Scottish Mortgage underperforms index but optimistic about AI

(Alliance News) - Scottish Mortgage Investment Trust PLC on Thursday reported a positive total ...

Alliance News 23 May, 2024 | 9:23AM
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(Alliance News) - Scottish Mortgage Investment Trust PLC on Thursday reported a positive total return for what its chair called "a challenging yet rewarding year".

The investor in growth companies globally is managed by Baillie Gifford & Co and has stakes in well-known technology stocks such as Nvidia Corp, Inc, Meta Platforms Inc, and TikTok-owner ByteDance Ltd.

Net asset value was 936.6 pence per share on March 31, with borrowings at fair value, up from 843.9p at the same time last year.

Scottish Mortgage shares were trading 2.0% higher at 887.71p on Thursday morning in London.

Scottish Mortgage reported an NAV total return of positive 11.5% in the financial year that ended March 31, compared with a negative 17.8% return for the previous year.

The FTSE All-World Index, meanwhile, delivered an NAV total return of 21.0% following the prior year's negative 0.9%.

Scottish Mortgage declared a final dividend of 2.64p per share, up 5.6% from 2.50p in financial 2023. This brings the total dividend up 3.4% to 4.24p from 4.10p per share.

"It has been a challenging yet rewarding year for the company set against a backdrop of volatile markets," commented Chair Justin Dowley. "Conflicting forces have been pulling investors in different directions.

"There is a sense of optimism regarding the integration of artificial intelligence into business models. Meanwhile, the macroeconomic and geopolitical factors driving market anxiety are too numerous to mention."

Looking ahead, Scottish Mortgage is "in a strong position to maximise returns for shareholders over the coming years", Dowley said, citing its "strong balance sheet, high conviction in the current portfolio and a commitment to facilitate trading of its shares around net asset value in normal market conditions."

Scottish Mortgage had a cash balance of GBP123.8 million at March 31, down from GBP184.9 million a year ago.

By Emma Curzon, Alliance News reporter

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Securities Mentioned in Article

Security Name Price Change (%) Morningstar
Scottish Mortgage Ord 900.20 GBX 0.09
Meta Platforms Inc Class A 504.16 USD 0.01
NVIDIA Corp 131.88 USD 1.75 Inc 183.66 USD -0.09

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