Henderson trust outperforms due to healthcare investment

The Henderson Smaller Companies Investment trust outperformed its peers after almost doubling its money in a Dubai focused healthcare company.

NMC Healthcare shares rose 98.9 per cent during the year in question, and contributed the largest slug of outperformance for the £751m trust, at 1.8 per cent.

The Henderson Smaller Companies investment trust returned 33 per cent in the twelve months to 31 May, compared with 27 per cent for the average trust in the AIC UK Smaller Companies sector in the same time period.

Neil Hermon, the trust’s manager, said: “The fundamentals of the corporate sector remained robust. Companies continued to grow their dividends whilst balance sheets remained strong.

“UK corporate earnings saw stronger growth, helped by improving economic conditions and the weakness of sterling increasing the value of overseas earnings for UK companies.”

Mr Hermon said: “NMC Health is a Middle Eastern based healthcare operation. Its main facilities are in the United Arab Emirates, particularly Dubai and Abu Dhabi. NMC has grown strongly since its IPO in 2012 through the building of new facilities and acquisitions.

“This growth is set to continue, particularly given the positive structural opportunities in the UAE, driven by an underprovision of state provided healthcare, the continued roll-out of mandatory health insurance and positive demographics.”

Mr Hermon, who said he expects the UK consumer to struggle for the year ahead, made recent investments in Avon Rubber, a company that derives significant revenue from defence spending globally, and Burford Capital, a litigation financing business that derives its revenue from the US and other international markets.

Among the shares it has sold have been Carpetright, a UK home furnishings business, and LSL Property Services, a UK estate agency.

The Henderson Smaller Companies Investment Trust trades at a discount to net assets of 14.2 per cent.  

david.thorpe@ft.com

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