Energy fund delivers more than nine per cent returns

The Nigeria Energy Sector Fund (NESF), a closed-end investment vehicle quoted on the Nigerian Stock Exchange (NSE) has declared a coupon payment of N51 per note to unit holders for the financial year ended March 31, 2016.

The coupon payment also represented a 9.23 per cent growth at the current market price of N552.20 per note.

Over the last three years, the Fund has delivered average returns of 10.74 per cent to unit holders in terms of coupon payments, against negative returns of 15.05 per cent in the stock market during the same period.

The impressive returns, notwithstanding the bearish mood that characterised the equities market on the back of weak macroeconomic environment in the country is a demonstration of sound management of the Fund.

In 2015, despite the impact of severe diminution incurred on investments in some oil and gas stock due to weak performance, the Fund returned a N35 coupon per note distribution. This translated into 6.33 per cent yield as against negative returns of 17.36 per cent in the stock market.

Also in 2014, unit holders earned N92 coupon per note, which translated into a yield of 17 per cent compared to negative returns of 16.14 per cent in the stock market during the period.

The Group Managing Director of SCM Capital, who is the Fund Manager, Gaventa Otono, said: “The Fund since inception has continued to witness significant growth and delivered value to unitholders in terms of coupon payments that is second to none in the industry.

“We kept our investment philosophy and adopted sound investment methodology to continue to sustain the Fund`s performance. The adoption of the improved and optimal appropriate asset allocation strategy has been key to the performance.”

On future expectation, he reiterated resolve to aggressively manage and take advantage of emerging opportunities in the economy despite the current economic recession, which offers both opportunities and challenges to fund managers.

He also urged discerning investors who are driven by the passion to earn regular income to take advantage of the enormous opportunities available to invest in the Fund to grow wealth.