British Empire Trust swings to earnings in full-year report

The FTSE 250 company reported investment income of £20.69m, down marginally on the £20.93m recorded in 2015, although revenue earnings per share rose to 14.32p from 11.75p.

Its capital earnings per share were 141.72p, swinging from a 59.95p capital losses per share in 2015, and total earnings per share were 156.04p, from losses of 48.2p per share last year.

Ordinary dividends per share remained in line with the prior year at 11.7p, though British Empire paid special dividends of 2.8p in 2016, while it paid no such dividends in 2015.

“There are an unusually large number of risks for investors at the time of writing,” said chairman Strone Macpherson.

“On the geopolitical front, the consequences of the outcome of the US election, the Brexit arrangements to be negotiated, the German, French and other European elections in the year ahead, and the turmoil in the Middle East, are all major uncertainties.”

Macpherson said the risk of significant policy errors by Central Banks also remained high.

“However, despite all these difficulties, and the volatility that they bring to the investment markets, such volatility often produces pricing anomalies for value investors such as British Empire.”

This year's results were encouraging, Macpherson explained, before stressing the importance to recognise that British Empire has a portfolio of investments containing a large store of unrealised value reflected in the considerable see-through discount.

“Your board believes that shareholders will continue to be well served over time by maintaining the current value investment approach.”