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Jupiter Dividend & Growth Trust PLC
Interim Management Statement for the three months ended 30 September 2012
The Board of Jupiter Dividend and Growth Trust PLC (the "Company") is pleased to announce its interim management review for the quarter ended 30 September 2012.
The following report relates to the performance of the Company's investment portfolio in the three months leading up to 30 September 2012.
Investment Manager's Report for the Quarter ended 30 September 2012
Equity markets, including the UK, generally rose during the third quarter of 2012 as investors anticipated further central bank support in the face of slowing global growth prospects. Sure enough, the European Central Bank committed to conditional but unlimited, direct purchases of sovereign debt. This may address near-term liquidity risks but cannot address growth prospects or long-term debt sustainability issues. In the US, where there is little threat of deflation, the Federal Reserve's bold decision to target the labour market and commit to open-ended quantitative easing marked a profound change in policy. Markets responded by raising inflation expectations.
In the portfolio we opened a new position in BT Group which, having paid down a lot of debt, is now set to benefit from a less onerous pricing structure and is offering films and sports programmes to its retail broadband customers. We established a new position in Resolution after the life assurer released poor interims. The company has simplified its complex structure and will focus on returning capital via dividends. Meanwhile, the shares offer an attractive yield. We bought into Halfords following poor first quarter results as we believed the shares were severely undervalued for a such a cash-generative business.
We took some profits from Majestic Wine and reduced our holdings in Hogg Robinson, Norcross and N Brown Group. We cut our position in Repsol and took up a rights issue for Melrose, the specialist turnaround group. The cash position was reduced from 8.0 per cent. at 30 June 2012 to 5.1 per cent. at 30 September 2012.
Fund Manager, Jupiter Asset Management Limited
1 November 2012
Total Assets as at 30 September 2012: £37,401,717
Shares in Issue on 30 September 2012:
32,319,031 Zero Dividend Preference shares
8,054,045 Common shares
91,675,333 Ordinary Income shares
|Net Asset Value (p)||Market Price (p)||Premium/(Discount)|
|Zero Dividend Preference shares||91.98||74.00||(20%)|
| Common shares|
|Ordinary Income shares||0.29||4.38||1410%|
Portfolio Distribution on 30 September 2012 Percentage of Total Assets
|Cash and fixed interest||5|
The Company's exposure to other UK listed investment companies was 0.0 per cent. as at 30 September 2012.
Top Ten Holdings on 30 September 2012
|Company||Country of Listing||% of Total Assets|
|Royal Dutch Shell 'B'||United Kingdom||7.1|
|HSBC Holdings||United Kingdom||5.0|
|Babcock International||United Kingdom||3.8|
|William Hill||United Kingdom||3.7|
Comparative Performance to 30 September 2012
|1 Month||3 Months||1 Year||Since Last Annual Report||Since Reconstruction|
|FTSE All-Share Index||0.9||3.7||13.0||4.9||9.4|
|FTSE 350 Higher Yield||(0.4)||2.0||10.7||2.3||(10.0)|
|Ordinary Income share NAV||0.0||-||-||0.0||(99.1)|
|Ordinary Income share price||0.0||0.0||(2.7)||3.1||(86.9)|
|Common share NAV||1.0||4.8||11.4||6.9||-|
|Common share price||1.7||3.8||9.2||3.8||-|
Jupiter Asset Management Limited ("Jupiter")
The Company's benchmark index is FTSE All-Share Index
Second interim dividends of 0.18p (net) per Ordinary Income share and 0.50p (net) per Common share both for the year ending 31 December 2012 were paid to Ordinary Income and Common shareholders on 31 August 2012.
Third interim dividends of 0.18p (net) per Ordinary Income share and .50p (net) per Common share both for the year ending 31 December 2012 will be paid to Ordinary Income and Common shareholders on 12 December 2012.
Availability of Monthly Fact Sheets
Monthly fact sheets for the Company are available for download from, www.jupiteronline.com and by post or fax on request from the company secretarial department.
The Company's Ordinary Income shares, Zero Dividend Preference shares and Common shares are listed on The London Stock Exchange and the prices are published in the Financial Times under `Investment Companies'.
The Net Asset Values of the Company's Ordinary Income shares, Zero Dividend Preference shares and Common shares are calculated weekly and can be viewed on The London Stock Exchange website at www.londonstockexchange.com (under the heading 'Market News').
The objective of the Company is to provide Ordinary Income and Common shareholders with a high and rising income together with the possibility of capital appreciation and to provide Zero Dividend Preference and Common shareholders with a predetermined level of capital growth.
The investment policy of the Company is to invest mainly in a portfolio of UK listed equities, UK equity-related securities (such as convertible securities, preference shares, convertible unsecured loan stock, warrants and other similar securities) and UK fixed interest securities.
The equities selected as suitable for the portfolio will generally be those judged to be lowly valued by the Investment Manager, typically offering an attractive dividend yield with sufficiently strong cash generation from their operational activities to grow the dividend to shareholders over a number of years. Such equities are likely to be considered by the Investment Manager to be undervalued by the stock market at the time of purchase and will offer scope for capital gains.
The portfolio manager selects each stock on its individual merits as an investment rather than replicating the relevant company's weighting within its benchmark, the FTSE All Share index. The portfolio is therefore unlikely to represent the constituents of its benchmark, but instead is intended to offer a well diversified investment strategy focussed on maximising returns from the prevailing economic background.
The portfolio manager has complete flexibility to invest any proportion of the Company's investment portfolio in debt securities from time to time. Investment in debt securities will be in convertible bonds, corporate bonds and other debt securities (such as gilts) considered by the Investment Manager to be quasi-cash instruments. Investment in bonds issued by corporate issuers will generally be in those of issuers which are either rated as "investment grade" issuers or are considered by the Investment Manager to have an equivalent grade. The Investment Manager may also invest in sub-investment grade corporate bonds where it considers that their ratings are likely to improve. The percentage of the portfolio invested in debt securities at any given time will primarily be driven by tactical considerations but will also depend upon the outlook for interest rates and the scope for improved debt ratings.
The Company may invest in unlisted securities (up to a maximum of 5 per cent. of Total Assets) and derivatives but it is not the Investment Manager's present intention to do so (save, in respect of derivatives for the purposes of efficient portfolio management).
It is the Company's policy to invest no more than 15% of its gross assets in other listed investment companies (including listed investment trusts) as defined in the Listing Rules.
Any material change in the investment policy of the Company described above may only be made with the approval of Shareholders by an ordinary resolution and separate class approval.
On behalf of the Board
Jupiter Asset Management Limited
1 November 2012
For further information, please contact:
Director of Investment Trusts
Jupiter Asset Management Limited
020 7314 4822
Company Secretarial Department
Jupiter Asset Management Limited
020 7314 4915
The Company's registered office is at 1 Grosvenor Place, London SW1X 7JJ.
This interim management statement has been prepared solely to provide information to meet the requirements of the UK Listing Authority's Disclosure and Transparency Rules.
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