Murray Income Trust increases dividend by 0.7%

Murray Income Trust increases dividend by 0.7%

Charles Luke, manager of Murray Income Trust

Murray Income Trust PLC, a fund managed by Standard Life Aberdeen (SLA), has posted its annual results revealing it has increased its total dividends per share by 0.7% to 34.25p.

The change marks the 47th year of consecutive increase. The trust has also posted a dividend yield of 4.5%, based on the year end share price of 768.0p.

Murray Income Trust posted a share price total return of -5.8% and net asset value total return of -5.3% which the company has said are both well ahead of of the FTSE All-Share Index Total Return of -13.0%.

Neil Rogan, chairman of Murray Income Trust, said: “Quality companies with attractive dividend yields, sound growth prospects and strong balance sheets are likely to be prized more than ever. The Company’s focus on quality should mean that it is particularly well placed to serve shareholders who are searching for a reliable, diversified and growing income stream.

“COVID-19 has led to a sudden, large and unexpected cut in dividend payments from many UK companies. Hit hard by declining revenues, companies have chosen to conserve cash or followed guidance to suspend dividends whilst in receipt of government furlough funding or other assistance.

“Calendar year 2020 dividends, for the market, are currently expected to be 40% below 2019 levels. Charles is currently forecasting a 14% reduction in our portfolio income in 2020. The purpose of building our revenue reserves over the years is to give us the ability to smooth dividend payments to shareholders in times such as these.

“So we are able to increase our full year dividend per share for the year ended 30 June 2020 to 34.25p by paying out 30.50p as this year’s revenue supplemented by 3.75p from revenue reserves, which represents the 47th year of consecutive dividend increases. This reduces our revenue reserves per share from 27.8p to 24.1p, the latter representing 70.3% of the full year dividend.”

Charles Luke, manager of Murray Income Trust, added: “Outperformance relative to the benchmark was evenly distributed across both halves of the year as stock selection proved to be strong in an environment where the focus on quality companies proved its worth again.

“As we saw during the period, these high quality companies provided the ability to participate when the equity market performed well given the structural growth characteristics of the holdings yet outperformed a falling market as their strong balance sheets and robust business models demonstrated defensive attributes.”

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