Woodford Patient Capital Trust 'evaluating' Neil Woodford's future with the fund
Woodford Patient Capital Trust is considering replacing Neil Woodford as its portfolio manager after enduring "the most challenging period" it has known.
Woodford Patient Capital Trust
36.32p
16:30 04/02/21
WPCT, launched by Woodford’s firm Woodford Investment Management, is one of the UK’s largest listed investment trusts. But chairman Susan Searle told investors on Monday that the last few months had "undoubtedly been the most challenging period for the company since it floated in 2015".
She added: "Events at the portfolio manager have been disappointing. For everyone associated with WPCT, shareholders and board members alike. Protecting shareholders’ interests as these difficult circumstances continue to play out remains the board’s priority."
WPCT confirmed it was evaluating Woodford’s role as portfolio manager and was "in dialogue with other potential managers".
Earlier this year, Woodford - then one of the UK’s most well-established and respected stockpickers - stunned investors when he gated his flagship fund, the Woodford Equity Income Fund. Woodford Investment Management, which Woodford founded in 2014, said it had suspended trading in the shares following a run of redemptions. The fund remains gated.
Following an interim review, WPCT said net asset value in the six months to 30 June had fallen to £654m from £807.2m at the end of December. But borrowings were reduced over the same six-month period to £111.1m, representing around 17% of the fund's overall value.
NAV per share slumped 26.2% to 72p by the end of June. From 28 June to 26 September, however, there was a decline in the daily NAV of 20.9%, which WPCT said represented a decline in the portfolio NAV to £591m.
Said Searle: "Since the suspension of WEIF, the value of some of the company’s assets have come under significant pressure as a result of the portfolio manager and WEIF no longer being able to support follow-on funding, thereby also in some cases impacting the net asset value of the company."
Woodford used the interim results to apologise for an "extremely disappointing" period.
"Shareholders have endured an extremely disappointing six-month period, for which I am very sorry," he said. "While shareholders can be forgiven for thinking there are no positives, I continue to believe that the majority of the businesses we have invested in are making good progress, in line with our pre-agreed milestones.
"This is not to gloss over the setbacks which the portfolio has suffered since WCPT was launched in 2015, nor the significant downward pressure both the NAV and share price have endured since the suspension of WEIT on 3 June.
"The journey to positive outcomes has been longer and more painful than investors would have liked or anticipated, but the returns to be gained by delivering on the progress, I believe, will ultimately reward the patient investor."