Train collects £19.4mn dividend as profits rise at fund house

Train collects £19.4mn dividend as profits rise at fund house

The latest accounts for Lindsell Train Limited, the fund house operated by high profile fund managers Nick Train and Mike Lindsell, reported a leap in profits for the year to the end of January 2022.

Profits for the year were £65.3mn, up from £62mn the prior year. That enabled dividends of £53.1mn to be paid, an increase on the £48.3mn paid out in the prior year.

Train, Lindsell and their families each own 36.7 per cent of the business, meaning each received a dividend of around £19.5mn.

Article continues after advert

Other shareholders in the company include staff members and the Lindsell Train investment trust. 

The highest paid director, likely to have been either Lindsell or Train, received £11mn in salary during the year. 

The company has 20 full time employees, and spent £33mn on wages and salaries in the year, implying an average salary of over £600,000 per employee. Of those 20 staff, six work in the fund management department.

The higher profits come despite the sharp underperformance of the Lindsell Train Global Equity fund during the period covered by these results.

During that year, the average fund in the IA Global sector returned a gain of 9 per cent, while this fund lost 2.4 per cent. 

The Lindsell Train UK Equity fund fared little better, returning 6.6 per cent during the year, while the average fund in the IA UK All Companies sector gained 13.3 per cent. 

During the period, the company earned £119mn from fund management fees and a little over £2mn from performance fees. Performance fees fell sharply from the £6mn recorded in the prior year. 

Lindsell Train also manages other funds in addition to the two whose performance is mentioned above, including a US equity fund which they opened to investors in May 2022. 

Lindsell and Train are both veterans of the fund management industry, but have committed to remaining at the firm for at least another seven years.

The financial impact of the decline in performance and assets under management can be seen in the accounts of the Lindsell Train investment trust, which is the third largest shareholder in Lindsell Train Limited. 

In a recent update to shareholders, it valued Lindsell Train Limited at £394mn in total, a reduction on the £450mn valuation it gave in 2019.