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(Corrects lede to show net assets fall.)
Scottish Mortgage Investment Trust PLC on Thursday raised its dividend for its financial year ended March 31 as net assets fell.
Its net asset value per share ended March 31 at 1,021.8 pence, slumping from 1,195.1p at the same point the year prior.
Its NAV total return in the twelve months to March 31 was minus 13%, which drastically underperformed its benchmark - the FTSE All-World index - which gained 13%.
‘Investors in Chinese companies have suffered from President Xi's regulatory crackdowns in the name of 'common prosperity'. In retrospect, it has been a mistake to reduce our holdings in western online platform companies rather than their Chinese counterparts,’ Scottish Mortgage explained.
The Edinburgh-based investment trust posted an annual pretax loss of £2.5 billion on investments, compared to a profit of £9.25 billion a year ago. This resulted in a net loss per share of 178.32p versus a net return of 632.84p a year ago.
‘The deteriorating geopolitical situation and significant job losses in the technology and education sectors have made the Chinese government's aggressive regulatory stance less tenable. Vice Premier Liu He's statement in March that the authorities should deliver 'policies favourable to markets and be cautious in introducing contractionary measures' may signal that the worst of the crackdown is behind us,’ the trust added.
The company said the total dividend for the year will be increased to 3.59p from 3.42p a year ago.
The firm expects high levels of growth in its current financial year despite challenges in the cost of living and rising interest rates, it said. ‘Most companies in the portfolio have delivered exceptional levels of growth over the past two years in a challenging operating environment,’ it explained.
Scottish Mortgage Investment Trust shares were 3.9% lower at 748.08 pence each in London on Thursday afternoon.
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