Temple Bar Investment Trust raised its interim dividend by more than 13% as the UK value-focused investment trust posted solid first-half 2026 returns after a bumper 2025 for the trust.
The trust reported a net asset value total return of 5.4% for the six months to 30 June, with a share price total return of 5.2%, a little behind the 7.2% from the FTSE All-Share Index.
Temple Bar lifted dividends for the period to 7.65p a share, up about 13.3% on a year earlier. The trust still yields around 3.7%, even after its share price has surged over the past 18 months.
These half-year reports are always backwards-looking, and the managers noted that performance had picked up strongly since the period end, leaving year-to-date NAV and share price total returns of 15.1% and 14.1% respectively, ahead of the benchmark’s 10.8%.
This is more like the 23.5% NAV return the trust produced in the year to 30th June.
Commenting on performance during the period, Ian Lance and Nick Purves, co-managers of Temple Bar Investment Trust, said: “The first half of 2026 was dominated by a geopolitical shock as the US and Israel struck Iran at the end of February triggering an immediate oil price surge. Brent crude ultimately rose to almost $120 per barrel at the end of March and almost doubled in the first three months.
“This was the largest quarterly gain since the first Gulf War began in 1990. Given this backdrop, the FTSE All-Share Index proved relatively resilient, given its substantial energy and materials weightings, registering a positive total return in the first quarter even as most developed equity markets fell. Within the UK index, the energy and basic materials sectors were standout performers in the first three months, while financials and consumer discretionary stocks, such as retailers and auto manufacturers, saw the sharpest declines.
“The second quarter was almost the mirror image of the first as an interim US–Iran deal was signed and the Strait of Hormuz was reopened. Unsurprisingly, the second quarter saw a pronounced rotation away from energy back towards domestic financials, consumer stocks and industrials.
“Overlaying these international developments was a deteriorating domestic political backdrop as Prime Minister Keir Starmer, announced his resignation in June. Andy Burnham took over as Prime Minister with markets closely focused on his fiscal positioning and his unexpected choice of John Healey as Chancellor.
“UK companies have continued to attract significant overseas interest in the period, with US private equity firm Castlelake making multiple bids for easyJet before an eventual successful bid by Apollo, and the US asset manager, Nuveen, bidding for Schroders. Testing company Intertek, insurer Beazley and food ingredient manufacturer Tate & Lyle were also the subject of bids from overseas purchasers. These bids underscore the persistent valuation discount of UK equities relative to global peers and bode well for the potential investment returns that are available in the UK market.
“The strongest performers in the period were the three Energy companies BP, Shell, and Total Energies which all saw their share prices rise in response to the sharp increase in Brent crude prices following the Strait of Hormuz crisis. The bank Standard Chartered and the Dutch insurer NN Group both performed well and continue to report strong income growth, muted cost growth and low levels of credit losses. Both have performed exceptionally well for the Company and, although not expensive, are not as attractively priced as they were a couple of years ago. Fund manager, Aberdeen Group also performed strongly on the back of continuing strong flows onto its market leading retail investment platform – Interactive Investor.
“Uncertainty remains due to the ongoing war in the Middle East, which has affected energy prices. So far in 2026, stock markets have been buoyed by strong levels of corporate profits growth which has been driven at least in part by large government deficits and massive investment in AI by the large technology companies. “As we are fond of saying, in an uncertain world, where it is all but impossible to predict short-term movements in share prices, our approach is and has always been to think long term and invest in what we believe to be fundamentally sound businesses at a significant discount to their true economic worth, on the basis that eventually that economic worth will be reflected in a higher share price. This approach attempts to take advantage of the short termism and behavioural inconsistencies of other investors and has successfully resulted in significant excess returns for our clients over the last 25 or so years.
“Whilst there is no investment approach that will outperform the stock market in each and every year, we feel confident that through the disciplined application of a well-diversified value investing strategy, we can continue to deliver these excess investment returns into the future.
“The Company continues to be invested in what we believe to be fundamentally sound businesses that should be capable, by virtue of their market positions and the industries in which they operate, of growing their profits over time, but which continue to be modestly valued in the stock market. The Company’s holdings are priced to deliver excess returns over time, and shareholders can look forward to the future with some optimism.”