-2.00p (-0.51%)
Change date
23/03/2017

Figures above are updated every business day after the close of trading and those displayed are to the close of the previous business day. Figures are shown in pence (GBP) and the data is provided by, and copyright @2016, FE.

General Trust Information

Objective

To achieve long-term capital growth by investment in UK quoted smaller companies.

Profile

The Company intends to achieve its investment objective by investing in a diversified portfolio consisting mainly of UK quoted smaller companies. The portfolio will normally comprise around 50 individual holdings representing the Investment Manager’s highest conviction investment ideas. In order to reduce risk in the Company without compromising flexibility, no holding within the portfolio should exceed 5 per cent. of total assets at the time of acquisition.The Company may use derivatives for portfolio hedging purposes (i.e. only for the purpose of reducing, transferring or eliminating the investment risks in its investments in order to protect the Company’s portfolio). Within the Company’s Articles of Association, the maximum level of gearing is 100 per cent of net assets. The Directors’ policy is that gearing will be between -5 per cent. and 25 per cent. of net assets (at the time of drawdown) in normal market conditions. The Directors have delegated responsibility to the Investment Manager for the operation of the gearing level within the above parameters.The Investment Manager’s investment process combines asset allocation, stock selection, portfolio construction, risk management, and dealing. The investment process is research intensive and is driven by the Investment Manager’s distinctive “focus on change” which recognises that different factors drive individual stocks and markets at different times in the cycle. This flexible, but disciplined, process ensures that the Investment Manager has the opportunity to perform in different market conditions.

Fund Manager

Harry Nimmo

Harry Nimmo

Harry graduated with an MBA from the University of Edinburgh in 1984 and joined Standard Life as an Investment Analyst with responsibility for UK equity funds in 1985. He became Senior Investment Analyst with sector responsibility for larger UK-quoted companies funds in 1990 and Investment Manager responsible for the UK equity smaller (quoted) company funds in 1993. Harry has managed our UK Smaller Companies Fund since its launch in January 1997.

NMPI Status

Standard Life UK Smaller Companies Trust plc (‘the Company’) currently conducts its affairs so that securities issued by it can be recommended by financial advisers to ordinary retail investors in accordance with the FCA’s rules in relation to non-mainstream investment products and intends to continue to do so for the foreseeable future. The Company’s securities are excluded from the FCA’s restrictions which apply to non-mainstream investment products because they are securities in a UK listed investment trust.

Performance

Trust Performance (on a bid to bid basis)

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Past performance is not a guarantee of future returns. The value of investments may go down as well as up and you may receive back less than you invested. Your capital and income is not guaranteed.

Trust Performance & Returns

(on a bid to bid basis)
Fund performance
Sector performance
 Last 1 month*Last 6 months*Last 1 year*Last 3 years*Last 5 years*
Fund performance
Sector performance

Past performance is not a guarantee of future returns. The value of investments may go down as well as up and you may receive back less than you invested. Your capital and income is not guaranteed.

* Values to-

Performance (on a bid to bid basis)

Powered by data from FE

Trust Performance(on a bid to bid basis)

(on a bid to bid basis)
Fund performance
Sector performance
 Last 1 month*Last 6 months*Last 1 year*Last 3 years*Last 5 years*
Fund performance
Sector performance

Past performance is not a guarantee of future returns. The value of investments may go down as well as up and you may receive back less than you invested. Your capital and income is not guaranteed.

* Values to -

** n/a indicates that fund performance information is not available for this period due to the date the fund was launched.

Current details

All prices displayed in p (GBP). Figures below updated at 06:15 pm. Figures are provided by, and copyright @2016, FE on a delayed basis.
EPIC code:SLS
Market sector:
Mid price:398.0000
Bid price:392.7500
Offer:398.0000
Opening price:394.0000
Daily high:399.0000
Daily low:394.0000
Previous day's close:397.0000
Daily change:1.0000 (0.25%)

LSE Announcements

Video

Harry Nimmo talks about investment trusts in general, the specifics around the Smaller Companies Trust he manages and gives a short-term outlook for the sector.

UK Smaller Companies

How to Invest

Shares in Standard Life Investments' range of investment trusts are listed on the London Stock Exchange. As with any public quoted company, investment trust shares can be bought and sold on the stock market. This can be done through directly through a platform provider such as Standard Life or via a stockbroker, financial adviser or wealth manager.

We recognise professional financial advice is important before taking any investment decision. We recommend investors seek financial advice before taking any decisions. If you'd like to find an adviser in your area, take a look at www.unbiased.co.uk.

Alternatively, there are a number of platform providers who offer an online ‘execution only’ service, some of these are listed below.

You should note that by clicking any of the above links, you will leave Standard Life Investments' website and go to another website. We are not responsible for the content or accuracy of external websites.

The value of investments and the income from them can go down as well as up and is not guaranteed; an investor may get back less than their original investment.

Insight

Of rubber mallets and financial markets

October 2016

When a physician applies a rubber mallet to a child’s knee to test the patellar reflex, the result is a knee-jerk reaction. Such an exaggerated response is often seen in financial markets in the immediate aftermath of an unexpected event. The UK’s recent EU referendum is a case in point; an initial sharp sell-off that now seems to have been something of an overreaction. Although consumer and business sentiment originally took a knock, the swift appointment of Theresa May, the longest running home secretary of modern times, has helped to restore confidence and dispel the post-referendum panic.

Since the referendum on 23 June, of the 57 companies we hold in the Standard Life UK Smaller Companies Trust, 38 have pronounced on the trading outlook. All 38 were in line with or better than expectations. Initially, some companies, particularly those exposed to the UK consumer, felt obliged to sound a note of caution. However, this is no longer the case. House builders, building products companies, auto retailers, purveyors of designer training shoes and carpet distributors are all relatively sanguine about the future. Indeed, the recent trend is for companies to emphasise their optimism by upping dividend payouts (Lookers) or buying back shares (Domino’s Pizza, Rightmove). Even smaller banks and real estate companies are starting to sound more confident.

Exceptions to this are airlines and holiday companies, both of which are very obvious losers from the weakness in sterling. That said, I received my copy of the Dart Group annual report today. The company, which owns Jet2 airlines and holidays, is run by its pugnacious founder Philip Meeson. In his annual statement, Meeson was noticeably upbeat, stating that “we feel confident that our customers…will be keen to travel from our rainy islands to the sun spots of the Mediterranean”. I’d back him on that statement.

My confidence in this optimistic outlook is strengthened by the number of companies in the Standard Life UK Smaller Companies Trust that are growing their dividends at double-digit rates. A simple average of the dividends of our top-ten holdings is 16%, and over the last five years the Trust’s dividend has grown at a compound growth rate of 18.3% per annum. This is only happening because of the consistent and sustainable earnings growth delivered by many UK smaller companies, which is in stark contrast to the distinctly sluggish picture among large and mega-cap stocks.

Furthermore, I am genuinely excited by many newer smaller companies, some of which have made their way into our portfolio. Good examples are premium mixer drink brand Fever-Tree and clothing retailer Joules (I recently attended the opening of the latter’s impressive new Edinburgh store). Meanwhile, software companies First Derivatives, GB Group and Accesso are also world beaters.

So, with the immediate aftermath of the referendum now behind us and sentiment more bullish than it was, how do I view the prospects for UK smaller companies? I still feel very comfortable that strong multi-year returns will be achieved by investing in the asset class, particularly in our smaller company portfolios, which is where I invest most of my own money. Our lower-risk, growth-oriented approach has been tested over many years. Our focus on balance sheet and cashflow strength, as well as stable and predictable growth also has the added benefit that when the unexpected does occur (and there are still plenty of risks out there) it is my belief our approach offers a good degree of resilience.

In the near 20 years our investment process has been in place, we have experienced four market cycles and, frankly, the Brexit furore does not come close to the 2008/09 financial crisis for seriousness. And if we cast our minds back even further, what about the nasty bear market that followed the Asian debt crisis of 1998, or the prolonged market downturn that came after the tech bubble of 1999/2000? Our returns since 1997 are in excess of 14% per annum, and for the long-term investor, I see no reason why this can’t continue for the foreseeable future.

Harry Nimmo, Investment Director

Source: All figures Standard Life Investments at 31 August 2016.