F&C Capital and Income Investment Trust dividend up 3.1%
F&C Capital and Income Investment Trust aims to provide its investors with a mixture of capital growth and increasing income through investment principally in FTSE All-Share companies. Managed by Julian Cane at F&C Investments in London, it began life in 1992 as F&C PEP Investment Trust and has a high proportion of regular investors on its register.
Total dividend for the year of 8.65p per share, up 3.1% on a year earlier. This is composed of three quarterly interim dividends of 1.9p, a final dividend of 2.55p and a special dividend (in respect of VAT recovery) of 0.4p.
Net asset value total return was -0.6%, compared with a total return from the benchmark FTSE All-Share index of 6.1% over the year.
The underperformance versus the benchmark is largely attributable to the Company's continued focus on good-quality businesses with solid dividend prospects. During the market rally from March, much of the best capital growth came from companies that had cut or passed their dividends.
Share price total return for the year was 1.3%.
Strong demand for the Company's shares, particularly from savings scheme investors, meant the shares traded on average at a slight premium to net asset value, and 4,720,000 shares were issued at a small premium during the year to satisfy demand.
The Company increased gearing steadily as markets moved lower in late 2008 and early 2009, which had a beneficial effect once the recovery took hold in March.
From the current financial year, all four dividends will be paid as interims. This will allow them to be paid at each quarter-end as, unlike a final dividend, interim dividends do not require AGM approval.
Pen Kent, Chairman of F&C Capital & Income Trust, commented: "Valuations of many companies do not appear too demanding. This is particularly true when looking at your Company's own investments and we expect future returns to be driven more by valuation than by sentiment or speculation on recovery. With our focus on steady growth in income, the prospect for our own dividend is reasonably positive."