Monthly Archives: July 2019

The L&G Pharma Breakthrough ETF

The L&G Pharma Breakthrough UCITS ETF is an Exchange Traded Fund that owns shares in pharmaceutical companies, that looks for Long-term value in the pharmaceutical sub-sector that benefits from certain commercial and regulatory incentives.

It’s top ten holdings are:-

Array BioPharma 6.6% of the fund

PTC Therapeutics 4.2% of the fund

PharmaMar 4.0% of the fund

Grifols 3.7% of the fund

CSL 3.6% of the fund

Nippon Shinyaku 3.6% of the fund

Celgene 3.6% of the fund

Jazz Pharmaceuticals 3.4% of the fund

Novartis 3.3% of the fund

Ipsen 3.3% of the fund

The Debt of Anheuser-Busch InBev

Anheuser-Busch InBev is one of the largest drinks and brewing companies in the world.

The annual report makes interesting reading.

The debt mountain, could drive a sober person to drink. Debt Interest-bearing loans and borrowings $105,584 Million. That is $105 Billion. Interest payments (finance costs) known as “Interest expense” $4.141 Billion.

The M&G Credit Income Investment Trust.

The Company aims to generate a regular and attractive level of income with low asset value volatility by investing in a diversified portfolio of public and private debt and debt-like instruments (‘Debt Instruments’), of which at least 70% will be investment grade

Top 20 holdings:-

M&G European Loan Fund 8.41% of the fund

Cash 7.80% of the fund

HSBC Holdings Plc 1.92% of the fund

Project Gate 1.82% of the fund

Brass No 6 Plc Brass 6 1.76% of the fund

Warwick Finance Residential Mortgages No. One Plc Warw 1 1.53% of the fund

Silverstone Master Issuer Smi 18-1x 1.51% of the fund

Newday Partnership Funding Plc Ndpft 17-1 1.51% of the fund

Coventry Building Society 1.48% of the fund

Marstons Issuer Plc 1.38% of the fund

Castell Caste 18-1 1.34% of the fund

Charter Mortgage Funding CCMF 18-1 1.34% of the fund

Yorkshire Building Society 1.24% of the fund

Altice Luxembourg SA 1.22% of the fund

Paragon Mortgages Plc Pargn 25 1.20% of the fund

Imperial Brands Finance Plc 1.19% of the fund

Lloyds Banking Group Plc 1.19% of the fund

Sonovate Limited 1.17% of the fund

London and Quadrant Housing Trust Ltd 1.17% of the fund

Hammerson Plc 1.17% of the fund

The Debt of Marks and Spencer plc.

Marks and Spencer PLC funding strategy is to ensure a mix of funding sources offering flexibility and cost effectiveness to match the requirements of the Group. Operating subsidiaries are financed by a combination of retained profits, bank borrowings, medium term notes, finance leases and committed bank facilities

Marks and Spencer has issued Medium Term Notes (MTN) as follows:

2019 £400m 6.125% Annually

2021 £300m 6.125% Annually

2023 £300m 3.000% Annually

2025 £400m 4.750% Annually

2037 US$300m (circa £240m) 7.125% Semi-annually

total debt (£400m + £300m + £300m + £400m + £240m) = £1,640m = £1.64bn

The National debt of the United States of America

The national debt of the United States is the total debt, or unpaid borrowed funds, carried by the Federal Government of the United States As of June 2019, federal debt held by the public was $16.17 trillion and intragovernmental holdings were $5.86 trillion, for a total national debt of $22.03 trillion. intragovernmental holdings are primarily composed of the Medicare bills.

UK National Debt

The UK national debt is the total amount of money the British government owes to the private sector and other purchasers of UK gilts.

In May 2019, UK public sector net debt was £1,806.1 billion equivalent to 82.9% of GDP

HSBC PLC July Dividend

On Friday 5th July, HSBC Holdings has paid out its July dividend of US $0.10 = 7.8368p a share.

The total number of voting rights in HSBC Holdings plc is 20,237,155,864.

Thus: 20,237,155,864 x 7.8368p a share = £1,585,945,430.749952

That is £1.585945 Billion

A yield of 5.27%

HM Government Borrowings, June 2019

Another month, guess what, take a lucky guess, it is the same old story, HM Government, spends more money than it receives via taxes and duties. Another deficit month, thus to bridge the gap, needs to borrow on the bond market.

In June 2019 , the HM Government had to borrow money to meet the difference between tax revenues and public sector expenditure. The term for this is The PSNCR: The Public Sector Net Cash Requirement. There were “only” 5 auctions of Gilts (UK Government Bonds) by the UK Debt Management Office to raise cash for HM Treasury:-

02-Jul-2019 0 5/8% Treasury Gilt 2025 £3,373.0970 Million

25-Jun-2019 1¾% Treasury Gilt 2049 £2,250.0000 Million

18-Jun-2019 0 7/8% Treasury Gilt 2029 £5,912.4990 Million

12-Jun-2019 0 1/8% Index-linked Treasury Gilt 2048 3 months £700.0000 Million

04-Jun-2019 1% Treasury Gilt 2024 £3,000.0000 Million

When you add the cash raised:-

(£3,373.0970 Million + £2,250.0000 Million + £5,912.4990 Million + £700.0000 Million + £3,000.0000 Million) = £15,235.596 Million

£15,235.596 Million = £15.235596 Billion

On another way of looking at it, is in the 30 days in June, HM Government borrowed:- £507.8532 Million each day for the 30 days.

We are fortunate, while the global banking and financial markets still has the confidence in HM Government to buy the Gilts (Lend money to the UK), the budget deficit keeps rising. What is also alarming, is the dates these bond mature 2024, 2025, 2029, 2048 and 2049. All long term borrowings, we are mortgaging our futures, but at least “We Are In It Together….