Caledonia manages to trump FTSE by 5pc in its first-half

UK investment trust Caledonia Investments outperformed the FTSE All-Share Index by five per cent in its first half 2010 results, it said yesterday.

Net asset value per share rose by 3.5 per cent to 2,105p from 2,034p while the index fell 1.5 per cent over the same period, the firm said in its interim results statement.

It has raised its interim dividend by 4.7 per cent to 11.1p per share and remains confident it can continue its unbroken 43-year record of increasing dividends in its full-year results.

Chief executive Will Wyatt said: “There’s been a general good tick up in the market and we’ve had some nice recovery in our unquoted portfolio, a lot of which is industrial-based.”

Caledonia’s share price remained broadly the same in the six months to 30 September at 1,627p, up from 1,625p at 31 March.

It invested £49m in the first half, including £25m of new investments into companies such as banknote printer De La Rue and Indian fund IAP Gateway to India, as well as £24m of follow-on investments. It realised £60m from existing investments.

Unquoted investments performed strongly, rising 11.1 per cent, while its listed portfolio rose 2.5 per cent.

Caledonia is currently trading at around a 19 per cent discount to earnings, which analysts consider wide.

The firm’s outlook is cautious and it aims to increase liquidity above its current two per cent net cash level.

“At the end of the day we will continue to try to grind out positive results and if we do that the performance and the share price will come,” Wyatt said.