Fidelity European return lags benchmark index in 'busy' year
Fidelity European Trust PLC on Wednesday reported a higher total dividend for 2025, as it posted net asset value per share gains, but saw its return underperform its benchmark.
The investor in European equities posted a net asset value total return of 16.2% for 2025, underperforming its benchmark, the FTSE World Europe ex UK Index, which returned 27.9% over the same period.
The investment trust’s net asset value per share improved 14% to 434.39 pence at December 31, from 382.44p a year earlier, with Fidelity European paying an interim dividend of 3.90 pence, up from 3.60p.
The company declared a final dividend of 6.00p, up 9.1% from 5.50p, bringing its total dividend for 2025 to 9.90p, up 8.8% from 9.10p.
Discussing the underperformance, Fidelity European noted contributing factors such as holding Novo Nordisk AS through a period of poor newsflow, being underweight in defence stocks and ‘preferring France to more highly favoured Germany’.
Shares in Fidelity European were up 1.0% at 405.62 pence on Wednesday morning in London.
‘2025 proved to be another busy year, not just on the world political stage and in European financial markets, but also for your company given the combination with Henderson European Trust PLC which completed in late September,’ said Chair Davina Walter.
Fidelity European acquired £462.7 million in net assets from Henderson European following shareholder approval of the combination.
‘After a year of strong performance, with markets having risen significantly, many investors in Europe are looking for further progress supported by potential productivity gains, interest rate cuts, continued fiscal stimulus and a belief that ’the worst is over’ in relation to US trade tariffs. This has led to a meaningful improvement in corporate earnings expectations from the flat outlook anticipated for 2025. While the path ahead may not be linear in these uncertain times, our team believe the portfolio is well positioned through its focus on high-quality, cash-generative businesses with strong balance sheets,’ continued Walter.
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