Charles Luke

The rise compares favourably against the company’s benchmark, outperforming the FTSE All-Share Index, which returned +26.7% (2020:-18.5%)

The company’s share price total return increased also increased by 31.2% compared to the 21.2% in 2020. The firm’s dividend has also been maintained at 13.20p.

Robert Talbut, chairman of Shires Income PLC, commented: “At this time last year, we were about to embark on an unprecedented journey as Covid-19 took its hold across the globe. In spite of such a turbulent period, Shires Income PLC has generated strong positive returns during the year ended 31 March 2021 as well as outperforming its benchmark, the FTSE All-Share Index, with a net asset value total return of 34.0% and a share price total return of 31.2%, versus a benchmark return of 26.7%.

“Three and five-year performance figures are also positive, with NAV total returns of 14.2% and 46.9%, versus benchmark returns of 9.9% and 35.7% respectively.

“The impact of Covid-19 dominated the global economic landscape during the year, and also had a significant impact on financial markets. Equity markets ultimately benefitted from the significant stimulus measures from governments and central banks as well as the rapid development and then deployment of effective vaccines, the first ones being approved in November 2020.

“Other events during the year therefore seemed to take a back seat, with, for example, the resolution of the UK’s departure from the EU at the end of 2020, having a limited impact on equity markets.”

Commenting on the company’s outlook, Iain Pyle and Charles Luke, investment managers of Shires Income PLC, added: “After a volatile 2020, equity markets have made a very strong start in 2021. Despite a worrying rise in Covid-19 cases globally, and especially in some emerging markets, investors continue to look through the near term risks. In the UK, this optimism is supported by a vaccine programme that continues to deliver and by a gradual lifting of restrictions.

“The leisure sector has already seen the benefit of this, with early evidence pointing to an increase in consumer spending through the Spring. Importantly, there is not yet any evidence to change the timeline for a significant increase in personal freedoms by the end of June. We expect to see the pace of the recovery increase at that point.”

They continued: “This dynamic means that performance across the market has been led by consumer discretionary companies and by more cyclical industrials, although other sectors have also performed well in a broad-based recovery. The nature of the performance reflects the fact that equity valuations, along with other asset classes, are being moved higher by government stimulus packages (as signed in the US in March) and increasing money supply globally.

“In this environment, with rising bond yields and, for a short time potentially, higher inflation, it is possible that we will continue to see value outperformance in equity markets. With a longer term view, however, we maintain a more balanced outlook.

“There remain many deflationary forces at work and the pace of recovery is unlikely to be consistent. Even if things are getting better today, how the virus develops through another winter season will be crucial to maintaining current optimism.”