Annual Financial Report and Notice of Annual General Meeting
Summary by AI BETAClose X
Artemis UK Future Leaders plc
Annual Financial Report (audited) Announcement for the Year Ended 31 January 2026
The following text is extracted from the Annual Financial Report of the Company for the year ended 31 January 2026. All page numbers below refer to the Annual Financial Report which will be made available on the Company's website.
Financial Highlights
Total return statistics (with dividends reinvested)
|
Change for the year (%) |
2026 |
2025 |
|
Net asset value (NAV) total return (1)(2) |
0.0 |
-2.4 |
|
Share price total return (1)(2) |
7.1 |
-8.0 |
|
Benchmark Index (2)(3) |
16.1 |
-7.8 |
Performance from 31 January 2016 to 31 January 2026
|
|
|
|
|
|
Since |
|
Total returns |
1 year |
3 years |
5 years |
10 years |
appointment |
|
Net asset value per ordinary share |
0.0% |
(6.4)% |
(8.3)% |
59.8% |
5.3% |
|
Ordinary share price |
7.1% |
(3.3)% |
(2.2)% |
58.7% |
12.3% |
|
Deutsche Numis Smaller Companies |
|
|
|
|
|
|
plus AIM (Excl. Inv-Trust) |
16.1% |
21.0% |
18.3% |
85.8% |
21.5% |
Source: Artemis/Datastream.
Capital statistics
|
At 31 January |
2026 |
2025 |
Change |
|
Total shareholders' funds (£'000) |
129,385 |
136,644 |
(5.3)% |
|
Net asset value (`NAV') per share |
434.66p |
449.88p |
(3.4)% |
|
Share price 1,2 |
386.00p |
375.00p |
2.9% |
|
Discount 1 |
(11.2)% |
(16.6)% |
|
|
Gearing 1 : |
|
|
|
|
- gross gearing |
8.6% |
9.0% |
|
|
- net gearing |
8.2% |
7.2% |
|
|
Maximum authorised gearing |
19.3% |
14.6% |
|
|
For the year ended 31 January |
2026 |
2025 |
|
|
First interim dividend |
3.85p |
3.85p |
|
|
Second interim dividend |
3.85p |
3.85p |
|
|
Third interim dividend |
3.85p |
3.85p |
|
|
Final dividend |
3.89p |
3.45p |
|
|
Total dividends |
15.44p |
15.00p |
2.9% |
|
Dividend yield 1,4 |
4.0% |
4.0% |
|
|
Dividend payable for the year (£'000) 4 : |
|
|
|
|
- from current year net revenue |
3,745 |
4,254 |
|
|
- from capital reserve |
883 |
437 |
|
|
|
4,628 |
4,691 |
|
|
Capital dividend as a % of year end net assets 1,4 |
0.7% |
0.3% |
|
|
Capital returns paid in the year: |
|
|
|
|
- Special dividend |
- |
484.85p |
|
|
Capital returns payable for the year (£'000): |
|
|
|
|
- Special dividend |
- |
16,401 |
|
|
Ongoing charges 1 |
1.00% |
1.03% |
|
1 Alternative Performance Measure (APM). See Glossary of Terms and Alternative Performance Measures on pages 70 to 72 of the financial report for details of the explanation and reconciliations of APMs.
2 Source: LSEG Data & Analytics.
3 The Benchmark Index of the Company is the Deutsche Numis Smaller Companies + AIM (excluding Investment Companies) Index with dividends reinvested.
4 Excludes the one-off elective special dividend (return of capital) of 484.85p paid to shareholders on 8 October 2024.
Chairman's statement
Dear shareholders,
The year was a challenging one for the Company and for the UK smaller companies sector more broadly. Over the 12 months to 31 January 2026, the Company delivered a flat total return on a net asset value ("NAV") basis, while the share price total return was 7.1%. This compared with a return of 16.1% from the Company's benchmark index. Investor sentiment towards UK domestic equities remained subdued throughout much of the period and improving business fundamentals in many of the portfolio's holdings were not reflected at the share-price level.
Change of Investment Manager
On 10 March 2025, following a formal review process, the Board appointed Artemis as Investment Manager to the Company, which was previously known as Invesco Perpetual UK Smaller Companies Investment Trust plc ("IPU"). The Board considered the change to be in the best long term interests of shareholders and has remained closely engaged throughout the transition and subsequent period.
Performance since the change has been difficult. This reflects a combination of continued headwinds facing UK smaller companies, cautious investor sentiment, and portfolio repositioning following the transition to Artemis. The portfolio was realigned during the year to reflect the new Investment Manager's investment philosophy and approach. The Board notes with encouragement that the Company has recently been awarded a Gold rating by Morningstar. This recognition is particularly welcome following a challenging period of performance, and reflects the strength of the investment process and the long-term potential of the strategy. While short-term returns have been disappointing, the Board takes reassurance from this independent endorsement and remains confident in the Manager's disciplined approach and its ability to deliver improved outcomes for shareholders over time.
Performance and markets
Market conditions over the year were characterised by weak confidence in UK domestic equities, with returns driven largely by stock specific factors rather than broad market support. Relative performance was affected by a range of smaller negative contributions rather than any single material detractor. Notwithstanding this, a number of portfolio companies continued to demonstrate resilient operating performance, reinforcing the Board's confidence in the portfolio's underlying fundamentals. Further details are given in the Investment Managers' Report.
The Company's shares traded at a discount to NAV throughout the year. The Board monitors the discount closely and recognises the importance of liquidity and market confidence for shareholders. Accordingly, the Company bought back 606,699 shares representing 2.0% of the Company during the year. We will continue to consider the use of the tools available to us, where appropriate, to address any sustained imbalance between supply and demand for the Company's shares.
Market context
The Board notes that valuations across the UK smaller companies universe remain attractive by historical standards and at a discount to both larger UK companies and international peers. This valuation backdrop has continued to support elevated levels of corporate activity, including mergers and acquisitions and share buybacks, across the sector. Such activity underlines the disconnect between market valuations and underlying fundamentals and provides a potential source of support for shareholder returns during periods of subdued sentiment.
While confidence towards UK equities remains cautious, the Board is mindful that periods of prolonged underperformance are not unprecedented. Historically, recoveries in UK smaller companies have often been sharp once confidence returns. The Board therefore continues to believe that the long term investment case for the asset class remains intact.
Dividends and dividend policy
The Company's regular dividend policy is to target a yield of 4% of the year-end share price, paid from income earned within the portfolio and enhanced, as necessary, through the use of realised capital profits. In accordance with this policy, the Company has declared and paid three interim dividends of 3.85p which are in line with the amounts paid in 2024. The Board has resolved that the Company will propose a final dividend payable in June 2026 of 3.89p per share to bring the total dividends paid for the year to 15.44p per share (2025: 15.00p). The final dividend will be payable on 11 June 2026, subject to shareholder approval, to shareholders on the register on 8 May 2026 and the shares will go ex-dividend on 7 May 2026. This represents all the available revenue earned by the Company's portfolio over the year, equating to 80% of the dividend payment, with the remainder being paid from realised capital reserves. Shareholders who hold shares on the main register and are residents of the UK, Channel Islands or Isle of Man can reinvest their dividend via the Dividend Reinvestment Plan (`DRIP'). Shareholders will need to submit an election by 21 May 2026. Further information can be found on the Company's webpage: https://www.artemisfunds.com/futureleaders
Board composition
I would like to take the opportunity to thank Simon Longfellow who resigned from the Board on 31 December 2025 for all his hard work and service to the Company. His experience of investment trust marketing and communication, especially when communicating with retail shareholders, has been very valuable. As previously communicated, the Board will comprise three Directors going forward, all of whom are independent non-executive Directors and who have experience in all the key areas of investment trust governance.
Annual General Meeting
This year's meeting will be held at the offices of Artemis at 12.00pm on Tuesday 2 June 2026. As well as the Company's formal business, there will be a presentation from Mark Niznik and William Tamworth on the Company's portfolio of companies and their prospects and you will have the opportunity to ask questions of the Portfolio Managers and Directors and to chat informally with all of us over lunch. Shareholders may bring a guest to these meetings. The Directors and I look forward to meeting as many of you as possible. For those unable to attend in person, a video update from the Portfolio Managers will be available on the Company's website after the AGM. Shareholders wishing to lodge questions in advance of the AGM should do so by email to the Company Secretary at artemisukfutureleaders@ntrs.com or, by letter, to 50 Bank Street, Canary Wharf, London, E14 5NT.
Outlook
While near-term market conditions remain uncertain, the Board takes encouragement from the Investment Manager's assessment of the opportunity set now available within UK smaller companies. It is well documented that smaller companies significantly outperform larger companies over the long-term. Therefore, for any long-term investor, it has paid to buy the dips. The managers have each bought over 1% of your investment trust, ensuring that their interests are aligned with yours as shareholders.
Valuations across the sector are at historically attractive levels and, in many cases, imply unduly pessimistic assumptions about economic and earnings prospects. In fact, we are currently in the second longest and second most severe period of UK smaller company underperformance since 1955. This period, beginning in August 2021, has encompassed two oil price shocks and several wars. Such periods of underperformance have, historically, been followed by strong recoveries once confidence begins to return. Importantly, the portfolio is positioned around businesses with robust balance sheets, strong cash generation and clear long-term growth potential, characteristics which we believe leave the Company well placed to benefit when sentiment improves.
The Iran conflict is a new negative that was not known about at the start of the year. The longer it continues, inflationary risks increase as higher energy prices filter through the economy. However, as the Managers point out in their report, the UK is in a position of low household debt and high savings. They feel the conflict is unlikely to have a material effect on smaller company prospects on their three-to-five-year view.
In the meantime, elevated levels of corporate activity, including mergers, acquisitions and share buybacks, continue to underline the disconnect between market valuations and underlying fundamentals and provide an additional source of potential returns. The Board therefore remains confident that, with the portfolio now fully aligned to Artemis' investment philosophy and stewardship approach, the Company is well positioned to capture the long-term opportunities available within UK smaller companies.
Bridget Guerin
Chairman
28 April 2026
Investment Manager's review
Statement from the previous managers Invesco Fund Managers
Invesco Perpetual UK Smaller Companies plc's net asset value (NAV) delivered a total return of -5.1% during the period 1 February to 9 March 2025. This was modestly behind its Deutsche Numis Smaller Companies plus AIM (Inv-Trust) benchmark which returned -4.4% during the same period.
During this period the fund managers had been instructed by the Board to administer the portfolio on a `care and maintenance' basis. We were asked not to purchase any new holdings and to take instructions on sales and reductions in holdings in order to raise funds for the redemption of the debt facility. Effectively we were taking instructions from the Board and Artemis via the Board.
Statement from the new managers Artemis Fund Managers Limited from 10th March 2025
Jonathan Brown & Robin West
Invesco Fund Managers Limited
Portfolio managers until 9 March 2025
Mark Niznik
Mark has managed Artemis` `UK smaller companies` strategy since joining the firm in 2007. He started his investment career in 1985 and has worked at firms including Invesco Perpetual and Standard Life.
William Tamworth
William works alongside Mark in managing Artemis' `UK smaller companies' strategy. Prior to joining Artemis in 2015, William worked at Liberum and Citigroup where he analysed small and mid-cap companies.
Performance
Artemis UK Future Leaders plc's net asset value (NAV) rose 5.3% between the point Artemis took charge on 7 March 2025 and 31 January 2026, compared with gains of 21.5% from its Deutsche Numis Smaller Companies plus AIM (-InvTrust) benchmark1.
We are disappointed with and apologise for this performance. While some of it relates to the transition and the performance of the stocks that we inherited, the larger component came in the period after the transition was complete, which we take full responsibility for (in the second half of the year, the NAV was down 1%, or 9 percentage points behind the benchmark).
Our overweight position in UK consumer discretionary holdings detracted from fund performance in the second half of the year. Rampant speculation ahead of the delayed autumn Budget sapped already fragile consumer confidence (and investor confidence). In the end the Budget was (largely) a non-event but our UK consumer discretionary shares underperformed over this period despite, in aggregate, largely unchanged earnings expectations.
Our technology and media holdings also also detracted from our performance. We have traditionally been attracted to the recurring earnings of subscription media businesses and software as a service revenue of technology businesses. Over the last six months there has been growing investor concern with regards to the potential disruption risk from AI for several stocks in these two sectors - hence the drag on our performance. We believe these concerns are overdone but it will take time for this to become evident. We stress the importance of first party (proprietary) data; the potential opportunities that come from AI (rather than just the risks) and the very attractive valuations of many of these companies.
What we did not own also impacted the relative performance - most notably basic material companies (for example Greatland Resources and Pan African Resources were amongst the best performing shares in the benchmark) which benefited from a gold price that was up over 70% in the year. We have tended to have little mining and oil & gas exposure as we feel poorly placed to judge future directions in commodity prices and we dislike the inherently high capital intensity of most businesses in these sectors. This was to the detriment of the portfolio last year.
After the transition period was complete, Artemis UK Future Leaders performed roughly in line with the open-ended fund we manage. While both had a poor second half, this was offset by a much stronger start to the year for the open-ended fund. We retain confidence in both our process and the small-cap opportunity over the long term.
Negatives
Future (specialist media) and Hilton Food Group (food packager) were our two biggest detractors. Although Future's earnings were reduced, the main negative came from the multiple placed on those earnings which has fallen yet further. For Hilton Foods, headwinds included high white-fish prices and delays in getting one of its facilities signed off, having previously discovered traces of listeria.
Orders fell at promotional products supplier 4imprint Group , but the expected hit to profit margins from tariffs (most of its products are made outside the US) failed to materialise. The long-term prospects for the company remain compelling: it offers an 8% free cashflow yield, has an excellent record of taking market share and there is scope for further growth in a fragmented market (despite being the leader, 4imprint's market share is only about 5%).
Gamma Communications, a B2B provider of voice and data services, was one of the best performers in our open-ended fund in 2024, but more than gave up those gains last year. Earnings expectations were pretty stable over 2025, meaning the fall in the share price was again down to the market putting a lower multiple on those earnings. Since the business was listed in 2014 it has increased its earnings per share by 7x (equivalent to a compound annual growth rate of 19%). It has never traded on such a low valuation as it does today - 9x price to earnings (P/E) or a 9% free cashflow yield. We added to our position.
Positives
Since we took charge of the trust on 7 March, our defence stocks have done well, with holdings in Avon Technologies, Chemring Group and Serco Group (which generates about 40% of its revenues from this area) rising strongly.
The portfolio's single best performer during the period was Secure Trust Bank , which fell significantly in October 2024 when three Court of Appeal decisions relating to motor finance went against FirstRand Bank and Close Brothers (which we don't own). Aside from a potentially large compensation bill, Secure Trust Bank also issued a profit warning driven by a slower recovery in its vehicle finance division, after the FCA's Borrowers in Financial Difficulty (BiFD) review led to a temporary pause in collections and a higher default rate.
At the time, we felt that the shares offered substantial potential upside, trading as they were at a 75% discount to book value. Since then, they have rebounded past their October 2024 starting price, with the company's loss-making vehicle finance book put into run-off and then subsequently sold at a premium to its book value. The UK Supreme Court largely overturned the Court of Appeal's rulings albeit there is still some uncertainty surrounding how the FCA will implement a customer redress scheme.
Pawnbroker H&T Group and foreign exchange specialist Alpha Group announced they were to be taken over, at premiums of 44% and 55% respectively to their pre-offer share prices. M&A has been and is likely to remain a driver of performance.
Another is buybacks: we saw a record number of holdings in our open-ended fund reduce their share count in 2025. We see this as indicative of management teams expressing the view that:
a) Their businesses have surplus capital (our median holding is forecast to have no net debt);
b) They are confident in the outlook; and
c) Their share prices do not reflect fundamental value.
Activity
Upon taking management of the trust, it took us about three months to rebalance it so it more closely reflected our investment philosophy. There is now an overlap of more than 85% between the trust and our open-ended Artemis UK Smaller Companies Fund.
After the initial rebalancing, some of our notable purchases have included bakery Greggs, subsea equipment-rental firm Ashtead Technology, specialist consultancy Science Group, Bloomsbury Publishing and specialist electrical-component manufacturer DiscoverIE. Although this is a disparate group of companies, what unites them is attractive valuations underpinned by strong cashflow, decent growth prospects and leading market positions in their niches.
Outlook
We are currently in the second longest and second most severe relative drawdown for UK small caps since 1955. You may question whether the small-cap effect - smaller companies' long-term outperformance of their larger counterparts - remains valid. We think the answer is a resounding `yes'.
The small-cap effect is a global phenomenon. Since 2000 - including the recent period of underperformance (which extends beyond the UK) - there has been a positive small-cap premium in all major global markets except for Taiwan.
Despite the compelling long-term numbers, there have been sustained periods of underperformance. Small-cap returns are lumpy. We do not know when the tide will turn, but when it does, a sharp rebound is likely. In 44% of calendar years since 1955, returns have exceeded 20% - and 52 months into a relative bear market does not feel like the time to capitulate 2 .
Meanwhile, UK mid and small caps remain cheap relative to history - which is not the case for most equity markets around the world. The FTSE 250 traditionally trades on a premium (higher price-to-earnings ratio) to the FTSE 100, but the current discount represents a 20-year relative low 3 . Valuations fall further as you go down the market-cap spectrum. Meanwhile, the FTSE 250 now has a higher dividend yield than the FTSE 100 4 . Again, this last happened more than 20 years ago.
With small caps deriving about 60% of revenues from the UK, compared with 20% for large caps 5 , these valuations make sense if you think the economic outlook is dire. But we think it isn't.
Over the last few years, the UK economy has consistently outperformed (admittedly low) consensus expectations set 12 months previously. With consumer spending accounting for 60% of the UK economy, we believe confidence is the key to unlocking small-cap returns. While it is currently moribund, we are confident that when it improves, the impact on small-caps will be material.
In the short term the recovery may (again) have been deferred by the Iran conflict as inflation rises (rather than falls), interest rate cuts are delayed and consumer sentiment hit. Real incomes are now likely to be (broadly) flat this year because of higher inflation. However, the high starting point for the UK household savings ratio (around 10%, double that of the US) and low household debt (household debt to income has been falling for 17 years 6 ) means consumer spending growth is likely to exceed expectations when confidence recovers. The impact of this recovery will be magnified by the low starting valuations.
Unemployment, which has continued to tick up, is an important risk. Our conversations with company management teams give us confidence we will not see a sudden spike in job losses, but it is nevertheless the biggest threat to our macro view. Working in the other direction is an improvement in the participation rate (people working or actively looking for work). The UK also has a relatively favourable medium-term outlook for the working-age population, which is expected to grow.
Politics is generally far less important than commonly believed. Local politics matters even less. Gilt spreads are already elevated and a pivot to the left risks a further jump in borrowing costs (which are negatively correlated with UK small caps).
Balancing the risks for 2026, we see significant opportunity. As at the end of March, the median holding in the fund was trading on a P/E of 9x or a free cash flow yield of 10%. This is cheaper than at any point we can remember. This feels very attractive as the businesses that we own are forecast on average to grow their earnings by double digits, earn a return on their capital of over 20% and have no debt.
Mark Niznik & William Tamworth
Artemis Fund Managers Limited
Portfolio managers from 10 March 2025
28 April 2026
2. Deutsche Numis UK Smaller Companies index (ex IT) relative to FTSE All-Share
3. Panmure Liberum, LSEG Workspace
4. Panmure Liberum, LSEG Workspace
5. Bloomberg
6. Bank of England, Stifel
Strategy and business review
Purpose, culture, business model and strategy
Artemis UK Future Leaders plc is an investment company and its investment objective is set out below. The strategy the Board follows to achieve that objective, is to set investment policy and risk guidelines, together with investment limits, and to monitor how they are applied. These are also set out below and have been approved by shareholders.
The Company's purpose is to generate returns for shareholders by investing their pooled capital to achieve the Company's investment objective through the application of its investment policy and with the aim of spreading investment risk.
As the Company has no employees, the business model the Company has adopted to achieve its objective has been to contract its operations to appropriate external service providers. The Board has oversight of the Company's service providers, and monitors them on a formal and regular basis. The Board has a collegiate culture and pursues its fiduciary responsibilities with independence, integrity and diligence, taking advice and outside views as appropriate and constructively challenging and interacting with service providers.
Up until 9 March 2025, the Company had contracted the services of Invesco Fund Managers Limited (`IFML'). IFML had delegated portfolio valuation, fund accounting and administrative services to The Bank of New York Mellon, London Branch. The Bank of New York Mellon (International) Limited (`BNYMIL') were the appointed depositary and custodian.
With effect from 10 March 2025, the Board has appointed Artemis Fund Managers Limited (`Artemis') as the Company's investment manager (the `Manager') to manage the portfolio in accordance with the Board's strategy and under its oversight. The Portfolio Managers responsible for the day to day management of the portfolio are Mark Niznik and William Tamworth. The Northern Trust Company, London Branch, has been appointed as fund administration service provider. Northern Trust Investor Services Limited are now custody and depositary service provider and finally Northern Trust Secretarial Services (UK) Limited has assumed the role of Company Secretary.
Contractual arrangements remain in place with MUFG Corporate Markets (formerly known as Link Group) to act as registrar.
Investment objective
The Company is an investment trust whose investment objective is to achieve long-term total returns for shareholders, primarily by investment in a broad cross-section of small to medium sized UK quoted companies.
Investment policy
The portfolio primarily comprises shares traded on the London Stock Exchange and those traded on AIM. The Portfolio Managers can also invest in unquoted securities, though these are limited to a maximum of 5% of gross assets at the time of acquisition.
The Manager seeks to outperform its benchmark, the Deutsche Numis Smaller Companies + AIM (excluding Investment Companies) Index with dividends reinvested. As a result, the Manager's approach can, and often does, result in significant overweight or underweight positions in individual stocks or sectors compared with the benchmark. Sector weightings are ultimately determined by stock selection decisions. Risk diversification is sought through a broad exposure to the market, where no single investment may exceed 5% of the Company's gross assets at the time of acquisition. The Company may utilise index futures to hedge risk of no more than 10% and other derivatives (including warrants) of no more than 15%. In addition, the Company will not invest more than 10% in collective investment schemes or investment companies, nor more than 10% in non-UK domiciled companies. All these limits are referenced to gross assets at the time of acquisition.
Borrowings under this investment policy may be used to raise market exposure up to the lower of 30% of NAV and £25 million.
Dividend policy
The Company's dividend policy is to distribute all available revenue earned by the portfolio in the form of dividends to shareholders. In addition, the Board has approved the use of the Company's capital reserves to enhance dividend payments. Therefore, the total dividend, paid to shareholders on a quarterly basis, comprises income received from the portfolio, with the balance coming from realised capital profits. Whilst not guaranteed, in normal circumstances, the dividend for the year ending 31 January is calculated to give a yield of 4% based on the year end share price. It does not include any preliminary charges and investors may be subject to tax on dividends received.
Performance
The Board reviews performance by reference to a number of Key Performance Indicators which include the following:
■ the movement in the NAV per share on a total return basis:
Details on the movement in the NAV per share on a total return basis is provided in the Total returns table on page 3.
■ the NAV and share price performance relative to the Benchmark Index and the peer group:
The Board regularly reviews the Company's performance against the Benchmark Index and the peer group at each Board meeting. Information on the Company's performance can be found in the Chairman's statement on page 4 and the Investment Managers' review from page 6.
■ the discount/premium to NAV:
The Board monitors the price of the Company's shares in relation to their NAV and the premium/discount at which the shares trade. Further information on the Company's discount to NAV over the course of the year can be found on page 3.
■ dividend per share:
As stated above, the Company's dividend policy includes a target dividend yield of 4% of year end share price. Further information on the three interim dividends and proposed final dividend for the year ended 31 January 2026 are provided in the Chairman's Statement on page 4.
■ the ongoing charges:
The ongoing administrative costs of operating the Company are encapsulated in the ongoing charges ratio, which is calculated in accordance with guidance issued by the Association of Investment Companies (`AIC'). The ongoing charges ratio provides a guide to the effect on performance of annual operating costs. The Board monitors the Company's expenditure at each Board meeting and on an annual basis the Board reviews an analysis which shows a comparison of the Company's ongoing charges and its main expenses with those of its peers.
The ongoing charges for the year ended 31 January 2026 was 1.00% (2025: 1.03%).
Further details on the calculation of the ongoing charges is shown on page 3.
Results and dividends
In the year ended 31 January 2026, the NAV total return was -0.0%, compared with a total return on the Benchmark Index of 16.1%. The discount at the year end was 11.2% (2025: 16.6%).
For the year ended 31 January 2026, three interim dividends of 3.85p per share were paid to shareholders in August and December 2025 and March 2026. Subject to shareholder approval, a final dividend of 3.89 per share will be paid on 11 June 2026 to shareholders on the register on 8 May 2025. This will give total dividends for the year of 15.44p (2025: 15.00p), representing a yield of 4.0% based on the share price as at 31 January 2026. Further details are provided in the Chairman's statement on page 4. Of the total dividend, 80.7% (2025: 86.8%) was generated from revenue in the year. The remainder was funded from realised capital reserves and represents 0.7% (2025: 0.3% from realised capital reserves) of the year end net assets.
Capital structure
The capital structure of the Company as at 31 January 2026 consisted of 49,826,436 ordinary shares of 20p each in issue, of which 20,059,743 ordinary shares were held in treasury.
Therefore, the Company's total voting rights were 29,766,693 ordinary shares. The Company bought back into treasury 606,699 ordinary shares at an average price of 372.76p.
Financial position and borrowings
At 31 January 2026, the Company's net assets were valued at £129 million (2025: £137 million), comprising a portfolio of equity investments, CFDs and net current assets, with no borrowings (2025: £12.4 million). Although as mentioned below use of CFDs created gearing of 8.2%.
Borrowings and derivatives are used by the Company for gearing. This may enhance the total return on its shares when the value of the company's assets is rising and exceeds the cost of borrowings, but it may have the opposite effect when the value is falling and when the underlying return is less than the cost of borrowing, thus reducing the total return on the shares. They may also increase the volatility of the returns to shareholders and the net asset value per share. The Company currently utilises Contracts for Difference (CFDs), often referred to as Equity Swaps for the purposes of gearing. Given the current investment policy, this effectively limits gearing to 15% of Net Asset Value. In practice, Board approval would be sought to increase gearing through CFDs above 10%. Net gearing through CFDs was 8.2% as at year end.
Outlook, including the Future of the Company
The main trends and factors likely to affect the future development, performance and position of the Company's business can be found in the Investment Manager's review. A triennial vote is held on the continuation of the Company with the next one being at the AGM in June 2027. Details of the principal risks affecting the Company are set out under `Principal risks and uncertainties' below.
Principal risks and uncertainties
The Directors confirm that they have carried out a robust assessment of the emerging and principal risks facing the Company, including those that would threaten its business model, future performance, solvency or liquidity. Most of these risks are market related and are similar to those of other investment trusts investing primarily in listed markets. The Audit Committee reviews the Company's risk control summary at each meeting, and as part of this process, gives consideration to identifying emerging risks. Emerging risks, such as evolving cyber threats, geo-political tensions and climate related risks, have been considered during the period as part of the Directors' assessment.
|
Principal risk description |
Mitigating procedures and controls |
|
Market (economic) risk Factors such as fluctuations in stock markets, interest rates and exchange rates are not under the control of the Board or the Portfolio Managers, but may give rise to high levels of volatility in the share prices of investee companies, as well as affecting the Company's own share price and the discount to its NAV. The risk could be triggered by unfavourable developments globally and/or in one or more regions, contemporary examples being the market uncertainty in relation to the wider political developments in Ukraine, the Middle East and the worldwide tariffs implemented by the USA. |
The Directors have assessed the market impact of the ongoing uncertainty from the unfavourable developments globally through regular discussions with the Portfolio Managers and the Corporate Broker. The Company's current portfolio consists of companies listed on the main UK equity market and those listed on AIM. To a limited extent, futures can be used to mitigate against market (economic) risk, as can the judicious holding of cash or other very liquid assets. Futures are not currently being used. |
|
Investment risk The Company invests in small and medium-sized companies traded on the London Stock Exchange or on AIM. By their nature, these are generally considered riskier than their larger counterparts and their share prices can be more volatile, with lower liquidity. In addition, as smaller companies may not generally have the financial strength, diversity and resources of larger companies, they may find it more difficult to overcome periods of economic slowdown or recession. |
The Portfolio Managers seek to mitigate risk through holding an economically diversified portfolio without concentrated macroeconomic bets. UK Smaller Companies in aggregate earn approximately 60% of their revenues from the domestic UK economy so the portfolio will be sensitive to both the UK macro economic outlook and sentiment towards the UK. The Manager's preference is to invest in companies with strong balance sheets and strong cash generation which should be relatively better positioned to withstand economic shocks. They like companies with market leading positions which tend to be better able to pass through price increases to mitigate cost inflation. The portfolio is constructed without reference to the benchmark. The weighting that a stock is given is a function of anticipated share price upside, the level of conviction and the riskiness of an investment. A single holding will typically not exceed 5% of the portfolio. The factor profile of the portfolio is also principally driven by bottom-up stock picking although our investment risk team generates factor analysis for the investment team to review on a regular basis. Sustainability analysis is a core part of stock analysis in both assessing the opportunities and risks facing companies over the medium to long term. The Manager identifies key ESG metrics for each company and tracks the disclosure and trend of these. Disclosures by companies in the investment universe can often be poor, so this is an area they engage on. The Portfolio Managers remain cognisant at all times of the potential liquidity of the portfolio. There can be no guarantee that the Company's strategy and business model will be successful in achieving its investment objective. The Board monitors the performance of the Company, giving due consideration to how the Manager has incorporated ESG considerations including climate change into their investment process. The Board also has guidelines in place to ensure that the Managers adhere to the approved investment policy. The continuation of the Manager's mandate is reviewed annually. |
|
Shareholders' risk The value of an investment in the Company may go down as well as up and an investor may not get back the amount invested. In addition, the Company operates within the UK investment trust sector, which has recently experienced increased levels of shareholder activism and other forms of corporate activity targeting listed investment companies. Such activity could create uncertainty regarding the Company's future, increase costs and management distraction, and may result in corporate actions that do not align with the long-term interests of all shareholders. |
The Board regularly reviews the Company's investment objective and strategy to ensure they remain appropriate. It also monitors the composition of the shareholder register, peer group performance on both a share price and NAV basis, and the Company's share price discount to NAV per share. The Board and the Portfolio Managers maintain an active dialogue with shareholders and other stakeholders, seeking to ensure that the market rating of the Company's shares reflects the underlying NAV and to understand investor concerns at an early stage. Share buyback and issuance authorities are in place to support the management of the discount and premium as appropriate. The Board remains alert to the potential for shareholder activism and is prepared to respond as necessary, with a focus on protecting the long-term interests of all shareholders. |
|
Reliance on the Manager and other third-party service providers The Company has no employees and the Board comprises non-executive directors only. The Company is therefore reliant upon the performance of third-party service providers for its executive function and service provisions. The Company's operational structure means that all cyber risk (information and physical security) arises at its third-party service providers, including the risk of fraud, sabotage or crime against the Company. The Company's operational capability relies upon the ability of its third-party service providers to continue working throughout the disruption caused by a major event such as the Covid-19 pandemic. Failure by any service provider to carry out its obligations to the Company in accordance with the terms of its appointment could have a materially detrimental impact on the operation of the Company and could affect the ability of the Company to successfully pursue its investment policy. The Company's main service providers, of which the Manager is the principal provider, are listed on page 75. The Manager may be exposed to reputational risks. In particular, the Manager may be exposed to the risk that litigation, misconduct, operational failures, negative publicity and press speculation, whether or not it is valid, will harm its reputation. Damage to the reputation of the Manager could potentially result in counterparties and third parties being unwilling to deal with the Manager and by extension the Company, which carries the Manager's name. This could have an adverse impact on the ability of the Company to pursue its investment policy successfully. |
Third-party service providers are subject to ongoing monitoring by the Manager and the Board. The Manager reviews the performance of all third-party providers regularly through formal and informal meetings. The Audit Committee reviews regularly the performance and internal controls of the Manager and all third-party providers through audited service organisation control reports together with updates on information security, the results of which are reported to the Board. The Manager's business continuity plans are reviewed on an ongoing basis and the Directors are satisfied that the Manager has in place robust plans and infrastructure to minimise the impact on its operations so that the Company can continue to trade, meet regulatory obligations, report and meet shareholder requirements. The Board receives regular update reports from the Manager and third-party service providers on business continuity processes and has been provided with assurance from them all insofar as possible that measures are in place for them to continue to provide contracted services to the Company. |
|
Regulatory risk The Company is subject to various laws and regulations by virtue of its status as an investment trust, its listing on the London Stock Exchange and being an Alternative Investment Fund under the UK AIFMD regime. A loss of investment trust status could lead to the Company being subject to corporation tax on the chargeable capital gains arising on the sale of its investments. Other control failures, either by the Manager or any other of the Company's service providers, could result in operational or reputational problems, erroneous disclosures or loss of assets through fraud, as well as breaches of regulations. |
The Manager reviews the level of compliance with tax and other financial regulatory requirements on a regular basis. The Board regularly considers all risks, the measures in place to control them and the possibility of any other risks that could arise. The Manager's Risk and Compliance function produce annual reports for review by the Company's Audit Committee. Further details of risks and risk management policies as they relate to the financial assets and liabilities of the Company are detailed in note 16 of this Annual Financial Report. |
Long-term viability
Viability statement
In accordance with provision 31 of the UK Corporate Governance Code 2024, the Directors have assessed the prospects of the Company over a longer period than 12 months. The Company is an investment trust, a collective investment vehicle designed and managed for long term investment. While the appropriate period over which to assess the Company's viability may vary from year to year, the long term for the purpose of this viability statement is currently considered by the Board to be at least five years, with the life of the Company not intended to be limited to that or any other period.
The main risks to the Company's continuation are: insufficient liquidity to meet liabilities as they fall due; poor investment performance over an extended period; shareholder dissatisfaction through failure to meet the Company's investment objective; or the investment policy not being appropriate in prevailing market conditions. Accordingly, failure to meet the Company's investment objective, and contributory market and investment risks are deemed by the Board to be principal risks of the Company and are given particular consideration when assessing the Company's long term viability. Despite ongoing geopolitical tensions, including the conflicts in Ukraine and the Middle East and the associated uncertainty in global markets, the Directors remain confident that the Company's investment strategy will continue to serve shareholders well over the longer term.
The investment objective of the Company has been substantially unchanged for many years. The 2015 amendment to the dividend policy gave some additional weight to targeting increased dividend income to shareholders. This change does not affect the total return sought or produced by the Manager but was designed to increase returns distributed to shareholders. The Board considers that the Company's investment objective remains appropriate. This is confirmed by contact with major shareholders.
Performance derives from returns for risk taken. The Investment Manager's review on page 6 sets out their current investment strategy. There has been no material change in the Company's investment objective, however.
Demand for the Company's shares and performance are not things that can be forecast, but there are no current indications that either or both of these may decline substantially over the next five years so as to affect the Company's viability. The Directors have also considered the continuation vote due to take place at the AGM in 2027 and note that the outcome of the vote is dependent on future performance and shareholder sentiment. Based on current conditions and shareholder engagement, the Directors remain confident that the Company's investment strategy will continue to serve shareholders over the longer term. The Directors have a reasonable expectation that the Company will be able to continue to operate and to meet its liabilities as they fall due over the period and that the continuation vote in 2027 will be successful.
The Company is a closed end investment trust and can pursue a long term investment strategy and make use of gearing to enhance returns through investment cycles without the need to maintain liquidity for investor redemptions.
Based on the above analysis, including review of the revenue forecast for future years along with stress testing of the portfolio liquidity and dividend sensitivity analysis, the Directors confirm that they expect the Company will continue to operate and meet its liabilities, as they fall due, during the five years ending January 2031.
Share capital
Shareholders authorised the Company to buyback up to 14.99 per cent of the shares in issue at the 2025 AGM.
During the year, the Company bought back 606,699 ordinary shares. As at 31 January 2026, 20,059,743 ordinary shares are held in treasury.
A resolution to renew the Company's buyback authority will be put to shareholders at the AGM on 2 June 2026.
No ordinary shares were issued during the year.
Duty to promote the success of the Company
The Directors have a statutory duty under Section 172 of the Companies Act 2006 to promote the success of the Company whilst also having regard to certain broader matters, including the need to engage with employees, suppliers, customers and others, and to have regard to their interests. The Company has no employees and no customers in the traditional sense and in accordance with the Company's nature as an investment trust, the Board's principal concern has been, and continues to be, the interests of the Company's shareholders taken as a whole. In doing so, it has due regard to the impact of its actions on other stakeholders including the Manager, other third-party service providers and the impact of the Company's operations on the community and the environment which are all taken into account during all discussions and as part of the Board's decision making.
The Board is committed to maintaining open channels of communication and engagement with stakeholders in a manner which they find most meaningful. The table below sets out how the Board engages with each of its key stakeholders:
|
Stakeholder |
Key considerations and engagement |
|
Shareholders |
The Board endeavours to provide shareholders with a full understanding of the Company's activities and reports formally to shareholders each year by way of the Half-Yearly and Annual Financial Reports. This is supplemented by the daily publication of the net asset value of the Company's ordinary shares on the London Stock Exchange website, and monthly factsheets. Shareholders who attend the AGM can meet the Board and the Portfolio Managers and have the opportunity to hear directly from the Portfolio Managers and ask questions. For shareholders who are unable to attend the AGM, a video update from the Portfolio Managers will be available on the Company's website after the AGM. Shareholders can also visit the Company's website, https://www.artemisfunds.com/futureleaders to access copies of Half-Yearly and Annual Financial Reports, shareholder circulars, factsheets and Stock Exchange announcements. There is a regular dialogue between the Board, the Manager and institutional shareholders to discuss aspects of investment performance, governance and strategy and to listen to shareholder views in order to help to develop an understanding of their issues. Meetings between the Manager and institutional shareholders are reported to the Board, which monitors and reviews shareholder communications on a regular basis. |
|
Manager & other key third-party service providers |
The Board engages representatives of the Manager at every Board meeting and receives updates from the Portfolio Managers on a regular basis outside of these meetings. At every Board meeting the Directors receive an investor relations update from the Manager, which details any significant changes in the Company's shareholder register, shareholder feedback, as well as notifications of any publications or press articles. In order to function as an investment trust with a premium listing on the London Stock Exchange, the Company relies on a diverse range of reputable advisers for support in meeting all relevant obligations. The Board, through the Manager, maintains regular contact with its key external service providers and receives regular reporting from them, both through the Board and committee meetings, as well as outside of the regular meeting cycle. Their advice, as well as their needs and views are routinely taken into account. The Board (through the Management Engagement Committee) formally assesses the third-party service providers' performance, fees and continuing appointment on an annual basis to ensure that the key service providers continue to function at an acceptable level and are appropriately remunerated to deliver the expected level of service. The Audit Committee reviews and evaluates the financial reporting control environments in place at each service provider. |
|
Investee companies |
On the Company's behalf the Investment Manager engages with investee companies, particularly in relation to ESG matters and shares held in the portfolio are voted at general meetings. An example of how the Manager engaged with an investee company during the year can be found on page 10. |
|
Association of Investment Companies (`AIC') |
The Company is a member of the AIC, which looks after the interests of investment trusts and provides information to the market. Comprehensive information relating to the Company can be found on the AIC website. As a member of AIC, the Company is welcomed to comment on consultations and proposal documents on matters affecting the Company and annually to nominate and vote for future AIC board members. |
Some of the key discussions and decisions the Board made during the year were:
to appoint Artemis Fund Managers Limited from 10 March 2025 following a review of the Company's investment management arrangements.
to approve the use of CFDs for the purposes of gearing, in place of a revolving credit facility, with a view to providing maximum flexibility at a lower cost. This required a minor change to the investment policy which was approved by shareholders at the 2025 AGM.
to approve an enhanced share buyback programme in late 2025 to address the persistent discount, improve liquidity and to reduce the threat from activist investors.
to continue as a three person Board following the resignation of Simon Longfellow as at 31 December 2025.
in line with the Company's dividend policy and subject to shareholder approval of the final dividend, the Board agreed to pay total dividends for the year ended 31 January 2026 of 15.44p per share. Dividends were paid from a combination of current year revenue and capital reserves. Factors the Board took into consideration in deciding the 2026 dividends included: shareholder expectations, revenue generated by the Company during the year, revenue forecasts for the current financial year and the capacity of the Company to pay dividends out of its reserves.
Board diversity
The Board considers diversity, including the balance of skills, knowledge, experience and gender amongst other factors when reviewing its composition and appointing new directors. The Board continues to recognise the importance of having a range of skilled and experienced individuals with the right knowledge represented on the Board in order to allow it to fulfil its obligations.
In view of its relatively small size, the Board will continue to ensure that all appointments are made on the basis of merit against the specification prepared for each appointment. In doing so, the Board will seek to meet the targets set out in the FCA's UK Listing Rule (`UKLR') 6.6.6R (9)(a), which are summarised below.
In accordance with UKLR 6.6.6R (9), (10) and (11) the Board has provided the following information in relation to its diversity as at 31 January 2026, being the financial year end of the Company. The information included in the tables below has been obtained following confirmation from the individual Directors. As shown in the tables, the Company did not meet the FCA gender and ethnic diversity targets as at 31 January 2026. Given its small size, which it considers appropriate, and the infrequency with which appointments are made, the Board is aware that achieving these targets is more challenging. It will be mindful of these targets when making any future appointments and will continue to take all matters of diversity into account as part of its succession planning.
Board Gender as at 31 January 2026
|
|
|
|
Number of |
Number in |
Percentage of |
|
|
Number of |
Percentage |
senior positions |
executive |
executive |
|
|
Board members |
of the Board |
on the Board |
management A |
management A |
|
Men |
2 |
66.6% |
1 B |
n/a |
n/a |
|
Women |
1 B |
33.3% |
1 C |
n/a |
n/a |
A The Company does not disclose the number of directors in executive management as this is not applicable for an investment trust.
B Does not meet the target that at least 40% of Directors are women as set as set out in UKLR 6.6.6R (9)(a)(i).
C The position of Chairman is held by a woman and therefore this meets the target of 1 as set out in UKLR 6.6.6R (9)(a)(ii).
Board Ethnic Background as at 31 January 2026
|
|
|
|
Number of |
Number in |
Percentage of |
|
|
Number of |
Percentage |
senior positions |
executive |
executive |
|
|
Board members |
of the Board |
on the Board |
management A |
management A |
|
White British or other White (including |
|
|
|
|
|
|
minority-white groups) |
3 |
100% |
2 |
n/a |
n/a |
|
Minority ethnic |
0 B |
0% |
0 |
n/a |
n/a |
A The Company does not disclose the number of directors in executive management as this is not applicable for an investment trust.
B Does not meet the target that at least one Director is from a minority ethnic background as set as set out in UKLR 6.6.6R (9)(a)(iii).
There have been no changes since the year end that have affected the Company's ability to meet the targets set in UKLR 6.6.6R (9)(a).
Sustainability and environmental, social and governance ('ESG') matters
The Board recognises that the most material way in which the Company can have an impact on ESG is through responsible ownership of its investments. The Board has appointed Artemis as Investment Manager, who engages actively with investee companies undertaking extensive evaluation and engagement on a variety of matters such as strategy, performance, risk, dividend policy, governance and remuneration. All risks and opportunities are considered as part of the investment process in the context of enhancing the long-term value of shareholders' investments. This will include matters relating to material environmental, human rights and social considerations that will ultimately impact the profitability of a company or its stock market rating and hence these matters are an integral part of Artemis' thinking as investors.
Further details are shown in ESG & stewardship at Artemis on pages 9 and 10.
A greenhouse gas emissions statement is included in the Directors' report on page 29.
Modern Slavery Act 2015
The Company is an investment vehicle and does not provide goods or services in the normal course of business or have customers. Accordingly, the Directors consider that the Company is not required to make any slavery or human trafficking statement under the Modern Slavery Act 2015.
The Strategic Report was approved by the Board of Directors on 28 April 2026.
Northern Trust Secretarial Services (UK) Limited
Corporate Company Secretary
Portfolio of investments at 31 January 2026
|
|
|
Market Value |
Portfolio Exposure* |
|
|
Company |
Sector |
£'000 |
£'000 |
% |
|
IntegraFin Holdings |
Investment Banking and Brokerage Services |
2,488 |
4,012^ |
3.0 |
|
GB Group |
Software and Computer Services |
3,195 |
3,910^ |
2.9 |
|
Secure Trust Bank |
Banks |
3,687 |
3,687 |
2.7 |
|
Mears Group |
Industrial Support Services |
3,676 |
3,676 |
2.6 |
|
MONY Group |
Software and Computer Services |
3,385 |
3,676^ |
2.6 |
|
Moonpig Group |
Retailers |
3,137 |
3,484^ |
2.5 |
|
Coats Group |
General Industrials |
3,418 |
3,418 |
2.4 |
|
NCC Group |
Software and Computer Services |
2,297 |
3,283^ |
2.3 |
|
Serco Group |
Industrial Support Services |
3,106 |
3,106 |
2.2 |
|
Morgan Sindall Group |
Construction and Materials |
3,090 |
3,090 |
2.2 |
|
Wilmington |
Media |
2,227 |
3,001^ |
2.1 |
|
Hollywood Bowl Group |
Travel and Leisure |
2,223 |
2,984^ |
2.1 |
|
Victorian Plumbing Groupᴬᴵᴹ |
Retailers |
2,916 |
2,916 |
2.1 |
|
Telecom Plus |
Electricity |
2,525 |
2,902^ |
2.1 |
|
Gamma Communications |
Telecommunications Service Providers |
2,279 |
2,836^ |
2.0 |
|
Young & Co's Brewery - Non-Votingᴬᴵᴹ |
Travel and Leisure |
2,761 |
2,761 |
2.0 |
|
Next 15 Groupᴬᴵᴹ |
Media |
2,721 |
2,721 |
1.9 |
|
Restoreᴬᴵᴹ |
Industrial Support Services |
2,690 |
2,690 |
1.9 |
|
4imprint Group |
Media |
2,651 |
2,651 |
1.9 |
|
Oxford Instruments |
Electronic and Electrical Equipment |
2,500 |
2,500 |
1.8 |
|
DFS Furniture |
Retailers |
2,478 |
2,478 |
1.8 |
|
On the Beach Group |
Travel and Leisure |
2,432 |
2,432 |
1.7 |
|
Brooks Macdonald Group |
Investment Banking and Brokerage Services |
2,386 |
2,386 |
1.7 |
|
Halfords Group |
Retailers |
2,327 |
2,327 |
1.7 |
|
Chemring Group |
Aerospace and Defence |
2,327 |
2,327 |
1.7 |
|
Norcros |
Construction and Materials |
1,243 |
2,297^ |
1.6 |
|
Wickes Group |
Retailers |
2,261 |
2,261 |
1.6 |
|
RWSᴬᴵᴹ |
Industrial Support Services |
2,234 |
2,234 |
1.6 |
|
Future |
Media |
1,118 |
2,226^ |
1.6 |
|
Avon Technologies |
Aerospace and Defence |
2,129 |
2,129 |
1.5 |
|
Greggs |
Personal Care, Drug and Grocery Stores |
2,128 |
2,128 |
1.5 |
|
Netcallᴬᴵᴹ |
Software and Computer Services |
2,125 |
2,125 |
1.5 |
|
Dunelm Group |
Retailers |
2,040 |
2,040 |
1.5 |
|
GlobalDataᴬᴵᴹ |
Industrial Support Services |
2,030 |
2,030 |
1.5 |
|
MJ Gleeson |
Household Goods and Home Construction |
1,991 |
1,991 |
1.4 |
|
Tatton Asset Managementᴬᴵᴹ |
Investment Banking and Brokerage Services |
1,987 |
1,987 |
1.4 |
|
Kainos Group |
Software and Computer Services |
1,968 |
1,968 |
1.4 |
|
Johnson Service Group |
Industrial Support Services |
1,949 |
1,949 |
1.4 |
|
YouGovᴬᴵᴹ |
Media |
1,862 |
1,862 |
1.3 |
|
NIOX Groupᴬᴵᴹ |
Medical Equipment and Services |
1,830 |
1,830 |
1.3 |
|
Henry Boot |
Real Estate Investment and Services |
1,161 |
1,821^ |
1.3 |
|
Ashtead Technology |
Oil, Gas and Coal |
1,795 |
1,795 |
1.3 |
|
TT Electronics |
Technology Hardware and Equipment |
1,792 |
1,792 |
1.3 |
|
LBG Mediaᴬᴵᴹ |
Media |
1,778 |
1,778 |
1.3 |
|
Science Groupᴬᴵᴹ |
Industrial Support Services |
1,764 |
1,764 |
1.3 |
|
Keller Group |
Construction and Materials |
1,675 |
1,675 |
1.2 |
|
discoverIE Group |
Electronic and Electrical Equipment |
1,663 |
1,663 |
1.2 |
|
Energean |
Oil, Gas and Coal |
1,651 |
1,651 |
1.2 |
|
Harworth Group |
Real Estate Investment and Services |
382 |
1,630^ |
1.2 |
|
Hilton Food Group |
Food Producers |
1,606 |
1,606 |
1.1 |
|
Bloomsbury Publishing |
Media |
721 |
1,602^ |
1.1 |
|
J D Wetherspoon |
Travel and Leisure |
1,543 |
1,543 |
1.1 |
|
Workspace Group |
Real Estate Investment Trusts |
1,484 |
1,484 |
1.1 |
|
Severfield |
Construction and Materials |
1,387 |
1,387 |
1.0 |
|
Jadestone Energyᴬᴵᴹ |
Oil, Gas and Coal |
1,381 |
1,381 |
1.0 |
|
Morgan Advanced Materials |
Electronic and Electrical Equipment |
1,361 |
1,361 |
1.0 |
|
Accesso Technology Groupᴬᴵᴹ |
Software and Computer Services |
1,178 |
1,178 |
0.8 |
|
Beeks Financial Cloud Groupᴬᴵᴹ |
Software and Computer Services |
1,058 |
1,058 |
0.8 |
|
CLS |
Real Estate Investment and Services |
998 |
998 |
0.7 |
|
M&C Saatchiᴬᴵᴹ |
Media |
997 |
997 |
0.7 |
|
Warpaint Londonᴬᴵᴹ |
Personal Goods |
882 |
882 |
0.6 |
|
Victrex |
Chemicals |
806 |
806 |
0.6 |
|
SIG |
Industrial Support Services |
717 |
717 |
0.5 |
|
FDM Group |
Industrial Support Services |
673 |
673 |
0.5 |
|
Videndum |
Industrial Engineering |
162 |
162 |
0.1 |
|
Total Investments: 65 (31 January 2025: 60) |
|
128,432 |
139,715 |
100.0 |
Ordinary shares unless stated otherwise.
* The Portfolio Exposure indicates the impact on market price movements resulting from the ownership of shares and derivative instruments. The Market Value represents the fair value of the portfolio, which is reflected on the Balance Sheet. In the case of holding a Contract for Difference (CFD), the Market Value reflects the profit or loss generated by the contract since its inception, based on the movement of the underlying share price. CFDs provide investors with the benefits and risks of owning a security without actually owning it. There is no delivery of physical goods or securities, which means that CFDs are generally regarded as an easier method of settlement because losses and gains are paid in cash. CFDs are disclosed in Derivative assets/liabilities at market value in the Balance Sheet on page 48. However, when the Company solely holds shares, both the Market Value and the Portfolio Exposure align.
AIM Investments quoted on AIM.
^ Includes CFD position.
Directors' responsibilities statement
The Directors are responsible for preparing the Annual Financial Report in accordance with United Kingdom applicable law and regulations.
Company law requires the Directors to prepare financial statements for each financial year. Under the law the Directors have elected to prepare financial statements in accordance with UK-adopted international accounting standards. Under company law, the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period.
In preparing these financial statements, the Directors are required to:
· select suitable accounting policies in accordance with IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors and then apply them consistently;
· make judgements and estimates that are reasonable and prudent;
· present information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable information;
· present additional disclosures when compliance with the specific requirements in UK-adopted IFRS is insufficient to enable users to understand the impact of particular transactions, other events and conditions on the Company's financial position and financial performance;
· state whether UK-adopted international accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements; and
· prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Under applicable law and regulations, the Directors are responsible for preparing the Strategic Report, a Corporate Governance Statement, a Directors' Remuneration Report and a Directors' Report that comply with the law and regulations.
The Directors of the Company each confirm to the best of their knowledge, that:
· the financial statements, prepared in accordance with UK-adopted international accounting standards, give a true and fair view of the assets, liabilities, financial position and profit of the Company;
· this Annual Financial Report includes a fair review of the development and performance of the business and the position of the Company together with a description of the principal risks and uncertainties that it faces; and
· they consider that this Annual Financial Report, taken as a whole, is fair, balanced and understandable and provides the information necessary for shareholders to assess the Company's position and performance, business model and strategy.
Signed on behalf of the Board of Directors
Bridget Guerin
Chairman
28 April 2026
Financial statements
Statement of comprehensive income
for the year ended 31 January 2026
|
|
|
|
|
31 January |
|
|
31 January |
|
|
|
|
|
2026 |
|
|
2025 |
|
|
|
Revenue |
Capital |
Total |
Revenue |
Capital |
Total |
|
|
Notes |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
|
Loss on investments held at fair value |
9 |
- |
(3,131) |
(3,131) |
- |
(4,673) |
(4,673) |
|
Income |
2 |
4,350 |
- |
4,350 |
4,902 |
- |
4,902 |
|
Net losses on derivatives |
10 |
- |
(334) |
(334) |
- |
- |
- |
|
Investment management fees |
3 |
(32) |
(456) |
(488) |
(189) |
(1,072) |
(1,261) |
|
Other expenses |
4 |
(528) |
(1) |
(529) |
(370) |
(466) |
(836) |
|
Loss before finance costs and taxation |
|
3,790 |
(3,922) |
(132) |
4,343 |
(6,211) |
(1,868) |
|
Finance costs |
5 |
(45) |
(258) |
(303) |
(89) |
(501) |
(590) |
|
Loss before taxation |
|
3,745 |
(4,180) |
(435) |
4,254 |
(6,712) |
(2,458) |
|
Taxation |
6 |
- |
- |
- |
- |
- |
- |
|
Loss after taxation |
|
3,745 |
(4,180) |
(435) |
4,254 |
(6,712) |
(2,458) |
|
Return per ordinary share |
7 |
12.37p |
(13.81)p |
(1.44)p |
13.02p |
(20.54)p |
(7.52)p |
The total columns of this statement represent the Company's statement of comprehensive income, prepared in accordance with UK-adopted international accounting standards. The loss after taxation is the total comprehensive loss. The supplementary revenue and capital columns are both prepared in accordance with the Statement of Recommended Practice issued by the Association of Investment Companies. All items in the above statement derive from continuing operations of the Company. No operations were acquired or discontinued in the year.
Statement of changes in equity
for the year ended 31 January 2026
|
|
|
|
|
Capital |
|
|
|
|
|
|
Share |
Share |
Redemption |
Capital |
Revenue |
|
|
|
|
Capital |
Premium |
Reserve |
Reserve |
Reserve |
Total |
|
|
Notes |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
|
At 31 January 2024 |
|
10,642 |
22,366 |
3,386 |
123,147 |
1,854 |
161,395 |
|
Total comprehensive loss for the year |
|
- |
- |
- |
(6,712) |
4,254 |
(2,458) |
|
Dividends paid |
8 |
- |
- |
- |
(1,278) |
(4,328) |
(5,606) |
|
Shares bought back and held in treasury |
13 |
- |
- |
- |
(286) |
- |
(286) |
|
Special dividend paid |
8,13 |
(677) |
- |
677 |
(16,401) |
- |
(16,401) |
|
At 31 January 2025 |
|
9,965 |
22,366 |
4,063 |
98,470 |
1,780 |
136,644 |
|
Total comprehensive loss for the year |
|
- |
- |
- |
(4,180) |
3,745 |
(435) |
|
Dividends paid |
8 |
- |
- |
- |
(437) |
(4,112) |
(4,549) |
|
Shares bought back and held in treasury |
13 |
- |
- |
- |
(2,275) |
- |
(2,275) |
|
At 31 January 2026 |
|
9,965 |
22,366 |
4,063 |
91,578 |
1,413 |
129,385 |
The accompanying accounting policies and notes are an integral part of these financial statements.
Balance sheet
as at 31 January 2026
|
|
|
2026 |
2025 |
|
|
Notes |
£'000 |
£'000 |
|
Non-current assets |
|
|
|
|
Investments held at fair value through profit or loss |
9 |
128,586 |
143,920 |
|
Current assets |
|
|
|
|
Derivative financial assets held at fair value through profit or loss |
10 |
39 |
- |
|
Other receivables |
11 |
688 |
2,839 |
|
Cash and cash equivalents |
|
497 |
2,472 |
|
Variation margin receivable |
|
90 |
- |
|
|
|
1,314 |
5,311 |
|
Total assets |
|
129,900 |
149,231 |
|
Current liabilities |
|
|
|
|
Derivative financial liabilities held at fair value through profit or loss |
10 |
(193) |
- |
|
Other payables |
12 |
(322) |
(12,587) |
|
|
|
(515) |
(12,587) |
|
Total assets less current liabilities |
|
129,385 |
136,644 |
|
Net assets |
|
129,385 |
136,644 |
|
Capital and reserves |
|
|
|
|
Share capital |
13 |
9,965 |
9,965 |
|
Share premium |
14 |
22,366 |
22,366 |
|
Capital redemption reserve |
14 |
4,063 |
4,063 |
|
Capital reserve |
14 |
91,578 |
98,470 |
|
Revenue reserve |
14 |
1,413 |
1,780 |
|
Total shareholders' funds |
|
129,385 |
136,644 |
|
Net asset value per ordinary share |
|
|
|
|
Basic and diluted |
15 |
434.66p |
449.88p |
The financial statements were approved and authorised for issue by the Board of Directors on 28 April 2026.
Signed on behalf of the Board of Directors
Bridget Guerin
Chairman
The accompanying accounting policies and notes are an integral part of these financial statements.
Statement of cash flows
for the year ended 31 January 2026
|
|
|
2026 |
2025 |
|
|
Notes |
£'000 |
£'000 |
|
Cash flow from operating activities |
|
|
|
|
Loss before taxation |
|
(435) |
(2,458) |
|
Add back finance costs |
|
22 |
590 |
|
Adjustments for: |
|
|
|
|
Purchase of investments |
|
(88,577) |
(19,030) |
|
Sale of investments |
|
103,051 |
37,995 |
|
Net loss of derivative transactions |
|
334 |
- |
|
Settlement of derivative transactions |
|
(180) |
- |
|
|
|
|
|
|
|
|
14,628 |
18,965 |
|
Loss on investments held at fair value |
|
3,131 |
4,673 |
|
Increase in receivables |
|
(209) |
(32) |
|
Increase in payables |
|
84 |
20 |
|
Net cash inflow from operating activities |
|
17,221 |
21,758 |
|
Cash flow from financing activities |
|
|
|
|
Finance cost paid |
|
(22) |
(590) |
|
Dividends paid |
8 |
(4,549) |
(5,606) |
|
Decrease in bank overdraft |
|
- |
(8,753) |
|
Bank facility (repayment)/drawdown |
|
(12,350) |
12,350 |
|
Shares bought back and held in treasury |
|
(2,275) |
(286) |
|
Special dividend paid |
8 |
- |
(16,401) |
|
Net cash outflow from financing activities |
|
(19,196) |
(19,286) |
|
Net (decrease)/increase in cash and cash equivalents |
|
(1,975) |
2,472 |
|
Cash and cash equivalents at start of the year |
|
2,472 |
- |
|
Cash and cash equivalents at the end of the year |
|
497 |
2,472 |
|
Reconciliation of cash and cash equivalents to the Balance Sheet is as follows: |
|
|
|
|
Cash held at custodian |
|
100 |
52 |
|
Northern Trust Global Funds plc - Sterling, money market fund |
|
397 |
2,420 |
|
Cash and cash equivalents |
|
497 |
2,472 |
|
Cash flow from operating activities includes: |
|
|
|
|
Dividends received |
|
4,157 |
4,825 |
|
Interest received |
|
5 |
5 |
As the Company did not have any long term debt at both the current and prior year ends, no reconciliation of the financial liabilities position is presented.
The accompanying accounting policies and notes are an integral part of these financial statements.
Notes to the financial statements
1. Principal accounting policies
Accounting policies describe the Company's approach to recognising and measuring transactions during the year and the position of the Company at the year end.
The principal accounting policies adopted in the preparation of these financial statements together with the approach to recognition and measurement are set out below. These policies have been consistently applied during the current year and the preceding year, unless otherwise stated.
The financial statements have been prepared on a going concern basis on the grounds that the Company's investment portfolio is sufficiently liquid and significantly exceeds all balance sheet liabilities. There are no unrecorded commitments or contingencies. The disclosure on going concern on page 28 in the Directors' Report provides further detail. The Directors believe the Company has adequate resources to continue in operational existence for the foreseeable future and has the ability to meet its financial obligations as and when they fall due for a period until at least 30 April 2027.
(a) Basis of preparation
(i) Accounting standards applied
The financial statements have been prepared on a historical cost basis, except for the measurement at fair value of investments and derivative financial instruments, including CFDs, which for the Company are quoted bid prices for investments in active markets at the Balance Sheet date and in accordance with the applicable UK-adopted international accounting standards. The standards are those that are effective at the Company's financial year end.
Where presentational guidance set out in the Statement of Recommended Practice (`SORP') `Financial Statements of Investment Trust Companies and Venture Capital Trusts', issued by the Association of Investment Companies in December 2025, is consistent with the requirements of UK-adopted international accounting standards, the Directors have prepared the financial statements on a basis compliant with the recommendations of the SORP. The supplementary information which analyses the statement of comprehensive income between items of a revenue and a capital nature is presented in accordance with the SORP.
The Directors have considered the impact of climate change on the value of the listed investments that the Company holds. In the view of the Directors, as the portfolio consists of listed and contracts for difference (`CFD'), their market prices should reflect the impact, if any, of climate change and accordingly no adjustment has been made to take account of climate change in the valuation of the portfolio in these financial statements.
(ii) Critical accounting estimates and judgements
The preparation of the financial statements may require the Directors to make estimations where uncertainty exists. It also requires the Directors to make judgements, estimates and assumptions, in the process of applying the accounting policies. There have been no significant judgements, estimates or assumptions for the current or preceding year.
(b) Foreign currency and segmental reporting
(i) Functional and presentation currency
The financial statements are presented in Sterling, which is the Company's functional and presentation currency and the currency in which the Company's share capital and expenses are denominated, as well as a majority of its assets and liabilities.
(ii) Transactions and balances
Foreign currency assets and liabilities are translated into Sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currency, are translated into Sterling at the rates of exchange ruling on the dates of such transactions, and profit or loss on translation is taken to revenue or capital depending on whether it is revenue or capital in nature. All are recognised in the statement of comprehensive income.
(iii) Segmental reporting
The Directors are of the opinion that the Company is engaged in a single segment of business of investing in equity, issued by companies operating and generating revenue mainly in the UK.
(c) Financial instruments
(i) Recognition of Financial Assets and Financial Liabilities
The Company recognises financial assets and financial liabilities when the Company becomes a party to the contractual provisions of the instrument. The Company offsets financial assets and financial liabilities if the Company has a legally enforceable right to set off the recognised amounts and interests and intends to settle on a net basis.
(ii) Derecognition of financial assets
The Company derecognises a financial asset when the contractual rights to the cash flows from the asset expire, or it transfers the right to receive the contractual cash flows on the financial asset in a transaction in which substantially all the risks and rewards of ownership of the financial asset are transferred. Any interest in the transferred financial asset that is created or retained by the Company is recognised as an asset.
(iii) Derecognition of financial liabilities
The Company derecognises financial liabilities when its obligations are discharged, cancelled or expired.
(iv) Trade date accounting
Purchases and sales of financial assets are recognised on trade date, being the date on which the Company commits to purchase or sell the assets.
(v) Classification of financial assets and financial liabilities
Financial assets
The Company classifies its financial assets as measured at amortised cost or measured at fair value through profit or loss on the basis of both: the entity's business model for managing the financial assets; and the contractual cash flow characteristics of the financial asset.
Financial assets measured at amortised cost include cash and debtors.
A financial asset is measured at fair value through profit or loss if its contractual terms do not give rise to cash flows on specified dates that are solely payments of principal and interest (`SPPI') on the principal amount outstanding or it is not held within a business model whose objective is either to collect contractual cash flows, or to both collect contractual cash flows and sell. The Company's equity and contracts for difference are classified as fair value through profit or loss as they do not give rise to cash flows that are SPPI.
Financial assets held at fair value through profit or loss are initially recognised at fair value, which is usually the transaction price and are subsequently valued at fair value.
For investments that are actively traded in organised financial markets, fair value is determined by reference to stock exchange quoted bid prices at the balance sheet date.
Financial liabilities
Financial liabilities, including borrowings through the bank facility or formerly the bank overdraft, are initially measured at fair value, net of transaction costs and are subsequently measured at amortised cost using the effective interest method, where applicable.
(d) Cash and cash equivalents. Cash and cash equivalents include any cash held at custodian and approved depositories as well as holdings in Northern Trust Global Funds plc- Sterling, a triple-A rated money market fund. Cash and cash equivalents are defined as cash itself or being readily convertible to a known amount of cash and are subject to an insignificant risk of change in value with original maturities of three months or less.
(e) Income. All dividends are taken into account on the date investments are marked ex-dividend; other income from investments is taken into account on an accruals basis. Where the Company elects to receive scrip dividends (i.e. in the form of additional shares rather than cash), the equivalent of the cash dividend foregone is recognised as income in the revenue account and any excess in value of the shares received over the amount of the cash divided recognised in capital. Deposit interest is taken into account on an accruals basis. Special dividends representing a return of capital are allocated to capital in the statement of comprehensive income and then taken to capital reserves. Dividends will generally be recognised as revenue however all special dividends will be reviewed, with consideration given to the facts and circumstances of each case, including the reasons for the underlying distribution, before a decision over whether allocation is to revenue or capital is made.
(f) Expenses and Finance Costs . All expenses and finance costs are accounted for in the statement of comprehensive income on an accruals basis.
The investment management fee and finance costs (including those related to the bank facility, contracts for difference (CFDs), or formerly the bank overdraft) are allocated 85% to capital and 15% to revenue. This is in accordance with the Board's expected long term split of returns, in the form of capital gains and income respectively, from the portfolio.
Investment transaction costs such as brokerage commission and stamp duty are recognised in capital in the statement of comprehensive income. Expenses incurred as a result of the special elective dividend and change of investment manager have been recognised as capital in the statement of comprehensive income. All other expenses are allocated to revenue in the statement of comprehensive income.
(g) Taxation. Tax represents the sum of tax payable, withholding tax suffered and deferred tax. Tax is charged or credited in the statement of comprehensive income. Any tax payable is based on taxable profit for the year, however, as expenses exceed taxable income no corporation tax is due. The Company's liability for current tax is calculated using tax rates that have been enacted or substantially enacted by the balance sheet date.
Deferred taxation is recognised in respect of all temporary differences that have originated but not reversed at the balance sheet date, where transactions or events that result in an obligation to pay more tax in the future or right to pay less tax in the future have occurred at the balance sheet date. This is subject to deferred tax assets only being recognised if it is considered probable that there will be suitable profits from which the future reversal of the temporary differences can be deducted. Deferred tax assets and liabilities are measured at the tax rates expected to apply in the period when the liability is settled or the asset realised.
Investment trusts which have approval under Section 1158 of the Corporation Tax Act 2010 are not liable for taxation on capital gains.
(h) Dividends. Dividends are not accrued in the financial statements, unless there is an obligation to pay the dividends at the balance sheet date. Proposed final dividends are recognised in the financial year in which they are approved by the shareholders.
(i) Derivatives. The contracts for difference held in the portfolio are valued based on the price of the underlying security or index which they are purchased to reflect. The nature and intended use of these derivatives is to synthetically allow the Company to go long on an underlying asset without the need to trade the physical securities. They are valued based on the quoted bid price of the underlying security when held long. There are revenue and capital returns to be derived from these instruments. Dividends on contracts for difference are recognised as revenue for long positions when the securities are quoted ex-dividend. Open CFD positions at the year end are shown at fair value in the Statement of financial Position under current assets or current liabilities. Interest on margin accounts held with brokers is included in the revenue return. All other gains/losses and cash flows from derivatives are included in the capital return.
2. Income
This note shows the income generated from the portfolio (investment assets) of the Company and income received from any other source.
|
|
2026 |
2025 |
|
|
£'000 |
£'000 |
|
Income from investments: |
|
|
|
UK dividends |
3,910 |
4,533 |
|
Derivative income from CFDs |
184 |
- |
|
UK special dividends |
183 |
262 |
|
Liquidity fund income |
41 |
- |
|
Overseas dividends |
27 |
102 |
|
Deposit interest |
5 |
5 |
|
Total income |
4,350 |
4,902 |
No special dividends have been recognised in capital during the year (2025: nil).
Overseas dividends include dividends received on UK listed investments where the investee company is domiciled outside of the UK.
3. Investment management fee
This note shows the fees due to the Manager. These are made up of the management fee calculated and paid monthly and, for the previous year. This fee is based on the value of the assets being managed.
|
|
|
|
2026 |
|
|
2025 |
|
|
Revenue |
Capital |
Total |
Revenue |
Capital |
Total |
|
|
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
|
Investment management fee |
32 |
456 |
488 |
189 |
1,072 |
1,261 |
Details of the investment management and secretarial agreement are given on page 28 in the Directors' Report.
At 31 January 2026, £114,000 (2025: £93,000) was accrued in respect of the investment management fee.
As part of the transition, Artemis agreed to a nine-month fee waiver covering the period from 7 March to 7 December 2025. The waiver fully offset the termination fee paid to Invesco, and in addition meant that the Company benefited from paying no management fee for the period 21 June to 7 December 2025.
4. Other expenses
The other expenses of the Company are presented below; those paid to the Directors and auditor are separately identified.
|
|
|
|
2026 |
|
|
2025 |
|
|
Revenue |
Capital |
Total |
Revenue |
Capital |
Total |
|
|
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
|
Directors' remuneration(i) |
130 |
- |
130 |
132 |
- |
132 |
|
Auditor's fees(ii): |
|
|
|
|
|
|
|
- for audit of the Company's annual financial statements |
56 |
- |
56 |
51 |
- |
51 |
|
Other expenses(iii) |
342 |
1 |
343 |
187 |
466 |
653 |
|
|
528 |
1 |
529 |
370 |
466 |
836 |
(i) The Director's Remuneration Report provides further information on Directors' fees.
(ii) Auditor's fees include expenses but excludes VAT. The VAT is included in other expenses.
(iii) Other expenses include:
· £19,000 (2025: £12,500) of employer's National Insurance payable on Directors' remuneration. As at 31 January 2026, the amounts outstanding on employer's National Insurance on Directors' remuneration was £1,300 (2025: £1,100), the amounts outstanding for Directors' fee was £8,700 (2025: £11,200).
· custodian transaction charges of £1,300 (2025: £1,700). These are charged to capital.
· broker, registrar, legal and print costs in connection with the special dividend of £nil (2025: £422,800). These were charged to capital.
· legal costs in connection with the change of Investment Manager £300 (2025: £42,000). These were charged to capital.
· £342,000 (2025: £187,000) represents operational costs paid by the Company and charged to revenue.
5. Finance costs
Finance costs arise on any borrowing facilities the Company has and from the financing element of Contracts for Difference (CFDs).
|
|
|
|
2026 |
|
|
2025 |
|
|
Revenue |
Capital |
Total |
Revenue |
Capital |
Total |
|
|
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
|
Bank facility fee |
- |
1 |
1 |
1 |
7 |
8 |
|
Interest on bank facility |
3 |
18 |
21 |
51 |
286 |
337 |
|
Overdraft interest |
- |
- |
- |
37 |
208 |
245 |
|
CFD finance cost |
42 |
239 |
281 |
- |
- |
- |
|
|
45 |
258 |
303 |
89 |
501 |
590 |
6. Taxation
As an investment trust the Company pays no tax on capital gains and, as the Company invested principally in UK equities, it has little overseas tax. In addition, no deferred tax is required to provide for tax that is expected to arise in the future due to differences in accounting and tax bases.
(a) Tax charge
|
|
2026 |
2025 |
|
|
£'000 |
£'000 |
|
Overseas taxation |
- |
- |
(b) Reconciliation of tax charge
|
|
2026 |
2025 |
|
|
£'000 |
£'000 |
|
Loss before taxation |
(435) |
(2,458) |
|
Theoretical tax at the current UK Corporation Tax rate of 25% (2025: 25%) |
(109) |
(615) |
|
Effects of: |
|
|
|
- Non-taxable UK dividends |
(961) |
(1,102) |
|
- Non-taxable UK special dividends |
(46) |
(65) |
|
- Non-taxable overseas dividends |
(7) |
(24) |
|
- Non-taxable loss on investments |
866 |
1,168 |
|
- Excess of allowable expenses over taxable income |
257 |
521 |
|
- Disallowable expenses |
- |
117 |
|
Tax charge for the year |
- |
- |
(c) Factors that may affect future tax changes
The Company has cumulative excess management expenses of £49,008,000 (2025: £48,030,000) that are available to offset future taxable revenue.
A deferred tax asset of £12,252,000 (2025: £12,007,000) at 25% (2025: 25%) has not been recognised in respect of these expenses since the Directors believe that there will be no taxable profits in the future against which the deferred tax assets can be offset.
7. Return per ordinary share
Return per ordinary share is the amount of gain or loss generated for the financial year divided by the weighted average number of ordinary shares in issue.
|
|
|
|
2026 |
|
|
2025 |
|
|
Revenue |
Capital |
Total |
Revenue |
Capital |
Total |
|
|
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
|
Return £'000 |
3,745 |
(4,180) |
(435) |
4,254 |
(6,712) |
(2,458) |
|
Return per ordinary share |
12.37p |
(13.81)p |
(1.44)p |
13.02p |
(20.54)p |
(7.52)p |
The returns per ordinary share are based on the weighted average number of shares in issue during the year of 30,268,571 (2025: 32,686,825).
8. Dividends on ordinary shares
The Company paid four dividends in the year - three interims and a final.
|
|
|
2026 |
|
2025 |
|
|
Pence |
£'000 |
Pence |
£'000 |
|
Dividends paid from revenue in the year: |
|
|
|
|
|
Third interim (prior year) |
3.85 |
1,170 |
3.85 |
1,302 |
|
Final (prior year) |
2.01 |
611 |
1.63 |
553 |
|
First interim |
3.85 |
1,169 |
3.85 |
1,302 |
|
Second interim |
3.85 |
1,162 |
3.85 |
1,171 |
|
Total dividends paid from revenue |
13.56 |
4,112 |
13.18 |
4,328 |
|
Dividends paid from capital in the year: |
|
|
|
|
|
Final (prior year) |
1.44 |
437 |
3.78 |
1,278 |
|
Total dividends paid from capital |
1.44 |
437 |
3.78 |
1,278 |
|
Total dividends paid in the year |
15.00 |
4,549 |
16.96 |
5,606 |
|
|
|
2026 |
|
2025 |
|
|
Pence |
£'000 |
Pence |
£'000 |
|
Dividends payable in respect of the year: |
|
|
|
|
|
First interim |
3.85 |
1,170 |
3.85 |
1,302 |
|
Second interim |
3.85 |
1,162 |
3.85 |
1,171 |
|
Third interim |
3.85 |
1,144 |
3.85 |
1,170 |
|
Final |
3.89 |
1,152 |
3.45 |
1,048 |
|
|
15.44 |
4,628 |
15.00 |
4,691 |
The third interim dividend of 3.85p per share, in respect of the year ended 31 January 2026, was paid to shareholders on 6 March 2026. The Company's dividend policy was changed in 2015 so that dividends will be paid firstly from current year revenue and any revenue reserves available, and thereafter from capital reserves. The amount payable in respect of the year is shown below:
|
|
2026 |
2025 |
|
|
£'000 |
£'000 |
|
Dividends in respect of the year: |
|
|
|
- from revenue reserve |
3,745 |
4,254 |
|
- from capital reserve |
883 |
437 |
|
|
4,628 |
4,691 |
Dividend payable from the capital reserve of £883,000 (2025: capital reserve of £437,000) as a percentage of year end net assets of £129,385,000 (2025: £136,644,000) is 0.70% (2025: 0.30%). The Company has £105,623,000 (2025: £112,136,000) of realised distributable capital reserves at the year end.
|
|
|
2026 |
|
2025 |
|
|
Pence |
£'000 |
Pence |
£'000 |
|
Capital returns paid in the year: |
|
|
|
|
|
Special Dividend |
- |
- |
484.85 |
16,401 |
|
|
- |
- |
484.85 |
16,401 |
A return of capital was offered to Shareholders during the year ended 31 January 2025, in respect of up to 10% of the Company's issued shares (excluding treasury shares). The return of capital was proposed by way of an elective special dividend, where all shareholders had an opportunity to elect in respect of each share held. The value of the special dividend of 484.85p was an amount per share which represented 97.5% of the published unaudited NAV per share of 497.29p as at the net asset value certification date (being 6.00 p.m. on 17 September 2024). The special dividend was paid on 8 October 2024, resulting in 3,382,648 shares being cancelled for no consideration pursuant to the reduction of capital and an amount of £16,401,000 was paid to Shareholders who elected to receive the special dividend.
9. Investments held at fair value through profit and loss
The portfolio is made up of investments which are listed or traded on a primary stock exchange or AIM. Profit and losses in the year include:
· realised, usually arising when investments are sold; and
· unrealised, being the difference from cost on those investments still held at the year end.
|
|
2026 |
2025 |
|
|
£'000 |
£'000 |
|
Investments listed on a primary stock exchange |
96,393 |
112,854 |
|
AIM quoted investments |
32,193 |
31,066 |
|
|
128,586 |
143,920 |
|
Opening valuation |
143,920 |
169,481 |
|
Movements in year: |
|
|
|
Purchases at cost |
88,577 |
18,982 |
|
Sales proceeds |
(100,780) |
(39,870) |
|
Loss on investments in the year |
(3,131) |
(4,673) |
|
Closing valuation |
128,586 |
143,920 |
|
Closing book cost |
142,631 |
157,586 |
|
Closing investment unrealised loss |
(14,045) |
(13,666) |
|
Closing valuation |
128,586 |
143,920 |
The transaction costs amount to £303,000 (2025: £68,000) on purchases and £23,000 (2025: £20,000) for sales. These amounts are included in determining the loss on investments held at fair value as disclosed in the statement of comprehensive income.
The Company received £100,780,000 (2025: £39,870,000) from investments sold in the year. The book cost of these investments when they were purchased was £103,532,000 (2025: £35,968,000) realising a loss of £2,750,000 (2025: gain of £3,902,000). These investments have been revalued over time and until they were sold any unrealised profits/losses were included in the fair value of the investments.
10. Derivatives
The derivative assets and liabilities held by the Company are presented below.
(a) Valuation of derivatives
All derivative instruments held by the Company comprise contracts for difference (CFDs) and are classified as financial assets and liabilities at fair value through profit or loss. CFDs are initially recognised at fair value on the date the contract is entered into and are subsequently re - measured to fair value at each reporting date, with gains and losses recognised in the statement of comprehensive income. The fair value of CFDs at the year end represents the net unrealised gain or loss on open positions, being the difference between the contract value and the market value at the balance sheet date.
|
|
|
|
2026 |
|
|
2025 |
|
|
Fair |
Fair |
|
Fair |
Fair |
|
|
|
value |
value |
|
value |
value |
|
|
|
current |
current |
Gross |
current |
current |
Gross |
|
|
assets |
liabilities |
exposure |
assets |
liabilities |
exposure |
|
|
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
|
Contracts for difference |
39 |
(193) |
11,128 |
- |
- |
- |
|
|
39 |
(193) |
11,128 |
- |
- |
- |
(b) Movements in derivatives
The movements in the fair value of derivative instruments during the year comprise realised gains and losses on positions closed during the year and unrealised movements in fair value on open positions at the year end. The total of these movements reconciles to the net losses on derivatives in the statement of comprehensive income.
|
|
2026 |
2025 |
|
|
Contracts |
Contracts |
|
|
for difference |
for difference |
|
|
£'000 |
£'000 |
|
Movements in year: |
|
|
|
Closed contracts - realised losses |
(180) |
- |
|
Closed contracts - Decrease in fair value |
(154) |
- |
|
Losses on derivatives in the year |
(334) |
- |
CFD transaction costs on positions opened and closed during the year amounted to £3,000 (2025: £nil).
11. Other receivables
Other receivables are amounts which are due to the Company, such as monies due from brokers for investments sold and income which has been earned (accrued) but not yet received.
|
|
2026 |
2025 |
|
|
£'000 |
£'000 |
|
Amounts due from brokers |
135 |
2,404 |
|
Prepayments and accrued income |
553 |
435 |
|
|
688 |
2,839 |
12. Other payables
Other payables are amounts which must be paid by the Company, and include any amounts due to brokers for the purchase of investments, interest in respect of the bank facility or amounts owed to suppliers (accruals), such as the Manager and auditor.
The bank facility provided a specific amount of capital, up to £20 million, over a specified period of time (two years). Unlike a term loan, the revolving nature of the bank facility allowed the Company to drawdown, repay and re-draw loans.
|
|
2026 |
2025 |
|
|
£'000 |
£'000 |
|
Bank facility* |
- |
12,350 |
|
Accruals |
322 |
237 |
|
|
322 |
12,587 |
*The bank facility was fully re-paid with effect 26 February 2025 and the facility withdrawn.
13. Share capital
Share capital represents the total number of shares in issue, including shares held in treasury.
(a) Allotted, called-up and fully paid
|
|
|
2026 |
|
2025 |
|
|
Number |
£'000 |
Number |
£'000 |
|
Allotted, called-up and fully paid |
|
|
|
|
|
Ordinary shares of 20p each |
29,766,693 |
5,953 |
30,373,362 |
6,075 |
|
Treasury shares of 20p each |
20,059,743 |
4,012 |
19,453,074 |
3,890 |
|
|
49,826,436 |
9,965 |
49,826,436 |
9,965 |
|
(b) Share movements |
|
|
|
|
|
|
|
2026 |
|
2025 |
|
|
Ordinary shares |
Treasury shares |
Ordinary shares |
Treasury shares |
|
Number of shares of 20p each at start of year |
30,373,362 |
19,453,074 |
33,826,929 |
19,382,155 |
|
Special dividend paid |
- |
- |
(3,382,648) |
- |
|
Shares bought back and held in treasury |
(606,669) |
606,669 |
(70,919) |
70,919 |
|
Carried forward |
29,766,693 |
20,059,743 |
30,373,362 |
19,453,074 |
During the year to 31 January 2026, the Company bought back into treasury, 606,669 (2025: 70,919) ordinary shares at a total cost of £2,275,000 (2025: £286,000). No shares were cancelled during the year (2025: 3,382,648 shares were cancelled as part of the Special Dividend paid on 8 October 2024). Since 31 January 2026 to 24 April 2026, the Company has bought back a further 297,700 ordinary shares into treasury.
14. Reserves
This note explains the different reserves attributable to shareholders. The aggregate of the reserves and share capital (see previous note) make up total shareholders' funds.
The share premium arises whenever shares are issued at a price above the nominal value plus any issue costs. The capital redemption reserve maintains the equity share capital and arises from the nominal value of shares repurchased and cancelled. The share premium and capital redemption reserve are non-distributable.
Capital investment gains and losses are shown in note 9, and form part of the capital reserve. The revenue reserve shows the net revenue retained after payment of dividends. The capital (to the extent that it constitutes realised profits) and revenue reserves are distributable by way of dividend. In addition, the capital reserve is also distributable by way of share buy backs.
15. Net asset value per ordinary share
The Company's total net assets (total assets less total liabilities) are often termed shareholders' funds and are converted into net asset value per ordinary share by dividing by the number of shares in issue.
The net asset value per share and the net asset values attributable at the year end were as follows:
|
|
|
Net asset value |
|
Net assets |
|
|
|
per ordinary share |
|
attributable |
|
|
2026 |
2025 |
2026 |
2025 |
|
|
Pence |
Pence |
£'000 |
£'000 |
|
Ordinary shares |
434.66 |
449.88 |
129,385 |
136,644 |
Net asset value per ordinary share is based on net assets at the year end and on 29,766,693 (2025: 30,373,362) ordinary shares, being the number of ordinary shares in issue (excluding treasury) at the year end.
16. Risk management, financial assets and liabilities
Financial instruments comprise the Company's investment portfolio as well as any cash, borrowings, other receivables and other payables.
Financial instruments
The Company's financial instruments comprise equity shares and derivative financial instruments which comprise long contracts for difference (CFDs) (as shown on pages 11 and 12), cash, other receivables and other payables that arise directly from its operations such as sales and purchases awaiting settlement and accrued income. The accounting policies in note 1 include criteria for the recognition and the basis of measurement applied for financial instruments. Note 1 also includes the basis on which income and expenses arising from financial assets and liabilities are recognised and measured.
Risk management policies and procedures
The Directors have delegated to the Manager the responsibility for the day-to-day investment activities of the Company as more fully described in the Directors' report.
As an investment trust the Company invests in equities and other investments for the long-term, so as to meet its investment policy (incorporating the Company's investment objective). In pursuing its investment objective, the Company is exposed to a variety of risks that could result in either a reduction in the Company's net assets or a reduction of the profits available for dividends. Those related to financial instruments include market risk, liquidity risk and credit risk.
The main risk that the Company faces arising from its financial instruments is market risk - this risk is reviewed in detail below. Since the Company invests mainly in UK equities traded on the London Stock Exchange, liquidity risk and credit risk are not significant. Liquidity risk is minimised as the majority of the Company's investments comprise a diversified portfolio of readily realisable securities which can be sold to meet funding commitments as necessary. In addition, a bank facility (formerly overdraft facility) provided short-term funding flexibility.
Credit and counterparty risk
Credit risk encompasses the failure by counterparties to deliver securities which the Company has paid for, or to pay for securities which the Company has delivered, and cash balances. Counterparty risk is minimised by using only approved counterparties. The Company's ability to operate in the short-term may be adversely affected if the Company's custodian suffers insolvency or other financial difficulties. The appointment of a depositary has substantially lessened this risk. The Board reviews the custodian's annual controls report and the Manager's management of the relationship with the custodian. This was The Bank of New York Mellon (International) Limited, an A-1+ rated financial institution, until 9 March 2025. From 10 March 2025 the custodian was changed to Northern Trust Investor Services Limited, a similarly rated institution. Cash balances are limited to a maximum of 2.5% of net assets with any one deposit taker, with only approved deposit takers being used. A maximum of 4.0% of net assets with The Bank of New York Mellon (International) Limited and a maximum of 7.5% of net assets for holdings in the Invesco Liquidity Funds plc - Sterling, a triple-A rated money market fund, were allowed during the period to 9 March 2025. Post transition, a maximum of 4.0% of net assets is allowed to be placed with Northern Trust Investor Services Limited with a further 10% maximum allowed to be invested in the Northern Trust Global Funds plc - Sterling money market fund.
The Company uses one counterparty for derivative transactions. The Company may enter into transactions in over-the-counter (`OTC') markets that expose it to the credit of its counterparties and their ability to satisfy the terms of such contracts. Where the Company enters into derivative contracts, it will be exposed to the risk that the counterparty may default on its obligations to perform under the relevant contract. In the event of bankruptcy or insolvency of a counterparty, the Company could experience delays in liquidating the position and may incur significant losses. There may be a risk that a counterparty will be unable to meet its obligations with regard to the return of the collateral and may not meet other payments due to the Company. To minimise such risk, the Investment Manager will assess the creditworthiness of any counterparty that it engages. On a daily basis, the Investment Manager assesses the level of assets with each counterparty to ensure that the exposure is within the defined limits.
The derivatives are disclosed in the Portfolio of Investments and J.P. Morgan Securities Plc is the counterparty for contracts for difference. Aside from the custodian, the derivative counterparties and brokers where trades are pending settlement, there were no significant concentrations of credit and counterparty risk as at 31 January 2026 and 31 January 2025.
Counterparty exposure
At the balance sheet date, the Company held only contracts for difference as derivatives instruments.
Details of the individual contracts are disclosed separately in the Portfolio of Investments and the total position by counterparty and the collateral pledged, at the year end, were as follows:
|
|
Contracts |
Total net |
Net collateral |
|
|
for difference |
exposure |
held/(pledged) |
|
2026 |
£'000 |
£'000 |
£'000 |
|
J.P. Morgan Securities Plc |
11,128 |
(154) |
- |
At 31 January 2025, the Company did not hold any derivative positions and therefore had no counterparty exposure.
Market risk
The fair value or future cash flows of a financial instrument may fluctuate because of changes in market prices. This market risk comprises three elements - currency risk, interest rate risk and other price risk. The Company's Manager assesses the Company's exposure when making each investment decision, and monitors the overall level of market risk on the whole of the investment portfolio on an ongoing basis. The Board meets at least quarterly to assess risk and review investment performance. The Company may utilise hedging instruments to manage market risk. Gearing is used to enhance returns, however, this will also increase the Company's exposure to market risk and volatility.
1. Currency risk
The exposure to currency risk is considered minor as the Company's financial instruments are mainly denominated in Sterling. At the current and preceding year end, the Company held no foreign currency investments or cash, although a small amount of dividend income was received in foreign currency.
During this and the previous year, the Company did not use forward currency contracts to mitigate currency risk.
2. Interest rate risk
Interest rate movements will affect the level of income receivable on cash deposits and the interest payable on variable rate borrowings. When the Company has cash balances, they are held in variable rate bank accounts yielding rates of interest dependent on the base rate of the Custodians, The Bank of New York Mellon (International) Limited (until 9 March 2025) and Northern Trust Investor Services Limited (from 10 March 2025). Additionally, holdings in Northern Trust Global Funds plc - Sterling are subject to interest rate changes.
The Company did not have any uncommitted bank facility in place at the year end (2025: the Company had an uncommitted bank facility up to a maximum of 30% of the net asset value of the Company or £20 million, whichever was the lower; the interest rate was charged at a margin over the Bank of England base rate). At the prior year end, £12.4 million of the bank facility was drawn down. The bank facility was fully repaid and withdrawn with effect from 26 February 2025.
Interest rate exposure
The Company has no financial assets or liabilities carrying fixed rates of interest. The exposure of financial assets and liabilities to floating interest rates, giving cash flow interest rate risk when rates are reset, is shown below.
|
|
2026 |
2025 |
|
|
£'000 |
£'000 |
|
Exposure to floating interest rates: |
|
|
|
Cash at bank |
100 |
52 |
|
Northern Trust Global Funds plc - Sterling |
397 |
- |
|
Invesco Liquidity Funds plc - Sterling |
- |
2,420 |
|
Bank facililty |
- |
(12,350) |
|
Derivative financial instruments - long CFDs (exposure less fair value) |
(11,282) |
- |
|
|
(10,785) |
(9,878) |
Interest rate sensitivity
The following table illustrates the sensitivity of the return after taxation for the year and net assets to a 1% (2025: 1%) increase or decrease in interest rates in regards to the Company's monetary financial assets and financial liabilities. This level of change is considered to be a reasonable illustration based on observation of current market conditions and in light of interest rate increases or decreases during the year. The sensitivity analysis is based on the Company's monetary financial instruments held at the balance sheet date with all other variables held constant.
|
|
|
2026 |
|
2025 |
|
|
1% increase |
1% decrease |
1% increase |
1% decrease |
|
Statement of comprehensive income |
|
|
|
|
|
- return after taxation |
|
|
|
|
|
Revenue return |
5 |
(5) |
6 |
(6) |
|
Capital return |
(113) |
113 |
(105) |
105 |
|
Total return after taxation for the year |
(108) |
108 |
(99) |
99 |
|
Net assets |
(108) |
108 |
(99) |
99 |
3. Other price risk
Other price risks (i.e. the risk of changes in market prices, other than those arising from interest rates or currency) may affect the value of the investments.
Other price risk exposure
The Company's total exposure to changes in market prices at 31 January comprises its holdings in equity investments and exposure to CFDs as follows:
|
|
2026 |
2025 |
|
|
£'000 |
£'000 |
|
Investments held at fair value through profit or loss |
128,586 |
143,920 |
|
Exposure to derivative instruments - Long CFDs |
11,129 |
- |
|
Total |
139,715 |
143,920 |
The above data is broadly representative of the exposure to other price risk during the current and comparative year.
Management of other price risk
The Directors manage the market price risks inherent in the investment portfolio by meeting regularly to monitor on a formal basis the Manager's compliance with the Company's stated objectives and policies and to review investment performance.
The Company's portfolio is the result of the Manager's investment process and as a result is not correlated with the Company's benchmark or the markets in which the Company invests. Therefore, the value of the portfolio will not move in line with the market but will move as a result of the performance of the company shares within the portfolio.
If the value of the portfolio fell by 10% at the balance sheet date, the loss after tax for the year would increase by £14 million (2025: loss after tax for the year would increase by £14 million). Conversely, if the value of the portfolio rose by 10%, the loss after tax would decrease (2025: loss after tax would decrease) by the same amount.
Concentration of exposure to market price risk
There is a concentration of exposure to the UK, though it should be noted that the Company's investments may not be entirely exposed to economic conditions in the UK, as many UK listed companies do much of their business overseas.
Fair values of financial assets and financial liabilities
The financial assets and financial liabilities are either carried in the balance sheet at their fair value (investments), or the balance sheet amount is a reasonable approximation of fair value (due from brokers, dividends receivable, accrued income, due to brokers, accruals, cash at bank and borrowings).
The fair value of quoted investments is determined using unadjusted quoted prices in active markets at the reporting date, where available.
For financial instruments where quoted market prices are not directly available, fair value is determined using observable market inputs, including prices from recent transactions, broker quotes, or valuation techniques that maximise the use of observable data and minimise the use of unobservable inputs.
Fair value hierarchy disclosures
The Company's financial instruments within the scope of IFRS 13 that are held at fair value comprise its investment portfolio and derivative financial instruments:
Level 1 - The unadjusted quoted price in an active market for identical assets or liabilities that the entity can access at the measurement date.
Level 2 - Inputs other than quoted prices included within Level 1 that are observable (i.e. developed using market data) for the asset or liability, either directly or indirectly.
Level 3 - Inputs are unobservable (i.e. for which market data is unavailable) for the asset or liability.
Categorisation within the hierarchy has been determined on the basis of the lowest level input that is significant to the fair value measurement of each relevant asset/liability.
|
|
|
2026 |
|
2025 |
|
|
Assets |
Liabilities |
Assets |
Liabilities |
|
|
£'000 |
£'000 |
£'000 |
£'000 |
|
Level 1 |
128,586 |
- |
143,920 |
- |
|
Level 2* |
39 |
(193) |
- |
- |
|
|
128,625 |
(193) |
143,920 |
- |
*Consists of the fair value of derivative financial instruments (long CFDs), calculated as the difference between the initial contract price of the CFD and the market value of the underlying investment, and is presented as derivative financial assets or derivative financial liabilities in the Balance Sheet.
17. Maturity analysis of contractual liability cash flows
The contractual liabilities of the Company are shown in note 12 and comprise amounts due to brokers and accruals. All contractual liabilities are settled in accordance with their contractual terms. Amounts due to brokers are generally payable on the purchase date of the investment plus two business days. Accruals are generally payable within three months. The Company did not have any bank facility in place at the year end (2025: the Company had an uncommitted bank facility which was repayable on demand).
18. Capital management
The Company's capital, or equity, is represented by its net assets which are managed to achieve the Company's investment objective set out on page 15.
The main risks to the Company's investments are shown in the Strategic Report under the `Principal risks and uncertainties' section on pages 17 to 19. These also explain that the Company is able to gear and that gearing will amplify the effect on equity of changes in the value of the portfolio.
The Board can also manage the capital structure directly since it determines dividend payments and has taken the powers, which it is seeking to renew, to buy-back shares, either for cancellation or to be held in treasury, and to issue new shares or sell shares held in treasury.
The Company is subject to externally imposed capital requirements with respect to the obligation and ability to pay dividends by s1158 Corporation Tax Act 2010 and by the Companies Act 2006, respectively, and with respect to the availability of the bank facility (formerly bank overdraft facility) and by the terms imposed by the lender. The Board regularly monitors, and has complied with, the externally imposed capital requirements. This is unchanged from the prior year.
Total equity at 31 January 2026, the composition of which is shown on the balance sheet on page 48, was £129,385,000 (2025: £136,644,000).
19. Contingencies, guarantees and financial commitments
Liabilities the Company is committed to honour but which are dependent on a future circumstance or event occurring would be disclosed in this note if any existed.
There were no contingencies, guarantees or other financial commitments of the Company as at 31 January 2026 (2025: nil).
20. Related party transactions and transactions with manager
A related party is a company or individual who has direct or indirect control or who has significant influence over the Company.
Under UK-adopted international accounting standards the Company has identified the Directors and Manager as related parties.
The Directors' remuneration and interests have been disclosed on page 37 with additional disclosure in note 4. No other related parties have been identified.
The management fee payable to the Manager for the year was £488,000 split between Artemis Fund Managers Limited £114,000 and Invesco Fund Managers Limited £374,000 (2025: Invesco Fund Managers Limited £1,261,000) of which £114,000 (2025: £93,000) was outstanding at the year end.
Details of the Manager's services and fees are disclosed in the Directors' report on page 28 and in note 3.
21. Post balance sheet events
As at 24 April, the Company's share price has decreased from 386.00p at 31 January 2026 to 341.50p. The NAV per share has decreased from 434.66p to 400.53p, reflecting market conditions.
2026 Financial Information
The figures and financial information for the year ended 31 January 2026 are extracted from the Company's annual financial statements for that year and do not constitute statutory accounts. The Company's annual financial statements for the year to 31 January 2026 have been audited but have not yet been delivered to the Registrar of Companies. The Auditor's report on the 2026 annual financial statements was unqualified, did not include a reference to any matter to which the Auditor drew attention without qualifying the report, and did not contain any statements under Section 498 of the Companies Act 2006.
2025 Financial Information
The figures and financial information for the year ended 31 January 2025 are compiled from an extract of the published accounts for that year and do not constitute statutory accounts. Those accounts have been delivered to the Registrar of Companies and included the report of the Auditor which was unqualified and did not contain a statement under Sections 498(2) or 498(3) of the Companies Act 2006.
Annual Financial Report
The audited 2026 annual financial report will be available to shareholders, and will be delivered to the Registrar of Companies, shortly. Copies may be obtained during normal business hours from Artemis Fund Managers Limited, Cassini House, 57 St James's Street, London SW1A 1LD and via the Company's website: www.artemisfunds.com/futureleaders
A copy of the annual financial report will be submitted shortly to the National Storage Mechanism (" NSM ") and will be available for inspection at the NSM, which is situated at https://data.fca.org.uk/#/nsm/nationalstoragemechanism .
Shareholder Information (Unaudited)
Notice of Annual General Meeting
THIS NOTICE OF ANNUAL GENERAL MEETING IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt as to what action to take, you should consult your stockbroker, solicitor, accountant or other appropriate independent professional adviser authorised under the Financial Services and Markets Act 2000. If you have sold or otherwise transferred all your shares in Artemis UK Future Leaders plc, please forward this document and the accompanying Form of Proxy to the person through whom the sale or transfer was effected, for transmission to the purchaser or transferee.
NOTICE IS GIVEN that the Annual General Meeting (`AGM') of Artemis UK Future Leaders plc will be held at the offices of Artemis Fund Managers Limited at Cassini House, 57 St James's Street, London SW1A 1LD at 12.00 noon on 2 June 2026 for the following purposes:
Ordinary Business
1. To receive and consider the Annual Financial Report for the year ended 31 January 2026.
2. To approve the Directors' Remuneration Policy.
3. To approve the Annual Statement and Report on Remuneration for the year ended 31 January 2026.
4. To approve the final dividend of 3.89p for the year ended 31 January 2026.
5. To re-elect Bridget Guerin as a Director of the Company.
6. To re-elect Graham Paterson as a Director of the Company.
7. To re-elect Mike Prentis as a Director of the Company.
8. To re-appoint the auditor, Ernst & Young LLP.
9. To authorise the Audit Committee to determine the auditor's remuneration.
Special Business
To consider and, if thought fit, to pass the following resolutions of which resolution 10 will be proposed as an ordinary resolution and resolutions 11 to 13 as special resolutions:
Authority to Allot Shares
10. That:
the Directors be generally and unconditionally authorised in accordance with Section 551 of the Companies Act 2006 as amended from time to time prior to the date of the passing of this resolution (the `Act') to exercise all powers of the Company to allot shares and grant rights to subscribe for, or convert any securities into, shares up to an aggregate nominal amount (within the meaning of Sections 551(3) and (6) of the Act) of £589,380, this being 10% of the Company's issued ordinary share capital (excluding Treasury Shares) as at 24 April 2026, such authority to expire at the conclusion of the next AGM of the Company or the date 15 months after the passing of this resolution, whichever is the earlier unless the authority is renewed or revoked at any other general meeting prior to such time, but so that this authority shall allow the Company to make offers or agreements before the expiry of this authority which would or might require shares to be allotted, or rights to be granted, after such expiry as if the authority conferred by this resolution had not expired.
Disapplication of Pre-emption Rights
11. That:
the Directors be and are hereby empowered, in accordance with Sections 570 and 573 of the Act to allot equity securities (within the meaning of Section 560 (1), (2) and (3) of the Act) for cash, either pursuant to the authority given by resolution 10 set out above or (if such allotment constitutes the sale of relevant shares which, immediately before the sale, were held by the Company as treasury shares) otherwise, as if Section 561 of the Act did not apply to any such allotment, provided that this power shall be limited:
(a) to the allotment of equity securities in connection with a rights issue in favour of all holders of a class of equity securities where the equity securities attributable respectively to the interests of all holders of securities of such class are either proportionate (as nearly as may be) to the respective numbers of relevant equity securities held by them or are otherwise allotted in accordance with the rights attaching to such equity securities (subject in either case to such exclusions or other arrangements as the Directors may deem necessary or expedient in relation to fractional entitlements or legal or practical problems under the laws of, or the requirements of, any regulatory body or any stock exchange in any territory or otherwise);
(b) to the allotment (otherwise than pursuant to a rights issue) of equity securities up to an aggregate nominal amount of £589,380, this being 10% of the Company's issued ordinary share capital (excluding Treasury Shares) as at 24 April 2026; and
(c) to the allotment of equity securities at a price not less than the net asset value per share (as determined by the Directors), and this power shall expire at the conclusion of the next AGM of the Company or the date 15 months after the passing of this resolution, whichever is the earlier unless the authority is renewed or revoked at any other general meeting prior to such time, but so that this power shall allow the Company to make offers or agreements before the expiry of this power which would or might require equity securities to be allotted after such expiry as if the power conferred by this resolution had not expired; and so that words and expressions defined in or for the purposes of Part 17 of the Act shall bear the same meanings in this resolution.
Authority to Make Market Purchases of Shares
12. That:
the Company be generally and subject as hereinafter appears unconditionally authorised in accordance with Section 701 of the Act to make market purchases (within the meaning of Section 693(4) of the Act) of its issued ordinary shares of 20p each in the capital of the Company (`Shares').
PROVIDED ALWAYS THAT:
(a) the maximum number of Shares hereby authorised to be purchased shall be 14.99% of the Company's issued ordinary shares (excluding Treasury Shares), this being 4,417,402 as at 24 April 2026;
(b) the minimum price which may be paid for a Share shall be 20p;
(c) the maximum price which may be paid for a Share must not be more than the higher of: (i) 5% above the average of the mid-market values of the Shares for the five business days before the purchase is made; and (ii) the higher of the price of the last independent trade in the Shares and the highest then current independent bid for the Shares on the London Stock Exchange;
(d) any purchase of Shares will be made in the market for cash at prices below the prevailing net asset value per Share (as determined by the Directors);
(e) the authority hereby conferred shall expire at the conclusion of the next AGM of the Company or the date 15 months after the passing of this resolution, whichever is the earlier, unless the authority is renewed or revoked at any other general meeting prior to such time;
(f) the Company may make a contract to purchase Shares under the authority hereby conferred prior to the expiry of such authority which will be executed wholly or partly after the expiration of such authority and may make a purchase of Shares pursuant to any such contract; and
(g) any Shares so purchased shall be cancelled or, if the Directors so determine and subject to the provisions of Sections 724 to 731 of the Act and any applicable regulations of the United Kingdom Listing Authority, be held (or otherwise dealt with in accordance with Section 727 or 729 of the Act) as treasury shares.
Period of Notice Required for General Meetings
13. THAT
the period of notice required for general meetings of the Company (other than AGMs) shall be not less than 14 clear days.
Dated this 28 April 2026
By order of the Board
Northern Trust Secretarial Services (UK) Limited
Corporate Company Secretary
Notes:
1. A member entitled to attend and vote at the AGM is entitled to appoint one or more proxies to attend, speak and vote in his stead. Where more than one proxy is appointed, each proxy must be appointed to exercise the rights attached to a different share or shares. A proxy need not be a member of the Company. However, if you appoint the Chairman of the AGM as your proxy, this will ensure that your votes are cast in accordance with your wishes. If any other person is appointed as your proxy, they may not be able to attend the meeting to vote on your behalf. In order to be valid an appointment of proxy must be returned by one of the following methods:
· via the Investor Centre app or at https://uk.investorcentre.mpms.mufg.com/ (see note 4); or
· via Proxymity (see note 5); or
· in hard copy form by post, by courier or by hand to the Company's registrars, MUFG Corporate Markets, PXS 1, Central Square, 29 Wellington Street, Leeds LS1 4DL; or
· in the case of CREST members, by utilising the CREST electronic proxy appointment service in accordance with the procedures set out below
and in each case to be received by the Company not less than 48 hours before the time of the meeting. Shareholders wishing to appoint a proxy should therefore appoint the Chairman of the AGM.
2. CREST members who wish to appoint a proxy or proxies by utilising the CREST electronic proxy appointment service may do so by utilising the procedures described in the CREST Manual. CREST Personal Members or other CREST sponsored members, and those CREST members who have appointed a voting service provider(s), should refer to their CREST sponsor or voting service provider(s) who will be able to take the appropriate action on their behalf. In order for a proxy appointment made by means of CREST to be valid, the appropriate CREST message (a `CREST Proxy Instruction') must be properly authenticated in accordance with Euroclear UK & International Limited's specifications and must contain the information required for such instructions, as described in the CREST Manual. The message, regardless of whether it relates to the appointment of a proxy or to an amendment to the instruction given to a previously appointed proxy must, in order to be valid, be transmitted so as to be received by the issuer's agent (ID RA10) by the latest time(s) for receipt of proxy appointments specified in this document. For this purpose, the time of receipt will be taken to be the time (as determined by the time stamp applied to the message by the CREST Applications Host) from which the issuer's agent is able to retrieve the message by enquiry to CREST in the manner prescribed by CREST. After this time, any changes of instructions to proxies through CREST should be communicated to the appointee through other means. The Company may treat as invalid a CREST Proxy Instruction in the circumstances set out in Regulation 35(5)(a) of the Uncertificated Securities Regulations 2001. CREST members and, where applicable, their CREST sponsors or voting service provider(s) should note that Euroclear UK & International Limited does not make available special procedures in CREST for any particular messages. Normal system timings and limitations will therefore apply in relation to the input of CREST Proxy Instructions. It is the responsibility of the CREST member concerned to take or, if the CREST member is a CREST personal member or sponsored member or has appointed a voting service provider(s), to procure that his CREST sponsor or voting service provider(s) take(s), such action as shall be necessary to ensure that a message is transmitted by means of the CREST system by any particular time. In this connection, CREST members and, where applicable, their CREST sponsors or voting service providers are referred, in particular, to those sections of the CREST Manual concerning practical limitations of the CREST system and timings.
3. A form of appointment of proxy is enclosed. Appointment of a proxy (whether by completion of a form of appointment of proxy, or other instrument appointing a proxy or any CREST Proxy Instruction or appointing a proxy via Proxymity) does not prevent a member from attending and voting at this meeting.
To be effective, the form of appointment of proxy, duly completed and executed, together with any power of attorney or other authority under which it is signed (or a notarially certified copy thereof) must be lodged at the office of the Company's registrars, MUFG Corporate Markets (formerly known as Link Group), PXS 1, Central Square, 29 Wellington Street, Leeds LS1 4DL, by not later than 12.00 noon on 29 May 2026.
4. Shareholders can vote electronically via the Investor Centre, a free app for smartphone and tablet provided by MUFG Corporate Markets (the company's registrar). It allows you to securely manage and monitor your shareholdings in real time, take part in online voting, keep your details up to date, access a range of information including payment history and much more. The app is available to download on both the Apple App Store and Google Play, or by scanning the relevant QR code below. Alternatively, you may access the Investor Centre via a web browser at: https://uk.investorcentre.mpms.mufg.com/.
Your vote must be lodged by 12.00 noon on 29 May 2026 in order to be considered valid or, if the meeting is adjourned, by the time which is 48 hours before the time of the adjourned meeting.
5. If you are an institutional investor, you may be able to appoint a proxy electronically via the Proxymity platform, a process which has been agreed by the Company and approved by the Registrar. For further information regarding Proxymity, please visit www.proxymity.io. Your proxy must be lodged by no later than 48 hours before the time of the Annual General Meeting in order to be considered valid or, if the meeting is adjourned, by the time which is 48 hours before the time of the adjourned meeting.
Before you can appoint a proxy via this process you will need to have agreed to Proxymity's associated terms and conditions. It is important that you read these carefully as you will be bound by them and they will govern the electronic appointment of your proxy. An electronic proxy appointment via the Proxymity platform may be revoked completely by sending an authenticated message via the platform instructing the removal of your proxy vote.
6. Unless otherwise indicated on the Form of Proxy, CREST voting, Proxymity or any other electronic voting channel instruction, the proxy will vote as they think fit or, at their discretion, withhold from voting.
7. If you hold your shares through a platform or nominees, you will need to contact them and ask them to appoint you as a proxy in respect of your shares in order to attend, speak and vote at the AGM.
8. A person entered on the Register of Members at close of business on 29 May 2026 (`a member') is entitled to attend and vote at the Meeting pursuant to Regulation 41 of the Uncertificated Securities Regulations 2001. Any changes to the Register of Members after such time and date shall be disregarded in determining the rights of any person to attend and/or vote at the Meeting. If the Meeting is adjourned, entitlement to attend and vote at the adjourned meeting, and the number of votes which may be cast thereat, will be determined by reference to the Company's Register of Members 48 hours before the time fixed for the adjourned meeting.
9. The Terms of Reference of the Audit Committee, the Management Engagement Committee, the Marketing Committee and the Nomination Committee and the Letters of Appointment for Directors will be available for inspection by request to the Company Secretary.
10. A copy of the Articles of Association are available for inspection by request to the Company Secretary.
11. Any person to whom this Notice is sent who is a person nominated under Section 146 of the Companies Act 2006 to enjoy information rights (a `Nominated Person') may have a right, under an agreement between him/her and the shareholder by whom he/she was nominated, to be appointed (or to have someone else appointed) as a proxy for the meeting. If a Nominated Person has no such proxy appointment right or does not wish to exercise it, he/she may have a right, under such an agreement, to give instructions to the shareholder as to the exercise of voting rights.
The statement of the above rights of the shareholders in relation to the appointment of proxies does not apply to Nominated Persons. Those rights can only be exercised by shareholders of the Company.
12. Any corporation which is a member can appoint one or more corporate representatives who may exercise on its behalf all of its powers as a member provided that they do not do so in relation to the same shares.
13. Any member attending the AGM, should this be permitted by government restrictions at the time, has the right to ask questions. The Company must cause to be answered any such question relating to the business being dealt with at the AGM but no such answer need be given if: (a) to do so would interfere unduly with the preparation for the AGM or involve the disclosure of confidential information; (b) the answer has already been given on a website in the form of an answer to a question; or (c) it is undesirable in the interests of the Company or the good order of the AGM that the question be answered.
14. You may not use any electronic address (within the meaning of Section 333(4) of the Companies Act 2006) provided in this Notice (or in any related documents including the proxy form) to communicate with the Company for any purposes other than those expressly stated.
15. As at 24 April 2026 (being the last practicable day prior to the publication of this Notice) the Company's issued share capital consists of 29,468,993 ordinary shares of 20p each carrying one vote each.
16. A copy of this notice, and other information required by Section 311A of the Companies Act 2006, can be found at www.artemisfunds.com/futureleaders
17. Shareholders should note that it is possible that, pursuant to requests made by members of the Company under Section 527 of the Companies Act 2006 (the `Act'), the Company may be required to publish on a website a statement setting out any matter relating to: (i) the audit of the Company's accounts (including the auditor's report and the conduct of the audit) that are to be laid before the AGM; or (ii) any circumstance connected with an auditor of the Company ceasing to hold office since the previous meeting at which annual accounts and reports were laid in accordance with Section 437 of the Act (in each case) that the members propose to raise at the relevant AGM. The Company may not require the members requesting any such website publication to pay its expenses in complying with Sections 527 or 528 of the Act. Where the Company is required to place a statement on a website under Section 527 of the Act, it must forward the statement to the Company's auditor not later than the time when it makes the statement available on the website. The business which may be dealt with at the AGM includes any statement that the Company has been required under Section 527 of the Act to publish on a website.
18. The following documents may be inspected at the registered office of the Company during business hours on any weekday (Saturdays, Sundays and Bank Holidays excluded) from the date of this Notice of AGM to the date of the AGM and will be available for inspection at the AGM, if appropriate, from 11.45am on 2 June 2026 until the conclusion of the meeting:
· copies of the letters of appointment of the Non-Executive Directors; and
· the Current Articles.
The Current Articles are available to view on the Company's website
https://www.artemisfunds.com/futureleaders.
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