It seems like the headlines in the national media over the last year have alternated between Brexit, Trump and trade wars and we are asked on an almost daily basis what the impact is likely to be on the financial markets. Our advice is consistently the same; ignore the noise and know what you own and why you own it.
But of course that is easier said than done in times of volatility. Even the risk takers amongst us will be forgiven for getting a little jittery and consider cashing it all in and hiding it under the bed. But there is an opportunity to invest much closer to home and while it’s not the biggest choice in the world, there’s definitely enough to look at and I’m sure you’ll be surprised at what’s available on your doorstep.
Living on an island, we know just how efficient and resilient locals are. We’re not out to conquer the world but we’re making the best of our enterprise, vision and distance from the political craziness and uncertainty all around us. Of course we’re not immune from our UK affiliations but generally we reap what we sow.
Within all this are thriving businesses assisted by their geographic protection, quality management and sturdy marketplace. Brighter people than me spotted the opportunity to list some of these companies and the benefits are very apparent. Immunity is probably too strong a word but there’s historically been very little volatility in local listings. The rationality of the investment, rather than sentiment, drives the value and the noise of the outside world is largely ignored. Added to this is the familiarity with what and who you’re investing in; there is a definite appeal to owning a small part of the companies you use regularly or drive past on your morning commute and the buildings you might work in or walk past as you go to a meeting.
Ravenscroft plays a significant part in the promotion and trading of local entities through our role as investment manager to Bailiwick Investments Limited (“Bailiwick”), the Channel Islands Property Fund Limited (“CIPF”) and the Financial Services Opportunities Investment Fund Limited (“FSOIF”) which own businesses and properties across the Channel Islands and in the Isle of Man. All three are listed on The International Stock Exchange (“TISE”).
So what do each of them invest in and are they worthwhile considering? Bailiwick has gross assets under administration of more than £80 million. It has the objective of attaining long-term capital growth by investing principally in a diversified portfolio of investments situated, operating or headquartered in the Channel Islands. Within its portfolio are a number of well known names, including:
• Sandpiper – the largest operator of food convenience shops across the Channel Islands with a network of 45 stores. Sandpiper also works in partnership, on a franchise basis, with a large number of blue chip UK retail brands and now operates in more than 30 locations. Brands include Costa Coffee, Morrisons and Iceland. Bailiwick announced in March that Sandpiper also plans to list on TISE.
• Jacksons CI Group – regarded as the Channel Islands’ leading motor dealership which includes Jacksons, Motor Mall, Trinity Tyres in Jersey and St Martin’s Tyres in Guernsey. Last year it created a new state of the art, multi-franchise facility in the Isle of Man.
• Jersey Electricity Limited – the sole supplier of electricity in Jersey serving around 50,000 domestic and commercial customers. It is listed on the London Stock Exchange.
• Oatlands Village – one of Guernsey’s leading visitor attractions which has recently undergone a multi-million pound redevelopment including a new play barn, ten pin bowling and trampolines.
Bailiwick has been consistently paying two dividends per year to its shareholders, which for 2017 and 2018 was 5.5 pence per share each year.
CIPF, which has gross assets under management of more than £255 million, aims to deliver capital growth and dividends through the acquisition and management of commercial property in the Channel Islands and Isle of Man. Target properties are prime Grade A office spaces let on long leases to quality covenants who are often global names.
Offices within the portfolio include:
• Regency Court, St Peter Port – 60,000 sq.ft plus 254 car parking spaces and let to Bank of Butterfield, Deloitte, Barclays, Schroders and IAG.
• Royal Chambers, St Peter Port – 67,473 sq.ft and let to EY, Terra Firma, Mourant and IPES.
• 17 – 18 Esplanade, St Helier – 29,241 sq.ft plus 22 car parking spaces and let to SG Hambros Bank & Trust (Jersey) Limited
• Liberation House and Windward House, St Helier – 84,977 sq.ft plus 64 car parking spaces and let to EY, Rossborough, CPA Global and BDO.
• Vicarage House, Isle of Man – 30,000 sq.ft and let to Zurich Insurance
The annual dividend paid in 2017 and 2018 was 6.6 pence per share.
FOSIF has the objective of attaining long-term capital growth and an income stream by investing in well-managed financial services and related companies, which are principally based in offshore financial centres. It has gross assets under administration of just over £66 million and its portfolio includes:
• PraxisIFM – provides a wide range of bespoke professional services to private individuals, families and international corporate clients. The group was originally established in 1972 and now has around 550 staff. Majority owned by its management team, PraxisIFM listed on TISE in April 2017.
• Oak Group – formed in 2018 as the vehicle through which FSOIF acquired Oak Trust and consolidated the fund’s interests in Consortia Partnership and Kreston IOM. Oak Group provides multi-jurisdictional fund, corporate and trust structuring, expert administration and compliance services. It has £20 billion of assets under administration and employs more than 160 staff across five offices.
This is just a brief snapshot of the opportunities available locally and the teams at Ravenscroft in Guernsey and Jersey would be delighted to talk to you further about investing in the islands we are proud to call our home.