City of London Investment Trust PLC on Friday said it outperformed its index benchmark during the half-year due to a strong recovery in UK equities leading the company to lift its interim payout.

The investment trust’s net asset value per share total return was 6.9% for the six months to December 31 ‘slightly ahead’ of its FTSE All-Share Index benchmark, which returned 6.5% in the period.

The company’s NAV per share stood at 404.4 pence as at December 31, up 4.3% from 387.6p at June 30.

City of London IT’s share price as of December 31 totalled 394.0p, a 1.0% increase from 390.0p as at June 30. Shares were up 0.7% at 409.85 pence each on Friday morning in London.

The company attributed the results to the continued pandemic recovery of the UK economy through ‘very accommodative monetary and fiscal policies.’

This resulted in UK equities benefitting from a recovery in corporate profits and dividends.

City of London declared two interim dividends of 4.80p each over the six months to December 31, up 1.1% from two interim payouts of 4.75p a year before.

‘The company’s diverse portfolio, strong cash flow and revenue reserve give the board confidence that it will be able to increase the dividend for the fifty-sixth consecutive year,’ it continued.

City London expects profit and dividends to continue increasing, with the wider economic growth outlook looking more positive.

Looking ahead, it added that: ‘The dividend yield from many high-quality UK equities remains attractive, with the continuing trend of takeovers demonstrating potential additional overall upside.’

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