The Luna AIM portfolio delivered a return of -5.4%* during the first quarter which was behind the FTSE AIM All Share TR index of -4.9%*. We are aware that one quarter is a very short time period and when taking a longer-term perspective from launch (01/06/2020 to 31/03/2025) the Luna AIM Portfolio has outperformed, returning 0.3%* compared with the FTSE AIM All Share TR of -16.5%*.
The best performing AIM holding was Everplay Group, the company changed its name from Team17 during the quarter. The share price delivered a return of 30%** during the quarter. Everplay is a leading global independent (“indie”) games developer and publisher of premium video games, working simulation games and children’s edutainment apps. During the quarter they reported a “strong bounce back in profitability” in its unaudited final results for the year ended 31 December 2024. Recording its highest ever revenues of £166.6m (2023: £159.1m) and pre-tax profits of £25.3m (2023: £1.1m loss).
On the negative side, RWS Holdings, which provides intellectual property translation, filing and search services, technical and commercial translation and localisation, and also develops and supports translation productivity and management software, saw its share price drop 35%**. The company reported continued progress on its medium-term strategy in an update on Tuesday, having returned to organic constant currency growth in the second half of its 2024 financial year. However, they highlighted pricing challenges in the year ahead and only slightly higher growth forecasts.
In summary, it was a slightly weaker quarter for the Luna AIM portfolio relative to the AIM All Share. Please remember that the AIM portfolio has been created to invest in companies that qualify for Business Property Relief (BPR) and in doing so are potentially outside of the estate for Inheritance Tax Purposes (IHT)***. Whilst delivering long-term performance is obviously welcome, we are looking to mitigate share price weakness that would negate the reason for investing in AIM (saving 40% IHT until April 2026).
* Source: MorningStar Direct
** Source: Alpha Terminal
*** based on current tax legislation and holding the assets for a minimum qualification period
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Luna Investment Management Limited (FRN: 923454) is an appointed representative of Thornbridge Investment Management LLP (FRN: 713859) which is authorised and regulated by the Financial Conduct Authority. Luna Investment Management is registered in England. No 12280396