TIDMSIGT
RNS Number : 5356P
Momentum Multi-Asset Value Trust
21 June 2022
To: RNS
Date: 21 June 2022
From: Momentum Multi-Asset Value Trust plc
LEI: 213800OQTUSRFDIL9L29
Results for the year ended 30 April 2022
Momentum Multi-Asset Value Trust plc ('MAVT' or 'your Company')
seeks to apply a value lens to identify the most compelling
investment opportunities across a highly diversified range of asset
classes. MAVT is designed to appeal to investors who wish to
combine the benefits of a quarterly income along with long-term
capital growth.
Chairman's Statement
HIGHLIGHTS
-- Net asset value total return +0.9% vs Benchmark +15.0%
-- Share price total return +1.5%
-- Annual volatility 12.5% vs 16.6% for the MSCI UK All Cap Index
-- Dividends for the year increased from 6.72p per share to 7.20p per share
-- Yield of 4.0% based on the 181.5p year-end share price
Source: MSCI/Morningstar/Momentum Global Investment
Management
OVERVIEW
When writing the Half Year Report in December, I noted the rise
in the cost of living at that time, largely caused by supply chain
bottlenecks and labour shortages in some sectors. Since then, the
invasion of Ukraine by Russia has been affecting the lives and
livelihoods of millions of people and leading to untold suffering
for the people of Ukraine. The effect on inflation has been quickly
felt in the energy markets, and there have already been significant
price increases across many agricultural products. Other impacts,
less forecastable today, must also be likely. The effects of the
COVID-19 pandemic included labour market upheavals and
dislocations, and the reversal of globalisation, both of which were
already causing inflation to rise. The invasion of Ukraine has
exacerbated these economically negative effects. What of China in
all this? Its economic importance to the prosperity of the West is
hard to overestimate and dangerous to underestimate. As of now,
China is pursuing a near zero COVID-19 policy with the result that
large parts of its population, and therefore economy, are
locked-down. China's current attitude towards Russia and the West
is hard to read but we can be certain it will be whatever the
Chinese authorities believe to be in their own best interests over
the long term; and their view of the long term is usually much
longer than ours.
Your Company performed well during the last year in the periods
when the Manager's Refined Value investment approach would have
been expected to do well, specifically when the Value Investing
style outshone Growth Investing. The latter style is now under
pressure, most obviously illustrated by the decline in valuations
of many US technology companies, largely as a result of rising
interest rates in response to rising inflation. As I commented in
the Half Year Report, rising inflation is rarely good for equities
but, if any are favoured, it is usually those already lowly valued
and when the Value style should do relatively well.
PERFORMANCE
Against this backdrop, for the year to 30 April 2022 (the
'Period') MAVT generated a net asset value ('NAV') total return per
share of +0.9%, compared with the Benchmark return of +15.0%. Over
the last five years, your Company has generated a NAV total return
per share of +32.0% (equivalent to 5.7% per annum) compared with
+41.8% (equivalent to 7.2% per annum) from the Benchmark.
MAVT adopted the Benchmark of CPI plus 6% per annum in July
2017. We measure performance against this Benchmark over a 'typical
investment cycle' which is defined as one that spans five to ten
years. As recently as both the Half Year Report and last year's
Annual Report, MAVT was well ahead of its Benchmark over the
respective trailing five years. The events of this Period have led
to a somewhat mediocre performance by MAVT, especially when
compared to its Benchmark which has been turbocharged by the rise
in inflation. The consequence is that MAVT is now behind its
Benchmark over five years though it could be argued the recent
period is not within the bounds of what might be considered
'typical'. It certainly feels as though the Benchmark will be a
challenging hurdle for some time, though the last two or three
years have amply demonstrated how quickly and significantly things
can and do change.
It is worth noting your Company has now passed the 10-year
anniversary of its current investment policy. Over this period the
NAV total return per share has been 8.5% per annum compared to its
blended Benchmark total return of 5.2% per annum. This is a
creditable absolute return and relative performance over the
10-year period.
The Manager's Review provides greater analysis and explanation
of MAVT's performance for the year.
DIVIDS
Your Company will pay a fourth interim dividend of 2.16 pence
per share (on 20 June 2022), which, when added to the three
preceding interim dividends of 1.68 pence per share, produces total
dividends of 7.20 pence per share for the year ended 30 April 2022,
an increase of 7.1% over the previous year. That represents a yield
of 4.0% on the share price of 181.5 pence that prevailed at the
year-end. The Board has previously made clear its intention to
increase dividends by at least inflation over a typical investment
cycle. The dividends of 7.20 pence per share for the year represent
an increase of 17.3% over five years which compares to inflation of
16.6% over the same period, as measured by the CPI.
The dividends for the year were covered by earnings but, even if
these had not been sufficient, the Board would have made the same
decision in relation to the dividends paid to Shareholders this
year. One of your Company's great strengths is the structure of its
balance sheet reserves which can be drawn upon to enable dividend
policy to be set without impinging upon your Manager's freedom to
make portfolio changes that might reduce revenue if that is in the
interests of achieving the best possible total return.
Looking forward, it is the Board's intention, barring unforeseen
circumstances, at least to maintain the aggregate dividends for the
year to 30 April 2023 at 7.20 pence per share, meaning a quarterly
rate of 1.80 pence per share. Given the outlook for inflation, it
is very likely the fourth interim dividend next year will be higher
than 1.80 pence per share consistent with the Board's intention to
increase dividends by at least inflation over the longer run.
DISCOUNT CONTROL MECHANISM ('DCM')
The DCM has been in operation since 1 August 2016. During the
Period MAVT bought back 4,210,500 shares costing GBP7.8 million and
issued 165,000 shares raising GBP0.3 million. Since being put in
place, the operation of the DCM has resulted in the issuance of
13,920,000 shares and the buy-back of 22,525,513 shares: a net
buy-back of 8,605,513 shares. As shares are issued at a small
premium and bought back at a small discount, the NAV of your
Company has been enhanced by GBP514,288 after all applicable
costs.
The Board believes the liquidity provided to Shareholders and
the lack of any material discount of the share price to the
underlying NAV of MAVT are of real value to Shareholders and
remains resolute in its application of the DCM to ensure these
benefits are maintained.
GEARING
MAVT has a GBP10 million revolving credit facility with The
Royal Bank of Scotland International Limited and, at the financial
year-end, GBP7 million was drawn down. During the Period the
average net gearing level was 9.5%. A small amount of the drawn
facility is held in cash to allow instant access to funds should
the need arise. The undrawn element of the facility is in place
largely to assist with the operation of the DCM, enabling gearing
levels to be maintained when the DCM results in the issuance of new
shares, and providing short-term working capital, if necessary,
when shares are bought back.
BOARD CHANGES
I have been a non-executive Director of MAVT for just over nine
years, having been Chairman for virtually all of that time. I will
retire at the AGM in July 2022 when James ('Jimmy') McCulloch will
succeed me. Jimmy has been on the Board for seven years, for the
last three as Senior Independent Director. I am confident that his
leadership and guidance will serve Shareholders well. Sue Inglis
will take over from Jimmy as the Senior Independent Director.
The Board was also pleased to announce the appointment of Jeroen
Huysinga as a non-executive Director with effect from 1 June 2022.
Jeroen is a highly experienced global equities investment
professional, and the Board and Manager look forward to his
insights and contribution.
My tenure on the Board has witnessed many changes and I am
indebted to my current and past Director colleagues for their
support and commitment. When I consider the resilience and
flexibility of your Company's mandate, as well as the
professionalism and capability of your Manager, I remain
confident that MAVT can serve Shareholders well in the
future.
ANNUAL GENERAL MEETING ('AGM')
This year's AGM, which will be your Company's 26(th) AGM, will
be held at 12 noon on Tuesday 26 July 2022 at MGIM's offices in
London.
We are looking forward to welcoming Shareholders in person this
year, particularly given the constraints we have faced over the
past two years. Shareholders will also be able to view the AGM live
via an online platform. Information on arrangements and how to
register to attend, either in person or online, can be found in the
Annual Report and on the Company's website at
https://momentum.co.uk/MAVT.
At the 2021 AGM, Shareholders approved all resolutions, each by
a majority of over 99% of shares voted. These resolutions included
those that help with the effective management of the DCM,
specifically allowing the Company to issue shares on a non
pre-emptive basis equivalent to 30% of its equity and to buy-back
up to 14.99% of the shares in issue.
As last year, your Board is asking Shareholders to approve two
separate resolutions concerning the issue of shares for an
aggregate of 30%. The first resolution seeks permission to issue
10%, and the second (extra) resolution seeks permission to issue up
to a further 20% solely in connection with the DCM. The Board
believes this approach of seeking non pre-emption authorities is in
the best interests of Shareholders and addresses any concerns that
the aggregate authority being sought is higher than the recommended
by Corporate Governance guidelines.
The Board believes that all the resolutions are in the best
interests of your Company and all Shareholders and strongly
recommends that Shareholders vote in favour of all the resolutions,
as the Directors intend to do in respect of their own beneficial
shareholdings of 341,402 shares.
COMMUNICATING WITH SHAREHOLDERS
The Board welcomes communications with Shareholders and, in
addition to formal channels, I encourage you to use our website and
our LinkedIn page which we continue to develop and refine. You can
also e-mail me, or, after the AGM, the new Chairman, directly at
MAVTChairman@momentum.co.uk with any questions.
Your Company is committed to acting sustainably and reducing the
amount of paper we use through greater use of electronic
communications. You will find a letter enclosed with this Annual
Report asking you how you would like to receive Shareholder
documents in the future. Our default method of communication will
be via the Company's website and we will inform you, either by
letter or e-mail, when a document has been published. You can still
elect to receive paper documents, if that is your preferred method
of communication, and you can change how you receive documents from
us at any time.
OUTLOOK
Inflation is rising and we are all experiencing its negative
effects. How much will it increase and for how long will it stay
'high'? With the UK base rate having recently increased to 1.25%
and inflation around 9% (and both projected to go higher), it is
easy to worry that policymakers are well behind the curve and so
are unlikely to rein in inflation any time soon. With the Russia
Ukraine military conflict and many worrying about recession, it is
easy to understand why policymakers seem to lack the conventional
solutions of materially tightening monetary policy to reduce
inflation.
MAVT's portfolio is structured with the Manager's Refined Value
investment approach applied across multiple asset classes. These
assets include relatively inexpensive equities and Specialist
Assets that largely comprise funds with underlying assets and cash
flows that are linked to inflation. This is not to suggest your
Board or Manager are complacent or sanguine for the year ahead.
However, MAVT's portfolio should provide some downside protection
to the worst of any significant stock market shocks, as well as do
much to protect against the worst of the effects of inflation.
There are always gains to be made however gloomy the
background.
Richard Ramsay
Chairman
20 June 2022
Manager's Review
Q&A with the Manager
Q. Could you outline MAVT's performance for the Period?
A. In a year of challenging and often volatile market conditions
it is pleasing to report that MAVT was broadly resilient delivering
a share price total return of 1.4%, and a NAV total return of 0.9%.
We view this as an encouraging result given market index returns
over the same time period.
Q. What were the key factors affecting performance?
A. The market environment fluctuated over the year with COVID-19
recovery phases intertwined with fresh waves of the virus and, more
recently, the Russia Ukraine conflict affecting global markets. The
major immediate impact has been the rapid rise of inflation which
in turn precipitated a sharp sell-off in Growth-orientated stocks
at the end of last year and into 2022. We are pleased that our
focus on Value has led us to navigate these challenges
effectively.
Q. Which portfolio holdings performed well and which were not so
successful?
A. The inflationary environment has provided a strong tailwind
for many of our Specialist Assets and these have performed
well.
Our holdings in property are of particular note. For example,
the share price of AEW REIT rose by 39%. This investment vehicle
specialises in buying properties with short-term leases or vacant
possession and either developing or repurposing them to add value.
The share price increased over the year as a result of the sale of
a number of properties at a significant premium.
The poorer performers in the portfolio included the UK Equity
holdings Accrol and Purplebricks. Accrol is a manufacturer of
toilet tissue which has seen rapidly rising input costs.
Purplebricks, the online estate agency, saw some administration
shortfalls resulting in rental client compensations. The companies'
share prices declined by 65% and 81% respectively over the
Period.
Contribution analysis by individual holdings in the year to 30
April 2022
Contributors Asset Class Contribution
1. Ultra Electronics UK Equities +0.65%
2. AEW REIT Specialist Assets +0.64%
3. Fair Oaks Income Specialist Assets +0.53%
4. Ediston Property Specialist Assets +0.44%
5. Senior UK Equities +0.37%
Detractors Asset Class Contribution
1. Syncona Specialist Assets -0.42%
2. Halfords Group UK Equities -0.42%
3. Schroder UK Public Private
Trust Specialist Assets -0.48%
4. Accrol Group UK Equities -0.92%
5. Purplebricks Group UK Equities -2.05%
Source: Momentum Global Investment Management /StatPro
Revolution.
Q. Has your investment landscape normalised now that the major
impacts of COVID-19 have subsided?
A. The landscape has normalised to some degree from the extremes
of 2020. However, we now find ourselves with a complex background
of rising inflation and central banks beginning to unwind
historically record levels of stimulus. In addition, the Russia
Ukraine conflict has the potential to escalate further causing
greater market uncertainty.
Investors will always have to contend with unexpected issues and
volatility. We seek to look across global markets to find
compelling Value opportunities. Our Refined Value approach means we
seek to buy low and sell high across a range of asset classes.
Q. What effect is the war in Ukraine having on the
portfolio?
A. MAVT's portfolio has almost no exposure to Russian or
Ukrainian assets. However, this ongoing conflict has affected
global markets in many ways. Commodities may see further increased
volatility, but your Company has limited exposure to
commodity-driven stocks.
More widely, our Value approach should, and indeed is, currently
outperforming portfolios that follow a Growth approach.
Q. Are you seeing compelling new investment opportunities? What
new holdings have been added to the portfolio and what do they
replace?
A. Significant market movements over the past year have led to a
number of companies and funds trading at what we consider to be
very attractive valuations. UK Equities have yielded some of the
most compelling new opportunities. Examples of our new investments
in this market include Games Workshop (due to growing global spend
on their Warhammer games), LBG Media (one of the largest media
platforms targeting younger consumers) and Jupiter Fund Management
(which we believe we purchased at an attractive share price and
where we are impressed by the new management team).
These new additions to the portfolio have been mainly funded by
the sale of our holdings in Clinigen and Ultra Electronics. Both
these companies were taken over at high share prices. We also sold
our long-standing holding in Britvic as the stock reached our
valuation target during the Period.
Q. Investors are increasingly concerned about inflation. What
impact does the steep rise in inflation have on the portfolio?
A. The portfolio has significant inflation protection on a
number of levels. MAVT follows a Value Investment style and Value
stocks tend to perform better in an inflationary environment due to
discounted cash flows, i.e. we are buying future profits at what we
believe are substantially lower prices.
Furthermore, our Specialist Assets exposure has, in many cases,
directly built-in contractual inflationary protection or indirect
exposure where returns are closely linked to inflation. Examples
include our holdings in property and infrastructure. During
inflationary periods, these investments may combine rising income
streams with increases in the value of the underlying 'real
assets'. The majority of rental agreements have inflation
protection built in and our specialist financials exposure
(comprising loans, mortgages and music royalties) is linked to
rises in interest rates or inflation-linked subscription rises. We
therefore believe the portfolio should perform well in an
inflationary environment.
Q. Many investors have seen significant income impairment. How
is MAVT navigating such challenges?
A. Your Company's portfolio derives both capital growth and
income from a wide range of investments in addition to traditional
equity dividends and credit yields.
The Specialist Assets component of the portfolio consists
entirely of closed-end investment companies. These vehicles are
able to smooth the volatility in their underlying income generation
by reserving some of their income in good years to pay out as
dividends in harder times. Throughout the COVID-19 crisis, MAVT's
Specialist Assets have paid consistent dividends benefitting income
generation from the portfolio as we waited for dividend payments in
the broader equity markets to return to more normal levels.
In addition, MAVT has ample balance sheet reserves which can be
used to pay dividends. This means we can make portfolio changes
that might reduce revenue if we believe that will achieve the best
possible total return.
Q. How do you consider ESG as part of the investment
process?
A. We are committed to our stewardship responsibilities and
recognise the risks and opportunities related to ESG factors that
can have a significant impact on your Company's long-term
performance. Therefore, we are committed to researching and
integrating ESG considerations before making any investment
decision (in the same way that we analyse all other financial
aspects relating to the investments we select) and we continue to
monitor all our holdings for their ongoing ESG performance and
progress against commitments at each investment review.
Where appropriate, we look favourably on the allocation of
capital towards issuers (companies and investment vehicles) that
explicitly seek to counteract the current and historic harm to
their stakeholders and the planet.
We engage proactively with many of our holdings and we vote our
shares when we believe this is important to protect shareholder
value. MGIM is a signatory to the UN's Principles of Responsible
Investment (UNPRI), is committed to the principles agreed by the
Investment Consultants Sustainability Working Group and is a
supporter of the UK Stewardship Code.
Q. How geared is the portfolio and is gearing a major driver of
performance?
A. Gearing is not a major driver of performance for the Company.
It is the Board's stated intention to use borrowings to manage the
DCM. Over the past year gearing has been elevated a little as the
COVID-19 sell-off led to some stocks becoming extremely
attractively valued. Hence, we raised gearing by a few percentage
points to take advantage of these opportunities over the longer
term. In future you should expect to see long-term average gearing
stay below 10%.
Q. We have seen a number of bids for companies in the portfolio
this year. What does this mean and do you expect this activity to
continue?
A. We have a bias towards UK Equities where we have identified
considerable value in recent years. Recent private equity bids
confirm our view that this market is currently attractive and we
expect to see further mergers and acquisitions. Where such activity
raises share prices to attractive levels we sell our holdings,
capitalising on opportunities and redeploying capital
elsewhere.
Q. What is your outlook for the Company for the year ahead?
A. We do not try to predict the future. Instead, we let
valuations guide our investment decisions as we seek to ensure that
the portfolio is always tilted to attractively valued assets. We
believe UK, Asian and Japanese equities are now looking attractive
and we have recently increased our exposure to these sectors,
funded through selling holdings that have performed well and are no
longer so attractively valued.
Momentum Global Investment Management
20 June 2022
Business Model
The purpose of MAVT is to act as a vehicle to provide, over
time, financial returns (both income and capital) to Shareholders.
Investment trusts, such as the Company, are long-term investment
vehicles and typically are externally managed, have no employees
and are overseen by a Board of independent non-executive
Directors.
THE BOARD
The Board, which normally comprises four independent
non-executive Directors but currently comprises five due to a hand
over period, has a broad range of skills and experience across all
major functions that affect the Company. The Board retains
responsibility for taking all decisions relating to the Company's
Investment Objective and Policy, gearing, corporate governance and
strategy, and for monitoring the performance of the Company's
Manager and service providers.
OUR INVESTMENT POLICY
The asset classes included in the Company's portfolio are UK and
Overseas Equities, Credit, Specialist Assets and Defensive Assets.
Further details of each asset class are provided below. The
Company's Manager aims to add value through both strategic and
tactical asset allocations within a range for each asset class.
The assets allocation ranges are as follows:
Asset allocation range %
UK Equities 15 - 60
Overseas Equities 10 - 40
Total Equities 25 - 85
Credit 0 - 40
Specialist Assets 0 - 50
Defensive Assets 0 - 20
Asset class descriptions (these are for general guidance only
and do not exclude other investments):
-- UK and Overseas Equities: companies listed on any recognised
stock exchange throughout the world.
-- Credit: government and corporate bonds, inflation-linked
securities, emerging market debt, and high yield bonds.
-- Specialist Assets: infrastructure, property, private equity,
and specialist financials.
-- Defensive Assets: gold (physical and miners), short equity
exchange-traded funds (ETFs), uncorrelated strategies, managed
futures, and government bonds.
Exposure to Specialist Assets will ordinarily be through
specialist collective investment products ('funds') managed by
third parties. Exposure to other asset classes may be achieved by
investing directly or through funds. With the Board's prior
approval, any exposure may also be gained through funds managed by
the Company's Manager.
The Company may use derivatives for efficient portfolio
management.
The Company will not invest more than 7.5% of gross assets in
any individual direct equity, any individual security related to
another asset class or any physical asset, or more than 10% of
gross assets in any fund.
The Company will not invest more than 7.5% of gross assets in
unlisted securities and will not hold more than 25% of its gross
assets in cash.
The Company may borrow to gear the Company's returns when the
Board and Manager believe it is in Shareholders' interests to do
so. The Company's borrowing policy allows gearing up to 25% of the
Company's net assets.
The Company's current borrowing facilities comprise a GBP10
million revolving loan facility of which GBP7 million was drawn
down at 30 April 2022 (equivalent to 12.2% of net assets). The
Board reviews these levels frequently and believes they are
appropriate for the Company at the present time.
The asset allocation ranges and limits referred to in the
Investment Policy are measured at the time of investment or
drawdown of borrowings.
HOW WE DIVERSIFY RISK ACROSS THE PORTFOLIO
The Manager diversifies portfolio risk in three ways:
-- The Multi-Asset Investment Policy helps reduce risk by
investing in a wide range of broadly uncorrelated asset
classes.
-- Having a Value style for investment and asset selection,
meaning investments are often made at lower than the asset's
intrinsic value, creating a margin of safety and thus reducing
risk.
-- The use of Defensive Assets in anticipation of and during
times of market stress.
ESG POLICY
The Directors recognise that their first duty is to act in the
best financial interests of the Company's Shareholders and to
achieve strong financial returns against acceptable levels of risk
in accordance with the objectives of the Company.
In asking the Manager to deliver against these objectives, the
Directors have also requested that the Manager takes into account
the broader ESG issues of the companies within the portfolio,
acknowledging that companies failing to manage these issues
adequately run a long-term risk to the sustainability of their
businesses.
As a signatory (through its parent company), the Manager is
committed to the UN's Principles of Responsible Investment (UNPRI)
and the principles agreed to by the Investment Consultants
Sustainability Working Group and is a supporter of the UK
Stewardship Code.
The Directors and the Manager are committed to active ownership
and engagement. The Manager engages proactively with the boards and
managements of the companies and third-party funds in which the
Company invests in order to encourage, influence and improve their
ESG practices, together with other business and commercial
aspects.
The Company is an investment trust with no employees. Therefore,
the Company has no direct employee or social responsibilities.
At the date of this report there were three male Directors and
two female Directors. For the year ended 30 April 2022 there were
two male and two female Directors. Following the AGM on 26 July
2022, the gender balance will return to this. As the Company has no
employees, it is not required to report further on gender
diversity.
HOW WE PROMOTE THE SUCCESS OF THE COMPANY
The Board is required to describe to the Company's Shareholders
how the Directors have discharged their duties and responsibilities
under section 172(1) of the Companies Act 2006 over the course of
the financial year.
The following disclosure explains how the Directors promoted the
success of the Company for the benefit of its members as a whole,
taking into account the likely long-term consequences of decisions
and the need to foster relationships with all stakeholders.
Who are What are the benefits of How do we engage?
our stakeholders? engagement?
Shareholders
Shareholders are key stakeholders The Manager, on behalf of the Board,
and the Board places great carries out a programme of Shareholder
importance on communication engagement throughout the year.
with them and welcomes all
Shareholders' views. The key methods of engagement include:
* Presenting at on-line and in-person events for retail
This engagement enables investors.
Shareholders to make informed
decisions about their investment
in the Company and facilitates * Regular one-to-one meetings with wealth managers and
the retention of existing private client brokers.
Shareholders and the attraction
of new ones.
* Meeting Shareholders at the Company's AGM.
* Providing information and updates on the Company's
website, including annual and interim reports,
factsheets, newsletters, video presentations,
podcasts and research reports.
* Using social media to provide regular updates.
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Manager
Regular interaction with The Board maintains a strong relationship
the Manager enables the with the Manager, ensuring open communication
Board to evaluate the Company's and sharing of views. The Board meets
performance against its with the Manager on several occasions
Investment Objective and throughout the year, receiving detailed
to understand the risks presentations and reports prior to
and opportunities the Company each Board meeting.
faces.
The Board, through the Management Engagement
This engagement ensures Committee, formally reviews the performance
that the Company's portfolio and terms and conditions of appointment
and affairs are well-managed of the Manager at least annually.
and enables the Company
to meet its strategic objectives.
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Service providers
A key relationship is with Juniper Partners engages regularly
Juniper Partners, which with the Company's service providers,
provides AIFM, company secretarial both through meetings and regular reporting.
and fund administration The regular interaction enables issues
services, as well as operating and requirements to be dealt with efficiently
the DCM. The Board seeks and collegiately.
to maintain constructive
relationships with Juniper The Board conducts an annual review
Partners and with the Company's of the performance and terms and conditions
other service providers. of appointment of the Company's service
providers.
This engagement ensures
the service providers carry
out their roles diligently
and provide value for money.
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Debt provider
The Company's debt provider Juniper Partners provides RBSI with
is The Royal Bank of Scotland regular updates on the Company's portfolio
International ('RBSI'). and compliance with its loan covenants.
On behalf of the Board, This demonstrates the Company's strong
Juniper Partners seeks to financial position and supports the
maintain a positive working financing arrangements.
relationship with RBSI.
This engagement supports
the Company's financing
arrangements.
-------------------------------------- ----------------------------------------------------------------------
What were the key stakeholder What actions were taken?
considerations during the
year?
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Shareholders
The ongoing impact of the The Manager held regular meetings with the Board
COVID-19 pandemic and the and Shareholders, including presentations at
emerging impact of geopolitical retail investor events. Updates on performance
events on the Company's performance, were provided on the Company's website via factsheets,
revenue and dividends. newsletters and financial reports. The Chairman's
Statement provides further information on the
Company's performance, revenue and dividends.
The Manager's Review provides an explanation
The integration of ESG into of how ESG is integrated into the investment
the investment process. process.
The operation of the DCM. The Board continues to view the DCM as a very
important tool for Shareholders. The DCM activity
during the year is covered in the Chairman's
Statement.
The format of the Company's
AGM. This year's AGM will be a held at the Manager's
offices in London. Shareholders will be able
to attend in person or on-line. The Board looks
forward to welcoming Shareholders to this event.
Details are included in the Annual Report.
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Manager
The ongoing oversight of The Manager's Review details the key investment
the Manager by the Board decisions taken during the year.
to ensure the Manager continues
to manage the Company in
accordance with the mandate
provided by Shareholders.
The Board has continued to strengthen its relationship
with MGIM throughout the year. Following a seamless
continuity of service, the Company is now able
The continued development to benefit from the broader capabilities of
of the Board's relationship MGIM.
with the Manager, following
the acquisition of Seneca
Investment Managers Limited
('SIML') by MGIM in 2020.
SIML was the Company's Manager
prior to its acquisition
by MGIM.
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Service providers
The ongoing impact of the All services providers continued to operate
COVID-19 pandemic on the remote working during the year, with no adverse
Company's service providers. impact on service quality. The Company's main
service providers have recently transitioned
to a hybrid working model, combining office
and remote working, and the Board will continue
to monitor this to ensure ongoing operational
resilience.
------------------------------------------------------------------------------------
Debt provider
The upcoming renewal of the It is the Board's current intention to seek
Company's loan facility with to renew the facility on best available terms.
RBSI, which expires in October
2022.
------------------------------------------------------------------------------------
PRINCIPAL RISKS AND UNCERTAINTIES
Risks are inherent in the investment process, but it is
important that their nature and magnitude are understood so that
risks, particularly those which the Company seeks to avoid or
minimise, can be identified and either avoided or controlled. The
Board has carried out a robust assessment of the principal and
emerging risks facing the Company, including those that threaten
its business model, future performance, solvency or liquidity. The
Board has established a detailed framework of the key risks that
the business is exposed to, with associated policies and processes
devised to mitigate or manage those risks.
The principal risks faced by the Company, are set out below. The
Company faces emerging risks from geopolitical events, climate
change and rising inflation. The impact of these on the principal
risks is detailed below.
Investment and strategy risk
Risk Mitigation
An inappropriate strategy, The Company's strategy is formally
including asset class, country reviewed by the Board at least
and sector allocation, stock annually, considering investment
selection and use of gearing, performance, Shareholder views,
could lead to underperformance developments in the marketplace
against the Company's Benchmark and the structure of the Company.
and peer group, and have an The strategy has been kept under
adverse effect on Shareholders' regular review in light of the
returns. COVID-19 pandemic, the Russia Ukraine
conflict and rising inflation.
Increase in this risk due The Board requires the Manager
to geopolitical tension and to provide an explanation of significant
rising inflation stock selection decisions and the
rationale for the composition of
the investment portfolio at each
Board meeting, when gearing levels
are also reviewed. The Board monitors
the spread of investments to ensure
that it is adequate to minimise
the risks associated with particular
asset classes, countries or factors
specific to particular sectors.
The Board monitors the investment
performance at each Board meeting.
------------------------------------------
Portfolio and market risk
Risk Mitigation
External factors such as market, The Board monitors the implementation
economic, political and legislative and results of the investment process,
change could cause increased including gearing strategy and
market volatility. This could ESG strategy, with the Manager
lead to a fall in the market on an ongoing basis and at each
value of the Company's portfolio Board meeting, through reviews
which would have an adverse of the portfolio composition, investment
effect on Shareholders' funds. activity and performance.
Increase in this risk due
geopolitical tension, climate
change and rising inflation
------------------------------------------
Financial risk
Risk Mitigation
Exposure to inappropriate Full details of the financial risks
levels of market price risk, and the ways in which they are
foreign currency risk, interest managed are disclosed in the notes
rate risk and liquidity and to the financial statements.
credit risk could result in
volatility of Shareholders' The Company has a diversified portfolio
funds. comprising mainly readily realisable
securities, mitigating the Company's
Increase in this risk due exposure to liquidity risk. The
geopolitical tension and rising risk of a counterparty failing
inflation is minimised through regular review
and due diligence.
------------------------------------------
Earnings and dividend risk
Risk Mitigation
Fluctuations in earnings resulting The Board reviews detailed income
from changes in the underlying forecasts prepared by the Manager
portfolio, or factors impacting and the Company Secretary at each
the dividend paying ability Board meeting and when the quarterly
of investee companies, could dividends are declared.
result in the Company being
required to pay dividends The Board and the Manager have
out of reserves on a sustained kept the dividend paying ability
basis, resulting in a reduction of the investee companies under
in NAV. regular review during the COVID-19
pandemic. The Company's ability
Decrease in this risk due to pay dividends out of distributable
to reduced impact of the COVID-19 capital reserves provides flexibility
pandemic in times of market stress.
------------------------------------------
Operational and cyber risk
Risk Mitigation
Disruption to, or failure The operational systems and controls
of, systems and controls, of the Manager and third-party
including cyber-attacks at service providers are regularly
the Manager and the Company's tested and monitored and are reported
third-party service providers, on at each Board meeting. An internal
in particular the Administrator control report, which includes
and Custodian, could result an assessment of risks, together
in financial and reputational with the procedures to mitigate
damage to the Company. such risks, is prepared by the
Company Secretary and reviewed
No change to this risk by the Audit Committee at least
once a year. The Custodian, J.P.
Morgan Chase Bank N.A., produces
an internal control report every
six months which is reviewed by
its auditor and gives assurance
regarding the effective operation
of its controls. A summary of this
report is reviewed by the Audit
Committee.
The operational requirements of
the Company, including from the
Manager and its service providers,
have been subject to rigorous testing
as to their application during
the COVID-19 pandemic, when increased
use of out of office working and
online communication has been required.
The operational arrangements have
proved robust.
------------------------------------------
Regulatory risk
Risk Mitigation
Breach of regulatory rules The Company Secretary monitors
could lead to suspension of the Company's compliance with the
the Company's stock exchange rules of the FCA and sections 1158
listing or financial penalties. and 1159 of the Corporation Tax
Breach of sections 1158 and Act 2010. Compliance with the principal
1159 of the Corporation Tax rules is reviewed by the Directors
Act 2010 could lead to the at each Board meeting.
Company being subject to tax
on chargeable gains.
No change to this risk
------------------------------------------
Key man risk
Risk Mitigation
Loss of key personnel and To reduce key man risk, MGIM operates
poor succession planning at a team approach to fund management,
the Manager or Company Secretary with each member of the four strong
could lead to disruption for highly experienced investment team
the Company. contributing to the performance
of the Company through their research
No change to this risk specialisations. Juniper Partners
has experienced company secretarial
and administration teams in place,
with appropriate levels of cover.
The Board receives regular updates
from MGIM and Juniper Partners
on business and succession plans.
------------------------------------------
GOING CONCERN
The Directors have undertaken a rigorous review of the Company's
ability to continue as a going concern. This review included
consideration of the Company's current Investment Objective, its
principal risks and uncertainties, its capital and debt management,
the nature of its portfolio, its income and expenditure
projections, gearing and the operation of the DCM.
The Company's investments consist mainly of readily realisable
securities which can be sold to maintain adequate cash balances to
meet expected cash flows, including debt servicing. The Board has
set limits for borrowing and regularly reviews the level of gearing
and compliance with banking covenants, including sensitivities
around the levels at which covenants may be breached. The Company's
loan facility with RBSI expires in October 2022 and it is the
Board's current intention to renew the facility on best available
terms.
The Board also has regard to ongoing investor interest in the
continuation of the Company, looking specifically at feedback from
meetings and conversations with Shareholders by the Company's
advisers, and the operation of the DCM, which the Directors believe
enhances the Company's appeal to investors.
Based on their assessment and considerations, the Directors
believe that the Company has adequate resources, an appropriate
financial structure and suitable management arrangements in place
to continue in operational existence for at least 12 months from
the date of this report, meeting liabilities when they fall due.
The Directors have concluded, therefore, that they should continue
to prepare the financial statements on a going concern basis and
the financial statements have been prepared accordingly.
THE COMPANY'S VIABILITY
The Directors have assessed the prospects of the Company over a
five-year period from the date that this Annual Report is due to be
approved by Shareholders. This period was selected as it is
considered a reasonable time horizon to consider the continuing
viability of the Company and a suitable period over which to
measure the performance of the Company against its Benchmark. The
five-year period is consistent with the planning horizon used by
the Company in managing its activities.
In their assessment of the viability of the Company, the
Directors have considered the following factors:
-- The principal risks and uncertainties detailed in the Annual
Report, including the Russia Ukraine conflict, and the mitigating
controls in place.
-- The Company's Investment Objective and its ongoing relevance
in the current environment.
-- The effectiveness of the DCM.
-- Income and expenditure projections.
-- The effect of any significant future falls in investment
values on the ability to repay and renegotiate borrowings and
retain investors.
-- The liquidity of the portfolio, which is principally invested
in readily realisable, listed equities and open-ended funds which
could be sold to meet funding requirements if necessary.
Based on the results of their analysis, the Directors have a
reasonable expectation that the Company will be able to continue in
operation and meet its liabilities as they fall due over the
five-year period to the AGM in 2027.
KEY PERFORMANCE INDICATORS
The Board uses a number of performance measures to assess the
Company's success in meeting its objectives.
More information on the Company's Key Performance Indicators can
be found in the Key Facts and the Chairman's Statement in the
Annual Report. The Key Performance Indicators are as follows:
Performance measured against the Benchmark and relevant
indices
The Board reviews and compares, at each meeting, the performance
of the portfolio as well as the net asset value total return and
share price total return for the Company against its Benchmark and
comparator indices. The Company's Benchmark is based on CPI as the
Board recognises the importance to Shareholders of achieving real
returns from their investment. The MSCI UK All Cap Index is used as
a comparator index to monitor the investment aim of delivering
equity-like, long-term returns with lower volatility and lower
risk.
Premium/(discount) to net asset value ('NAV')
At each Board meeting, the Board monitors the level of the
Company's premium/(discount) and the operation of the DCM, which
aims to keep the volatility of the premium/ (discount) low and the
share price trading at close to NAV. The Company publishes a NAV
per share figure on a daily basis, through the official newswire of
the London Stock Exchange.
Ongoing charges
The ongoing charges are a measure of the total expenses incurred
by the Company expressed as a percentage of the average
Shareholders' funds over the year. The Board regularly reviews the
ongoing charges and monitors all Company expenses and considers the
current level of ongoing charges to be reasonable given the nature
and size of the Company. Details of the Company's ongoing charges
percentage can be found in the Annual Report.
Revenue earnings and dividends per share
The Board reviews a revenue forecast on a quarterly basis to
determine the quarterly dividend and considers dividend growth
against CPI.
Richard Ramsay
Chairman
20 June 2022
Income Statement
For the year ended 30 April 2022
Year ended 30 April 2022
Revenue Capital Total
Notes GBP'000 GBP'000 GBP'000
--------------------------------------------- ------ ----------- ----------- -----------
Losses on investments - (1,453) (1,453)
Currency losses - (15) (15)
Income 3,167 - 3,167
Investment management fee (155) (366) (521)
Administrative expenses (522) - (522)
Profit/(loss) before finance costs
and taxation 2,490 (1,834) 656
--------------------------------------------- ------ ----------- ----------- -----------
Finance costs (34) (81) (115)
Profit/(loss) before taxation 2,456 (1,915) 541
Taxation (38) - (38)
--------------------------------------------- ------ ----------- ----------- -----------
Profit/(loss) for year/ total comprehensive
income 2,418 (1,915) 503
--------------------------------------------- ------ ----------- ----------- -----------
Return per share (pence) 2 7.30 (5.78) 1.52
--------------------------------------------- ------ ----------- ----------- -----------
The total column of this statement represents the profit and
loss account of the Company. The supplementary revenue and capital
columns are both prepared under guidance published by the
Association of Investment Companies.
All revenue and capital items in the above statement derive from
continuing operations.
No operations were acquired or discontinued in the year.
The accompanying notes are an integral part of the financial
statements.
Income Statement
For the year ended 30 April 2021
Year ended 30 April 2021
Revenue Capital Total
Notes GBP'000 GBP'000 GBP'000
-------------------------------------- ------ ----------- ----------- -----------
Gains on investments - 22,842 22,842
Currency losses - (46) (46)
Income 2,974 - 2,974
Investment management fee (153) (363) (516)
Administrative expenses (520) - (520)
Profit before finance costs and
taxation 2,301 22,433 24,734
-------------------------------------- ------ ----------- ----------- -----------
Finance costs (43) (92) (135)
Profit before taxation 2,258 22,341 24,599
Taxation (23) - (23)
-------------------------------------- ------ ----------- ----------- -----------
Profit for year/ total comprehensive
income 2,235 22,341 24,576
-------------------------------------- ------ ----------- ----------- -----------
Return per share (pence) 2 5.48 54.75 60.23
-------------------------------------- ------ ----------- ----------- -----------
The total column of this statement represents the profit and
loss account of the Company. The supplementary revenue and capital
columns are both prepared under guidance published by the
Association of Investment Companies.
All revenue and capital items in the above statement derive from
continuing operations.
No operations were acquired or discontinued in the year.
The accompanying notes are an integral part of the financial
statements.
Balance Sheet
As at As at
30 April 30 April
2022 2021
Notes GBP'000 GBP'000
Fixed assets
Investments at fair value
through profit or loss 63,401 72,995
------------------------------ ------ --------- ---------
Current assets
Debtors and prepayments 573 726
Cash 670 876
------------------------------ ------ --------- ---------
1,243 1,602
------------------------------ ------ --------- ---------
Creditors: amounts falling
due within one year
Bank loan (7,000) (7,000)
Other creditors (276) (976)
------------------------------ ------ --------- ---------
(7,276) (7,976)
------------------------------ ------ --------- ---------
Net current liabilities (6,033) (6,374)
------------------------------ ------ --------- ---------
Net assets 57,368 66,621
------------------------------ ------ --------- ---------
Capital and reserves
Called-up share capital 12,400 12,400
Share premium account 16,063 16,044
Special reserve 13,116 20,651
Capital redemption reserve 2,099 2,099
Capital reserve - unrealised (9,238) (5,498)
Capital reserve - realised 20,668 18,843
Revenue reserve 2,260 2,082
------------------------------ ------ --------- ---------
Equity shareholders' funds 57,368 66,621
------------------------------ ------ --------- ---------
Net asset value per share
(pence) 3 183.34 188.53
------------------------------ ------ --------- ---------
Statement of Changes in Equity
For the year ended 30 April 2022
Share Capital Capital Capital
Share premium Special redemption reserve- reserve- Revenue
capital account reserve reserve unrealised realised reserve Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------------- -------- -------- -------- ----------- ----------- --------- -------- --------
Balance at
30 April 2021 12,400 16,044 20,651 2,099 (5,498) 18,843 2,082 66,621
Total comprehensive
income - - - - (3,740) 1,825 2,418 503
Dividends paid - - - - - - (2,240) (2,240)
Discount control
costs - (34) - - - - - (34)
Shares bought
back into treasury - - (7,795) - - - - (7,795)
Shares issued
from treasury - 53 260 - - - - 313
Balance at
30 April 2022 12,400 16,063 13,116 2,099 (9,238) 20,668 2,260 57,368
--------------------- -------- -------- -------- ----------- ----------- --------- -------- --------
Statement of Changes in Equity
For the year ended 30 April 2021
Share Capital Capital Capital
Share premium Special redemption reserve- reserve- Revenue
capital account reserve reserve unrealised realised reserve Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------------- -------- -------- --------- ----------- ----------- --------- -------- ---------
Balance at
30 April 2020 12,400 16,104 39,287 2,099 (27,008) 18,629 2,005 63,516
Total comprehensive
income - - - - 21,510 831 2,235 24,576
Dividends paid - - - - - (617) (2,158) (2,775)
Discount control
costs - (60) - - - - - (60)
Shares bought
back into treasury - - (18,636) - - - - (18,636)
Balance at
30 April 2021 12,400 16,044 20,651 2,099 (5,498) 18,843 2,082 66,621
--------------------- -------- -------- --------- ----------- ----------- --------- -------- ---------
The revenue reserve, realised capital reserve and special
reserve represent the amount of the Company's reserves
distributable by way of dividend.
Cash Flow Statement
Year Year
ended ended
30 April 2022 30 April
2021
GBP'000 GBP'000 GBP'000 GBP'000
Net return before finance
costs and taxation 656 24,734
Adjustments for:
Losses/(gains) on investments 1,453 (22,842)
Exchange movements 15 46
Loan interest paid (74) (149)
Tax paid (38) (23)
(Increase)/decrease in
dividends receivable (105) 66
(Increase)/decrease in
other debtors (15) 23
Decrease in other creditors (61) (12)
------------------------------- --------- -------------- --------- -----------
Net cash inflow from
operating activities 1,831 1,843
------------------------------- --------- -------------- --------- -----------
Investing activities
Purchases of investments (11,735) (17,464)
Sales of investments 19,660 37,515
------------------------------- --------- -------------- --------- -----------
Net cash inflow from
investing activities 7,925 20,051
------------------------------- --------- -------------- --------- -----------
Financing activities
Proceeds of issue of shares 313 -
Cost of share buy-backs (8,020) (18,721)
Equity dividends paid (2,240) (2,775)
------------------------------- --------- -------------- --------- -----------
Net cash outflow from
financing activities (9,947) (21,496)
------------------------------- --------- -------------- --------- -----------
(Decrease)/increase in
cash (191) 398
Exchange movements (15) (46)
Opening balance 876 524
------------------------------- --------- -------------- --------- -----------
Closing balance 670 876
------------------------------- --------- -------------- --------- -----------
Statement of Directors' Responsibilities
The Directors are responsible for preparing the Annual Report
and financial statements, in accordance with applicable law and
regulations.
Company law requires the Directors to prepare financial
statements for each financial year. Under that law the Directors
have elected to prepare the financial statements in accordance with
United Kingdom Generally Accepted Accounting Practice (United
Kingdom Accounting Standards), including FRS 102 'The Financial
Reporting Standard applicable in the UK and Republic of Ireland',
and applicable law.
Under company law the Directors must not approve the financial
statements unless they are satisfied that they present a true and
fair view and provide the information necessary for Shareholders to
assess the Company's performance, business model and strategy.
In preparing these financial statements, the Directors are
required to:
-- select suitable accounting policies and then apply them consistently;
-- make judgements and estimates that are reasonable and prudent;
-- state whether applicable UK Accounting Standards have been
followed, subject to any material departures disclosed and
explained in the nancial statements; and
-- prepare the financial statements on a going concern basis
unless it is inappropriate to presume that the Company will
continue in business.
Under applicable law and regulations, the Directors are also
responsible for preparing a Directors' Report, Directors'
Remuneration Report and Statement of Corporate Governance that
comply with that law and those regulations. The financial
statements are published on https://www.momentum.co.uk/MAVT which
is a website maintained by the Company's Manager. The Directors are
responsible for the maintenance and integrity of the corporate and
financial information included on the Company's website.
Legislation in the UK governing the preparation and
dissemination of financial statements may differ from legislation
in other jurisdictions.
The Directors con rm that to the best of their knowledge:
-- the financial statements, prepared in accordance with the
applicable UK Accounting Standards, give a true and fair view of
the assets, liabilities, financial position and profit or loss of
the Company;
-- that, in the opinion of the Directors, the Annual Report and
Accounts taken as a whole is fair, balanced and understandable and
it provides the information necessary to assess the Company's
position and performance, business model and strategy; and
-- the Strategic Report includes a fair review of the
development and performance of the business and the position of the
Company, together with a description of the principal risks and
uncertainties that the Company faces.
The Directors are responsible for keeping proper accounting
records that are sufficient to show and explain the Company's
transactions and disclose with reasonable accuracy at any time the
financial position of the Company and enable them to ensure that
its financial statements comply with the Companies Act 2006, where
applicable. They are responsible for taking such steps as are
reasonably open to them to safeguard the assets of the Company and
to prevent and detect fraud and other irregularities.
For Momentum Multi-Asset Value Trust plc
Richard Ramsay
Chairman
20 June 2022
Notes
1. The financial statements have been prepared in accordance
with Financial Reporting Standard 102 and with the Statement of
Recommended Practice 'Financial Statements of Investment Trust
Companies and Venture Capital Trusts'. The financial statements are
prepared in sterling which is the functional currency of the
Company and are rounded to the nearest GBP'000. They have also been
prepared on the assumption that approval as an investment trust
will continue. The financial statements have been prepared on a
going concern basis.
2. Return per Ordinary share
The revenue return per Ordinary share is calculated on net
revenue on ordinary activities after taxation for the year of
GBP2,418,000 (2021 - GBP2,235,000) and on 33,122,018 (2021 -
40,804,188) Ordinary shares, being the weighted average number of
Ordinary shares in issue during the year.
The capital return per Ordinary share is calculated on net
capital losses for the year of GBP1,915,000 (2021 - gains of
GBP22,341,000) and on 33,122,018 (2021 - 40,804,188) Ordinary
shares, being the weighted average number of Ordinary shares in
issue during the year.
The total return per Ordinary share is calculated on total gains
for the year of GBP503,000 (2021 - gains of GBP24,576,000) and on
33,122,018 (2021 - 40,804,188) Ordinary shares, being the weighted
average number of Ordinary shares in issue during the year.
3. Net asset value per Ordinary share
The net asset value per Ordinary share is based on net assets of
GBP57,368,000 (2021 - GBP66,621,000) and on 31,290,848 (2021 -
35,336,348) Ordinary shares, being the number of Ordinary shares in
issue at the year end.
4. Dividends
A fourth interim dividend in respect of the year ended 30 April
2022 of 2.16p (2021 - 1.68p) per Ordinary share will be paid on 20
June 2022 to Shareholders on the register on 06 June 2022. In
accordance with UK Accounting Standards this dividend has not been
included as a liability in these accounts and will be recognised in
the period in which it is paid.
5. Related parties
The Directors of the Company receive fees for their
services.
6. Bank loan facility
The Company has a GBP10,000,000 (2021: GBP10,000,000) revolving
loan facility in place with The Royal Bank of Scotland
International Limited which expires in October 2022. At 30 April
2022 GBP7,000,000 had been drawn down at a rate of 1.05% plus SONIA
until 31 July 2022. At 30 April 2021 GBP7,000,000 had been drawn
down at an all-in fixed rate of 1.13388% until 31 July 2021. The
terms of the revolving loan, including interest rate, are agreed at
each draw down. The facility can be cancelled at any time without
cost to the Company.
7. Risk management, financial assets and liabilities
The Company's financial instruments comprise:
-- Equities, bonds and collective investment schemes that are
held in accordance with the Company's Investment Objective;
-- Term loans, the main purpose of which are to raise finance for the Company's operations;
-- Cash and liquid resources that arise directly from the Company's operations; and
-- Other short-term debtors and creditors.
The main risks arising from the Company's financial instruments
are market risk, interest rate risk, credit risk, liquidity risk
and foreign currency risk. The Board regularly reviews and agrees
policies for managing each of these risks and they are summarised
below. These policies have remained unchanged since the inception
of the Company.
Liquidity risk
Liquidity risk is the risk that the Company will encounter
difficulty in meeting obligations associated with financial
liabilities. Liquidity risk is not considered to be significant as
the Company's assets comprise of mainly readily realisable
securities, which can be sold to meet funding commitments if
necessary.
Market risk
Market risk arises mainly from uncertainty about future prices
of financial instruments held. It represents the potential loss the
Company might suffer through holding market positions in the face
of price movements.
To mitigate the risk the Board's investment strategy is to
select investments for their fundamental value. Stock selection is
therefore based on disciplined accounting, market and sector
analysis, with the emphasis on long term investments. The Manager
actively monitors market prices throughout the year and reports to
the Board, which meets regularly in order to consider investment
strategy.
Interest rate risk
Financial assets: Prices of bonds and prices of the underlying
holdings of third-party debt funds are determined by market
perception as to the appropriate level of yields given the economic
background. Key determinants include economic growth prospects,
inflation, the government's fiscal position, short-term interest
rates and international market comparisons. The Manager takes all
these factors into account when making any investment decisions as
well as considering the financial standing of the potential
investee company.
Financial liabilities: The Company may finance some or all of
its operations through the use of a loan facility. The Board sets
borrowing limits to ensure gearing levels are appropriate to market
conditions and reviews these on a regular basis.
Foreign currency risk
The income and capital value of the Company's investments are
mainly denominated in sterling; therefore, the Company is not
subject to any material risk of currency movements.
Other price risk
Other price risks (i.e. changes in market prices other than
those arising from interest rate or currency risk) may affect the
value of the quoted investments held directly or indirectly through
collective investment products.
It is the Board's policy to hold an appropriate spread of
investments in the portfolio in order to reduce the risk arising
from factors specific to a particular country or sector. The
allocation of assets to international markets and the stock
selection process both act to reduce market risk. The Manager
actively monitors market prices throughout the year and reports to
the Board, which meets regularly in order to review investment
strategy. The vast majority of investments held by the Company,
directly or indirectly through collective investment products, are
listed on various stock exchanges worldwide.
Credit risk
Credit risk represents the failure of the counterparty to a
transaction to discharge its obligations under that transaction
that could result in the Company suffering a loss.
The risk is not considered significant, and is managed as
follows:
-- investment transactions are carried out with a large number
of brokers, whose credit-standing is reviewed periodically by the
Manager, and limits are set on the amount that may be due from any
one broker;
-- the risk of counterparty exposure due to failed trades
causing a loss to the Company is mitigated by the review of failed
trade reports by the Administrator on a daily basis. In addition,
the Administrator carries out a stock reconciliation to the
Custodian's records on a weekly basis to ensure discrepancies are
picked up on a timely basis. The Manager's Compliance department
carries out periodic reviews of the Custodian's operations and
reports its findings to the Manager's Risk Management Committee;
and
-- cash is held only with reputable banks with high quality external credit enhancements.
None of the Company's financial assets are secured by collateral
or other credit enhancements.
8. Financial information
These are not full statutory accounts for the year ended 30
April 2022. The full audited annual report and accounts for the
year ended 30 April 2022 will be sent to Shareholders in June 2022
and will be delivered to the Registrar of Companies following the
Company's Annual General Meeting. The full audited accounts for the
year ended 30 April 2021, which were unqualified, have been lodged
with the Registrar of Companies.
9. The report and accounts for the year ended 30 April 2022 will
be made available on the website https://momentum.co.uk/MAVT.
Copies may also be obtained from the Company Secretary's office,
Juniper Partners Ltd, 28 Walker Street, Edinburgh EH3 7HR.
Enquiries:
Juniper Partners Limited, Company Secretary 0131 378 0500
Steve Hunter, Momentum Global Investment
Management Limited 0151 906 2481
07470 478974
Gary Moglione, Momentum Global Investment
Management Limited 0151 906 2461
07469 852685
Sally Walton, SEC Newgate (media enquiries) 020 3757 6872
07961 463864
About Momentum Multi-Asset Value Trust plc
Momentum Multi-Asset Value Trust plc ("MAVT" or the "Company")
is a UK investment trust, listed on the London Stock Exchange.
MAVT is managed by Momentum Global Investment Management which
has a boutique culture and more than 20 years' experience in
multi-asset and value investing. The Company's management team
employs a "refined value" bottom up, deeply researched investment
approach. Value investing is a process which is traditionally
applied to equity investment. MAVT's manager seeks to refine and
apply the value identification process across a highly diversified
range of asset classes, including global equities, credit and
specialist assets (such as property, infrastructure, financial
investment vehicles, private equity and music royalties), and
defensive assets (such as gold), seeking the most compelling
investment opportunities wherever they can be found. Responsible
investment considerations also form an integral part of the
investment philosophy and ESG considerations are implemented
throughout the investment process.
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END
FR SEMFISEESEIM
(END) Dow Jones Newswires
June 21, 2022 02:00 ET (06:00 GMT)
Grafico Azioni Momentum Multi-asset Value (LSE:MAVT)
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Da Apr 2024 a Mag 2024
Grafico Azioni Momentum Multi-asset Value (LSE:MAVT)
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