Saints hikes divi and expects shareholder payouts to rise

Patrick Edwardson has increased his Scottish American Investment Trust’s (Saints) second interim dividend and is confident payouts will soon recover to their pre-2009 levels.

Edwardson increased the mid-year payout from 2.25p to 2.30p per share, bringing the trust’s total half-year dividend to 4.60p, a rise of 2.2% year-on-year.

In a six-months to 30 June stretch - which saw the company’s benchmark fall 3.7% - Edwardson’s trust outperformed, keeping losses down to 1.1%.

Its fixed interest, listed and direct property investments also performed well, while returns from the portfolio’s equities reflected the more challenging conditions faced by stockmarkets.

In response analysts shone a light on the rise in the dividend.

‘The managers have been confident enough to raise the interim dividends ahead of an expected recovery in dividend receipts next year,’ Oriel Securities said.

‘With shares trading around NAV, like many higher yielding equity trusts Saints is no longer cheap.  However performance has been good and the portfolio is well diversified by geography and asset class.’

Payouts to shareholders have been rocked by company cut backs and the BP crisis in the Gulf of Mexico, which alone is expected to wipe £10 billion from total shareholder payouts awarded throughout the year.

Edwardson said that in broad terms he and the trust board believe both the global economy and financial systems have started to recover from the crisis. 

While he said many developed economies will remain fragile and markets prone to periods of uncertainty, he expects developing nations to lead the global recovery, which will see corporate profits and dividends to grow.