Smithson Investment Trust (SSON) H1 2024 earnings summary

Executive summary

• NAV per share total return for H1 2024 was -1.8%, underperforming the MSCI World SMID Index's +3.4% return; share price declined 2.6% in the same period.

• Since inception, annualised NAV per share growth is +8.2%, outperforming the comparator index by 0.5 percentage points.

• Share buybacks continued, with £206.4m spent in H1 2024, totaling £439.7m since 2022, yet discount to NAV widened to 12.2%.

• Total loss after tax for H1 2024 was £71m, with a capital loss of £77m and revenue profit of £6m.

• No interim dividend proposed; focus remains on long-term capital growth rather than income.

Financial highlights

• Net assets at 30 June 2024 were £2,274.4m, down from £2,622.9m at 30 June 2023.

• NAV per share at 30 June 2024 was 1,569.5p, compared to 1,575.4p at 30 June 2023.

• Ongoing charges ratio improved to 0.86% for H1 2024, from 0.88% in 2023.

• Portfolio turnover (adjusted for buybacks) was 20.0% in H1 2024, up from 13.1% last year.

• Free cash flow growth for portfolio companies was 14% over the last twelve months; free cash flow yield rose to 3%.

Outlook and guidance

• Board and Investment Manager remain optimistic about long-term prospects, citing strong fundamentals and refreshed portfolio.

• Rising interest rates have been a headwind, but are not expected to persist indefinitely.

• Portfolio positioned for long-term growth, with recent additions in high-quality small and mid-cap companies.