LONDON (ShareCast) - (Sharecast News) - Alliance Trust reported a negative total shareholder return of -6.1% in its final results for 2018 on Friday, swinging from a positive return of 19.2% in 2017.
The FTSE 250 investment and financial services provider's share price as at year-end on 31 December was 688.0p, down 7.8% compared to the 746.5p price a year earlier.

Its net asset value total return was -5.4%, compared to an 18.5% improvement in 2017, and its net asset value per share at year-end was down 7% year-on-year at 723.6p.

The trust's equity portfolio total return remained ahead of its benchmark since the adoption of its current investment approach on 1 April 2017, the board noted, outperforming the MSCI All Country World Index by a cumulative 1%, with its figure being 5.1% compared to the index's 4.1%.

Its performance in 2018 was -4.2%, which was a wider loss than the MSCI ACWI, at -3.3%

Alliance Trust's ongoing charges ratio for 2018 was 0.65%, with the directors claiming that the increase compared to the prior year reflected a full year of WTW's fees and fixed costs rising as a proportion of a smaller asset base.

It bought back a total of 14 million shares in 2018, compared to 145.1 million shares in 2017, which included the purchase of 95.5 million shares from activist investor Elliott.

The year began with the firm's shares trading at a discount of 4.0%, and ended at a discount of 4.9%.

Alliance Trust's board raised its total ordinary dividend for 2018 by 3.0% to 13.55p, compared with a total ordinary dividend for 2017 of 13.16p, which marked the 52nd consecutive annual increase.

"2018 was a challenging year for global equities with most markets falling and many active managers struggling to outperform," said Alliance Trust chairman Lord Smith of Kelvin.

"Like others, we trailed our benchmark, partly due to market returns during much of the year having been driven by a narrow group of very large companies."

Lord Smith said the company's strategy of appointing a number of managers with different styles and approaches to select their best stocks meant the firm would "never" have a concentrated exposure to one segment of the market.

"By investing more broadly across companies, countries and sectors, we should avoid the short-term performance highs and lows driven by particular market factors.

"In the long run, though, we expect our portfolio to outperform the market.

"Meanwhile, we continued to provide investors with income by increasing our dividend, which has now risen every year for 52 consecutive years."

During the year, Lord Smith noted that the company made further progress towards simplifying its business, by disposing of many of its remaining non-core investments, adding that it was in the process of selling - subject to regulatory approval - our subsidiary, Alliance Trust Savings, to Interactive Investor.

"The rationalisation of our holdings will enable us to focus on global equities which at year-end represented over 97% of our assets.

"We are clear on the direction of the Trust and that it will continue to prove a wise choice as a core investment for the long term."

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