The trust reported a net asset value (NAV) return of 15.1% compared to a benchmark return of 21.9% for the 12 months to June 30, 2026. Since taking over Murray Income in March, Artemis made changes to the portfolio, which lifted its share price up by 11.5%.

The dividend also increased by a penny to 41p, marking the trust’s 53 consecutive years of dividend increases, while the net revenue per share was 40.6p.

The new board bought back 4.6m shares at an average discount of 8.3%, which added 0.4% to the NAV return. The discount narrowed from 9.6% to 6.7%.

Retiring chair Peter Tait

Artemis spent £600,000 on the legal, corporate and admin costs in relation to the transition. It also paid £3.9m of stamp duty on purchases of new portfolio investments. Artemis agreed not to charge a fee for the first nine months but will then shift to being charged at the lower of market capitalisation or NAV. 

Chair Peter Tait announced that he will step down at the AGM in October, retiring after nine years on the board of the trust, with the last three as chair. He will be succeeded by Jane Lewis, subject to shareholder approval of her election as director at that AGM.

The firm contributed £150,000 to marketing the trust.

The new management team noted an increase in M&A activity in the UK market highlighting that SEGRO and easyJet received takeover approaches during the period and were the largest contributors to the trust: “another sign of the undervaluation of parts of the UK equity market in our view, and there are several more names in our portfolio that we believe could be vulnerable to an approach.

“This should underpin share prices as M&A approaches once again look to be ticking up for UK companies.”

Mr Tait pointed out that the “UK stock market continued to make progress, rising by 21.9% in the year to end June helped by strong returns from the financials and metals and mining sectors in particular. The share price return from your portfolio was modestly behind that of the UK benchmark over the year, but with that performance gap closing significantly after the appointment of Artemis in March of this year.”

The portfolio managers also highlighted the gap between UK and international valuations with the portfolio trading on 12.4x earnings, the all-share on 12.7x, and the world index at 23x.

Artemis will use gearing as a “tool for enhancing portfolio performance”. The company has in place £100m of long-term borrowings made up of £40m loan notes redeemable at par in November 2027 and £60m loan notes redeemable at par in May 2029.

These combined have a weighted interest cost of 3.6%. The company also has a three-year multi-currency revolving credit facility that runs to October 2027, but which can be reduced or terminated at short notice at no extra cost.

Artemis has put Adrian Frost, Andy Marsh and Nick Shenton in charge of the trust; between them, they have 57 years of experience running UK equity income portfolios. They will also be assisted by investment director Josh Passmore and portfolio analyst Jamie Lindsay.

Mr Tait said: “More recently, after a period of substantial underperformance, the board initiated a strategic review which resulted in the appointment of Artemis as the investment manager of the company.

“No management change is easy, but one of the main upsides of investment trusts for long-term investors is having an independent board closely monitoring performance and making these tough decisions. The closed-end structure gives boards and managers the freedom to avoid short-termism and enhance capital and income growth through the judicious use of gearing and, in the case of your company, a progressive dividend policy.

“That’s why I recommend trusts as the bedrock of any long-term savings plan and why, with the appointment of Artemis, I have personally increased my holdings in Murray Income Trust.”

QuotedData’s James Carthew said: “Artemis has been managing Murray Income for around six months now. It is great to see the improvement in its performance, in what has been a turbulent period mainly thanks to the Iran war. There has been considerable dispersion of returns across the UK equity income sector over this period, with Murray Income sitting in the middle of the performance table. So, too early to get excited, but a step in the right direction.”