(Alliance News) - Global Smaller Cos Trust PLC on Thursday said its annual performance was affected by a "challenging" year, but noted its raised dividend payout was "a good sign".

The London-based investment trust said net asset value at April 30 was 165.9 pence per share, down 4.0% from 172.8p a year prior. NAV total return was negative 2.9%, falling below the benchmark of negative 2.1%.

Global Smaller Cos cited a "difficult global market backdrop" for growth-orientated stocks due to high inflation rates, but said the second half of the year ended April 30 showed a "modest recovery."

The company declared a final dividend of 1.67p, up 31% from 1.27p a year prior. This brings the full-year dividend to 2.30 pence, up 25% from 1.84p the year before.

Looking ahead, Global Smaller Companies said it remains confident in medium-term prospects.

Chair Anja Balfour said: "It seems likely that the path of inflation and interest rates in the next few months will have a large bearing on equity market trends. The lagged impact of previous rate hikes will be a headwind in the coming period for the global economy. Having said this, the manager is continuing to find opportunities in the markets."

Shares in Global Smaller Companies were down 0.7% at 139.60p each in London on Thursday morning.

By Sabrina Penty, Alliance News reporter

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