AIM Portfolio Service: Q1 2022 Update

Published: 11th April 2022 (1 Min Read)

The portfolio declined by 15.85% over the quarter compared to the benchmark which decreased by 14.53%. The quarter was weak due to the sad events in Ukraine causing further uncertainty alongside supply chain issues, which continue to persist in part due to China’s zero covid policy.

During the quarter we sold Knights Group. Knights issued a profit warning in March which was due to a slowdown of corporate work and Omicron during their traditionally busy months of February/March. Whilst we still believe in the regional rollup model, this profit warning highlighted the fixed operational nature of their business (fixed renumeration of employees) which could be susceptible to any economic slowdown.

We deployed some of the cash from the takeover of Sumo into a new holding, Instem. Instem provides integral software solutions to pharmaceutical companies to help them bring new drugs to the market quicker than would normally be the case. It typically takes over 12 years for a drug to go from discovery to the market and over 50% of drugs on the market have been through Instem’s platform during development. We live in a growing/ageing population and the global pandemic is likely to have intensified the pressure on healthcare groups to accelerate and improve the entire drug trial process, which should be positive for Instem.

We know there are a lot of challenges ahead, but we believe we hold companies which are in structurally growing areas and should there be any further negative outlook ahead, they will still have the opportunity to grow and be able to ride out any volatility.

To download the latest quarterly factsheet, please click here.

To find out more about our AIM Portfolio Service, please click here.

Risk warning: You should remember that the value of investments, whether pooled or direct equities, and the income derived therefrom may fall as well as rise and you may not get back the amount that you invest. In the event that you require a level of income higher than that generated by your portfolio, you should be aware this will dilute the capital value of your portfolio. Past performance is not a guide to the future. If you are in any doubt of the suitability of an investment for your particular circumstances, you should contact an investment manager for tailored advice.

Article written by
Tinzar Minmin