Dividend Growth Split Corp. Launches New ATM Equity Program
Dividend Growth Split Corp. is excited to announce the renewal of its at-the-market equity program (ATM Program), a strategic move designed to provide greater flexibility in managing the Fund's finances. This program allows the Fund to issue Class A Shares and Preferred Shares directly to the public at market price, reflecting the Fund's proactive approach to capital management.
Program Details and Implementation
The renewed ATM Program enables the Fund to replace its previous program that has now concluded. By issuing shares at the current market prices, the Fund can optimize the capital it raises while offering investors a chance to acquire shares of the Fund based on prevailing market valuations. The program is set to operate under a financial distribution agreement with RBC Capital Markets, ensuring the strategic handling of share sales.
Distribution Timing and Volume
The timing and volume for distributions under this program will solely depend on the Fund’s discretion, allowing for a tailored approach to market conditions. This ensures that the Fund's initiatives align closely with its operational strategies and market dynamics.
Investment Strategy of the Fund
The Fund primarily invests in a diverse portfolio of equity securities from Canadian dividend growth companies. To enhance diversification and potential returns, it may also allocate a portion of its assets—up to 20%—to global dividend growth companies. This strategy is guided by the expertise of Brompton Funds Limited, the Fund's Manager, who meticulously selects companies based on their robust market capitalization and potential for future dividend growth.
Objectives for Shareholders
For holders of Class A Shares, the Fund aims to provide regular monthly cash distributions, targeting $0.10 per share, in addition to growth in the net asset value per share. The Preferred Shares, on the other hand, are set to offer fixed quarterly cash distributions, ensuring a steady income stream for investors.
Impressive Historical Performance
Over the past decade, the Class A Shares have achieved a remarkable average annual return of 12.8%, significantly surpassing the S&P/TSX Composite Total Return Index by 4.1%. Meanwhile, the Preferred Shares have delivered a solid 5.5% annual return, outperforming their comparable index by 2.5%. This performance underscores the Fund's ability to generate value for its investors consistently.
About Brompton Funds
Founded in 2000, Brompton Funds has positioned itself as a knowledgeable and seasoned player in the investment fund arena. Focusing on both income and growth, Brompton offers a range of investment solutions, including exchange-traded funds (ETFs), enabling investors to meet various financial objectives.
Looking Forward
As the ATM Program is set to remain effective until September 1, 2026, Dividend Growth Split Corp. is poised to adapt to market fluctuations and increase shareholder value concurrently. The ongoing commitment to shareholder returns and strategic investment makes this initiative a critical component of the Fund's broader investment strategy.
Frequently Asked Questions
What is the ATM Program of Dividend Growth Split Corp.?
The ATM Program allows Dividend Growth Split Corp. to issue shares to the public at prevailing market prices, providing flexibility and potential capital growth.
How does the Fund select investments?
The Fund invests primarily in Canadian dividend growth companies with a market capitalization of at least $2 billion and a history of dividend stability or growth potential.
What are the expected returns for Class A Shares?
Investors can expect a targeted monthly distribution of $0.10 per Class A Share along with potential growth in the share's net asset value.
What historical performance has the Fund achieved?
Over the last 10 years, Class A Shares have delivered a 12.8% annual return while Preferred Shares have returned 5.5% annually.
Who manages the Dividend Growth Split Corp. Fund?
The Fund is managed by Brompton Funds Limited, an experienced investment manager focusing on income and growth strategies.
