THE £3.7 billion Scottish Mortgage Investment Trust turned in a stellar performance in its latest financial year, boosted by strong showings from holdings including Chinese online marketplace operator Alibaba.
Scottish Mortgage, the largest conventional investment trust in the UK, said yesterday that it had achieved a 27.7 per cent total return on net asset value in the year to March 31, taking into account capital and income.
This was way ahead of a 19.2 per cent total return on the broader global equities benchmark, the FTSE All-World Index.
The trust, which is managed by venerable Edinburgh investment house Baillie Gifford, benefited from a strong performance by Baidu, the Chinese online search engine. Baidu is listed as Scottish Mortgage's fourth-largest holding at March 31.
Scottish Mortgage was also boosted by a good showing by Illumina, which develops, manufactures, and markets life science tools and integrated systems for large-scale analysis of genetic variation and function and is based in San Diego in California.
The investment trust's performance was also helped by strong showings from Chinese internet service portal Tencent Holdings, online retailer Amazon, social media giant Facebook and car manufacturer Fiat, as well as by Alibaba.
Scottish Mortgage, which has tens of thousands of private shareholders, had a sizeable holding in Alibaba ahead of the Chinese company's flotation last year, having purchased a stake in the online marketplace operator from Yahoo in 2012.
Baillie Gifford's James Anderson, joint manager of Scottish Mortgage, said that Alibaba, up by 118 per cent, had been the single-biggest percentage mover over the year as the Chinese company went through its initial public offering.
The value of Scottish Mortgage's holding in Alibaba had risen to £151.5 million by March 31, from less than £70m at the end of the prior financial year.
Scottish Mortgage had total assets of £3.7bn at the end of March this year, including borrowings, and shareholders' funds of £3.3bn.
Amazon was its biggest holding at March 31, with the trust's stake valued at £305m. Illumina was Scottish Mortgage's second-biggest stake, with this holding worth £299m.
The investment trust's stake in Tencent was worth £258m at March 31, with its holding in Baidu valued at £254m.
Among Scottish Mortgage's 20 largest holdings at March 31 was electric car company Tesla.
Ask whether there were any sectors or companies in which Scottish Mortgage was particularly interested at the moment, Mr Anderson replied: "We're really excited about biotech and genomic science-driven healthcare - it might even help humanity."
He cited Illumina as a key example of a company operating in this area. On its website, Illumina highlights the part its systems could play in the "realisation of personalised medicine".
Mr Anderson also cited Scottish Mortgage's interest in the rise of solar and battery technologies, highlighting its holding in Tesla.
Mr Anderson signalled there had been no major drags on Scottish Mortgage's performance during the year to March from companies in the portfolio.
Scottish Mortgage is proposing a final dividend of 1.55p-a-share for the year to March 31. This makes a total of 2.93p for the year, a rise of one per cent on the payout for the preceding 12 months.
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