The Lemon Fool

ADrunkenMarcus wrote:

mc2fool wrote:I believe I've been pretty clear in saying that I think you need to determine TMPL's proper TR

That's why the TR data for TMPL was provided, above, from another source.

Of which you said their "method warrants investigation", to which I'd agree 'cos their figure doesn't feel right as it's less that your "cheat" adding-in figure despite the shares having risen over the period. But having neither access to Sharepad nor the inclination anyway, I'll leave you to it.....

mc2fool wrote:

ADrunkenMarcus wrote:

mc2fool wrote:I believe I've been pretty clear in saying that I think you need to determine TMPL's proper TR

That's why the TR data for TMPL was provided, above, from another source.

Of which you said their "method warrants investigation", to which I'd agree 'cos their figure doesn't feel right as it's less that your "cheat" adding-in figure despite the shares having risen over the period. ....

As I noted in my original post, the Sharepad figure would be lower than my original 'cheat' total return calculation, because the share price had fallen since that was done (not risen). However, the Sharepad total return figure was not lower by much.

I'm not sure why this conversation should be so difficult.

I'll take your earlier advice.

Best wishes

Mark.

ADrunkenMarcus wrote:Temple Bar's recent poorer performance made me look at its longer term track record.

Your statistics on TMPL are interesting - thanks. But I'm not a great fan of long term records. Especially if long-ago performance is alleviating poor recent performance. I know that past performance is no guarantee of future performance, but I do feel that bad performance over the past 5 years would sway my judgement more than good performance 10 years ago.
Looking at a graph (from Hargreaves Lansdown) of the total return of TMPL over the past 5 years, it has been generally sitting below, but following the trend (apart from a very recent short-lived spike), of a FTSE all-share tracker fund (HSBC FTSE All Share Index). And its Dividend yield has been about 0.5% below the FTSE all-share tracker. So It's difficult to see why the current managers deserve their fees.
So in your shoes, I would be off to pastures new with this investment. Then knowing my luck, the performance of TMPL would suddenly, and dramatically, improve.

scotia wrote:Then knowing my luck, the performance of TMPL would suddenly, and dramatically, improve.

That's exactly the worry, isn't it?

I wonder the same with Murray International (MYI).

I have kept a record, for a couple of years, of each of my shareholdings' annual total return. It can be interesting that a company which is the best performer for one year can be the weakest performer the next year, or at least show a dramatic reversal. Of course, individual companies are different to investment trusts, but it might apply more broadly.

Best wishes

Mark.

ADrunkenMarcus wrote:

scotia wrote:Then knowing my luck, the performance of TMPL would suddenly, and dramatically, improve.

That's exactly the worry, isn't it?

I wonder the same with Murray International (MYI).

I have kept a record, for a couple of years, of each of my shareholdings' annual total return. It can be interesting that a company which is the best performer for one year can be the weakest performer the next year, or at least show a dramatic reversal. Of course, individual companies are different to investment trusts, but it might apply more broadly.

Best wishes

Mark.

Well - I certainly can't accuse MYI of being a world index tracker! It invests in an eclectic mix of countries which bear no relation to their indexed weights in a world tracker. E.G. only 15% in the USA , but about 10% in Mexico. It is clearly a stock-picker's fund - only the managers currently appear to be picking the wrong stocks from the wrong areas! Its performance over the past 5 years is significantly poorer than a world tracker, and it is humiliated by the high fliers - e.g. global ITs from Bailie Gifford or global funds from Lindsell Train and Fundsmith.
But following the Dogs of the Dow philosophy - that yesterday's dogs become tomorrows winners (which partially relates to your own observations), maybe it is about to turn from an ugly duckling into a swan - and clearly investors seem to think that this is a possibility, since it is sitting at a premium around 4%. I'm not convinced

77ss wrote:....
Aberforth Smaller Companies (which I don't hold) is similar to HSL - 61% in FT250 cos....

Correction - 35%.

I've been thinking about increasing my stake in sub-100 companies for a bit now, and this thread has stimulated me to do a bit of work. There is quite a distribution in terms of company sizes held:



Wow! It worked - thanks to itsallaguess et al.

The first five have already been mentioned; I decided not to look at Acorn and have added Blackrock Throgmorton.

For those interested, Tempus in The Times on Tuesday did a overview of THRG - with a 'buy' recommendation (FWIW).

I hold Montanaro Smaller UK Cos IT and I was looking at their most recent fact sheet recently and wondering if the name of the Trust is entirely accurate since 25% of the companies it holds have a value of of £500m or less, 14% are in the £1.5bn - £2bn bracket and 12% are worth £2bn or more. Just a thought.

Rituximan wrote:I hold Montanaro Smaller UK Cos IT and I was looking at their most recent fact sheet recently and wondering if the name of the Trust is entirely accurate since 25% of the companies it holds have a value of of £500m or less, 14% are in the £1.5bn - £2bn bracket and 12% are worth £2bn or more. Just a thought.

Thanks for that - another one to add to my list for consideration.

'Smaller' is very much in the eye of the beholder. The largest FT250 company has a market capitalisation of about £5.2bn, so maybe £2bn can be considered 'small'. A quick look suggests that MTU is 19% FT250 and 81% sub-FT350/AIM.

77ss wrote:

Rituximan wrote:I hold Montanaro Smaller UK Cos IT and I was looking at their most recent fact sheet recently and wondering if the name of the Trust is entirely accurate since 25% of the companies it holds have a value of of £500m or less, 14% are in the £1.5bn - £2bn bracket and 12% are worth £2bn or more. Just a thought.

Thanks for that - another one to add to my list for consideration.

'Smaller' is very much in the eye of the beholder. The largest FT250 company has a market capitalisation of about £5.2bn, so maybe £2bn can be considered 'small'. A quick look suggests that MTU is 19% FT250 and 81% sub-FT350/AIM.

Morningstar use the following for their ratings.

Giant Top 40%
Large Next 30%
Mid-cap Next 20%
Small-cap Next 7%
Micro-cap Lowest 3%

In money terms this is up to £596m micro, up to 2.5bn small, up to 11.3bn medium

For those interested in Temple Bar (TMPL):

Temple Bar Investment Trust – Just getting started - 23 April 2021

https://quoteddata.com/research/temple- ... gLqRvD_BwE

Looking at the top 10 investments (48%) , the businesses there have "challenges ". I'd say the new management has taken a punt on recovery shares rather than quality.

Royal Mail plc 7.3
BP p.l.c. 5.4
Anglo American plc 5.3
NatWest Group Plc 4.9
Royal Dutch Shell Plc Class B 4.7
Standard Chartered PLC 4.5
ITV PLC 4.2
Marks and Spencer Group plc 4.1
Aviva plc 4.1
Dixons Carphone PLC 3.5
Total 48.0

There was a welcome announcement from TMPL yesterday, which if carried through, will give an effective dividend increase this year of almost 14%. I say effective, as there has been a recent share split.

In May, TMPL announced there first quarterly dividend of 10.25p [2.05p post split], and an intention to pay an annual 41p [8.2p]
https://www.investegate.co.uk/temple-bar-investment-trust-pl--tmpl-/prn/dividend-declaration/20220510164028PFB5B/

There was then a 5 for 1 share split

Yesterday, the second quartely was announced at 2.3p, with an intention to pay an annual 9p
https://www.investegate.co.uk/temple-bar-investment-trust-pl--tmpl-/prn/dividend-declaration/20220816174052P3482/

Last year's dividend was 39.5p [7.9p post split], so a nice 13.9% increase. Only Henderson International (HINT) of those ITs I own or follow is showing a higher intended increase this year at 14.3%, and nothing else comes close.

But in spite of the increase, it should be noted the dividend is still only at 87.5% of the level in 2020 before the cut.

For holders - 2nd quarterly dividend - 2.3p, ex-div 8 Sept, pay 30 Sept.

Presumably an increase in the dividend of that amount can only be made possible by continuing to use revenue reserves? I am not saying there is anything wrong with that but if so we ought to recognise that.

Dod

mike wrote:But in spite of the increase, it should be noted the dividend is still only at 87.5% of the level in 2020 before the cut.

The irony was that TMPL's dividend growth was finally showing some welcome strength (as was its share price) and then COVID-19 struck!

Best wishes


Mark.

Presumably an increase in the dividend of that amount can only be made possible by continuing to use revenue reserves? I am not saying there is anything wrong with that but if so we ought to recognise that

According to the Temple Bar report "It is anticipated that this level of dividend will be fully covered by earnings."

AfricaHand wrote:

Presumably an increase in the dividend of that amount can only be made possible by continuing to use revenue reserves? I am not saying there is anything wrong with that but if so we ought to recognise that

According to the Temple Bar report "It is anticipated that this level of dividend will be fully covered by earnings."

Excellent. Maybe they have found the Holy Grail. It always pays to be a bit cynical with that sort of increase in the dividend from an investment trust bearing in mind that they are required to distribute at least 85% of their revenue profits, so for an increase of 14% they would have to be distributing pretty much all of their revenue profits or have found a few new high yielding shares. Maybe a mixture of both and nothing wrong with that of course.

Must take a look at their accounts.

Dod

monabri wrote:Looking at the top 10 investments (48%) , the businesses there have "challenges ". I'd say the new management has taken a punt on recovery shares rather than quality.

Royal Mail plc 7.3
BP p.l.c. 5.4
Anglo American plc 5.3
NatWest Group Plc 4.9
Royal Dutch Shell Plc Class B 4.7
Standard Chartered PLC 4.5
ITV PLC 4.2
Marks and Spencer Group plc 4.1
Aviva plc 4.1
Dixons Carphone PLC 3.5
Total 48.0

In the top 20 holdings ( well , top 22) we find ITV, Pearson, BT, VOD, Easyjet, Centrica, Capita, Kingfisher (the latter being the most shorted company).

https://www.shorttracker.co.uk/company/GB0033195214/

Page 20 of the latest AR ( risk register) states

"As at 31 December 2021 the Company had distributable revenue reserves of £11.7 million. Furthermore, income risk is mitigated by the
Company’s ability to distribute realised capital gains if required to meet any revenue shortfall."

I'd be a little uneasy as to whether this risk was adequately thought through and is covered. Are the companies generating recovering free cash flow (oil companies = yes) to support future dividend increases? The trust seems to contain many companies that even the HYPers worry about and avoid!

monabri wrote:

monabri wrote:Looking at the top 10 investments (48%) , the businesses there have "challenges ". I'd say the new management has taken a punt on recovery shares rather than quality.

Royal Mail plc 7.3
BP p.l.c. 5.4
Anglo American plc 5.3
NatWest Group Plc 4.9
Royal Dutch Shell Plc Class B 4.7
Standard Chartered PLC 4.5
ITV PLC 4.2
Marks and Spencer Group plc 4.1
Aviva plc 4.1
Dixons Carphone PLC 3.5
Total 48.0

In the top 20 holdings ( well , top 22) we find ITV, Pearson, BT, VOD, Easyjet, Centrica, Capita, Kingfisher (the latter being the most shorted company).

https://www.shorttracker.co.uk/company/GB0033195214/

Page 20 of the latest AR ( risk register) states

"As at 31 December 2021 the Company had distributable revenue reserves of £11.7 million. Furthermore, income risk is mitigated by the
Company’s ability to distribute realised capital gains if required to meet any revenue shortfall."

I'd be a little uneasy as to whether this risk was adequately thought through and is covered. Are the companies generating recovering free cash flow (oil companies = yes) to support future dividend increases? The trust seems to contain many companies that even the HYPers worry about and avoid!

Thanks for that. Seems to bear out my unusually cynical view. Certainly I think there should be some caution from eager income seekers.

Dod

Temple Bar has the stated Objective (in its KID) "To provide long term total returns (a combination of income and capital growth) greater than the FTSE All-Share Index"
Over the past 5 years the total return of the FTSE All-Share Index has been 23.8%. The total return of Temple Bar has been 6.6%
Numerical data from Hargreaves Lansdown.

scotia wrote:Temple Bar has the stated Objective (in its KID) "To provide long term total returns (a combination of income and capital growth) greater than the FTSE All-Share Index"
Over the past 5 years the total return of the FTSE All-Share Index has been 23.8%. The total return of Temple Bar has been 6.6%
Numerical data from Hargreaves Lansdown.

Quite.

Dod