Foreign & Colonial (FRCL) wants to formally change its name to F&C Investment Trust as it seeks to project a more modern image in its 150th year.
In a statement in its annual report published today Simon Fraser, chairman of the UK’s oldest investment trust, tells shareholders: ‘Our anniversary year provides a natural reflection point to ensure your company continues its contribution and relevance in the modern world. As part of this, our marketing will increasingly take place under the company's commonly used name "F&C Investment Trust"; the name with which Foreign & Colonial has always been synonymous.’
Shareholders will be asked at the next annual general meeting to approve an amendment to the articles of association to enable the corporate name change to "F&C Investment Trust PLC”, he said.
The proposal is the least contentious route the company could take as it sought to update its image. Although Foreign & Colonial is one of the best known brands in investment the imperial tone of the name does not appeal to younger generations and could be an obstacle to further growth in the £3.5 billion global fund.
The announcement follows another good year with the company achieving a 16.9% total return on net assets in 2017, helped by good performance in its investments in Europe, Japan and emerging markets.
This translated into a total shareholder return of 21% as the discount - or gap between the share price and underlying net asset value - narrowed to a decade low of 4%. This easily beat the 13.8% return from the FTSE All-World index, giving the trust an annual average return of 9.9% over 10 years. Over 20 years it is 8.9%.
F&C has paid a dividend in every year since its launch in 1868 and is on course to complete its 47th year of rising payouts with a final dividend of 2.7p per share. This gives a total of 10.4p per share for the year, up 5.6% on last year and ahead of the 3% rise in inflation. The dividends were fully covered by earnings and are backed up by revenue reserves of over one year’s worth of payments, the company said.
Although last year the number of shares bought back by the company fell to a low of 4.4 million, F&C remains determined to reduce its share price discount to as close to zero as possible. With the discount having narrowed below 5% in the past 12 months it says it will no longer refer to the 7.5% target it set three years ago.