Acorn Income Fund Ld Share Discussion Threads

[chc15] 10/11/2020 13:31

Long term sufferer here on this, but good to see the divi, and not from capital!

[speedsgh] 10/11/2020 11:27

Dividend Announcement - HTTPS://www.investegate.co.uk/acorn-income-fund--aif-/prn/dividend-announcement/20201110111526P2864/ The Directors are pleased to declare a fourth interim dividend for the year ending 31 December 2020 of 5.75p per Ordinary Share which represents an increase of 10.58% compared to the corresponding dividend for the year ended 31 December 2019. With this distribution the total dividend for 2020 will be 23p per Ordinary Share, a 10.58% increase on the 20.8p distribution in 2019. COVID-19 has led many UK companies to reduce or cancel dividend payments and this has impacted Acorn's earnings in 2020. The 23p per Ordinary Share distribution for the year will be achieved by drawing from the Company's revenue reserves. At 31 December 2019, Acorn had revenue reserves equal to 1.04 times the 2019 dividend. The Directors consider the current situation is one in which it is appropriate to draw on those reserves in order to maintain income levels for investors. Acorn will not distribute from capital. Dividends will only be paid out of current period revenues and revenue reserves. The recovery in the income flow from the Company's Smaller Companies portfolio is progressing well. Many of Acorn's investee companies initially adopted a cautious approach to the uncertainties that lay ahead and reduced or passed their dividends. These companies are now resuming dividend payments. A few have actually increased dividends above their 2019 level. There are nine investee companies in the portfolio that have not yet resumed dividends however our investment advisers for the Smaller Companies portfolio believe that most of these will make distributions in 2021. The directors will monitor the level of income generated by the portfolio and this in turn will inform decisions on the appropriate dividend distribution for 2021. Ex-Dividend Date: 3 December 2020 Record Date: 4 December 2020 Payment Date: 18 December 2020 Dividend per Share: 5.75 pence per Ordinary Share (Sterling)

[speedsgh] 04/11/2020 13:16

Latest Edison research note... Looking ahead with cautious optimism - HTTPS://www.edisongroup.com/wp-content/uploads/2020/11/Acorn-Income-Fund-Limited-Looking-ahead-with-cautious-optimism.pdf

[2wild] 24/10/2020 14:09

Got back in Friday at 257.7p, just below the 256-260 mid price, on a 14% discount to 300p NAV and 8.9% yield.

[speedsgh] 17/8/2020 12:55

Interims are out. Q3 dividend payment maintained at 5.75p... Half-year Report - HTTPS://www.investegate.co.uk/acorn-income-fund--aif-/prn/half-year-report/20200817113000P7B8C/ Dividend Announcement - HTTPS://www.investegate.co.uk/acorn-income-fund/prn/dividend-announcement/20200817123603P89D2/ "At 31 December 2019, Acorn had revenue reserves equal to 1.04 times the 2019 dividend. The Directors consider the current situation is one in which it is appropriate to draw on those reserves in order to maintain income levels for investors. The interim results published today show that the revenue reserves at 30 June 2020 stood at 14.6p per share having been 21.6p per share at 31 December 2019. Acorn will not distribute from capital. Dividends will only be paid out of current period revenues and revenue reserves." "... the directors believe that 5.75p per share is a reasonable target for the fourth interim dividend that will be paid in December; however shareholders should note that the actual dividend will be set in the light of income earned over the remainder of the year as well as the outlook for 2021 and beyond."

[stueybabes] 13/8/2020 09:37

<< The million dollar question. Will the current level of dividend payout (5.75p per qtr/23.00p annualised) be maintained? >> The interim results and next dividend announcement should be out in the next week or two I suspect, so not long for a little more info on this. A little of the John Baron froth seems to be coming off this morning.

[speedsgh] 12/8/2020 15:29

The million dollar question. Will the current level of dividend payout (5.75p per qtr/23.00p annualised) be maintained? "The first interim dividend for 2020 was increased by 10.57% to 5.75p. The Company's income will inevitably be impacted by recent market developments. However, the board recognises the importance of dividends to shareholders and it is the board's intention to maintain the second interim dividend whilst keeping matters relating to future dividends under close review but noting the availability of a healthy dividend reserve. Earnings per share for the year of 22.31p covered the dividend distribution by 107% and resulted in an addition to revenue reserves of £239,024."

[stueybabes] 12/8/2020 12:33

Ah, that would do it. Thanks for the info, noiseboy. Good to see that the spread has narrowed a lot as well. Now 271/274.

[noiseboy] 12/8/2020 08:11

John Baron bought in Yesterday.

[stueybabes] 12/8/2020 07:32

(duplicate deleted)

[stueybabes] 12/8/2020 07:32

Nice jump yesterday. Various resolutions passed at the AGM but not sure any of them justified an 11% price increase. Not complaining though!

[orinocor] 20/7/2020 18:32

Yes indeed a terrible miscalculation! Not nearly as risky as I've suggested.

[biggest bill] 20/7/2020 17:59

Orinocor, I've had a look at ipu. The last time I looked at ipu, the discount was only 5% so it looks much more attractive now. I might buy a few shares there as well.

[biggest bill] 20/7/2020 17:42

Orinocor, the gearing figure of 67% is not 67/100 of the assets; it is 67/167 of the assets which is 40%.

[biggest bill] 20/7/2020 17:34

Orinocor, You have miscalculated badly. The investments would have to fall by 60% to achieve a nav of zero. Since more than a quarter of the investments are fixed interest securities, this seems rather unlikely to put it mildly.

[orinocor] 20/7/2020 17:18

I'm not sure about this one at all. If the value of the investments fall 33% the NAV goes to zero! Very, very unlikely but who knows what could happen in the months ahead. As a comparison I have been buying Invesco Smaller Companies trust. The epic code is IPU. You can currently buy these shares at around the mid price so the discount is 15%-16% and it has no gearing. On the contrary the latest factsheet to the end of June shows it to have net cash of 1.9%. So a completely different risk profile but the shares were 50% higher at the start of the year so a lot of potential upside and for me a much better proposition.

[biggest bill] 20/7/2020 17:00

I had a look at rmmc but that has recovered much further from its March lows. I think the upside here is much greater. Rmmc also has a much bigger bid/offer spread than aif which is very offputting.

[riverman77] 20/7/2020 16:42

I think this is a lot more geared than any of the other trusts, but I agree the discount looks too wide and I actually picked some up this morning. RMMC is another one that looks far too wide (that's around 30%).

[biggest bill] 20/7/2020 16:29

Riverman, other similar trusts trade at a much lower discount and the points you are making also apply to those trusts. The discount here is anomalous.

[riverman77] 20/7/2020 16:25

I notice that they also have a put option - this should presumably offer some protection if there is another big market fall.

[riverman77] 20/7/2020 16:24

The fixed income portfolio isn't risk free though so should still be included in the gearing calculation.

[biggest bill] 20/7/2020 16:21

I noticed that the shares bottomed out at 215p in March when the ft100 fell under 5000. The current price is not much above that.

[brwo349] 20/7/2020 16:14

This level of gearing is not for the faint of heart. What if FTSE tests 5000 again?

[biggest bill] 20/7/2020 16:13

More than a quarter of the portfolio is in fixed interest securities. This means that the real level of gearing is more like 20 to 25% to the stock market.