F&C Investment Trust Reports Mixed H1 2025 Results Amid Market Volatility, Plans 55th Consecutive Dividend Hike

• North America (-3.3% vs -2.5% benchmark): Struggled. While the JPMorgan large-cap growth strategy showed relative resilience, value strategies diverged. UnitedHealth (-43.1% on fraud probe concerns) was a major detractor for one manager.
• Europe inc. UK (+9.2% vs +12.3% benchmark): Strong absolute return but lagged the surging benchmark. Financials like National Bank of Greece (+53.1%) and Bank of Ireland (+46.3%) shone, while Pearson (-15.3%) suffered.
• Japan (+4.7% vs +2.6% benchmark): A bright spot, led by Nintendo (+50.5%) and its Switch 2 success.
• Emerging Markets (+6.1% vs +2.7% benchmark): Newly managed by Invesco, this segment performed strongly, boosted by Telefonica Brasil (+43.0%).
• Global Strategies: Global Income (+3.3%) and Global Enhanced (+4.0%) outperformed, aided by stocks like NRG Energy (+63.8%). Global Focus (-0.1%) was marginally behind.
• Private Equity (-3.8%): Facing tough exit conditions, though core mid-market buyouts showed resilience.

The “Magnificent Seven” saw starkly divergent fortunes: Nvidia (+7%), Meta (+25% in USD), and Microsoft (+8.1%) held up, while Apple (-25%), Tesla (-28%), Alphabet (-14.8%), and Amazon (-8.7%) struggled.

The Income Engine: Still Firing

This is where FCIT’s heritage truly shines:

• Net revenue return per share rose 8.6% to 10.47p (H1 2024: 9.64p).
• This supports the declared first interim dividend of 3.8p and the planned 55th consecutive annual increase.
• The Board explicitly aims for long-term dividend growth exceeding inflation and maintains substantial revenue reserves to support this objective.

In a world starved of reliable income, this track record remains a cornerstone of FCIT’s appeal.

Looking Ahead: Cautious Optimism & Strategic Positioning

Niven acknowledges the risks (tariff uncertainty, geopolitics) but expresses cautious optimism:

• Broadening Opportunity: Expects market returns to broaden beyond recent narrow leaders, potentially benefiting FCIT’s diversified style.
• US Exceptionalism Debate: While acknowledging the US growth premium, FCIT has been marginally reducing US exposure due to valuations and dollar risks, seeking opportunities elsewhere.
• Emerging Markets Hope: A weaker dollar and potential rate cuts offer a tailwind. Valuations look attractive after prolonged underperformance.
• AI’s Long-Term Promise: Believes AI will ultimately boost productivity and benefit capital owners.

The outlook hinges on navigating persistent uncertainty, but Niven concludes: “We remain confident that we can continue to deliver our investment objectives, to grow both capital and income for our shareholders over the long term.”

A Board in Transition

The period saw Edward Knapp step down after nine years of service. He is replaced on the Board (from 1st September) by Josh Bottomley, CEO of dunnhumby, bringing significant digital, data, and financial services experience.

The Verdict: Resilience Tested, Track Record Intact

F&C Investment Trust’s H1 2025 results reflect a battle against powerful external forces. A flat NAV return in such a climate, while slightly behind the benchmark, isn’t disastrous. The real story lies in the underlying resilience: the active management navigating regional and stock divergence, the continued commitment to judicious buybacks to manage the discount, and, above all, the unwavering focus on delivering that 55th consecutive annual dividend increase. For income-focused investors seeking global diversification and a trust with genuine staying power, FCIT continues to offer a compelling, if sometimes bumpy, journey. The diversified approach championed by Hollond and Niven isn’t about shooting the lights out every quarter; it’s about weathering storms and compounding returns over the very long term. On that measure, the oldest investment trust in the business remains very much in the game.