Miton UK MicroCap Trust plc (LON:MINI) has announced its Factsheet for July 2024 is now available.
Manager commentary
During July and August last year, global interest rates reached their peak, normally they dampen down economic activity gradually over time. In general, UK economic growth has slowed subsequently, but as yet it hasn’t fallen back into recession. Meanwhile, inflationary pressures that were excessive last year, have also slowed. Investors now anticipate that UK interest rates will start to be cut soon.
Even as UK interest rates are reduced, UK economic growth may continue to slow a little further, because
like interest rate rises, there is a time lag before interest rate cuts start to have an impact.
During July, the worst portfolio detractor was Trufin. Last year, one of Trufin’s subsidiaries won a software contract from Lloyds Bank, that improves the operational efficiencies of administering loans. Unfortunately, during July, Trufin announced that Lloyds had chosen to reverse their prior decision, for reasons unrelated to the effectiveness of the software.
As it was, one of Trufin’s other subsidiaries has been trading ahead of expectations, so its profit forecasts
for the coming year were unchanged. Trufin also subsequently announced a new software contract with a challenger bank during July. But even so, although the company remains upbeat, investors were disappointed with the loss of the Lloyds Bank contact, and Trufin’s share price fell 38% during July.
Elsewhere there were upbeat announcements during July from Beeks Financial Cloud Group, Totally, TPXimpact (a new holding added prior to its appreciation), Concurrent Technologies and Supreme. Whilst the share prices of all these appreciated by between 14 and 55%, the Trust’s NAV was held back by the setback in Trufin.
Gervais Williams & Martin Turner
31.07.2024
Miton UK MicroCap Trust (LON:MINI) intends to invest primarily in the smallest companies, measured by their market capitalisation and quoted or traded on an exchange in the United Kingdom.
