Under the rules governing UK listed investment trusts, shareholders get to have a continuation vote at various intervals.
There had been some talk a while back that when the NZIT came up to its continuation vote shareholders may have voted to wind it up because it had some poor performance.
However the latest results show the fund has done well.
According to First New Zealand Capital, which is a key supporter of UK listed investment trusts; NZIT has in the 12-months to October 31 seen its diluted NAV (in sterling terms) rise 24%, to a fully diluted 284.8 pence per share.
In New Zealand dollars the diluted net asset value increased 20%, exceeding the 13% rise in the NZSX All Index, and the 9% increase in the Australian All Ordinaries Index. The main contributors to the performance came from significant holdings in Toll NZ, Fisher & Paykel Healthcare, Fletcher Building, and Freightways.
NZIT recently announced it was increasing its dividend by 25% to 5 pence per share.
The board is recommending shareholders keep the fund going.
It is “citing recent good performance, the positive outlook for the company and its unique status as the only closed-end listed vehicle offering exposure to a basket of New Zealand dominated Australasian equities, with emphasis on capital appreciation and in a tax neutral manner,” FNZC says.
But the board have also proposed that the continuation vote should be taken every two years. That would mean the next one is in 2007 rather than 2010.
First New Zealand Capital is recommending to shareholders that they vote in favour of both resolutions.
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