QuotedData's Weekly News Show - Samantha Fitzpatrick from Murray International

Okay, it's 11 o'clock, and we'll get going. So there's a bit of news to run through this morning. So I'm doing some, Richard Williamson will be doing some. Then our guest this week is Samantha Fitzpatrick, who's one of the managers of Murray International. So we'll be talking to her in a bit. So news-wise, you can see there's five things we pulled out there. Some of them a bit quick, though, so we won't be too long. Foresight Solar first. As with all of these renewable energy funds, everything was looking great until interest rates started to go up. And then quite quickly, the share price was at a de-rate. And even though rates have been coming down, the share price has not recovered, and it's got to go wider and wider. So at some point, the elastic has to snap. And you can see, this is the whole sector ranked by dividend yield, actually. I just thought that was interesting. I think 10.5% is a daft level, really, because you can't get that on the same thing. And these dividends are fairly safe, as I keep saying, so it just seems extreme. I think the board now agrees with us. And then this one just ranks it by the 10-year net returns, because there are a clutch of these funds that are more than 10 years old, so we've got long enough history of them to see what they're like over time. And it's not too bad. And then if you look at the five-year numbers, I think it ranks second in that group there. So there's nothing really wrong with what it's doing. Nothing's sort of gone wrong. What they've published on the 18th was their end-of-December NAV quarterly update. And one thing, we're all miserable for a good reason, it's been the most overcast year in the UK since the company started, probably quite a while since. And generation was 75% budget. But that sounds bad. It's not the end of the world, though, really. With 7%, this is probably extreme levels of things. They're selling the portfolio they've got in Australia, which makes the business a bit more simple and we can free up some cash. They were targeting an AP dividend for the year, and that's all totally fine. And they're targeting, one of the weird things they've done is they've said the target dividend cover for 2025 is 1.3 times, but they haven't actually set what the level of dividend is yet. So maybe they're gonna reverse engineer that. But we're not expecting a cut on it, you know, the whole thing sort of keeps marching on. And then because of the discount, they have been buying that stock. Now, so far they've bought about 40 million pounds worth, which is not too bad, but obviously that's sort of slowed a bit more recently. And maybe with the Australian money, they're going to do something more radical. What the board has done, first thing is to reduce the fee. So they've changed it, New School is the company, I don't know the different one, but it's now the average of market cap and NAV as the base. And they've just pulled down the percentages as well. So what was 1% plus 0.05 and what was 0.9 plus 0.8. And that saves them about 1.2 million pounds if you add the current discount system. Obviously that's not the point of this exercise. They do want to get rid of this cap there. The only thing is, it's a slightly odd in that, obviously, if they went back to training the premium, then they'd get more money than they do at the moment. That doesn't really sit well with me, but we're not there yet. We want them to leave for a while. So the board has said that we've been told to share, or as we realise this, we've been quite upset. Some of them are just saying, we want the money back. Others are saying, we need just bigger, more liquid funds here. So really calling for mergers and things. And the board's looking into all of this and taking this seriously. So the implication here is that you would get a sort of choice of cash and a merger with another company. It's not easy to get cash out of these portfolios. If you just create a realisation pool and put the size of the assets in there, there are deals that can be done buying with the ongoing pool, depending on how big that is. But you could be waiting a very long time to get your money back, as the sort of mixed energy experience has shown. So it's a start, and the share price has moved up a little bit, but we'll need to see what's going to happen. Now, in terms of what actually might happen, we've got a new IPO, which is obviously quite exciting, because we haven't had an IPO for ages. It's not very big, 54 million pounds. Nevertheless, that doesn't mean we won't be able to do stuff. It starts trading next Tuesday. It's on the specialist fund segment, so that means many people won't be able to buy it, and maybe you won't want to anyway. It's going to have quite a focused portfolio, just two positions, probably, but up to five, and that's the reason it has to go on the specialist fund segment, because it's not appropriately diversified for a main market listing. But nevertheless, I don't think there should necessarily be a criteria, and that's one of the things we'd quite like to get rid of, is the specialist fund segment, which is converging all together. The managers are Rob Naylor and Chris Mills, and you'd know them because they were involved in sorting out hypnosis. Rob's involved with rental music. Chris has been involved with Rob on PRS REIT, which Rich has talked about here before. So the idea is they will pick a couple of alternative assets funds, things that are in property, infrastructure, renewables, private equity, that sort of stuff, trading on big discounts, and trying to do something constructive with them to address the discount. So in terms of their fees, 1% base fee on 54 million isn't a huge amount of money by the time you sort of run across to the management company. So the upside for them is their performance fee, which is 10% of everything they make over 10% above their in price. And the real important thing to get across here, is the big difference between this and Saba. Is that it's been really called for and backed with hard cash money by frustrated investors in these things that want to see these discounts close. So we've all tried very hard to draw interest in them. We've all tried very hard to campaign for a resolution to the cost disclosure problem. We've all tried very hard to get the government to take the general decline of the UK equity market seriously. Nothing's really happening. And so it's kind of inevitable that someone's gonna come along and start picking things up. So watch this space really. And then obviously in terms of fund that we do love and has just recently survived a Saba attack, is Herald. And you can see how the discounts weren't down since it won the vote. But it's kind of gone back to where it was before. It's not excessive at all. And the question is what happens next? The results that came out this week were good, I thought. I mean, they're fighting against dreadful headwind in terms of the UK equity market. It's about third of the fund more or less. And you can see the return on the Deutsche Unis index was only 5%. The returns on the American stocks were much, much higher. And that's what Saba would have you to look at. But obviously, it does hold American stocks. And to the extent it holds American stocks, it outperformed that. There's nothing really wrong with what this fund is doing. And also, they bought back a lot of stock last year. Partly because of Saba, partly because they were doing it anyway. They bought back well over 400 million pounds of stock. So the important thing here and the thing we used to flag, there is an AGM coming up on 24th of March. Every three years, they have a continuation vote. Saba may have been selling stock and not disclosing it because we felt, I mean, we can't pinpoint it, but we felt that it's been quite bad at disclosing things when it's supposed to. And I think I'd really like to be sort of akin to that. But it might still own 29% of the company. It's a straightforward 50-50 vote. So it's gonna be really important to make sure you vote in favor of continuation if you're a shareholder, because otherwise Saba could kind of win by the back door. So as we well rehearsed on this, we know that you have to get in touch with your platform and get your votes in early. So well before the 20th of March, vote early. Right, that's enough for me. Let's talk to Richard. Thanks, James. Yeah, so a lot going on again in property, mainly M&A as usual, as we've seen over the last couple of years. So this week, Asura, which is the healthcare breed which owns GPs, hospitals, things like that, received a proposal value in it of just under 1.6 billion from a consortium of KKR, which is a private equity giant, and USS, which is the university in the UK. And that price of 48p was a massive premium to sharebuys, which is going to show how viable it is for KKR. And it was just under 3% discount for the NAB, for the last reported NAB in September. Now, as I said, they've been working on this for six months, and they've had, this is the fourth offer that they've put to the board. The board rejected it, stating that it's materially undervalued to the company and its prospects. If we go on to the next slide, we'll look at what they've said. So it appears that that rejection may put this to bed now, this bid anyway. So USS has called out, saying that they're not going to consider another bid with KKR. KKR hasn't gone that far, but they've said that they're considering their options whether to engage with the board any further. They've got until 14th of March to make their intention known, whether they can work with KKR or not. So we'll wait and see on that. But just looking at Assura's portfolio, so we've had this sort of ridiculous period over the last couple of years, where inflation and things like that, they've not been able to develop the health centres that they wanted to because they can't get the rent past the district value up. So district value is sort of turning them down. They've had to increase their rents off because of inflation on building materials and things like that. So there's just been this impasse. So their portfolio has been stagnant for a long time. But last year they decided to take action to get some growth going again. So in May they entered into a joint venture with USS. I don't know how that relationship is going to move forward. An 80 to 20 JV. So USS holds 80% of the equity, Assura 20%. It was seeded with seven of Assura's portfolio properties, and they're looking to grow that to $250 million in three years, potentially up to $400 million. USS is the money, basically. And Assura will take management fees, asset management fees, property fees, stuff like that from the joint venture. So that's good news. And then later in the year, in August, they did a deal to buy private hostels, 14 of them across the UK. Massive deal, $500 million. It sort of diversifies their portfolio now, so they've not just got NHS stuff and GP pharmacies and the like. They've now got private hostels, which we all know is playing a massive part in the healthcare solution in the UK. So top tenants, there's a typo there, but it's Muffield Health, Spire, and the like. Massive elongated income for 26 years, fully repairing and insuring these things, which means that the tenant was responsible for repairs on the property and insuring and stuff like that. So 100% inflation linked, annual reviews capped at 4% and followed at 1%. And it funded it through issuing hundreds of millions of shares to the North West, a massive new debt facility, drew 80 million from the RTF, which is quite expensive, and then some of the cash they already had on their books and papers. So that has seen their LTV... Well, actually, sorry, this slide just shows the portfolio now and how diversified it is. It's private, which is the green area on the bar chart to the right. That's now a quarter of their income is on these private hostels, and GPs are now down half. But this deal, obviously, with the issuance of the new debt and the RTF stuff, took their LTV to just under 50%, which is quite a lot in today's times compared to its peers. But to address the scale of this debt, they started a £200 million disposal programme, and that will repay that expense of RTF and reduce the LTV down to below 0.5%, which is fairly quite high, but more palatable. So what next after this deal was rejected? Well, we'll see if KKR come back with another offer or even if another party comes in. I feel like if a board rejects an offer like this, they have to come out and say... All they've come out is said that they feel it undervalued, but they've not really come out with a big reason or rationale behind that or anything. So I think they need to come out and say what the actual growth plan is here and why this deal was rejected. And it also brings up the merger, which has been long muted. It's not exactly meant, actually, that they should merge with PHP, which is a direct comparison. They own pretty much the same things, GP centres across the UK, and that would create a massive 6 billion portfolio, about 2.6 billion market cap. But who knows? That may bring that forward now to try and keep it going out of private hands. And then HomeReach, we all know the story here by now. So they've been marketing their remaining portfolio, which I think I talked about a month ago now. But they've received some offers in February, and they say they're credible parties, they're on to the next stage, and they'll use these proceeds to go back to capital shareholders. But that's obviously complicated by the litigation that's going on with group shareholders against them, but also them against former managers, and also the FCA. So the timings of this and how much this is going to cost is all going to impact on capital back to shareholders. And just a quick one on results. So they've been delayed again. They've kept getting pushed back and pushed back and pushed back further. So they're now saying that they're going to be published in the second quarter of this year, so sometime between May and June. And trading in their shares will be suspended until that happens. Interims are still having to be done, I would expect in March and April. And yesterday they had an AGM where nearly 45% voted against the accounts from 2023. So we'll see what happens there. We'll hopefully get a decent sale of their portfolio and some closure on it. Good, thanks Richard. So now let's talk to Samantha. Good morning. Thank you very much for doing this. As usual, I'm going to hand over to you and let you tell us a bit about the fund first and then we'll get to some questions from the audience. If you do have a question, please put it into the YouTube chat box and then I will relate to Samantha. But in the meantime, I'm going to shut up and hand over to you. Sorry, thank you. No problem. Okay, take two. So Murray International Trust is a longstanding trust that goes back to 1907. And it is a very large liquid global equity income trust with gross assets of around 1.8 billion. It does have some debt, some gearing. The gearing level at present is around about 6%. And that has been coming down over the past few years as we have chosen not to renew a couple of tranches of debt which were up for renewal again. We were being quoted a rate of 6% when we were paying 2 point something for the previous tranches. So we were in the fortunate position to say, no, thank you, we'll just leave that for now. The dividend yield is something that people do associate with Murray International and for good reason. So the dividend yield currently is 4.5%. And that has been incredibly consistent over time between 4 and 5%, no matter what's been going on in the backdrop. And the reason we've been able to keep that consistent is partly due to the investment trust structure. So we do have very healthy income reserves. Having the long track record that we have and having the trust being managed pretty prudently over time has meant that we have been able to tuck money away for a rainy day. But we are currently sitting on roughly 73 million sterling of reserves which is equivalent to one year's worth of dividend payments. So a lot of people, we give their IT for that. We are very grateful to have that as backup. The trust is currently trading at a discount as is the sector as a whole. As at the end of the year, which is what this figure represents, it was around 9%. That has come in a bit. It was just under 8% last time I looked. And another feature to remember about this trust is that it's fairly straightforward in the sense that we invest predominantly in equities, listed equities. And there is a small proportion of fixed income holdings at the moment. And we only ever go there when there is extreme valuation attractions around that part of the market. So these are holdings that were introduced 10 years ago at a very attractive level. But again, that proportion has been coming down as a lot of these bonds have been going over. So currently 94% of those assets are in listed equities from around the world. And if we go on to the next slide, this is really hammering home what the investment objective is for Murray International. And we include this in every single conversation with shareholders and potential shareholders because this is the crucial part of really our message is to explain what it is. The investment objective for the company has three different components. The first is maintaining that above average dividend yield. It's important to our shareholders to have that consistency. And we also want to grow that income and grow the capital ahead of inflation over time. And the objective is not listed here, but the goal is to have that income covered from the income generated from our underlying holdings. Now if that doesn't happen, as I say, we can tap into reserves, that's what they're there for. But that is the goal that we set out to achieve. In terms of how successful we've been in doing that over the years, there's a few bullet points here. So first of all, the chart shows you that above average yield. And this is comparing the yield on Murray International with the average of other global equity income trusts as defined by the AIC. The data on here with regards to dividend growth is a little bit out of date, apologies. We haven't declared or had accepted our final dividend payment yet for 2024. But the track record stands nonetheless. So we have currently 19 years of consecutive dividend growth. A couple of years before that it was flat, so it's not that we've been cut before that. But in terms of growth, we're currently at 19 years. Dividend growth ahead of inflation is something that we've managed to achieve in 15 of the last 20 years. It has been tricky over the past couple of years to achieve that. But the compound annual growth rate on that dividend is 7% over that 20-year time period. And similarly, when you look at the total NEB return over time, we have managed to achieve above inflation growth in the NEB return in 14 of the past 20 years, with an annualised return over that time period of 10%. So that's, I think, slightly ahead of a standard global equity index. But the really interesting point is that we do it in a very different manner. The next slide really highlights that point. This is nothing like a reference index. People find it really difficult to come up with an appropriate way to measure Murray International. It's not traditional in the sense that you can just compare it against the MSCI World Index, for example, because the investment objective is not to beat that index, as a lot of other products may be. And you can see, first of all, the NEB consistency over time. So the last few years, it's been 8% to 10% at a time when the equity markets have been all over the place. And so you will see, for example, last year there was an underperformance versus the all-world reference index of around 11%. Roll back a couple of years, and it looked like we were superstars because we outperformed by 17% in 2022, which was a difficult year for global equities. In our view, we weren't fabulous in 2020. Year 22, we weren't awful in 2024. Every year, we're just trying to meet that investment objective rather than worry too much about what the wider market is doing, because that's why our shareholders are invested in this product. The next slide is building on that slightly. So there is an element of capital preservation in Murray International. It is a more traditional, defensive income product in that regard. And although we absolutely want to grow capital over time, it really helps if you don't lose it in the first place, to be quite honest. So if you look at the track record, again, over a long period of time, 20 years, and look at how the Trust has performed each month over that time, you can easily see, on average, how it's stacked up against the standard index. So we have, for example, in down markets, a tendency to perform better. So on average, the Trust has outperformed by 74 basis points per month in down markets over that period. And the flip side of that is that we tend to participate in up markets, but perhaps not keep pace if markets are very strong. And particularly, as we've seen recently, markets being dominated by a handful of companies, which are quite simply not appropriate for this strategy, because they don't pay income. And if we go on to the next slide, this really explains and shows how diversified the Trust is. So thankfully, nowadays, we don't have to be chock full of telecoms and health care and staples to achieve the investment objective. We don't have to be dominated by any one particular region or country. We can get exposure from all over the world and then collectively, as a Trust, it's trying to tick those boxes in the investment objective. So just now, for example, we have 24% exposed to European listed equities. We have 32% in North America, which is the highest it's been for quite some time, actually. So people who don't know the Trust would hone in on that and maybe question why it's not bigger. It's just because when you're trying to achieve that investment objective, the stocks haven't led as well. But that's quite interesting to see that weight going up in the US because there are more income opportunities there now than there were even going back five, ten years ago. Asian equity is 23%. UK equities have been quite consistent over the past few years, about 6%. And we do have some exposure to Latin America, which again, brings a different type of exposure and quite unique companies in some sense. And in the sector chart as well, you'll see that we can get exposure to lots of different types of companies, which is fantastic, just from a pure risk diversification standpoint. The top 10 holdings is there, for your information. Lots of different types of companies there. You'll see, for example, some of the big tech stocks of the world. Taiwan Inductor and Broadcom are the biggest holdings currently. And we have slashed those positions, believe it or not, because they have been extremely strong performers over the past year or so. But still quite big positions in the trust. And you'll see also things like Philip Morris International, a tobacco company, a Singaporean bank in there. CME is a derivatives exchange in the US. We have Buripo Asur, a Mexican airport operator. AbbVie is a US health care stock. Enbridge, a Canadian pipeline company. So lots of different types of businesses in there, making up the top 10. And you will also see from this chart that we don't need every company to generate that 4.5% yield. We do operate a barbell approach, so that we can have really diverse types of companies in there. And so for every Broadcom, which is really low at the moment for us, just under 1% dividend yield, that's offset by the likes of an Enbridge at 6% yield. And that's always the way it always has been over time. I've put in this slide just to give a feel for the kind of trading that we've been doing recently. So in terms of the level of trading, that 13% of gross assets is fairly normal and obviously does fluctuate from year to year. A lot of the selling we did last year was trimming holdings that had held up extremely well. So things like Broadcom, TSMC, we took a lot of money out of those names, because the maximum we can have in any one company is 5%. And so that forces you to recycle that capital into weaker names and not be too falling in love with any one company or too wedged to any one theme or any one market. In terms of the new companies that went in, and these will be familiar to most people, Mercedes-Benz we put in last February. And Coca-Cola Company was one of our more recent additions. Taylor Wimpy in the UK. And Medtronic, which is a US healthcare devices company. So that kind of broadened the exposure that we had within healthcare. And the divestments for quite different reasons. So Roche, the Swiss pharma company, was just kind of lack of conviction. We've got lots of choices within healthcare. This one we thought was okay, but not fantastic. So we decided to get rid of that one. TC Energy is a pipeline company in Canada that we switched into Enbridge. That was an analyst preference there. China Bank is one that we got wrong. This was a Chinese property company that we bought a few years ago, thinking that by this time, the Chinese property market would have been cleaned up and sorted out a lot more than it has. So when China Bank cut its dividends, or cancelled its dividend rather, back in April of last year, that was the catalyst to exit the stock. And Epiroc is a Swedish company. It's a company which does machinery for mining. That was purely on valuation. That had performed very well. It wasn't a big income generator, and we didn't think it had that much more capital upside when we sold out. So that was a divestment for the right reason. If you want the investment pieces, we thought it played out pretty nicely. And where we put money as well is also existing holdings, which have been weak. So Diageo is one we've been speaking a lot to shareholders about over the past year or so. We're sticking with that one. We've talked it up again recently, for example. And then just to finish off, before we go on to questions, if there are any, why invest in Murray International? And I'd say that the main reason you would is if that investment objective is something that you fancy, basically. You know, this is a company which is quite simple in its investment objective. It is about growing that dividend, growing the capital over time, and having that consistency of income. And that is something that often people use as a nice alternative to other global equity income trusts out there, which perform very differently, have very different holdings. We don't have any MAG7, for example, in here because it wouldn't fulfil the investment objective. So as a balance to other trusts, it can be useful from that perspective. We also absolutely stick to our guns. So as I say, over the years, it's looked like we've been crazy doing this. Other years, it's looked like we've been really clever. But it's just absolutely sticking to what we tell shareholders we're doing because the investment objective is set by the shareholders. And then it's up to us to try and fulfil that. And I think we're very fortunate to have the whole world to choose from. When we speak to our colleagues who manage other income products, but they're more constrained to regions, it just makes me very lucky that we can go where we think we can add value no matter where the company happens to be listed. And with that, I'll finish off. Thank you for listening. Right, thank you very much for that. That's good. We have got some questions for you. Yes. So where should we start? Let's start with the bond stuff actually first because that is different and it's something that very few other funds do. Yeah. So what sorts of bonds do you have in there? Yes, at the moment, there's 13 holdings and they're all emerging market debt. So this is across a whole range of different companies. So for example, we have a couple of Indian corporate bonds. We have Mexican bonds. We have one South African bond in there. And the individual weight to each of these is fairly small. So compared to what we have in equities where we have typically minimum 1%, maximum 5%, the bond holdings are much smaller in size. And again, this is not a call on bonds. It's not a call on emerging market debt. It just happens to be that if you roll back 10 years, these, in our view, are high-quality corporates and well-funded government bonds were looking at a real opportunity and it helped offset what we were seeing in equities at that time which had much lower yields. So trying to just use these, use that flexibility as a way to deliver the mandate has worked over time. And currently, the running yield on the bond portfolio is around 8.5%, 9%. So it does help to deliver the investment mandate. But would we add more to that category now or more to other bonds? No, because we're kind of in no man's land with regards to valuations, I think. So it's something that we will use, but we've only really used in a sizable way twice in the last 20 years. You have to go back another 10 years before that, before we had sizable holdings. And then it was treasuries and it was gilts because, again, what they were offering from an income perspective was relatively attractive at that point in time. So it fulfils its purpose, but it's not something that we're banging the table about by any means. It's there as an option. And then in terms of the credit risk of those, are they relatively high-quality companies? They are. So, again, I maybe should have specified this. We don't do that independently. So myself and my colleague, Martin Conaghan, who are managers of Murray International, we absolutely lean on our emerging market desk experts in London for this part of the portfolio. So they're the ones that know these things inside out. They go through in fine detail exactly how credit-worthy these companies are. But when you've got something like a Valley bond, for example, in the trust, I mean, we actually sold that a couple of years ago. It was trading at 146. It was a par bond. And if you already hold the equity, you're happy with the equity, and you're getting what we consider to be really attractive opportunities in the bond of that same company, then I think it is worth consideration. But, yeah, yeah, of course, you have to be careful, and we have to rely on their expertise in that regard. And then at the moment, the gearing and the allocation to bonds are roughly matched. Is that a deliberate thing, or is that just coincidental? No, and do you know what? It's something that is a bit of a shame because people can, if they weren't having a conversation, would easily make that conclusion. You're taking debt on to buy bonds, and it's not at all. So we have, as I say, had more debts as well in the past. So the bonds and the gearing has come down at the same time, which, again, could be a bit misleading, but it's a completely different decision. It's just you're taking on gearing because you think you can make money on that for your shareholders, but where you decide to allocate that could be equities, could be bonds, could be any location, so it's not tied in. Right, okay, that makes sense. And then in terms of the gearing that you have got, is it quite long-term, or is it short-term, regarding credit facilities? It's long-term. So we have currently £110 million, roughly split in two, £150 million, £160 million. The first tranche of debt comes up for renewal again in 2031, and the second half in 2037. And the weighted average coupon we're paying on that is 2.56%. So, I mean, it looks amazing now. And I remember when we took out that longer tranche a few years ago, it was 15-year money. We took it out, and the weight on that was 2.83. And I remember sitting in the board meeting and we were debating, oh, is that a wee bit more expensive than we had been paying? Is that a right decision? And I'm so pleased that the answer was yes, because that's fantastic. So we don't have to think about that now for quite a long time. But we do look, you know, if things change and we are getting more palatable numbers coming before us, there's nothing to say we wouldn't go up again. The maximum we've had is £200 million, so I don't see us going above that. Again, it's a board decision, but that would be in a comfort level, I would say. £110 at the moment is where we stand, but it's to say we don't have to think about it for a while. OK, fair enough. Now, I think one of the most important things that differentiates you is this insistency on covering the dividend, because obviously the big other trusts in the sector pays income out of capital. So how important do you think that is to generate the income that you pay out? I just think it gives that level of comfort that you don't otherwise get. So if markets keep going up and up and up, which a lot of people even nowadays think that's a given, it's not a given. So I think just having that ambition to cover the dividend just makes this trust different, makes it clear what it is. And then if we get a bump per year and we can tuck reserves away, and we did have to dip into it in COVID, that again is quite comforting for people. So could we have a higher dividend if we use our capital reserves? Absolutely we could have, but that to me would really mix the messaging. And as you say, there's plenty of alternatives if that's what people want to do or they want to split the allocation. So I think in our minds, we know at the start of every year what income we have to generate to be able to cover that dividend. And it's not that we would ever do anything solely with that in mind. You've got to have the companies that you believe in, you're looking for that capital growth as well. But again, I actually quite like that discipline of having, the ambition of having a covered dividend from day one, and it does sit well with issue holders. Great, thank you. Now let's look at the geographical specificity. So the other interesting thing, the big differentiator, is this weighting in North American equities, which is a lot lower than the World Index. And a lot of people are saying that North America looks expensive. Is it driven by valuation? Is that the main reason why you've got those weightings? It's more driven by, well, for a long time it was driven by the income. We just could not get the income. I mean, if you go back, I mean, let's go back a while now, but 2010, I think we had 7% in North America because you just could not get that level of income that we required. Nowadays you can. You can get contributors from there, which is fantastic. But if we were to really push that, again, trying to cover that dividend in a sensible way would be really difficult. So you end up with double the weight maybe in your tobacco stock or whatever, which again doesn't really sit well. So having, it's actually 32% in North America, five of that's Canada, so it's even lower if you're looking just at US stocks. It's not something that we worry about terribly. If you were to get a lot of US companies up in that dividend, nothing against having more there. The last two additions actually were Coke Admitronic. So yeah, we can see opportunities there on the income side. But it fluctuates as well. It's been interesting over the years when we first added Dotcom, one of our biggest US holdings. That was four years ago in the dark days of COVID. That was on a 7% dividend yield. I mean, you would never believe that now. It's one of the growth BI darlings of the world and it's less than 1% dividend yield. But that wasn't that long ago. That was a really interesting dividend company. So who's to say that won't come again and we'll find opportunities. But I think the US market is so warped at the moment because of these massive big companies that just do not pay income. There are very little, no intention really of growing that income. So it's quite an easy call in a way for us just to not bother with those particular names. You can get similar exposures elsewhere. So yes, it's not that we're against any of these businesses, but they just don't fulfil the mandate. So we can quite easily pass and move on to something else. Sure. Obviously, US politics is nevertheless dominating the headlines. So there's a question here about your American healthcare holdings, for example, with Robert Kennedy Jr. being the health minister. Do you worry about what's going on? Is there anything that you might change in the portfolio because of what the US government's doing? I think it's fascinating to kind of listen. And it's been really interesting this time round, even compared to Trump's last time in power, to see how markets have reacted or how they haven't reacted to some of these really quite wild and bold statements that he makes. In terms of the healthcare companies in particular, so we have Appleby and we have Merck within the US, which we're fairly comfortable with both of those names actually. The way he's talking about tariffs on drugs coming into the country, that would maybe impact the length of a Roche, which we no longer own. But maybe I could see some of these companies being a bit more trying to work out what that means for them. So happy enough, to be honest with you, with the exposures that we have within healthcare at the moment. And it's even some of the other policies that have been bandied about at the moment with regards to tariffs. It is impacting companies like Pernod and Diageo, these European businesses that most of Diageo is selling more into the US. But are you trying to make any kind of call right now about exactly what's going to happen? Is it a threat? Is it real? Is there going to be some kind of deal made? Even Mercedes. Mercedes is really caught in that at the moment with tariffs all over the world. But there's so many clawback schemes going on that actually the headlines don't necessarily transpire. Even if they were going to happen, to be as bad as the initial stock market reaction would suggest. So I think just a time of digestion is absolutely needed and not just an automatic reaction to some of these, as I say, really quite wild stories that are going around. How about Enbridge? The pipeline's running through Canada into the States. That's right. So they are like north, south, east, west. And they have come out and said that the 10% on energy tariffs comes to play. That will be OK for them. So they have done the numbers. And the way their business is structured, they don't think that's going to be something that's going to impact them too greatly. So that was pretty reassuring to hear that. OK, thank you. What about renewables? Because obviously we talked about that earlier, how cheap they are in our sector. But is that an interesting area for you? Yeah, we've got some, but maybe not in the way people would automatically assume. So we have total energy, for example, in the trust, which over the years has been gradually, maybe quite a quiet way, but just doing more and more and more in that space. And I think the story is believable. I think they do need the traditional side to fund a lot of these projects. And I do think no matter what happens in the US, this is definitely going to happen. It's not something that can just stop. And we do have exposure to Enel, which is our Italian utility company. We have Shell as well as the other company, which has exposures to the area. But I think out of them all, Total is the one that actually stacks up, I think, is the best in terms of its policy and its approach to that particular part of its portfolio. And I think it will continue to grow. OK, great. Thank you. Asia, I've been writing some stuff recently looking at that, and it's incredible how the yields have gone up. Yes, they have. Is that growing as a proportion of the portfolio? It's been about the same, James, to be honest with you. Over the last five years or so, that Asian exposure has been pretty static. And we have made some changes to the portfolio in there, but what's, again, really quite pleasing in Asia is you can get exposure to so many different kinds of companies in so many different locations, and they don't all act the same way. And I'm really pleased that that has changed even better over the past few years, because at one time when China was down, lots of Asian markets were under a cloud as well. That has not been the case. So even companies like OCBC in Singapore, the bank, or SCB in Thailand, they've got nothing really to do with what's going on in China. They've got really nothing to do a lot of the time with what's going on in other parts of the world. So they keep doing what they're doing in their own market very well. And that has been really pleasing from an income perspective in terms of the rewards that they've given back to shareholders in that way. So Asia was kind of there. I think the US is definitely catching up in terms of kind of clocking on to the fact that this is... The income side is valuable for certain shareholders as well. So Asia were a step ahead in that sense, and that continues to be an important part of the Trust because of the diversification it brings. Okay, thank you. One specific question about... Can you explain the difference between what Bezi does and what Taiwan Semiconductor does? Because there's a question here about how they... Do they compete with each other? Yeah, so Bezi sells to TSMC. So they are linked. BE Semiconductor, they provide the semiconductor equipment. And the exciting part of that business is in a part of the business called hybrid bonding. And it is to do with exactly how the... It's not glue, obviously, but how they actually come together in a more efficient way. And they are the pioneers in that. Other companies are getting into it now, but Bezi were there first. So they sell to the likes of TSMC so that when they put the semiconductors together and they sell onto other people, they can do it in a more efficient manner. So it's been quite interesting. Bezi's a really volatile stock. You have to remember that when you invest in this one. It can be quite lumpy orders from the likes of TSMC and Intel and people like that. And so it is linked, but it's not identical. Okay, makes sense. Thank you. And then TSMC is one of these holdings that we just sit at the top of everybody's portfolio. I know. That's not something you worry about, the group thing? Let's come back to what is it, why are you owning it? We've held this for 20 years or something. We've held it forever. We've taken far more out of the name than we currently have. And you do keep coming back to it because at one time it was more for income. This was a big yielder back when we first invested in it. And now you're thinking it's not a great yielder. It's done really well over the past year or so. So is it still worthy of a 4% position? But what gives me comfort is the fact that they are just so far ahead of peers and they're still investing so much billions to keep that dominance. And they've been quite clever and quite savvy in terms of working with places like the US to get more local production. But they're charging for it. They're in quite a powerful place when it comes to negotiation because these chips, these high-end chips, are just so crucial and they're everywhere. So a company is not going to really go down the quality curve on that aspect. So I think they're not a lot of things together. I just make it still tick the box. I mean, it upped its dividend by 30% last year despite only having a 1.4% yield. So in terms of rewarding shareholders in that way, that's in the mindset. That's not something that you're having to persuade them to do. They're already there. So it still is a company that fits the mandate and yet it's a very, very popular stock. So that's not one that we think we've got really any huge differing view to others. Perhaps. But I think it is one that's still a really good company. It's cyclical. I mean, two years ago, this was one of the worst performing holdings. Again, you have to accept that. You know, it's going to be up and down with cycles. But it's one that I think is still a very good company. And these are all fairly big companies. To what extent do you go down the market cap scale into some of the smaller mid-cap stocks? Yeah, there's a limit to how far down we can go. So given it's a 1.8 billion trust, minimum position 1%, and you don't want everybody stuck in a stock. So there are limits. One of the smaller ones we've got is Taylor-Rimpey, so a stock we put in last September. So I think market cap for that one is about 5 billion sterling, something like that, if I remember correctly. So that one, again, that was probably the lower end of what we feel comfortable with and just how it trades as well. So it's not just the market cap. We've got to look at the prefloat and just its average daily volume, et cetera. So it's not that we're against it. Bezzi, as well, interestingly, when we bought that, going back again three years ago now, that was a 5 billion euro market cap company, so one that really wasn't on the radar for most people at that time. So you can go down, but not, I wouldn't say we can really go much lower than that, to be quite honest with you. Yeah, that makes sense. I'm intrigued about Mercedes-Benz. What's the electric vehicle story with that one? Yeah, so this is one that, like most of the global car manufacturers, have been pulling back from. So as the EV story has just slowed a bit, there's just not the infrastructure that would be ideal for it. The costs are still high for a lot of people. There's still issues on batteries. There's still a lot of work to be done there. There's just the government support and I think in general people's acceptance of these things has kind of stalled. But the good thing with Mercedes-Benz and others is that because they are so big, they can flex that model. So Mercedes have EV and traditional in pretty much every model they do, so they do have flexibility around that, compared to a lot of Tesla, for example, that's just associated with one thing. So again, it's quite good that they have the ability to flex depending where we go with that particular strategy. Obviously, one of the things that's been dominating headlines this week is the possibility that the war in Ukraine might end. Did you have any Russian stocks when they invaded? No, we didn't. Russia, because I've not really gone into this, but there is a quality assessment on every company we would do. There's different components of that and part of it is corporate governance. The way you would expect that to be very much part of a quality assessment and looking after shareholders, minority shareholders. So no, we didn't, and we've never had any Russian holdings in the trust. Okay, fair enough. So actually, that sort of quality thing is important. Yeah, I think when you're trying to, you can come at it from different angles, but if you're trying to get a consistent income from a company, that absolutely feeds into how the company is managed, what its cash flow is like, can you guarantee that? You don't want people swirling away a lot of it for themselves. So it's not to say that you can't invest in family-owned businesses or companies that are invested in other companies. That can be absolutely fine, but you've got to get to why it's being done and do you feel comfortable. And we only have to have 50 names, so it's not like you're having to agonise over these decisions. If something is a bit off, you just really don't need to go there. And we have the whole world, as I say, to choose from, so we have maybe a bit more flexibility than others over a lot of these things. Cool. We always get this question. So are you invested in the Trust? Yes, I am. And the rest of the team too, yeah? Yes, we don't have to, but yeah, I think it makes sense to manage this. And this is the only thing I manage as well, which I love. You know, at one time I invested, I've done small cap over the years, I've done equity funds without the income element to them, but this really does appeal to me just as a person, as an investor, and as a manager. So I'm well aligned. Brilliant. Thank you very much indeed, Samantha. I think we've covered a lot of ground. And good luck with it all. Thank you. And we'll talk to you again in a year or two. So thank you. Thank you. Have a good day. Bye-bye. Great. So thanks for everybody tuning in today. Sorry for the sound problems that we had earlier on. Anyway, we'll be back next week talking to the manager of Hydrogen One Cups Growth, which had a little bit of good news this morning. And in the meantime, have a good weekend and we will see you next week. Bye.