Athelney Trust PLC
Legal Entity Identifier:
213800ON67TJC7F4DL05
The unaudited net asset value of Athelney Trust was 176.6p at 31 March 2025.
Fund Manager's comment for March 2025
The US economy expanded at an annualized 2.4% in Q4 2024, slightly exceeding expectations, with growth driven by resilient consumer spending. Inflation continued to ease, with CPI falling to 2.8% in February and core inflation reaching a near three-year low of 3.1%. The Federal Reserve maintained interest rates at 4.25%-4.5% in March, signalling a measured approach to potential cuts while lowering GDP growth forecasts. Labour market conditions softened, as unemployment rose to 4.1% and job growth slowed to 151,000 in February. Manufacturing weakened due to tariff-related disruptions, while the services sector rebounded on stronger demand, reflected in a rising S&P Global Services PMI.
The European economy stagnated in Q4 2024, reflecting weak growth momentum. Inflation fell to 2.3% in February, slightly below initial estimates but still above the ECB's 2% target. Core inflation eased to 2.6%, its lowest since early 2022, prompting the ECB to cut interest rates by 25bps to 2.50%. Manufacturing showed signs of stabilization, with output expanding and job cuts slowing, while the services sector lost momentum as new business growth weakened. Wage pressures eased, leading to a slower rise in input costs and selling prices.
The UK economy grew by 0.1% in Q4 2024, in line with previous estimates, following stagnation in Q3. Growth was supported by modest gains in services and construction, while manufacturing weakened, particularly in metals and transport equipment. Inflation eased to 2.8% in February, but the Bank of England held interest rates at 4.5% in March, citing persistent inflation risks and geopolitical uncertainties. Unemployment remained steady at 4.4%, though manufacturing sentiment deteriorated to a two-year low amid weak demand and rising costs. Meanwhile, the services sector showed resilience, with the Services PMI rising to its highest level since August 2024, as new business improved, and firms remained cautiously optimistic despite ongoing cost pressures.
Global equity markets faced renewed pressure in March, as concerns over tariffs and economic uncertainty led to the worst quarterly performance for the S&P 500 and Nasdaq Composite since 2022. During the month the S&P 500 declined by 5.8%, the Nasdaq Composite by 8.2%, the MSCI World Index by 4.6%, while in the UK, the FTSE 100 fell 2.6% and the FTSE 250 by 4.2%. The Small Cap Index and AIM All-Share Index declined by 1.7% and 3.1%, respectively, while the Fledgling Index posted a modest decline of 0.3%.
The Association of Investment Companies (AIC) recently identified 26 investment trusts that consistently deliver the highest yields. To qualify, trusts required a minimum yield of 5%, a decade-long track record without year-on-year dividend cuts, and a positive total return over the past 10 years. Notably, Athelney was included in this select group and stands out as the only trust dedicated to UK smaller companies.
When compared to the market, our portfolio faced the same headwinds in March, with the NAV decreasing by 3.2%. During the month, we initiated a holding in Mony Group plc, a leading UK-based price comparison website, helping consumers save on financial products, insurance, energy, and broadband services. We trimmed our holdings in AEW Reit, Tritax Big Box, Cake Box, Impax Asset Management, NWF Group and PayPoint and sold our remaining holding in Cerillion. We added to our holding in 4Imprint after they announced a special dividend. Notable contributors to performance included Fever-Tree, AEW REIT and Begbies Traynor Group. The largest detractors from our performance were 4Imprint, Treatt and Liontrust Asset Management.
Fact Sheet
An accompanying fact sheet which includes the information above as well as wider details on the portfolio can be found on the Fund's website www.athelneytrust.co.uk under "About" then select "Latest Monthly Fact Sheet".
Background Information
Dr. Emmanuel (Manny) Pohl AM
Manny is Chairman and Chief Investment Officer of E C Pohl & Co ("ECP"), an investment management company and has been a major shareholder in Athelney trust for many years.
E C Pohl & co is licensed by the Australian Financial services (license no.421704).
Manny Pohl and the ECP group has AUD2.7bn (£1.5 billion) under its management including four listed investment companies, three listed in Australia and one in the UK:
· Flagship Investments (ASX code:FSI)
AUD95m https://flagshipinvestments.com.au
· Barrack St Investments (ASX code: BST)
AUD37m www.barrackst.com
· Global Masters Fund Limited (ASX code: GFL)
AUD33m www.globalmastersfund.com.au
· Athelney Trust plc (LSE code: ATY)
GBP6m www.athelneytrust.co.uk
Athelney Trust plc Investment Policy
The investment objective of the Trust is to provide shareholders with prospects of long-term capital growth with the risks inherent in small cap investment minimised through a spread of holdings in quality small cap companies that operate in various industries and sectors. The Fund Manager also considers that it is important to maintain a progressive dividend record.
The assets of the Trust are allocated predominantly to companies with either a full listing on the London Stock Exchange or a trading facility on AIM or ISDX. The assets of the Trust have been allocated in two main ways: first, to the shares of those companies which have grown steadily over the years in terms of profits and dividends but, despite this progress, the market rating is favourable when compared to future earnings and dividends; second, to those companies whose shares are standing at a favourable level compared with the value of land, buildings or cash in the balance sheet.
Athelney Trust was founded in 1994. In 1996 it was one of the ten pioneer members of the Alternative Investment Market ("AIM"). In 2008 the shares became fully listed on the main market of the London Stock Exchange. Athelney Trust has a successful progressive dividend growth record and the dividend has grown every year since 2004. According to the Association of Investment Companies (AIC) Athelney Trust is a "Dividend Hero" being one of only a few investment companies that have increased their dividend every year for 20 years or more. See link
https://www.theaic.co.uk/income-finder/dividend-heroes
Website
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