allshare income unit trust - St James's Place

St. James's Place Allshare Income Unit TrustReport of the ManagerDuring the period under review, 1 April 2012 to 30 September 2012, the St. James's PlaceAllshare Income Unit Trust Income unit offer price rose by 1.5% from 82.61p to 83.83p and theAccumulation unit offer price (in which revenue is reflected in the price rather than distributed)rose by 3.6% from 98.65p to 102.2p. On the 15 November 2012, the latest available datebefore the printing of this report, the Income unit offer price was 82.25p and the Accumulationunit offer price was 101.2p. The estimated yield was 4.00%.The Trust's PerformanceThe performance of the Trust since its launch in October 2007 and over the period under review isshown below, together with figures for the most commonly quoted indices in comparable marketswhere the major proportion of the Trust has been invested.St. James's Place Allshare Income Unit TrustIncome units (offer to offer)Accumulation units (offer to offer)Indices - actualFTSE All-ShareFTSE All-Share (net income reinvested)Source: Lipper for Fund returns01/10/07 to 31/03/12 to30/09/12 30/09/12% change % change-16.2 +1.5+2.2 +3.6-9.6 -0.1+8.0 +2.0REMEMBER THAT THE PRICE OF UNITS AND REVENUE FROM THEM MAY GO DOWN ASWELL AS UP. PLEASE BE AWARE THAT PAST PERFORMANCE IS NOT INDICATIVE OF FUTUREPERFORMANCE.Investment Adviser's CommentsUK equities made modest progress over the reporting period. Global economic growth ratesslowed with parts of Europe, including the UK, falling back into recession. Worries in the eurozone continued with austerity measures threatening a self-perpetuating downward spiral ofspending cuts leading to poor tax receipts triggering further cuts. Emerging economies sawgrowth rates slow as the tightening of monetary policy from the previous year impacted. The USeconomy continued to generate slow growth albeit at an insufficient pace to bring downunemployment significantly.Equity markets were initially weak as data disappointed but then rallied as investors anticipatedfurther policy action from central banks. This was a benign background for bond markets whichcontinued to rise as investors chased income. The fall in corporate bond yields helped improve theattractiveness of yielding equities.The portfolio outperformed during the period mainly due to some good increases in some of thesmaller capitalised companies. EMIS, who supply software to doctor’s surgeries, saw the shareprice rise by nearly 50% as profit forecasts were increased on the back of an increase in their rolloutrate. The performance of Tarsus was strong due to robust trading while Vectura benefittedfrom the approval of one of their drugs which triggered licence payments. The period was weakfor resource stocks but an underweight position helped performance. KBC Advanced Technologyfell in value after a profit warning, while Titan Europe lost ground despite being subject to atakeover bid. During the period holdings were acquired in GKN, based on their acquisition ofVolvo Aerospace, and Wolseley, due to their US housing exposure. In the FTSE 250 arena, MicroFocus International was bought due to the company’s attractive yield profile from both ordinaryand special dividends as they flex their strong balance sheet and cash flows.Earnings forecasts are under pressure due to the economic slowdown but this appears to belargely reflected in share prices. The impending US ‘fiscal cliff’ will produce market volatilitywhich should provide good opportunities and company finances are generally strong, which willprovide good support for dividends.AXA Investment Managers UK Limited 12 October 20122