The Esmée Fairbairn Foundation, the Wellcome Trust and the Church Commissioners for England have all suffered sharp income falls in their most recent financial years, down 63, 29 and 16 per cent respectively.
Released this week, Esmée Fairbairn’s accounts for the year ending 31 December 2009 show a fall in total income of £20.3m to £11.7m, almost entirely due to a big drop in investment income.
Earlier this month, the Church Commissioners for England revealed that in the same period its investment income, which represents its only source of funding, dropped by £27.6m to £145.5m.
They follow the trend set by the Wellcome Trust, whose year-end 30 September 2009 accounts show total income down by £87.9m to £217.1m, mostly due to a fall in dividends and interest of £89m to £166.1m.
Foundation maintains “defensive portfolio”
Esmée Fairbairn’s portfolio underperformed its blended benchmark by 5.6 per cent, an annual total return in 2009 of 12.8 per cent not matching the benchmark of 18.4 per cent.
The Foundation’s report blames “the more defensive positioning” of its investments, and says the biggest absolute losses and market underperformance came from its direct property investments, “which not only took longer to rally but the nature of which amplified the losses”.
It says that given continuing market uncertainty the Foundation has continued to hold a defensive portfolio, and, in particular, maintained high cash balances.
The Foundation maintained its expenditure around the £28m mark.
The Church Commissioners, meanwhile, were hit by their listed UK equities, with income falling by £27.6m on the previous year to £46.9m.
The Wellcome Trust saw its UK equity income rise but this was the only one of its seven main categories to do so (see table).
|Wellcome Trust's dividend and interest breakdown|
|2009 (£m)||2008 (£m)|
|Dividends from quoted UK equities||45.7||42.2|
|Dividends from quoted overseas equities||90.0||97.2|
|Interest from UK fixed interest securities||8.3||52.8|
|Interest from overseas fixed interest securities||4.6||25.2|
|Income from unquoted investments||14.2||25.3|
|Interest on cash and cash deposits||3.3||6.0|
|Securities lending income||0.0||6.4|
Portfolio values recovery
On the bright side, Esmée Fairbairn saw an increase in the value of its investment assets of 10 per cent to £815.7m, while the Church Commissioners' were up 13 per cent to £4.6bn.
The Wellcome Trust’s however, perhaps reflecting its earlier year-end, fell by 0.4 per cent to £13.9bn.