London Finance & Investment warns of more volatility

Brexit and Covid-19 hold threat of additional market volatility, group says as it keeps dividend unchanged


Investment holding company London Finance & Investment Group has kept its total dividend unchanged, even as it expects Brexit in the UK and the Covid-19 pandemic to continue generating market volatility.

The JSE-listed group has a portfolio of strategic investments and a general portfolio with holdings in numerous companies, including Nestlé, Danone and British American Tobacco.

The value of the group’s strategic investments fell 17.2% to £6.29m (R133m) in the year to end-June, with the value of its 43.8% stake in Western under pressure after that company recently held onto its dividend and reported a loss.

Western’s business model is to take big minority stakes in small companies usually before or as their shares are admitted to trading on one of the UK’s stock exchanges and have directors in common through which they can provide advice and support for the companies.

The group’s general portfolio has decreased by 13% to £9.95m.

“The continued political and economic uncertainty in Europe, where a Brexit trade deal has yet to be delivered, and globally, with Covid-19 and the negative impact from tariff issues, will clearly affect world economies and we can expect further volatility and turbulence in the markets ahead,” the group said.

The group’s board has recommended a final dividend of 0.60p per share, making a total of 1.15p, unchanged from the previous comparative period.

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