City Of London Investment Share Discussion Threads

[masurenguy] 18/8/2016 16:34

Who mentioned profit - I posted that "he is already up £100,000 in 8 weeks"

[joe say] 18/8/2016 16:29

It ain't profit until its realised

[masurenguy] 18/8/2016 15:57

Yes and a very shrewd Buy by Barry Olliff on 23 June. Based on todays current Bid price he is already up £100,000 in 8 weeks on that one-off transaction.

RNS Number: 1421C, 23rd June 2016: The Company would like to advise that Barry Olliff, Chief Executive Officer, today purchased 145,186 ordinary shares of 1p each at a price of 295p per share.

[vfast] 18/8/2016 15:42

Yes and nice move up today.

[masurenguy] 18/8/2016 14:00

Shareprice up 20% in the 8 weeks since the Brexit vote !

[garycook] 14/8/2016 04:47

monty.Been a great investment and core holding for me.Purchased at 253,and with dividends re-invested,over the years only owes me 194.So it is yielding 12% for me.

[montyhedge] 13/8/2016 21:42

EM gains, everyone looking for some yield, high risk, high yield.

[vfast] 04/8/2016 16:12

Thanks for the information Mayn.

[tmfmayn] 04/8/2016 11:34

Yes, good to be over $4bn again.

There were a few disappointing snippets in the latest presentation the other week:
hxxp://www.citlon.com/shareholders/share_reports/IP38.pdf

Snapshot on slide 4 suggested new client money of $500m targeted for FY 2017 -- January presentation had aimed for $750m.

Financials - Exchange rates table on slide 20 indicated operating costs of £5m plus $8m for UK and US offices. Previously was £4m and $7m.

Client tenure chart on slide 47 shows new client FUM gained in 2005 and H1 2016 of less than $400m. July 2015 presentation had aimed for $500m of new client FUM for FY 2016.

Anyway, at least FUM has advanced of late and the favourable GBP:USD rate should help earnings (Brexit covered on slide 3) to cover the dividend.

[robsy2] 04/8/2016 09:44

Yes thanks Mayney for that. EM seems to be swinging back into fashion again. I am delighted with this stock.
Best
R2

[masurenguy] 04/8/2016 09:05

Good spot Mayn. Yes, it looks like some good progress is being made in EM investment funds over the past couple of months post the Brexit referendum. Barry Olliff's recent Buy @295p some 6 weeks ago looks well timed - up 14% - while another of my EM fund holdings, Henderson Far East Income (HFEL), is also up by 24% over the past 7 weeks.

[tmfmayn] 04/8/2016 08:47

End of July FUM now shown
hxxp://www.citlon.com/shareholders/announcements.php

Could be $4.15bn. Highest for at least a year.

[garycook] 23/7/2016 05:07

Started to make a move now,after being at around £3 forever.The due dividend of course attractive.350 next target,and then £4 hopefully

[montyhedge] 22/7/2016 15:25

I love this income stock, great yield.

[my retirement fund] 21/7/2016 21:49

Probably people waking up o the fact the dividend has been re-affirmed

[lynton3] 21/7/2016 19:22

Does anyone have a take on why the shares jumped so much today?

[vfast] 19/7/2016 15:08

Masurenguy, much appreciated.

[chairman20] 19/7/2016 13:19

thanks for the postings guys

[masurenguy] 19/7/2016 11:52

City of London Investment Group (CLIG.L)

Solid full year results in difficult markets
City of London issued a trading statement for the 2016 financial year. The figures were a little better than expected, some of which was due to exchange rate effects. Funds under management finished the year at $4.0bn, which was a 5% decrease in dollar terms from a year ago but an 11% increase in sterling terms to £3.0bn. Pre-tax profits are expected to be £8.0m, with basic eps of 23.6 (0.1p higher than our estimate). As expected a final dividend of 16p was announced, bringing the total for the year to an unchanged 24p.

Market Data

Price (p): 315.0
Mkt Cap (£m): 85.4

Sector: Financial Services

New Business: In dollar terms the MSCI Emerging Markets Index fell 12% over the year, compared to 5% in FUM. We believe that the larger part of this is new business flows, though the EM CEF strategy again outperformed. There is no news on prospective flows.

Operations

There is no new news on operations, though we note that City of London has continued to maintain its excellent cost control. The company notes that with their focus on Emerging Markets and with predominantly US clients the operational impact of Brexit is very slight.

Valuation

The prospective P/E of 13.3 times is in line with the peer group. The yield of 7.6% is very attractive and should at the very least provide support for the shares in the current volatile markets. At current market levels we’d expect dividend cover to be restored in 2017.

Risks

To date, City of London has not experienced the sort of outflows that some other emerging market fund managers have, aided by its good performance and strong client servicing. Further EM volatility may increase the risk of such outflows however.

Investment summary

City of London has continued to show robust performance in challenging market conditions. The valuation remains reasonable. At current FUM and exchange rates, dividend cover will be restored in FY2017 adding to investors comfort.

Analyst: Dr Brian Moretta
Hardman & Co
11/12 Tokenhouse Yard
London
EC2R 7AS
United Kingdom
Tel: [phone]
Fax: [phone]

www.hardmanandco.com

[my retirement fund] 18/7/2016 11:34

Indeed, conformation of a must have high income share with added growth potential, if ever there was one!

[s0lis] 18/7/2016 11:00

Much more interested in their graph showing a 30% increase in post tax profit for this current year. Given their dividend policy of 1.2 x cover over the 5 year average, we should see a dividend uplift on the horizon.

[montyhedge] 18/7/2016 07:39

16p dividend, that's all I'm interested in.

[masurenguy] 18/7/2016 07:24

Positive impact of fall in sterling exchange rate more than offsets 5% decline in FUM. Investment performance beats benchmark index. Recommendation. Eps down by 11% but strong cash position and forward optimism results in the BoD recommending the final dividend of 16p to be maintained.

RNS Number : 3911E
City of London Investment Group PLC
18 July 2016

This announcement contains inside information

TRADING UPDATE for the year to 30 June 2016

City of London (LSE: CLIG), a leading emerging markets asset management group, provides a trading update for its financial year ended 30 June 2016. The numbers that follow are all unaudited.

Funds under management were US$4.0 billion (£3.0 billion) at 30 June 2016 (2015: US$4.2 billion or £2.7 billion), representing a 5% decrease in US$ terms and an 11% increase in GBP terms as a result of the exchange rate moving from 1.57 to 1.33 over the period. Over the same period, the MSCI Emerging Markets TR Net Index fell by 12% in US$ terms, resulting in a relative change in funds under management of +7% versus the benchmark, a product of both positive investment performance and new and existing client inflows.

Investment performance in the emerging markets closed-end fund (CEF) strategy continues to be strong, with results in the first or second quartile versus manager peers for the year ending 30 June 2016. The current size-weighted average discount (SWAD) across client portfolios is c. 14%-15%, indicating that there is still present significant relative value in the strategy. The investment approach adds value beyond this by exploiting volatility of the underlying discounts in the CEF universe, from which portfolios are constructed with their specific SWAD characteristics plus active country allocation.

The Group's overheads for the year to 30 June 2016 are expected to be £10.7 million (2015: £9.4 million) and the current monthly run-rate is c£0.9m.

For the year to 30 June 2016, City of London expects that pre-tax profits will be approximately £8.0 million (2015: £8.9 million), and that profits after an anticipated tax charge of £2.0 million (25% of pre-tax profits) will be approximately £5.9 million (2015: profits of £6.6 million after a tax charge of £2.3 million, representing 26% of pre-tax profit). Basic and fully diluted earnings per share are expected to be 23.6p and 23.5p respectively (2015: 26.4p and 26.0p).

As a result of the fall in Emerging Markets during the financial year, earnings cover will be reduced this year but given the Group's strong cash position and optimism with regard to the future, the Board is recommending a maintained final dividend of 16p per share (2015: 16p). This would bring the total for the year to 24p (2015: 24p), a dividend cover of 0.98 times earnings per share (2015: 1.1 times).

The Board confirms the final dividend timetable for the year to 30 June 2016:

· ex-dividend date: 13 October 2016

· dividend record date: 14 October 2016

· payable: 31 October 2016

City of London expects to announce final results alongside publication of its Accounts for the year to 30 June 2016 on 12 September 2016. The Group's Annual General Meeting will be held on 17 October 2016.

Business Update

. Virtually all CLIM income is USD based - our fees are sourced from US Institutions

· Zero FUM effect from BREXIT - zero redemptions FYTD

· Over 90% of CLIM income on a see through basis is effectively derived from the Emerging Markets

· Approximately 40% of Group costs are in GBP

· Only 2.5% of CLIM assets are UCIT'S - very little fall out from BREXIT

Template

Please see the attached graph which is based on the following assumptions and includes the estimated cost of a maintained dividend:



Assumptions:

- Starting point Current FuM (end June 2016)

- Net increase in FuM in 2016/2017 (straight-lined to June 2017):

· emerging market strategies $250m

· diversification strategies $250m

- Operating margin adjusted monthly for change in product mix and commission run-off

- Market growth: 0%

- Increase in overhead: 5%

- Corporation tax based on an estimated average rate of 26%

- Exchange rate assumed to be £1/$1.35 for entire period

- Number of CLIG Shares in issue (26.9m) less those held by the ESOP Trust (1.9m) as at 30 June 2016

[robsy2] 18/7/2016 07:21

I am surprised by the weakness of EM in general.I thought EM was recovering strongly, but year on year it is still down. Their funds are performing relatively well and the USD Xrate has saved he day, divi safe , pretty good really ?
R2