For financial professionals in the UK

Fund Manager April Commentary – Lowland Investment Company

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Laura Foll, CFA

Laura Foll, CFA

Portfolio Manager

20 May 2021
2 minute read

April was a good month for the Trust on an absolute basis and relative to its FTSE All-Share benchmark. The Trust’s net asset value rose 6.4%, relative to a 4.3% rise in the FTSE All-Share and a 4.8% rise in the AIC UK Equity Income Sector.

Among the best performers during the month was engineer IMI, which reported stronger than expected organic sales growth during the first quarter, as well as higher longer-term margin targets across the business. Vehicle hire firm Redde Northgate also performed well on the expectation that as the UK comes out of lockdown demand for their flexible hire vehicles will increase. The drivers of underperformance during the month were predominantly being underweight large index constituents that performed well, including HSBC and AstraZeneca (which rose 7.0% and 6.5% respectively in April). Specialist materials designer and manufacturer Morgan Advanced Materials also underperformed on no company-specific news, although there are concerns across a number of industrial companies of input cost pressures and supply chain outages causing disruption. We continue to hold a sizeable position on the view that management cost savings during the course of the pandemic are underappreciated and will lead to higher margins in the future than the business has generated historically.

We have now seen first quarter trading updates for much of the portfolio and the progress is broadly encouraging. For example, the banks held have largely surprised positively and in some cases are beginning to write back a portion of the material loan loss provisions taken last year. The industrial companies held are also (broadly) seeing a pick-up in organic growth, although there remain pockets of weakness, such as civil aerospace, and some supply chain outages that are proving disruptive in some markets, such as automobiles. Over the last month trading activity within the portfolio was quite muted as we carefully monitor the progress of the domestic and global economic recovery.



Net asset value (NAV) – The total value of a fund’s assets less its liabilities.

These are the views of the author at the time of publication and may differ from the views of other individuals/teams at Janus Henderson Investors. References made to individual securities do not constitute a recommendation to buy, sell or hold any security, investment strategy or market sector, and should not be assumed to be profitable. Janus Henderson Investors, its affiliated advisor, or its employees, may have a position in the securities mentioned.


Past performance does not predict future returns. The value of an investment and the income from it can fall as well as rise and you may not get back the amount originally invested.


The information in this article does not qualify as an investment recommendation.


Marketing Communication.






Important information

Please read the following important information regarding funds related to this article.

Before investing in an investment trust referred to in this document, you should satisfy yourself as to its suitability and the risks involved, you may wish to consult a financial adviser. This is a marketing communication. Please refer to the AIFMD Disclosure document and Annual Report of the AIF before making any final investment decisions.
    Specific risks
  • If a Company's portfolio is concentrated towards a particular country or geographical region, the investment carries greater risk than a portfolio that is diversified across more countries.
  • Some of the investments in this portfolio are in smaller company shares. They may be more difficult to buy and sell, and their share prices may fluctuate more than those of larger companies.
  • This Company is suitable to be used as one component of several within a diversified investment portfolio. Investors should consider carefully the proportion of their portfolio invested in this Company.
  • Active management techniques that have worked well in normal market conditions could prove ineffective or negative for performance at other times.
  • The Company could lose money if a counterparty with which it trades becomes unwilling or unable to meet its obligations to the Company.
  • Shares can lose value rapidly, and typically involve higher risks than bonds or money market instruments. The value of your investment may fall as a result.
  • The return on your investment is directly related to the prevailing market price of the Company's shares, which will trade at a varying discount (or premium) relative to the value of the underlying assets of the Company. As a result, losses (or gains) may be higher or lower than those of the Company's assets.
  • The Company may use gearing (borrowing to invest) as part of its investment strategy. If the Company utilises its ability to gear, the profits and losses incurred by the Company can be greater than those of a Company that does not use gearing.