Raven Russia, a £565 million fund focused on Russian warehouses that has long been one of Neil Woodford’s favourite trusts, has reported strong annual results despite turmoil in the country.
Through 2013 Raven Russia’s net operating income leapt 37% to £112 million, with 97% portfolio occupancy, which gave its board the confidence to boost its dividend by a third to 5p – equivalent to a 6.5% yield.
Chair Richard Jewson noted the regional strife, but was sanguine about its impact on Raven’s business.
‘We must hope that events in the Ukraine settle peaceably in the coming months and we recognise the effect that this will have on the capital markets whilst the issues remain unresolved,’ he said.
Raven Russia’s share price has fallen by 3% over the past three months, despite a 3% recovery to 77p following this morning’s results.
Jewson commented: ‘For us, it is business as usual in Russia, with leases and banking arrangements continuing to be signed and rents paid.’
Glyn Hirsch, chief executive officer, added that ‘relatively speaking Russia is in a strong position but currency volatility makes financial planning difficult’.
Hirsch claimed he therefore felt ‘justified in keeping a relatively high balance of free cash’, currently worth £137 million.
Ewan Lovett-Turner, an analyst at Numis Securities, commended this approach. ‘The group has a well let and conservatively funded portfolio which should continue to support its progressive dividend policy,’ he remarked.
‘We expect net asset value progression to be fairly muted in the coming periods with the focus remaining on earnings growth and level of distributions.’
Invesco currently owns 35% of the fund.