BMO Global Smaller Companies NAV outperforms the Benchmark as equity markets post further advances

by | Dec 14, 2021

BMO Global Smaller Companies PLC (the ‘Company’) has published its Half-Year results for the six months to 31 October 2021.

Financial highlights

  • Net Asset Value with debt at fair value (‘NAV‘) increased to 183.39p per share, giving a total return of 5.6% compared to the Benchmark total return of 4.3%
  • The share price ended the period at 167.2p, delivering a total return of -0.1%, with the discount widening from 3.6% to 8.8% in the period
  • Interim dividend increased by 3.6% to 0.57p per ordinary share


Portfolio highlights

  • All regional portfolios beat the local smaller company indices in the period
  • Best total sterling return from the European portfolio, strong outperformance recorded in North America
  • Performance helped by elevated level of takeover activity especially in the UK and North America
  • Strong recovery in income received, with revenue return per share up 106.7% as many companies returned to paying dividends having cancelled them during the early part of the pandemic


Commenting on the six month period and looking forward, lead manager Peter Ewins said: “Stock markets have started the financial year well, supported by the global economic recovery and corporate earnings rebound. With inflation hitting multi-year highs, looking forward, investors need to consider the potential risk to equity valuations from tighter monetary policy, especially in the US. It seems likely however that interest rates will remain very low compared to prevailing rates of inflation in the main developed markets, providing support for the case to continue to hold onto high quality equities. Having said this, the recent acceleration in Covid case numbers in Europe, the emergence of a new variant of the virus and reimposed restrictions are clearly unwelcome developments ahead of the Christmas period.

“While recent supply chain and logistical issues are causing disruption to the operations of some businesses, we remain encouraged by the performance of most of the companies in the portfolio. Demonstrating effective cost management and the ability to move up pricing will be important drivers in the near term for company management teams.”

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