Axe Woodford now! Pressure mounting on board of Patient Capital to get rid of embattled manager
- Trust bosses under pressure to replace Woodford as crisis continues
- Woodford’s Patient Capital publishes its half-year results on Monday
Neil Woodford is facing fresh calls to be axed from the investment trust that bears his name.
The 59-year-old manages the Woodford Patient Capital Trust which has suffered a halving of its share price since early this year.
Trust bosses, including chairman Susan Searle, are under pressure to replace Woodford as his investment empire is engulfed in crisis.
Woodford Patient Capital Trust bosses, including chairman Susan Searle, are under pressure to replace Neil Woodford as his investment empire is engulfed in crisis
They will be quizzed on their plans when Patient Capital publishes its half-year results on Monday – with some observers calling for Woodford’s head.
‘I would hope they would,’ said James Carthew, head of investment company research at Marten & Co.
He added: ‘The Woodford brand is tainted and his association with the trust is one of the things depressing its share price.’
Patient Capital shares closed up 0.2 per cent, or 0.1p, yesterday at 44p, well below the 2019 peak of 90p and overall peak of nearly 120p.
Patient Capital is separate from Woodford’s flagship Equity Income fund, which has been gated since June 3, meaning savers cannot withdraw their cash.
Since denying investors access to their nest eggs, Woodford has collected nearly £7.7million from them in fees, despite criticism from regulators.
Smaller fund halves in value
The crisis engulfing Neil Woodford’s empire has taken its toll on another fund he runs.
His Income Focus fund has halved in value since the flagship Equity Fund barred savers from taking out their investments on June 3.
It is worth just £225.2million, down from £494.3million when Equity Income was suspended and well off its October 2017 peak of £747.1million.
A spokesman for the fund said: ‘We remain confident that the disciplined approach that has served Neil Woodford and his investors well for more than 30 years is determining an investment strategy that is appropriate for the economic and market environment that confronts us.’
Woodford’s efforts to restructure his investments are continuing, with stakes in a number of companies reduced or sold completely in recent days.
The crisis at Equity Income has spread to Patient Capital amid widespread fears among investors that Woodford has lost his golden touch.
When Patient Capital was set up in April 2015, it raised £800million, making it the UK’s largest-ever investment trust launch.
Analysts say Woodford needs to be replaced as the manager of the trust. It trades at a discount of around 35 per cent to its net asset value – a measure of the value of the companies it has investments in.
This indicates investors are uncertain about its long-term prospects.
Analysts at Numis said replacing Woodford would be a ‘catalyst for a turnaround in sentiment’.
The Mail first revealed Woodford could be fired from Patient Capital in June. In July, Patient Capital said that while it was confident about the day-to-day management of the trust, its board said it would ‘engage with a broader range of third-party managers in order to undertake a full assessment of all potential management options, which may or may not lead to a change in the company’s management arrangements’.
Iain Scouller, analyst at financial firm Stifel, said that while Woodford may survive Monday, his removal at some point was ‘reasonably likely given the situation that we’ve seen over the last few months’.
Analysts at JP Morgan Cazenove said: ‘It looks increasingly likely that the company that bears Woodford’s name will move to another manager.’