Annual Financial Report
Summary by AI BETAClose X
To: RNS
Date: 2 September 2026
From: CT Global Managed Portfolio Trust PLC (the 'Company')
LEI: 213800ZA6TW45NM9YY31
Information disclosed in accordance with Disclosure Guidance and Transparency Rule 4.1.3
Statement of Audited Results for the year ended 31 May 2026
Growth Shares - 2026 Highlights
- Share price total return(1) per Growth share of +25.6% for the financial year (2025: +1.6%).
- Share price total return per Growth share of +117.4% in the 10 years to 31 May 2026, the equivalent of 8.1% compound per year(1).
Income Shares - 2026 Highlights
- Annual dividend of 7.85p per Income share (2025: 7.60p), an increase of 3.3%.
- Over the last three financial years the total annual dividend has increased by 9.0%, as compared to CPI of 8.4%.
- Dividend yield(1) of 6.0% at 31 May 2026 (2025: 6.6%), based on total dividends for the financial year of 7.85p (2025: 7.60p) per Income share. Dividends are paid quarterly.
- Share price total return(1) per Income share of +21.2% for the financial year (2025: +3.8%).
Notes:
(1) See Alternative Performance Measures on pages 95 to 97 in the Annual Report and Financial Statements.
Forward looking statements
This document may contain forward looking statements with respect to the financial condition, results of operations and business of the Company. Such statements involve risk and uncertainty because they relate to future events and circumstances that could cause actual results to differ materially from those expressed or implied by forward looking statements. The forward looking statements are based on the Directors' current views and on information known to them at the date of this document. Nothing should be construed as a profit forecast.
Chairman's Statement
"We have listened carefully to what matters most to shareholders and, as a result, have undertaken a number of initiatives. Whether through clearer performance reporting, protecting income against inflation, providing a more convenient dividend payment schedule or making fuller use of existing features of the Company's investment policy, each initiative is designed to improve the experience and outcomes for our shareholders."
Dear Shareholder
Thank you for your ongoing investment in CT Global Managed Portfolio. Together with our Manager, Columbia Threadneedle Investment Business Limited, we continually focus on outcomes for shareholders and seek to make improvements when appropriate.
As part of this commitment, we have undertaken a number of important initiatives:
• To make performance easier for shareholders to understand, we are replacing our single benchmark with three complementary comparators providing a more relevant view of investment performance.
• To help protect Income shareholders' purchasing power, we will aim to increase dividends by at least the rate of inflation as measured by the UK Consumer Price Index ('CPI') over rolling three-year periods (based on financial years).
• To better align with Income shareholders' day-to-day finances, we intend to pay dividends monthly rather than quarterly, starting from the next financial year.
• To enhance shareholders' total return potential, the Investment Managers intend to make fuller use of the existing features of the Company's investment policy, including using the borrowing facility in both Portfolios.
We believe these developments will benefit shareholders and support CT Global Managed Portfolio's long-term success. You can find more information on each of these initiatives, along with other updates, within this Chairman's Statement.
Performance Reporting
Since launch in 2008, the Company has used the FTSE All-Share Index as the benchmark for the outcomes of both share classes. We have reviewed whether this remains the most useful way for shareholders to assess performance. Because most companies in the FTSE All-Share Index are not investment companies, the Index does not closely reflect what the Company is allowed to invest in. For that reason, for financial years beginning on or after 1 June 2026, the Board believes it will be more helpful to show performance for both share classes against three comparators instead:
• the FTSE All-Share Closed End Investments Index - this is more closely aligned with the Company's investment policy because it is made up only of UK-listed investment companies;
• the FTSE All-Share Index - many UK retail investors may see this as a broad alternative for their money; and
• CPI - this will help shareholders see whether their investment is keeping ahead of the rising cost of living.
Whilst the Company's benchmark for the year under review was the FTSE All-Share Index, we have also included, in this Annual Report and Financial Statements, the corresponding returns from the other two comparators for information purposes.
Performance
For the Company's financial year ended 31 May 2026, the net asset value ('NAV') total return(1) (capital performance plus the reinvestment of any dividends paid) was +25.1% for the Growth shares and +23.3% for the Income shares, both of which outperformed the +21.6% total return for the FTSE All-Share Index. For the same period, the FTSE All-Share Closed End Investments Index delivered a total return of +27.6% and CPI rose by +2.8%.
Both the Growth and Income Portfolios' performance proved resilient during a period of further volatility in financial markets, resulting from heightened geopolitical uncertainty that culminated in the US-Iran conflict. That conflict, and the ensuing closure of the Strait of Hormuz, resulted in a sharp increase in commodity prices, and a brief selloff in equity markets, from which the recovery was swift, albeit to an extent concentrated in the US and Asia and focused on companies related to the Artificial Intelligence theme.
Investment company sector performance, on the whole, was improved versus recent years, as underlying NAV performance was strong and discounts tightened. Market leadership amongst the World's stock markets broadened beyond US-listed mega capitalisation technology companies, into areas such as Asia and Emerging Markets. Alternative asset returns remained under pressure from a higher interest rate environment and Private Equity continued to suffer from a weak 'exit' environment.
From 1 June 2025, the beginning of the Company's 2026 financial year, the investment Portfolios have been managed by Adam Norris and Paul Green, supported by the Manager's broader EMEA Multi-Asset Solutions team (of which they are members). In their first year, the Investment Managers repositioned the Portfolios between regions and sectors and it is pleasing to see the strong NAV total return of both Portfolios. The Investment Managers' Review, which includes an overview of their investment activity, is set out on pages 13 to 16 in the Annual Report and Financial Statements.
The Company's compound annual NAV total returns(2) over the 10 years to 31 May 2026 were +8.5% for the Growth shares and +7.0% for the Income shares, as compared to the compound annual total returns of +8.9% for the FTSE All-Share Index, +10.2% for the FTSE All-Share Closed End Investments Index and a compound annual increase in CPI of +3.6% over the same period. This year's strong returns have helped reduce the negative impact of the relatively difficult four financial years from 2022 to 2025. As explained in their Review, the Investment Managers are positive on equity markets and selective alternative assets. Discounts have begun to narrow within alternatives, and the Investment Managers see strong NAV growth potential from specific alternative assets, which may help to close discounts further.
Revenue and Dividends to Income Shareholders
For the financial year ended 31 May 2026, four interim dividends have now been paid totalling 7.85p per Income share, which represents an increase of 3.3% from the prior financial year (2025: 7.60p per Income share). This increase compares to the change in CPI over the year of 2.8%. The fourth interim dividend was paid after the year end on 10 July 2026.
This is the 15th consecutive year of dividend increase and the yield on the Income shares was 6.0% on the year end Income share price, compared with 3.1% for the FTSE All-Share Index and 2.6% for the FTSE All-Share Closed End Investments Index.
In the absence of unforeseen circumstances, it is the Board's intention, in accordance with the Company's stated dividend policy, to pay four quarterly interim dividends, each of at least 2.00p per Income share, so that the aggregate dividends for the financial year ending 31 May 2027 will be at least 8.00p per Income share.
After allowing for the payment of the fourth interim dividend, the Company has a revenue reserve of £2.9 million, equivalent to approximately 59% of the current annual dividend cost (at 8.00p per Income share). In addition, the £29.6 million distributable reserve (the 2022 special reserve, which was created following the cancellation of the share premium account) is attributable to the Income shares. These reserves can be drawn on to support the payment of dividends to Income shareholders. The Board believes this use of reserves affords the Investment Managers more flexibility with portfolio construction, ensuring that total returns for Income shareholders are not detrimentally impacted by the dividend target.
Changes to Dividend Aim and Payment Frequency
The Board is well aware that increases in dividends are important to Income shareholders and in particular how increases compare with inflation. It has become the Board's aim to seek to increase dividends by at least as much as inflation (as measured by CPI) over rolling three-year periods (based on financial years). This will likely mean that, in years when inflation is low, dividend increases may exceed it, but, when inflation is high, dividend increases may lag, effectively providing Income shareholders with a smoother income profile over the rolling three-year periods. The Board first adopted this dividend aim for the three years which ended 31 May 2026. Over that period, dividends increased by 9.0% and CPI by 8.4% equivalent to compound annual increases of 2.9% and 2.7% respectively.
The Board also intends to change the frequency of Income shareholders' dividends from quarterly to monthly, with effect from the next financial year which commences on 1 June 2027. Changing within the financial year could cause confusion and so this is best implemented from the beginning of a new financial year. The Board believes many Income shareholders
will receive other forms of income, like salary and/or pensions, on a monthly basis and indeed their budgeting is likely to be on a monthly basis too. We therefore believe moving from quarterly to monthly payments will prove helpful and popular with our existing Income shareholders and has the potential to attract new investors.
In practical terms, this change to the payment profile will not mean the full year's dividends will be any different from what they would have been. Income shareholders will receive on a monthly basis roughly one-third of what they would have received in their quarterly dividends in each of the three-month periods, and their overall cash flow should be accelerated. For example, the dividend usually paid in respect of the first financial quarter is typically paid in October, whereas the monthly dividends in respect of this first quarter are expected to be paid in August, September and October, and so on for the subsequent dividends. More information about this change will be shared nearer the intended start date.
Investment Policy
We, alongside the Investment Managers, have reviewed the features of the Company's investment policy and, while we do not see any that need changing at the moment, there are two existing features that are worth mentioning that may be used going forward.
The Company's investment policy requires it to invest 'principally' in listed closed-end investment companies. By including the word 'principally' it has always been the case that other types of investment funds could be used in a relatively small way while still adhering to the policy. This latitude has not been used to date but, as the listed closed-end investment companies universe has reduced in number, it is more likely that the Investment Managers may wish to use other types of funds where they can provide attractive exposure that is not otherwise available to the Company from listed closed-end investment companies.
The Company's investment policy also permits the use of derivatives within parameters set by the Financial Conduct Authority and prescribed as efficient portfolio management. Again, whilst this has always been available to the Company, derivatives have not been used to date. Going forward it is more likely that 'index futures' may be used to gain or reduce exposures more quickly and more cheaply than by buying or selling investments. Typically these would be short-term expedients and modest in scale.
The Board will of course be monitoring closely any use of these features and discussing any use with the Investment Managers.
Borrowing
The Company has an unsecured revolving credit facility ('RCF') with The Royal Bank of Scotland International Limited ('RBSI') for £10 million, which can be used in either Portfolio. At the year-end, £7 million of the RCF had been drawn down in the Income Portfolio (2025: £7 million in the Income Portfolio), which represented 8.0% of its gross assets (2025: 10.3%). No borrowings were drawn down in the Growth Portfolio (2025: nil), although we expect that, going forward, the Growth Portfolio may also make use of the borrowing facility. With that in mind, the Board has requested RBSI consider an increase in the size of the RCF with RBSI.
The Board is responsible for the Company's gearing strategy and sets parameters within which the Investment Managers operate. Borrowings are not normally expected to exceed 20% of the total assets of the relevant Portfolio; in practice they have been more modest and used to seek to enhance total return, including the net income in the Income Portfolio.
Management of Share Price Premium and Discount to NAV
We are active in issuing shares to meet demand and buying back shares when this is appropriate. In normal circumstances we aim to ensure the discount to NAV at which the shares trade is no more than 5% and, during the financial year ended 31 May 2026, the Growth shares and Income shares traded at an average discount of -1.8% and an average premium of +0.6% respectively.
During the financial year, 1,265,000 Growth shares were resold out of treasury at an average premium to NAV of 1.5%, raising gross proceeds of £3.9 million. In addition, and primarily in the first half of the financial year, 1,678,000 Growth shares were bought back into treasury at an average price of 275.51p per Growth share, with a total cost of £4.6 million, and at an average discount to NAV of -3.8%.
Also during the financial year, 7,125,000 new Income shares were issued from the Company's block listing facility and 200,000 Income shares were sold from treasury at an average premium to NAV of 1.6%. In total these transactions raised gross proceeds of £9.1 million in the Income Portfolio. 200,000 Income shares were bought back into treasury at an average price of 118.375p per Income share, at a total cost of £0.2 million and at an average discount to NAV of -3.6%.
The Board is seeking shareholders' approval to renew the powers to allot shares, buy back shares and sell shares from treasury at the forthcoming Annual General Meeting ('AGM'). Specifically, the Board is once again seeking approval to allow the Company to issue (or sell from treasury) up to 20% of each share class without rights of pre-emption and, in this respect, there are two resolutions proposed. Each resolution is for up to 10% and, therefore, for an aggregate of up to 20% of each of the Growth shares and Income shares. This approach allows any shareholder who may not wish to give approval to an aggregate limit higher than that recommended by corporate governance guidelines the ability to approve the first resolution for up to 10% and to also consider the second resolution separately for a further 10%.
The Board believes the ability to issue and buy back shares helps to reduce the volatility in the premium or discount of the share prices to the underlying NAVs and the 20% overall share allotment authority and the 14.99% buy-back authority with respect to both the Growth shares and Income shares are therefore in the best interests of all shareholders.
Share Conversion Facility
Shareholders have the opportunity to convert their Growth shares into Income shares or their Income shares into Growth shares annually subject to minimum and maximum conversion quantum thresholds which may be reduced or increased at the discretion of the Board.
The ability to convert without incurring UK capital gains tax or paying stamp duty should be an attractive facility for shareholders who wish to do so, and the next conversion date will be on 12 November 2026. Information is provided on pages 91 and 92 in the Annual Report and Financial Statements, and full details will be provided on the Company's website (ctglobalmanagedportfolio.co.uk) from 3 September 2026.
Investment Management Fee
During the financial year, the Board and Manager agreed a reduction in the investment management fee (the 'Fee') with effect from 1 September 2025. The Fee has been reduced to 0.60% per annum of the net asset value of each Portfolio (rather than 0.65% per annum of the total assets of each Portfolio) and there is no longer any charge on any assets which are invested in other investment vehicles managed by the Manager.
Board Changes
During the year, Simon Longfellow took up a full-time senior marketing role and, as a result, was not able to continue his role with the Company and stepped down as a non-executive Director with effect from 31 December 2025. The Board was very sorry to lose Simon who had been an excellent colleague with great insights contributing particularly into our marketing efforts and we wish him all the best for the future.
As a consequence, the Board undertook a recruitment process to replace him and was pleased to appoint Roland Spencer as a non-executive Director with effect from 19 February 2026. We believe that Roland's experience of marketing, the direct-to-consumer market and retail investor engagement will add considerable value to the Board. He chairs the Marketing Committee already to great effect. Roland's biographical details are set out on page 30 in the Annual Report and Financial Statements, and his election will be proposed to shareholders for approval at the forthcoming AGM on 23 October 2026.
AGM
The Annual General Meeting will be held on 23 October 2026 at Columbia Threadneedle Investments, Cannon Place, 78 Cannon Street, London, EC4N 6AG at 11.30am. Adam Norris and Paul Green will give a presentation and provide an overview of their investment strategy together with their views on the outlook.
Voting on all resolutions at the AGM will be held on a poll, the results of which will be announced and posted on the Company's website (ctglobalmanagedportfolio.co.uk) following the meeting. All shareholders are therefore encouraged to make use of the proxy form or form of direction provided, in order that they can lodge their votes.
Should shareholders have any questions or comments in advance, these can be raised with the Company Secretary (MPTCoSec@columbiathreadneedle.com). Following the AGM, the Investment Managers' presentation will be available on the Company's website.
Outlook
"Prediction is very difficult, especially if it's about the future!" - I have always appreciated this quote and, while it has always been true, it feels particularly so now when a political leader somewhere can make any prediction about the future look foolish very quickly. This is not to absolve myself from some attempt to talk about the prospects for your Company, though, on investment matters, I could not do better than the Investment Managers have in their Review in their last section entitled "The Future Belongs to the Optimists". I commend that to you as well as the rest of the Review of their maiden year.
Your Company's Portfolios are not positioned to protect from Black Swan events (i.e. unpredictable events with severely negative impacts) but rather to provide truly diversified equity orientated exposures to geographies, sectors, investment styles and investment managers. By diversified we mean that investments should not all move in the same direction under the influence of the same events and environments (i.e. the Investment Managers try to avoid too much correlation amongst the investments). Over time this should help achieve the aims of both Portfolios.
As described in this Statement and elsewhere in this Annual Report and Financial Statements, your Board and Manager have undertaken several initiatives which we believe will improve the experience and outcomes for our shareholders. These, and an encouraging first year by our Investment Managers, give us cause to be optimistic for CT Global Managed Portfolio's future. The future belongs to the optimists!
David Warnock
Chairman
1 September 2026
(1) Total return - see Alternative Performance Measures on pages 95 to 97 of the Annual Report and Financial Statements
(2) Compound annual NAV total return - see Alternative Performance Measures on pages 95 to 97 of the Annual Report and Financial Statements
Investment Managers' Review
"We are pleased to report our first annual results for CT Global Managed Portfolio, as the new Investment Managers since 1 June 2025. Overall, equity markets delivered strong positive returns in the financial year ended 31 May 2026. To this end, the share price total returns for the Growth shares was +25.6% and the Income shares was +21.2%. The NAV total returns of the Growth shares was +25.1% and the Income shares was +23.3%."
As comparators, the total return for the FTSE All-Share Index was +21.6%, the FTSE All-Share Closed End Investments Index
+27.6% and the UK Consumer Price Index +2.8%.
We report on a busy year for the Company, with meaningful levels of turnover as we adjusted the Portfolios to further represent the 'global' remit of the Company, whilst allocating to areas of the market which represent strong opportunities for future returns.
A Year of Repositioning
Turnover was heightened for the Company, with the composition of the Growth Portfolio changing by 51% by value, and the Income Portfolio by 46%. Whilst the process of refining the Portfolios is an ongoing and constant feature of active fund management, we have made significant changes to the composition of the Portfolios since we became the new Investment Managers at the beginning of the Company's financial year. The significant repositioning was completed by the year end and, going forward, we will continue to refine the Portfolios to represent our selected best-in-class investment company managers and market opportunities.
We have repositioned the Portfolios to reflect our favoured investment markets for total returns. The biggest beneficiaries of this were investment companies focused on Asia and Emerging Markets equities. Within the Growth Portfolio, the allocation increased to 18.1%, up from 3.4%, and within the Income Portfolio to 17.7%, from 7.3%. We outline our rationale in 'Emerging Value'.
In addition, we added to investment companies with a global investment remit. Within the Growth Portfolio this increased to 19.8%, from 12.1%, and within the Income Portfolio to 20.6%, from 15.3%.
To fund this increased global exposure, we have reduced the allocation to UK-focused investment companies. Within the Growth Portfolio this reduced to 14.2%, down from 29.4%, and within the Income Portfolio it reduced to 19.5%, from 40.2%. We outline our rationale in 'The UK Needs a Korea Break'.
Within alternatives, we are enthusiastic about the specific opportunities for capital and income growth. Whilst optically our allocation in the Growth Portfolio fell from 9.3% to 2.9%, this captures the sale of defensive multi-asset trusts, reflecting our constructive view on equities. Within the Income Portfolio, the allocation rose from 10.5% to 16.5%, an area we covered within our review in the Half-Year Report.
Further to these changes in allocations, we have reduced the number of underlying investment companies held in each Portfolio. As a result, the top ten holdings reflect a higher degree of conviction. In the Growth Portfolio, the number of holdings was reduced to 30 from 39 and the top ten holdings represented 58% of the portfolio at the year end, up from 36%. In the Income Portfolio, the number of holdings was reduced from 36 to 31, and the top ten holdings represented 48% of the Portfolio at 31 May 2026, up from 37%. We would expect the Income Portfolio to remain more diversified than the Growth Portfolio, supporting predictable dividend streams to investors.
Lastly, the level of overlap between the Growth and Income Portfolios has increased. This reflects our decision to invest in our view of best-in-class investment company managers, particularly those who utilise a total return approach to investing. An example of this is our introduction of Invesco Global Equity Income Trust, which is now the largest holding in the Growth Portfolio and a top five holding in the Income Portfolio. The company's managers', Stephen Anness and Joe Dowling, focus on company cash flow to drive not just dividends but capital growth for investors. Although the portfolio holdings produce a small yield premium to the wider market, the managers' opportunity set is not confined to high yielding stocks, as the investment company structure affords the flexibility to use reserves to top up dividends available to investors - a strategy we believe is suitable for both Portfolios.
We set out below, the performance drivers through the 2026 financial year and the investment themes which are expected to influence Portfolio performance going forward.
The Great Equity Transfer
Investors heavily invested in software, data and asset light businesses faced a challenging year. Fears of agentic artificial intelligence ('AI') eating into software and data-related company profitability triggered a bruising de-rating (paying lower price multiples for company profit streams) amongst industry leaders, erasing trillions of pounds in market capitalisation.
However, it is private capital markets that are willing to write bigger cheques to fund certain capital-hungry growth businesses, allowing them to remain private for much longer. The Growth Portfolio benefitted from this through its holdings in The Schiehallion Fund and Scottish Mortgage Investment Trust - both managed by Baillie Gifford, both providing meaningful exposure to these enormous yet-still-private companies. Two of the trusts' largest holdings (SpaceX and Anthropic) added over $2 trillion to their aggregate valuations, whilst still operating as private companies, over the past two years alone, a phenomenon which is having a transformative effect on both public and private markets.
Post period-end, SpaceX offered shares to the public for the first time via an IPO (initial public offering) at a market capitalisation on a par with the top ten S&P 500 companies (albeit not included in the main reference index for a further twelve months), or for context, larger than the top ten FTSE 100 companies combined. Anthropic's pathway to IPO is underway and is expected to command a market capitalisation north of $1 trillion.
Emerging Value
Not only has a shift occurred between public to private markets, but, perhaps for the first time in a decade, many of the public market winners are also found away from the US market.
Many 'hardware' companies related to AI supply chains, such as companies manufacturing semiconductor and memory chips, have seen their profits explode higher, with a number being domiciled in Emerging Markets.
As a result, despite the MSCI Emerging Markets Index returning +55% over one year to 31 May 2026, the index trades on a cheaper price-to-earnings multiple today. Said differently, the performance of Emerging Markets has been entirely driven by increasing corporate profitability.
When we reflect upon previous periods of such strong investment returns, this is often attributed to investors re-rating stocks (paying higher price multiples for company profit streams) - not yet the case in Emerging Markets.
We have therefore continued to add to our Asian and Emerging Market investment company holdings, as covered in 'A Year of Repositioning'. New holdings within the Growth Portfolio include Fidelity Emerging Markets and Invesco Asia Dragon Trust; Invesco Asia Dragon Trust was also added to the Income Portfolio.
The UK Needs a Korea Break
One of the more eye-catching statistics we've read in recent months was how the UK's aggregate stock market capitalisation had fallen below that of South Korea's, and then quickly followed by falling below that of Taiwan. As discussed in 'Emerging Value', many mission critical companies in the AI supply chains can be found in the Far East. In fact, the Technology sector weighting within the MSCI Emerging Markets Index is now larger than within the S&P 500.
No such critical component businesses are domiciled in the UK market, which still comprised 30% in Financials (banks and insurers) versus just 2.4% in Technology at the financial year end. In fact, when we adjust for the sector composition, we do not see the UK market as being particularly cheap and much more in-line with other major markets, such as Europe and Japan.
Throughout the year we reduced our holdings in UK-focused investment companies. Whilst no full sales were made from the Growth Portfolio in the second half of the year (six full sales were made in the first half-year), within the Income Portfolio, we exited Montanaro UK Smaller Companies Investment Trust, The Mercantile Investment Trust, The City of London Investment Trust and The Merchants Trust (in addition to three full sales detailed in the Half-Year Report).
Within the Income Portfolio, we added to our position in Murray Income Trust, after the change of manager to the established Artemis UK Income team, which enjoys one of the best and longest track records in the open-ended IA Equity Income Sector and commend the board on its selection.
Within our remaining UK equity exposure, we have repositioned the holdings to be increasingly focused on small and mid-sized companies, an area which we believe stands to benefit the most if investor flows return to the UK market. Indeed, absent returning flows, our preference is for investment company managers who utilise a highly engaged approach to unlock value. That is, working with (or even replacing) management teams and boards of directors to drive value through either M&A or business model adaption. We include Odyssean Investment Trust, Strategic Equity Capital and Aberforth Smaller Companies in this cohort.
Double Up
Rarely outside of post-recession recoveries do we look back over twelve months and see funds or trusts which have doubled in value. To that end, we give special mentions to Polar Capital Technology Trust, The Schiehallion Fund and Fidelity Emerging Markets (not owned for the full financial year), all of which provided triple-digit returns.
These returns are in no small part due to the flexibility the investment company structure provides portfolio managers. The Schiehallion Fund (covered in 'The Great Equity Transfer') invests mostly in private companies which are unsuitable for an open-ended fund.
Fidelity Emerging Markets, with its +103% share price total return, almost doubled its MSCI Emerging Markets benchmark return. When we decompose those returns, we find that more than half of its outperformance can be attributed to gearing, investing in smaller but less liquid companies and shorting specific companies or markets - impressive use of the investment company structure and we applaud the managers, Chris Tennant and Nick Price, for exceptional outperformance.
Paying Down for Quality
Investors have been told for the past fifteen years that 'paying up' for quality is a successful investment strategy. Why buy value/turnaround businesses when quality businesses can continue to compound without issues?
This seems to have changed in the current interest rate environment.
We suspect the ten years to 2022 may well be seen as the exception rather than rule for sustained quality outperformance. Indeed, some of the weakest performing investment companies across the sector over the past year were found to have a quality-focused investment approach. However, we still believe high quality and predictable companies should provide a role in investor portfolios, particularly in periods of market stress, when investors flock to companies considered durable and defensive.
Over the year, we acquired a new position for the Growth Portfolio in JPMorgan Global Growth & Income (as well as significantly adding to the Income Portfolio holding) and within the Income Portfolio we began a new position in STS Global Income & Growth Trust. Our preference is for a global, rather than regional, approach to quality companies, giving wider investment remits to identify truly durable businesses.
Within the Growth Portfolio, we sold Finsbury Growth & Income Trust, European Opportunities Trust and The Monks Investment Trust and, within the Income Portfolio, we sold Scottish American Investment Company, as well as the aforementioned The City of London Investment Trust and Montanaro UK Smaller Companies Investment Trust.
A Kick to the Privates
Enormous value creation is occurring in particular private equity companies (see 'The Great Equity Transfer'), a phenomenon supported by ever deeper private capital pockets. However private equity success is now increasingly bifurcated between those accessing these companies, and those who do not, or cannot.
Within private equity 'buyout' (where businesses are owned and operated predominantly by one private equity sponsor), companies will be managed over a number of years, typically five, and be readied for a sale. It is this 'exit' where the greatest uplift to valuations often occurs. With exits taking longer to achieve, this has had a dampening effect on private equity returns.
Compounding the woes, private equity dealmakers have long had a significant preference for 'asset light' companies - businesses which can scale quickly without significant injections of capital. Think software, data and service-based companies. With the onset of AI, these business models have faced a threat like never before. Why pay a software provider when AI can build, code and customise it for you?
Within the Growth Portfolio, HgCapital Trust (ticker: HGT) was in the eye-of-the private equity and software storm through the financial year. We had modestly increased the position into relative underperformance during the first half of the financial year, but meaningfully reduced the holding in December and January, as we witnessed the software-related issues in public markets, with HGT mostly unscathed at that point. Whilst the trust's share price bounced towards the end of the period, the trust returned -26.3% for the financial year.
Additionally, Literacy Capital (ticker: BOOK), a UK micro-cap buyout investment company managed by father-son combination Paul and Richard Pinder, returned -28.4% for the year. After an excellent few years of performance, the trust's NAV fell 5.9% as some of the larger holdings gave back some of their previous gains. However, BOOK's share price discount to NAV widened from a 15% to a 34% discount, exacerbating the negative returns to shareholders. Whilst such performance is unwelcome, Paul and Richard Pinder own a combined 39% of BOOK shares in issue and are thus heavily aligned with investor outcomes.
Within the Income Portfolio, we topped up our holding in NB Private Equity Partners in the first half of the financial year, as, in our view, the portfolio is ripe with mature businesses readied for exit. With exits taking longer to materialise, returns for the year were a positive, but pedestrian +6.1%.
What Didn't Work
Whilst we are pleased with investor outcomes in the first year of managing your Company's Portfolios, and indeed have strong conviction in their repositioned states, it would be remiss not to further reflect upon positioning which didn't work for shareholder returns.
In our meetings with investment company managers, we endeavour to get under the bonnet of their investment process and decision-making.
Within Private Equity, we believe this approach is more powerful and revealing for companies which are investing in their own funds or direct holdings, otherwise known as 'Direct Private Equity'.
It leads us away from more 'Diversified Private Equity' companies, such as Pantheon International (a full sale during the financial year) and HarbourVest Global Private Equity (not owned). These two, despite their diversified approach in a sideways market, returned +37.5% and +42.6% respectively, as their discounts to NAV closed significantly. An opportunity cost and an opportunity missed.
Moreover, sometimes investment companies can represent very little of the market we are targeting. Over the financial year, Aurora UK Alpha Trust (ticker: ARR) fell -1.4% versus a FTSE All-Share total return +21.6%. Whilst such underperformance is undoubtedly disappointing, ARR bears little resemblance to the wider UK market with an active share of close to 95% (that is, the trust owns a portfolio which is 95% different from the FTSE All-Share composition).
The uniqueness of ARR does not end there. The manager, Phoenix Asset Management, led by Gary Channon, is not paid an ongoing management fee from the trust, with the manager solely earning a performance fee, only paid if the trust outperforms the index. And even then, the performance fee is paid in ARR shares, strengthening the alignment of interest with shareholders, encouraging long termism rather than chasing short-term performance. We remain patient.
The Future Belongs to the Optimists
Our positive outlook at the start of the financial year, based on a strengthening economic backdrop and improving corporate earnings, has, at times, been tested by heightened geopolitical risks. However, the strength of corporate earnings has driven many equity market indices to new record highs, much in relation to AI and data centre supply chains.
We remain alive to any further conflict escalations in the Middle East, recognising the importance that energy pricing and energy security has on the ability for AI related profitability to continue to flourish.
Economic growth continues to remain robust in the face of, once again, heightened inflation expectations. This may have consequences for the path of interest rates as central banks decide how aggressively they need to respond to another wave of inflation.
Overall, our views remain constructive. We expect economic growth to stay positive, while earnings momentum appears strong and increasingly broad-based across sectors and regions. Narrow market leadership remains a risk, particularly given the extent to which the AI theme has driven gains in a relatively small group of companies, but the underlying profit picture is healthier than this suggests.
Against that backdrop, we continue to see the most compelling return opportunities in equities, both public and private, with selective allocations to alternatives, bonds and direct lending investment companies. From a regional perspective, we continue to favour Asia and Emerging Markets, having reallocated away from the UK throughout the financial year.
In summary, while geopolitical uncertainty may bring further market volatility, resilient growth and solid corporate fundamentals should remain the dominant forces shaping markets going forward.
We remain excited for the prospects for both the Growth and Income Portfolios, which we believe are invested in best-in-class managers, who utilise the structural advantages of investment companies and continue to drive strong shareholder returns over the longer term.
We look forward to further updating investors at the AGM in October and over the current financial year.
Adam Norris and Paul Green
Investment Managers
Columbia Threadneedle Investment Business Limited
1 September 2026
Income Statement
For the Year ended 31 May 2026
|
|
Notes |
Revenue |
Capital |
Total |
|
|
|
£'000 |
£'000 |
£'000 |
|
Gains on investments |
|
- |
32,861 |
32,861 |
|
Foreign exchange losses |
|
- |
(5) |
(5) |
|
Income |
|
5,875 |
- |
5,875 |
|
Investment management fee |
|
(303) |
(762) |
(1,065) |
|
Other expenses |
|
(722) |
- |
(722) |
|
Return on ordinary activities before finance costs and tax |
|
4,850 |
32,094
|
36,944
|
|
Finance costs |
|
(151) |
(226) |
(377) |
|
Return on ordinary activities before tax |
|
4,699
|
31,868 |
36,567 |
|
Tax on ordinary activities |
5 |
- |
- |
- |
|
Return attributable to shareholders |
|
4,699 |
31,868 |
36,567 |
|
Return per Income share - basic and diluted |
3 |
8.25p |
16.68p |
24.93p |
|
Return per Growth share - basic and diluted |
3 |
- |
66.89p |
66.89p |
The total column of this statement is the Profit and Loss Account of the Company. The supplementary revenue and capital columns are prepared under guidance published by The Association of Investment Companies.
Segmental analysis, illustrating the two separate portfolios of assets, the Income Portfolio and the Growth Portfolio, is shown in note 2 to the financial statements.
All revenue and capital items in the Income Statement derive from continuing operations.
Return attributable to shareholders represents the profit for the year and also total comprehensive income.
Income Statement
For the Year ended 31 May 2025
|
|
Notes |
Revenue |
Capital |
Total |
|
|
|
£'000 |
£'000 |
£'000 |
|
Gains on investments |
|
- |
1,600 |
1,600 |
|
Foreign exchange losses |
|
- |
(4) |
(4) |
|
Income |
|
5,075 |
- |
5,075 |
|
Investment management fee |
|
(290) |
(732) |
(1,022) |
|
Other expenses |
|
(744) |
- |
(744) |
|
Return on ordinary activities before finance costs and tax |
|
4,041 |
864
|
4,905
|
|
Finance costs |
|
(128) |
(194) |
(322) |
|
Return on ordinary activities before tax |
|
3,913
|
670 |
4,583 |
|
Tax on ordinary activities |
5 |
- |
- |
- |
|
Return attributable to shareholders |
|
3,913 |
670 |
4,583 |
|
Return per Income share - basic and diluted |
3 |
7.44p |
(2.93p) |
4.51p |
|
Return per Growth share - basic and diluted |
3 |
- |
6.33p |
6.33p |
The total column of this statement is the Profit and Loss Account of the Company. The supplementary revenue and capital columns are prepared under guidance published by The Association of Investment Companies.
Segmental analysis, illustrating the two separate portfolios of assets, the Income Portfolio and the Growth Portfolio, is shown in note 2 to the financial statements.
All revenue and capital items in the Income Statement derive from continuing activities.
Return attributable to shareholders represents the profit for the year and also total comprehensive income.
Balance Sheet
As at 31 May 2026
|
|
|
Income shares |
Growth shares |
Total |
|
|
Notes |
£'000 |
£'000 |
£'000 |
|
Fixed assets |
|
|
|
|
|
Investments at fair value |
|
84,840 |
110,981 |
195,821 |
|
|
|
|
|
|
|
Current assets |
|
|
|
|
|
Debtors |
|
392 |
256 |
648 |
|
Cash at bank and on deposit |
|
1,790 |
2,350 |
4,140 |
|
|
|
|
|
|
|
|
|
2,182 |
2,606 |
4,788 |
|
|
|
|
|
|
|
Creditors Amounts falling due within one year |
|
(7,412) |
(560) |
(7,972) |
|
|
|
|
|
|
|
Net current (liabilities)/ assets |
|
(5,230) |
2,046 |
(3,184) |
|
|
|
|
|
|
|
Net assets |
|
79,610 |
113,027 |
192,637 |
|
|
|
|
|
|
|
Capital and reserves |
|
|
|
|
|
Called-up share capital |
|
2,808 |
1,788 |
4,596 |
|
Share premium |
|
13,721 |
1,213 |
14,934 |
|
Capital redemption reserve |
|
2,700 |
2,258 |
4,958 |
|
2022 special reserve |
|
29,588 |
29,581 |
59,169 |
|
2008 special reserve |
|
19,634 |
4,637 |
24,271 |
|
Capital reserves |
|
6,959 |
73,550 |
80,509 |
|
Revenue reserve |
|
4,200 |
- |
4,200 |
|
|
|
|
|
|
|
Shareholders' funds |
|
79,610 |
113,027 |
192,637 |
|
|
|
|
|
|
|
Net asset value per share (pence) |
6 |
130.77p |
332.59p |
|
Balance Sheet
As at 31 May 2025
|
|
|
Income shares |
Growth Shares |
Total |
|
|
Notes |
£'000 |
£'000 |
£'000 |
|
Fixed assets |
|
|
|
|
|
Investments at fair value |
|
66,576 |
87,956 |
154,532 |
|
|
|
|
|
|
|
Current assets |
|
|
|
|
|
Debtors |
|
286 |
146 |
432 |
|
Cash at bank and on deposit |
|
1,332 |
3,592 |
4,924 |
|
|
|
|
|
|
|
|
|
1,618 |
3,738 |
5,356 |
|
|
|
|
|
|
|
Creditors Amounts falling due within one year |
|
(7,219) |
(289) |
(7,508) |
|
|
|
|
|
|
|
Net current (liabilities)/ assets |
|
(5,601) |
3,449 |
(2,152) |
|
|
|
|
|
|
|
Net assets |
|
60,975 |
91,405 |
152,380 |
|
|
|
|
|
|
|
Capital and reserves |
|
|
|
|
|
Called-up share capital |
|
2,481 |
1,787 |
4,268 |
|
Share premium |
|
5,197 |
476 |
5,673 |
|
Capital redemption reserve |
|
2,699 |
2,258 |
4,957 |
|
2022 special reserve |
|
29,588 |
29,581 |
59,169 |
|
2008 special reserve |
|
19,681 |
6,122 |
25,803 |
|
Capital reserves |
|
(2,540) |
51,181 |
48,641 |
|
Revenue reserve |
|
3,869 |
- |
3,869 |
|
|
|
|
|
|
|
Shareholders' funds |
|
60,975 |
91,405 |
152,380 |
|
|
|
|
|
|
|
Net asset value per share (pence) |
6 |
113.36p |
265.86p |
|
Cash Flow Statement
Year ended 31 May 2026
|
|
Notes |
Income shares |
Growth shares |
Total |
|
|
|
£'000 |
£'000 |
£'000 |
|
|
|
|
|
|
|
Net cash outflow from operations before dividends and interest |
|
(740) |
(1,026) |
(1,766) |
|
Dividends received |
|
3,717 |
1,826 |
5,543 |
|
Interest received |
|
64 |
92 |
156 |
|
Interest paid |
|
(365) |
- |
(365) |
|
Net cash inflow from operating activities |
|
2,676 |
892 |
3,568 |
|
Investing activities |
|
|
|
|
|
Purchases of investments |
|
(38,823) |
(55,391) |
(94,214) |
|
Sales of investments |
|
32,234 |
53,897 |
86,131 |
|
Net cash flows from investing activities |
|
(6,589) |
(1,494) |
(8,083) |
|
Net cash flows before financing activities |
|
(3,913) |
(602) |
(4,515) |
|
Financing activities |
|
|
|
|
|
Equity dividends paid Proceeds from issuance of new shares |
4 |
(4,368) 8,780 |
- - |
(4,368) 8,780 |
|
Share conversion - Income to Growth |
|
(305) |
305 |
- |
|
Share conversion - Growth to Income |
|
258 |
(258) |
- |
|
Shares purchased to be held in treasury |
|
(238) |
(4,648) |
(4,886) |
|
Sale of shares from treasury |
|
244 |
3,854 |
4,098 |
|
Fixed rate term loan repaid |
|
- |
- |
- |
|
Revolving credit facility drawdown |
|
- |
|
- |
|
Net cash flows from financing activities |
|
4,371 |
(747) |
3,624 |
|
Net movement in cash and cash equivalents |
|
458 |
(1,349) |
(891) |
|
Cash and cash equivalents at the beginning of the year |
|
1,332 |
3,592 |
4,924 |
|
Cash and cash equivalents at the end of the year |
|
1,790 |
2,243 |
4,033 |
|
Represented by: Cash/ (overdraft) at bank Short-term deposits |
|
210 1,580 |
(107) 2,350 |
103 3,930 |
|
|
|
1,790 |
2,243 |
4,033 |
Cash Flow Statement
Year ended 31 May 2025
|
|
Notes |
Income shares |
Growth shares |
Total |
|
|
|
£'000 |
£'000 |
£'000 |
|
|
|
|
|
|
|
Net cash outflow from operations before dividends and interest |
|
(732) |
(1,054) |
(1,786) |
|
Dividends received |
|
3,365 |
1,610 |
4,975 |
|
Interest received |
|
57 |
113 |
170 |
|
Interest paid |
|
(334) |
- |
(334) |
|
Net cash inflow from operating activities |
|
2,356 |
669 |
3,025 |
|
Investing activities |
|
|
|
|
|
Purchases of investments |
|
(5,938) |
(6,359) |
(12,297) |
|
Sales of investments |
|
5,374 |
11,848 |
17,222 |
|
Net cash flows from investing activities |
|
(564) |
5,489 |
4,925 |
|
Net cash flows before financing activities |
|
1,792 |
6,158 |
7,950 |
|
Financing activities |
|
|
|
|
|
Equity dividends paid Proceeds from issuance of new shares |
|
(3,947) 2,064 |
- - |
(3,947) 2,064 |
|
Share conversion - Income to Growth |
|
(210) |
210 |
- |
|
Share conversion - Growth to Income |
|
433 |
(433) |
- |
|
Shares purchased to be held in treasury |
|
(58) |
(3,219) |
(3,277) |
|
Sale of shares from treasury |
|
58 |
400 |
458 |
|
Fixed rate term loan repaid |
|
(5,000) |
- |
(5,000) |
|
Revolving credit facility drawdown |
|
5,000 |
|
5,000 |
|
Net cash flows from financing activities |
|
(1,660) |
(3,042) |
(4,702) |
|
Net movement in cash and cash equivalents |
|
132 |
3,116 |
3,248 |
|
Cash and cash equivalents at the beginning of the year |
|
1,200 |
476 |
1,676 |
|
Cash and cash equivalents at the end of the year |
|
1,332 |
3,592 |
4,924 |
|
Represented by: Cash at bank Short-term deposits |
|
192 1,140 |
52 3,540 |
244 4,680 |
|
|
|
1,332 |
3,592 |
4,924 |
Statement of Changes in Equity
For the Year ended 31 May 2026
|
Income shares |
Share capital £'000 |
Share premium £'000 |
Capital redemption reserve £'000 |
2022 special reserve £'000 |
2008 special reserve £'000 |
Capital reserves £'000 |
Revenue reserve £'000 |
Total shareholders' funds £'000 |
|
|
As at 31 May 2025 |
2,481 |
5,197 |
2,699 |
29,588 |
19,681 |
(2,540) |
3,869 |
60,975 |
|
|
Increase in share capital in issue, net of share issuance expenses |
329 |
8,517 |
- |
- |
- |
- |
- |
8,846 |
|
|
Shares purchased for treasury |
- |
- |
- |
- |
(238) |
- |
- |
(238) |
|
|
Sale of shares from treasury |
- |
- |
- |
- |
244 |
- |
- |
244 |
|
|
Profit on sale of treasury shares |
- |
7 |
- |
- |
(7) |
- |
- |
- |
|
|
Share conversion |
(1) |
- |
- |
- |
(46) |
- |
- |
(47) |
|
|
Cancellation of deferred shares |
(1) |
- |
1 |
- |
- |
- |
- |
- |
|
|
Transfer of net income from Growth to Income Portfolio |
- |
- |
- |
- |
- |
- |
1,486 |
1,486 |
|
|
Transfer of capital from Income to Growth Portfolio |
- |
- |
- |
- |
- |
(1,486) |
- |
(1,486) |
|
|
Dividends paid |
- |
- |
- |
- |
- |
- |
(4,368) |
(4,368) |
|
|
Return attributable to shareholders |
- |
- |
- |
- |
- |
10,985 |
3,213 |
14,198 |
|
|
As at 31 May 2026 |
2,808 |
13,721
|
2,700
|
29,588 |
19,634
|
6,959
|
4,200
|
79,610
|
|
|
Growth shares |
|
|
|
|
|
|
|
|
|
|
As at 31 May 2025 |
1,787 |
476 |
2,258 |
29,581 |
6,122 |
51,181 |
- |
91,405 |
|
|
Increase in share capital in issue, net of share issuance expenses |
- |
- |
- |
- |
- |
- |
- |
- |
|
|
Shares purchased for treasury |
- |
- |
- |
- |
(4,648) |
- |
- |
(4,648) |
|
|
Sale of shares from treasury |
- |
- |
- |
- |
3,854 |
- |
- |
3,854 |
|
|
Profit on sale of treasury shares |
- |
737 |
- |
- |
(737) |
- |
- |
- |
|
|
Share conversion |
1 |
- |
- |
- |
46 |
- |
- |
47 |
|
|
Cancellation of deferred shares |
- |
- |
- |
- |
- |
- |
- |
- |
|
|
Transfer of net income from Growth to Income Portfolio |
- |
- |
- |
- |
- |
- |
(1,486) |
(1,486) |
|
|
Transfer of capital from Income to Growth Portfolio |
- |
- |
- |
- |
- |
1,486 |
- |
1,486 |
|
|
Return attributable to shareholders |
- |
- |
- |
- |
- |
20,883 |
1,486 |
22,369 |
|
|
As at 31 May 2026 |
1,788 |
1,213 |
2,258 |
29,581 |
4,637 |
73,550 |
- |
113,027 |
|
|
Total Company |
|
|
|
|
|
|
|
|
|
|
As at 31 May 2025 |
4,268 |
5,673 |
4,957 |
59,169 |
25,803 |
48,641 |
3,869 |
152,380 |
|
|
Increase in share capital in issue, net of share issuance expenses |
329 |
8,517 |
- |
- |
- |
- |
- |
8,846 |
|
|
Shares purchased for treasury |
- |
- |
- |
- |
(4,886) |
- |
- |
(4,886) |
|
|
Sale of shares from treasury |
- |
- |
- |
- |
4,098 |
- |
- |
4,098 |
|
|
Profit on sale of treasury shares |
- |
744 |
- |
- |
(744) |
- |
- |
- |
|
|
Share conversion |
- |
- |
- |
- |
- |
- |
- |
- |
|
|
Cancellation of deferred shares |
(1) |
- |
1 |
- |
- |
- |
- |
- |
|
|
Dividends paid |
- |
- |
- |
- |
- |
- |
(4,368) |
(4,368) |
|
|
Return attributable to shareholders |
- |
- |
- |
- |
- |
31,868 |
4,699 |
36,567 |
|
|
Total Company as at 31 May 2026 |
4,596 |
14,934 |
4,958 |
59,169 |
24,271 |
80,509 |
4,200 |
192,637 |
|
Statement of Changes in Equity
For the Year ended 31 May 2025
|
Income shares |
Share capital £'000 |
Share premium £'000 |
Capital redemption reserve £'000 |
2022 special reserve £'000 |
2008 special reserve £'000 |
Capital reserves £'000 |
Revenue reserve £'000 |
Total shareholders' funds £'000 |
|
|
As at 31 May 2024 |
3,134 |
3,223 |
1,950 |
29,588 |
19,464 |
(998) |
3,903 |
60,264 |
|
|
Increase in share capital in issue, net of share issuance expenses |
90 |
1,974 |
- |
- |
- |
- |
- |
2,064 |
|
|
Shares purchased for treasury |
- |
- |
- |
- |
(58) |
- |
- |
(58) |
|
|
Sale of shares from treasury |
- |
- |
- |
- |
58 |
- |
- |
58 |
|
|
Share conversion |
6 |
- |
- |
- |
217 |
- |
- |
223 |
|
|
Cancellation of deferred shares |
(749) |
- |
749 |
- |
- |
- |
- |
- |
|
|
Transfer of net income from Growth to Income Portfolio |
- |
- |
- |
- |
- |
- |
1,109 |
1,109 |
|
|
Transfer of capital from Income to Growth Portfolio |
- |
- |
- |
- |
- |
(1,109) |
- |
(1,109) |
|
|
Dividends paid |
- |
- |
- |
- |
- |
- |
(3,947) |
(3,947) |
|
|
Return attributable to shareholders |
- |
- |
- |
- |
- |
(433) |
2,804 |
2,371 |
|
|
As at 31 May 2025 |
2,481 |
5,197
|
2,699
|
29,588 |
19,681
|
(2,540)
|
3,869
|
60,975
|
|
|
Growth shares |
|
|
|
|
|
|
|
|
|
|
As at 31 May 2024 |
2,353 |
428 |
1,698 |
29,581 |
9,206 |
48,969 |
- |
92,235 |
|
|
Increase in share capital in issue, net of share issuance expenses |
- |
- |
- |
- |
- |
- |
- |
- |
|
|
Shares purchased for treasury |
- |
- |
- |
- |
(3,219) |
- |
- |
(3,219) |
|
|
Sale of shares from treasury |
- |
- |
- |
- |
400 |
- |
- |
400 |
|
|
Profit on sale of treasury shares |
- |
48 |
- |
- |
(48) |
- |
- |
- |
|
|
Share conversion |
(6) |
- |
- |
- |
(217) |
- |
- |
(223) |
|
|
Cancellation of deferred shares |
(560) |
- |
560 |
- |
- |
- |
- |
- |
|
|
Transfer of net income from Growth to Income Portfolio |
- |
- |
- |
- |
- |
- |
(1,109) |
(1,109) |
|
|
Transfer of capital from Income to Growth Portfolio |
- |
- |
- |
- |
- |
1,109 |
- |
1,109 |
|
|
Return attributable to shareholders |
- |
- |
- |
- |
- |
1,103 |
1,109 |
2,212 |
|
|
As at 31 May 2025 |
1,787 |
476 |
2,258 |
29,581 |
6,122 |
51,181 |
- |
91,405 |
|
|
Total Company |
|
|
|
|
|
|
|
|
|
|
As at 31 May 2024 |
5,487 |
3,651 |
3,648 |
59,169 |
28,670 |
47,971 |
3,903 |
152,499 |
|
|
Increase in share capital in issue, net of share issuance expenses |
90 |
1,974 |
- |
- |
- |
- |
- |
2,064 |
|
|
Shares purchased for treasury |
- |
- |
- |
- |
(3,277) |
- |
- |
(3,277) |
|
|
Sale of shares from treasury |
- |
- |
- |
- |
458 |
- |
- |
458 |
|
|
Profit on sale of treasury shares |
- |
48 |
- |
- |
(48) |
- |
- |
- |
|
|
Share conversion |
- |
- |
- |
- |
- |
- |
- |
- |
|
|
Cancellation of deferred shares |
(1,309) |
- |
1,309 |
- |
- |
- |
- |
- |
|
|
Dividends paid |
- |
- |
- |
- |
- |
- |
(3,947) |
(3,947) |
|
|
Return attributable to shareholders |
- |
- |
- |
- |
- |
670 |
3,913 |
4,583 |
|
|
Total Company as at 31 May 2025 |
4,268 |
5,673 |
4,957 |
59,169 |
25,803 |
48,641 |
3,869 |
152,380 |
|
Principal Risks and Uncertainties
As an investment company investing primarily in listed securities, most of the Company's principal risks and uncertainties that could threaten the achievement of its objectives and strategy, and its future performance, liquidity and solvency, are market-related.
A summary of the Company's risk management and internal control arrangements is included within the Report of the Audit Committee in the Annual Report and Financial Statements. By means of the procedures set out in that summary, the Board has established an ongoing process for identifying, evaluating and managing the significant risks faced by the Company. The Board also considers emerging risks which might affect the Company and related updates from the Manager on such risks are also considered. During the year, significant risks included the outlook for inflation, ongoing macroeconomic and geopolitical concerns and the impact on financial markets of US trade tariffs and the US/Iran conflict. Any emerging risks that are identified and considered to be of significance are included on the Company's risk register with any mitigations. These significant risks, emerging risks and other risks are regularly reviewed throughout the year by the Audit Committee and the Board. The Audit Committee and the Board have also regularly reviewed the effectiveness of the Company's risk management and internal control systems for the period.
The principal risks and uncertainties faced by the Company, and the Board's mitigation approach, are described below.
Market risk
The Company's assets consist mainly of listed closed-end investment companies and its principal risks are therefore market-related and include market risk (comprising currency risk, interest rate risk and other price risk), liquidity risk and credit risk.
Climate change may also have an impact on investee companies in the coming years.
Uncertainty in markets, with events such as the US/Iran conflict and the impact on financial markets of US trade tariffs, together with macroeconomic and geopolitical concerns, have led to volatility in the Company's NAV.
No change in overall risk during the year, but, given macroeconomic and geopolitical concerns, this risk remains heightened.
Mitigation
The Board regularly considers the composition and diversification of each Portfolio and considers individual stock performance together with purchases and sales of investments. Investments and markets are discussed with the Manager on a regular basis.
Engagement on financially material environmental, social and governance matters is undertaken by the Manager and its approach is explained on pages 19 to 20 of the Annual Report and Financial Statements.
The Board has, in particular, considered the impact of market volatility, macroeconomic and geopolitical concerns and inflation and they are discussed in the Chairman's Statement and Investment Managers' Review. As a closed-end investment company, the Company is not constrained by asset sales to meet redemptions so can remain invested through volatile market conditions and is well suited to investors seeking longer-term returns.
An explanation of market risk and the way in which it is managed is contained in notes 18 to 23 to the financial statements in the Annual Report and Financial Statements.
Investment performance risk
Incorrect strategy, asset allocation, stock selection (in the context of the market, economic or geopolitical backdrop) and the use of gearing could all lead to poor returns for shareholders.
No change in overall risk during the year, but, given macroeconomic and geopolitical concerns, this risk remains heightened.
Mitigation
The investment strategy and performance against peers and relevant indices are considered by the Board at each meeting and reviewed with the Manager. The Board is responsible for setting the gearing range within which the Manager may operate and gearing is discussed at every meeting and related covenant limits are closely monitored. The Manager's Investment Risk team provide oversight on investment risk management.
The Portfolios are diversified and principally comprise listed closed-end investment companies and their compositions are reviewed regularly by the Board.
Underlying dividends from investee companies are also closely monitored and the revenue reserve and the 2022 special reserve attributable to the Income Portfolio can be drawn on to support the payment of dividends to Income shareholders.
If required, the Board can hold additional meetings at short notice to discuss any significant matters.
Third party service delivery and cyber risk
Failure of the Manager as the Company's main service provider or disruption to its business, or that of any other outsourced or third party service provider, could lead to an inability to provide accurate reporting and monitoring or a misappropriation of assets, leading to a potential breach of the Company's investment mandate or loss of shareholders' confidence.
The risk includes failure or disruption as a consequence of external events such as the COVID-19 pandemic.
External cyber attacks could cause such failure or could lead to the loss or sabotage of data.
No change in overall risk during the year.
Mitigation:
The Board meets regularly with the management of the Manager and its Operational Risk team to review internal control and risk reports, which includes oversight of the Manager's own third party service providers. During the year, the Audit Committee also met with a representative of the Manager's internal audit function to discuss the outcome of its recent projects and planned activities. The Manager's appointment is reviewed annually and the contract can be terminated with six months' notice. The Manager has a business continuity plan in place to ensure that it is able to respond quickly and effectively to an unplanned event that could affect the continuity of its business.
The Manager has outsourced certain administrative functions (such as fund accounting services) to State Street Bank and Trust Company ('State Street') and supervision of such third party service providers, including the administrator of the Manager's savings plans, has been maintained by the Manager. This includes the review of IT security and heightened cyber threats.
The Manager also closely monitors the performance of its technology platform to ensure it is functioning within acceptable service levels. Periodically, the Audit Committee receives a presentation from the Manager's Information Security team on its information and cyber security programme.
The Board receives quarterly reports from the Depositary confirming safe custody of the Company's assets and cash and holdings are reconciled to the Custodian's records. The Custodian's internal controls reports are also reviewed by the Manager and key points reported to the Audit Committee. The Board also receives periodic updates from the Custodian on its own cyber security controls.
The Depositary is specifically liable for loss of any of the Company's assets that constitute financial instruments under the AIFM Directive.
Viability Assessment and Statement
In accordance with the UK Corporate Governance Code, the Board is required to assess the future prospects for the Company and considered that a number of characteristics of the Company's business model and strategy were relevant to this assessment:
· The Company's investment objective and policy, which are subject to regular Board monitoring, means that the Company is invested in two actively managed, diversified Portfolios comprising principally holdings in listed closed-end investment companies and the level of borrowing is restricted.
· The Company's investments are principally in listed securities which are traded in the UK on the London Stock Exchange's Main Market or other regulated exchanges and which are expected to be readily realisable.
· The Company is a listed closed-end investment company whose shares are not subject to redemptions by shareholders.
· Subject to shareholder continuation votes, the next of which will be at the AGM in 2028 and five yearly thereafter, the Company's business model and strategy is not time-limited.
Also relevant were a number of aspects of the Company's operational arrangements:
· The Company retains title to all assets held by the Custodian under the terms of a formal agreement with the Custodian and Depositary.
· The borrowing facility, which remains available until February 2027, is subject to a formal agreement, including financial covenants with which the Company complied in full during the year.
· Revenue and expenditure forecasts are reviewed by the Directors at each Board meeting.
· The operational robustness of key service providers and the effectiveness of alternative working arrangements.
· Alternative service providers can be engaged at relatively short notice if necessary.
The Directors also considered:
· The level of ongoing charges incurred by the Company which are modest and predictable and, excluding the ongoing charges of underlying funds, total 1.03% and 1.07% of average net assets (at 31 May 2026) for the Growth shares and Income shares respectively.
· Future revenue and expenditure projections.
· The Company's ability to meet liquidity requirements given its investment Portfolios consist principally of listed investment companies which can be realised if required.
· The ability to undertake share buy-backs if required and the Board's aim, in normal market conditions, of using buy-backs to maintain the discount to NAV at which the Company's shares trade at not more than 5%.
· Whether the Company's investment objective and policy continue to be relevant to investors.
· Directors are non-executive and the Company has no employees and consequently the Company does not have potential redundancy or other employment-related liabilities or responsibilities.
· The uncertainty in markets and macroeconomic and geopolitical concerns and the prospects for the Company's investment Portfolios.
These matters were assessed over a five year period to September 2031, and the Board will continue to assess viability over rolling five year periods. A rolling five year period represents the horizon over which the Directors believe they can form a reasonable expectation of the Company's prospects, although they do have due regard to viability over the longer term.
In considering the viability of the Company, the Directors carried out a robust assessment of the principal risks and uncertainties which could threaten the Company's objective and strategy, future performance and solvency. The assessment also included a number of stress tests and scenarios which considered the impact of inflation and the impact of market volatility and a significant fall in equity markets on the Company's investment Portfolios over a five year period. These risks, their mitigations and the processes for monitoring them are set out in Principal Risks and Uncertainties and in the Report of the Audit Committee and in notes 18 to 23 to the financial statements in the Annual Report and Financial Statements.
The results demonstrated the impact on the Company's net assets and its expenses and its ability to meet its liabilities over that period and adhere to its financial covenants.
Based on their assessment, and in the context of the Company's business model, strategy and operational arrangements set out above, the Directors have a reasonable expectation that the Company will be able to continue in operation and meet its liabilities as they fall due over the five year period to September 2031.
Responsibility Statement of the Directors in Respect of the Annual Report and Financial Statements
We confirm that to the best of our knowledge:
· the financial statements, prepared in accordance with the applicable set of accounting standards, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company;
· the Strategic Report and the Report of the Directors include 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 the Company faces; and
· we consider the Annual Report and Financial Statements, 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.
On behalf of the Board
David Warnock
Chairman
1 September 2026
Notes
1. These financial statements of the Company, which are the responsibility of, and were approved by, the Board on 1 September 2026, have been prepared on a going concern basis in accordance with the Disclosure Guidance and Transparency Rules of the Financial Conduct Authority, Financial Reporting Standards (FRS 102) and the Statement of Recommended Practice (SORP) "Financial Statements of Investment Trust Companies and Venture Capital Trusts" issued by The Association of Investment Companies (AIC). The audited financial statements for the Company comprise the Income Statement and the total columns of the Balance Sheet, the Cash Flow Statement and the Statement of Changes in Equity and the Company totals shown in the notes to the financial statements. The analysis showing the two separate Portfolios of assets attributable to the Income shares and Growth shares is disclosed to assist shareholders' understanding, but is additional to that required. The Company's capital structure is explained in the Capital Structure section on page 90 of the Annual Report and Financial Statements.
There have been no significant changes to the Company's accounting policies during the year ended 31 May 2026.
The preparation of the Company's financial statements on occasion requires management to make judgements, estimates and assumptions that affect the reported amounts in the primary financial statements and accompanying disclosures. These assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in the current or future periods, depending on the circumstance. Management do not believe that any significant accounting judgements or estimates have been applied to this set of financial statements that have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities within the next financial year.
The Company's assets consist mainly of equity shares in closed-end investment companies which are traded on a UK or other Regulated Stock Exchange and in most circumstances, including in the current market environment, are expected to be readily realisable.
The Company has a £10 million unsecured revolving credit facility, which is available until 10 February 2027. The Board has set limits for borrowing and regularly reviews the Company's gearing levels and its compliance with bank covenants. The Board has considered the Company's principal risks and uncertainties and other matters, and has considered a number of stress tests and scenarios which considered the impact of severe stock market volatility on shareholders' funds and demonstrated that if required the Company had the ability to raise sufficient funds so as to remain within its debt covenants and meet its liabilities.
As such, and in light of the controls and review processes in place and the operational robustness of key service providers, and bearing in mind the nature of the Company's business and assets and revenue and expenditure projections, the Directors believe that the Company has adequate resources to continue in operational existence for a period of at least twelve months from the date of approval of the financial statements. For this reason, the Board continues to adopt the going concern basis in preparing the financial statements.
2. Segmental Analysis
The Company carries on business as an investment trust and manages two separate Portfolios of assets: the Income Portfolio and the Growth Portfolio. The Company's Income Statement can be analysed as follows. This has been disclosed to assist shareholders' understanding, but this analysis is additional to that required.
Year ended 31 May 2026
|
|
Income Portfolio |
Growth Portfolio |
Total |
||||||
|
|
Revenue |
Capital |
Total |
Revenue |
Capital |
Total |
Revenue |
Capital |
Total |
|
|
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
|
|
|
|
|
|
|
|
|
|
|
|
Gains on investments |
- |
11,481 |
11,481 |
- |
21,380 |
21,380 |
- |
32,861 |
32,861 |
|
Foreign exchange losses |
- |
(2) |
(2) |
- |
(3) |
(3) |
- |
(5) |
(5) |
|
Income |
3,840 |
- |
3,840 |
2,035 |
- |
2,035 |
5,875 |
- |
5,875 |
|
Investment management fee |
(180) |
(268) |
(448) |
(123) |
(494) |
(617) |
(303) |
(762) |
(1,065) |
|
Other expenses |
(296) |
- |
(296) |
(426) |
- |
(426) |
(722) |
- |
(722) |
|
Return on ordinary activities before finance costs and tax |
3,364 |
11,211 |
14,575 |
1,486 |
20,883 |
22,369 |
4,850 |
32,094 |
36,944 |
|
Finance costs |
(151) |
(226) |
(377) |
- |
- |
- |
(151) |
(226) |
(377) |
|
Return on ordinary activities before tax |
3,213 |
10,985 |
14,198 |
1,486 |
20,883 |
22,369 |
4,699 |
31,868 |
36,567 |
|
Tax on ordinary activities |
- |
- |
- |
- |
- |
- |
- |
- |
- |
|
Return (1) |
3,213 |
10,985 |
14,198 |
1,486 |
20,883 |
22,369 |
4,699 |
31,868 |
36,567 |
Year ended 31 May 2025
|
|
Income Portfolio |
Growth Portfolio |
Total |
||||||
|
|
Revenue |
Capital |
Total |
Revenue |
Capital |
Total |
Revenue |
Capital |
Total |
|
|
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
|
|
|
|
|
|
|
|
|
|
|
|
Gains on investments |
- |
22 |
22 |
- |
1,578 |
1,578 |
- |
1,600 |
1,600 |
|
Foreign exchange losses |
- |
(4) |
(4) |
- |
- |
- |
- |
(4) |
(4) |
|
Income |
3,404 |
- |
3,404 |
1,671 |
- |
1,671 |
5,075 |
- |
5,075 |
|
Investment management fee |
(171) |
(257) |
(428) |
(119) |
(475) |
(594) |
(290) |
(732) |
(1,022) |
|
Other expenses |
(301) |
- |
(301) |
(443) |
- |
(443) |
(744) |
- |
(744) |
|
Return on ordinary activities before finance costs and tax |
2,932 |
(239) |
2,693 |
1,109 |
1,103 |
2,212 |
4,041 |
864 |
4,905 |
|
Finance costs |
(128) |
(194) |
(322) |
- |
- |
- |
(128) |
(194) |
(322) |
|
Return on ordinary activities before tax |
2,804 |
(433) |
2,371 |
1,109 |
1,103 |
2,212 |
3,913 |
670 |
4,583 |
|
Tax on ordinary activities |
- |
- |
- |
- |
- |
- |
- |
- |
- |
|
Return (1) |
2,804 |
(433) |
2,371 |
1,109 |
1,103 |
2,212 |
3,913 |
670 |
4,583 |
(1) Any net revenue return attributable to the Growth Portfolio is transferred to the Income Portfolio and a corresponding transfer of an identical amount of capital is made from the Income Portfolio to the Growth Portfolio and accordingly the whole return in the Growth Portfolio is capital. Refer to the Statement of Changes in Equity.
3. Return per share
The return per share for the year ended 31 May 2026 is as follows:
|
|
Income shares |
Growth shares |
||||
|
|
Revenue |
Capital |
Total |
Revenue |
Capital |
Total |
|
|
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
|
Return attributable to Portfolios |
3,213 |
10,985 |
14,198 |
1,486 |
20,883 |
22,369 |
|
Transfer of net income from Growth Portfolio to Income Portfolio |
1,486 |
- |
1,486 |
(1,486) |
- |
(1,486) |
|
Transfer of capital from Income Portfolio to Growth Portfolio |
- |
(1,486) |
(1,486) |
- |
1,486 |
1,486 |
|
Return attributable to shareholders |
4,699 |
9,499
|
14,198 |
- |
22,369 |
22,369 |
|
Return per share |
8.25p |
16.68p |
24.93p |
- |
66.89p |
66.89p |
|
Weighted average number of shares in issue during the year (excluding shares held in treasury) |
56,937,208 |
33,439,719 |
||||
The return per share for the year ended 31 May 2025 is as follows:
|
|
Income shares |
Growth shares |
||||
|
|
Revenue |
Capital |
Total |
Revenue |
Capital |
Total |
|
|
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
|
Return attributable to Portfolios |
2,804 |
(433) |
2,371 |
1,109 |
1,103 |
2,212 |
|
Transfer of net income from Growth Portfolio to Income Portfolio |
1,109 |
- |
1,109 |
(1,109) |
- |
(1,109) |
|
Transfer of capital from Income Portfolio to Growth Portfolio |
- |
(1,109) |
(1,109) |
- |
1,109 |
1,109 |
|
Return attributable to shareholders |
3,913 |
(1,542)
|
2,371 |
- |
2,212 |
2,212 |
|
Return per share |
7.44p |
(2.93p) |
4.51p |
- |
6.33p |
6.33p |
|
Weighted average number of shares in issue during the year (excluding shares held in treasury) |
52,569,505 |
34,946,339 |
||||
4. Dividends
|
|
|
|
2026 Income shares Total |
|
Dividends on Income shares |
Register date |
Payment date |
£'000 |
|
|
|
|
|
|
Amounts recognised as distributions during the year:
|
|
|
|
|
For the year ended 31 May 2025 |
|
|
|
|
- fourth interim dividend of 2.05p per Income share |
13 June 2025 |
11 July 2025 |
1,105 |
|
For the year ended 31 May 2026 |
|
|
|
|
- first interim dividend of 1.90p per Income share |
12 September 2025 |
10 October 2025 |
1,036 |
|
- second interim dividend of 1.90p per Income share |
12 December 2025 |
16 January 2026 |
1,087 |
|
- third interim dividend of 1.90p per Income share |
13 March 2026 |
17 April 2026 |
1,140 |
|
|
|
|
4,368 |
|
|
|
|
|
|
Amounts relating to the year but not paid at the year end:
|
|
|
|
|
- fourth interim dividend of 2.15p per Income share |
12 June 2026 |
10 July 2026 |
1,312 |
The fourth interim dividend of 2.15p per Income share was paid on 10 July 2026 to shareholders on the register on 12 June 2026, with an ex-dividend date of 11 June 2026.
The Growth shares do not carry an entitlement to receive dividends.
5. (a) Tax on ordinary activities
Year ended 31 May 2026
|
|
Income Portfolio |
Growth Portfolio |
Total |
||||||
|
|
Revenue |
Capital |
Total |
Revenue |
Capital |
Total |
Revenue |
Capital |
Total |
|
|
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
|
|
|
|
|
|
|
|
|
|
|
|
Current tax charge for the year being taxation on ordinary activities |
- |
- |
- |
- |
- |
- |
- |
- |
- |
Year ended 31 May 2025
|
|
Income Portfolio |
Growth Portfolio |
Total |
||||||
|
|
Revenue |
Capital |
Total |
Revenue |
Capital |
Total |
Revenue |
Capital |
Total |
|
|
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
|
|
|
|
|
|
|
|
|
|
|
|
Current tax charge for the year being taxation on ordinary activities |
- |
- |
- |
- |
- |
- |
- |
- |
- |
(b) Reconciliation of tax charge
|
|
|
2026 |
||
|
|
|
Income shares |
Growth shares |
Total |
|
|
|
£'000 |
£'000 |
£'000 |
|
Gain on ordinary activities before tax: |
|
14,198 |
22,369 |
36,567 |
|
Corporation tax at standard rate of 25% |
|
3,550 |
5,592 |
9,142 |
|
Effects of: |
|
|
|
|
|
Gains on investments not taxable |
|
(2,870) |
(5,344) |
(8,214) |
|
Non-taxable UK dividend income |
|
(488) |
(440) |
(928) |
|
Non-taxable overseas dividend income |
|
(326) |
(46) |
(372) |
|
Expenses not utilised |
|
134 |
238 |
372 |
|
Tax charge (note 5 (a)) |
|
- |
- |
- |
|
|
|
|
|
|
6. The net asset value per Income share is calculated on net assets of £79,610,000 (2025: £60,975,000), divided by 60,877,194 (2025: 53,790,518) Income shares, being the number of Income shares in issue at the year-end (excluding any shares held in treasury).
The net asset value per Growth share is calculated on net assets of £113,027,000 (2025: £91,405,000), divided by 33,983,710 (2025: 34,381,161) Growth shares, being the number of Growth shares in issue at the year-end (excluding any shares held in treasury).
7. During the year, the Company issued 7,125,000 (2025: 1,870,000) Income shares from the block listing facility receiving net proceeds of £8,846,000 (2025: £2,064,000).
During the year, the Company bought back 200,000 (2025: 50,000) Income shares through the market for treasury at a cost of £238,000 (2025: £58,000). During the year, the Company resold 200,000 (2025: 50,000) Income shares from treasury receiving net proceeds of £244,000 (2025: £58,000).
During the year, valid conversion notices were received to convert 248,593 Income shares (2025: 185,555 Income shares) (which represented a value of £305,000 (2025: £210,000)). These were converted into 100,864 Growth shares (2025: 81,313 Growth shares) in accordance with the Company's Articles and by reference to the ratio of the relative underlying net asset values of the Growth shares and Income shares on the conversion date.
The Company's Articles allow for Deferred shares to be allotted as part of the share conversion to ensure that the conversion does not result in a reduction of the aggregate par value of the Company's issued share capital. The Deferred shares were subsequently repurchased by the Company for nil consideration (as they have no economic value) and as authorised by shareholders at the October 2025 AGM.
Since the year end, the Company has issued a further 725,000 Income shares from the block listing facility receiving net proceeds of £958,000 and bought back 50,000 Income shares for treasury at a cost of £64,000.
8. During the year, the Company bought back 1,678,000 (2025: 1,255,000) Growth shares through the market for treasury at a cost of £4,648,000 (2025: £3,219,000). During the year, the Company resold 1,265,000 (2025: 150,000) Growth shares from treasury receiving net proceeds of £3,854,000 (2025: £400,000).
During the year, valid conversion notices were received to convert 85,315 Growth shares (2025: 167,760 Growth shares) (which represented a value of £258,000 (2025: £433,000)). These were converted into 210,269 Income shares (2025: 382,822 Income shares) in accordance with the Company's Articles and by reference to the ratio of the relative underlying net asset values of the Growth shares and Income shares on the conversion date.
The Company's Articles allow for Deferred shares to be allotted as part of the share conversion to ensure that the conversion does not result in a reduction of the aggregate par value of the Company's issued share capital. The Deferred shares were subsequently repurchased by the Company for nil consideration (as they have no economic value) and as authorised by shareholders at the October 2025 AGM.
Since the year end, the Company has bought back a further 220,000 Growth shares for treasury at a cost of £714,000.
9. Financial Instruments
The Company's financial instruments comprise its investment Portfolios, cash balances, bank borrowings and debtors and creditors that arise directly from its operations. The Company, which is an investment trust, holds two Portfolios of financial assets in pursuit of its investment objective.
Listed and quoted fixed asset investments held are valued at fair value.
The fair value of the financial assets and liabilities of the Company at 31 May 2026 and 31 May 2025 is not materially different from their carrying value in the financial statements.
The main risks that the Company faces arising from its financial instruments are:
(i) market price risk, being the risk that the value of investment holdings will fluctuate as a result of changes in market prices caused by factors other than interest rate or currency rate movements;
(ii) interest rate risk, being the risk that the future cash flows of a financial instrument will fluctuate because of changes in market interest rates;
(iii) foreign currency risk, being the risk that the value of investment holdings, investment purchases, investment sales and income will fluctuate because of movements in currency rates;
(iv) credit risk, being the risk that a counterparty to a financial instrument will fail to discharge an obligation or commitment that it has entered into with the Company; and
(v) liquidity risk, being the risk that the Company may not be able to liquidate its investments quickly or otherwise raise funds to meet financial commitments.
Market Price Risk
The management of market price risk is part of the fund management process and is typical of equity and debt investment. The Portfolios are managed with an awareness of the effects of adverse price movements through detailed and continuing analysis with an objective of maximising overall returns to shareholders.
Interest Rate Risk
Floating Rate
When the Company retains cash balances the majority of the cash is held in variable rate bank accounts yielding rates of interest linked to the UK base rate which was 3.75% at 31 May 2026 (2025: 4.25%). There are no other assets which are directly exposed to floating interest rate risk.
When the Company draws down amounts under its revolving credit facility, interest is payable based on SONIA (which can vary on a daily basis) plus a margin.
Fixed Rate
Movements in market interest rates will affect the market value of fixed interest investments. Neither the Income Portfolio nor the Growth Portfolio holds any fixed interest investments.
Foreign Currency Risk
The Company may invest in overseas securities which give rise to currency risks. At 31 May 2026, the Income Portfolio had Euro denominated investments valued at £1,190,000 (2025: £1,603,000), and a US Dollar denominated investment valued at £1,979,000 (2025: £1,167,000). At 31 May 2026, the Growth Portfolio had a US Dollar denominated investment valued at £3,253,000 (2025: £946,000).
As the remainder of the Company's investments and all other assets and liabilities are denominated in sterling there is no other direct foreign currency risk. However, although the Company's performance is measured in sterling and the Company's investments (other than the above) are denominated in sterling, a proportion of their underlying assets are quoted in currencies other than sterling. Therefore movements in the rates of exchange between sterling and other currencies may affect the market price of the Company's investments and therefore the market price risk includes an element of currency exposure.
Credit Risk
Credit risk is the risk that a counterparty to a financial instrument will fail to discharge an obligation or commitment that it has entered into with the Company. The Manager has in place a monitoring procedure in respect of counterparty risk which is reviewed on an ongoing basis. The carrying amounts of financial assets best represents the maximum credit risk exposure at the Balance Sheet date.
Credit risk arising on transactions with brokers relates to transactions awaiting settlement. Risk relating to unsettled transactions is considered to be small due to the short settlement period involved and the acceptable credit quality of the brokers used. The Manager monitors the quality of service provided by the brokers used to further mitigate this risk.
All the assets of the Company which are traded on a recognised exchange are held by JPMorgan Chase Bank, the Company's Custodian. Bankruptcy or insolvency of the Custodian may cause the Company's rights with respect to securities held by the Custodian to be delayed or limited. The Board monitors the Company's risk by reviewing the Custodian's internal control reports as described in the Report of the Audit Committee in the Annual Report and Financial Statements.
The credit risk on liquid funds is controlled because the counterparties are banks with acceptable credit ratings, normally rated A or higher, assigned by international credit rating agencies. Bankruptcy or insolvency of such financial institutions may cause the Company's ability to access cash placed on deposit to be delayed, limited or lost.
Liquidity Risk
Liquidity risk is the risk that the Company will encounter difficulty in realising assets or otherwise raising funds to meet financial commitments. The risk of the Company not having sufficient liquidity at any time is not considered by the Board to be significant, given that the Company's listed and quoted securities are considered to be readily realisable.
The Company's liquidity risk is managed on an ongoing basis by the Manager in accordance with policies and procedures in place as described in the Report of the Directors. The Company's overall liquidity risks are monitored on a quarterly basis by the Board.
The Company maintains sufficient investments in cash and readily realisable securities to pay accounts payable and accrued expenses which are settled in accordance with suppliers stated terms. The Company has a £10 million unsecured revolving credit facility which is available until 10 February 2027 with The Royal Bank of Scotland International Limited. As at 31 May 2026, £7 million of the unsecured revolving credit facility was drawn down (2025: £7 million). The interest rate on the unsecured revolving credit facility is variable, and a non-utilisation fee is payable on undrawn amounts.
10. Subject to certain minimum and maximum thresholds which may be set by the Board of CT Global Managed Portfolio Trust PLC, shareholders have the right to convert their Income shares into Growth shares and/or their Growth shares into Income shares upon certain dates, the next of which will be on 12 November 2026 and then annually or close to annually thereafter. Under current law, such conversions will not be treated as disposals for UK capital gains tax purposes.
11. The Board of Directors (the "Board") is considered a related party. Under the UK Listing Rules, the Manager is also defined as a related party. However, the existence of an independent Board of Directors demonstrates that the Company is free to pursue its own financial and operating policies and therefore, under the AIC SORP, the Manager is not considered to be a related party for accounting purposes.
There are no transactions with the Board other than aggregated remuneration for services as Directors as disclosed in the Directors' Remuneration Report within the Annual Report and Financial Statements. The beneficial interests of the Directors in the Income shares and Growth shares of the Company are disclosed in the Annual Report and Financial Statements. There are no outstanding balances with the Board at the year-end.
David Warnock is the senior independent non-executive director of ICG Enterprise Trust plc. The Growth Portfolio had a holding of 66,400 shares (2025: 190,000 shares) in this company valued at £919,000 at 31 May 2026 (2025: £2,394,000). Sue Inglis is a non-executive director and Chairman of Invesco Global Equity Income Trust plc. The Growth Portfolio had a holding of 2,279,490 shares (2025: nil shares) in this Company valued at £9,164,000 at 31 May 2026 (2025: n/a) and the Income Portfolio had a holding of 1,016,632 shares (2025: nil shares) in this Company valued at £4,087,000 at 31 May 2026 (2025: n/a). Simon Longfellow was a non‑executive director until his retirement on 31 December 2025 and was also a non-executive director of Artemis UK Future Leaders plc. The Income Portfolio had a holding of 455,000 shares (2025: 405,000 shares) in this Company valued at £1,629,000 at 31 May 2026 (2025: £1,491,000).
Transactions between the Company and the Manager are detailed in the notes to the financial statements in the Annual Report and Financial Statements.
12. Annual Report and Financial Statements and Annual General Meeting
This statement was approved by the Board on 1 September 2026. It is not the Company's full statutory accounts in terms of Section 434 of the Companies Act 2006. The statutory Annual Report and Financial Statements for the year ended 31 May 2026 has been approved and audited and received an unqualified audit report and did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying the report, and did not contain a statement under Section 498 of the Companies Act. This will be sent to shareholders during September 2026 and will be available for inspection at 6th Floor, Quartermile 4, 7a Nightingale Way, Edinburgh, EH3 9EG the registered office of the Company.
The statutory Annual Report and Financial Statements for the year ended 31 May 2025 also received an unqualified audit report and did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying the report, and did not contain a statement under Section 498 of the Companies Act.
The full Annual Report and Financial Statements are available on the Company's website www.ctglobalmanagedportfolio.co.uk
The Annual General Meeting of CT Global Managed Portfolio Trust PLC will be held at 11.30am on 23 October 2026 at Columbia Threadneedle Investments, Cannon Place, 78 Cannon Street, London EC4N 6AG.
A copy of the Annual Report and Financial Statements will be submitted to the National Storage Mechanism and will shortly be available for inspection at data.fca.org.uk/#/nsm/nationalstoragemechanism
The audited financial statements for the year ended 31 May 2025 have been lodged with the Registrar of Companies and the audited financial statements for the year ended 31 May 2026 will be lodged with the Registrar of Companies following the Annual General Meeting.
Alternative Performance Measures ('APMs')
The Company uses the following APMs. These are not statutory accounting measures and are not intended as a substitute for statutory measures.
Total return - the return to shareholders calculated on a per share basis taking into account both any dividends paid in the year and the increase or decrease in the share price or NAV in the year. The dividends are assumed to have been re-invested in the form of shares or net assets, respectively, on the date on which the shares were quoted ex-dividend.
The effect of reinvesting these dividends on the respective ex-dividend dates and the share price total returns and NAV total returns are shown below.
|
|
31 May 2026 |
|
31 May 2025 |
||
|
|
Growth shares |
Income shares |
|
Growth shares |
Income shares |
|
Share price per share at start of financial year |
258.0p |
115.5p |
|
254.0p |
119.0p |
|
Share price per share at end of financial year |
324.0p |
131.0p |
|
258.0p |
115.5p |
|
Change in the year |
25.6% |
13.4% |
|
1.6% |
-2.9% |
|
Impact of dividend reinvestment (1) |
n/a |
7.8% |
|
n/a |
6.7% |
|
Share price total return for the year |
25.6% |
21.2% |
|
1.6% |
3.8% |
(1) During the year ended 31 May 2026 dividends totalling 7.75p went ex-dividend with respect to the Income shares.
During the year ended 31 May 2025 the equivalent figure was 7.55p.
|
|
31 May 2026 |
|
31 May 2025 |
||
|
|
Growth shares |
Income shares |
|
Growth shares |
Income shares |
|
NAV per share at start of financial year |
265.86p |
113.36p |
|
259.29p |
116.51p |
|
NAV per share at end of financial year |
332.59p |
130.77p |
|
265.86p |
113.36p |
|
Change in the year |
25.1% |
15.4% |
|
2.5% |
-2.7% |
|
Impact of dividend reinvestments (1) |
n/a |
7.9% |
|
n/a |
6.9% |
|
NAV total return for the year |
25.1% |
23.3% |
|
2.5% |
4.2% |
(1) During the year ended 31 May 2026 dividends totalling 7.75p went ex-dividend with respect to the Income shares.
During the year ended 31 May 2025 the equivalent figure was 7.55p.
Compound annual total return - converts the total return over a period of more than one year to a constant annual rate of return applied to the compounded value at the start of each year.
|
|
|
|
31 May 2026 |
||
|
|
|
|
|
Growth shares |
Income shares |
|
Indexed Share price total return at 31 May 2016 |
|
|
|
100.0 |
100.0 |
|
Indexed Share price total return at 31 May 2026 |
|
|
|
217.4 |
198.1 |
|
Period (years) |
|
|
|
10.0 |
10.0 |
|
Compound annual total return |
|
|
|
8.1% |
7.1% |
|
|
|
|
31 May 2026 |
||
|
|
|
|
|
Growth shares |
Income shares |
|
Indexed NAV total return at 31 May 2016 |
|
|
|
100.0 |
100.0 |
|
Indexed NAV total return at 31 May 2026 |
|
|
|
226.2 |
197.2 |
|
Period (years) |
|
|
|
10.0 |
10.0 |
|
Compound annual total return |
|
|
|
8.5% |
7.0% |
Discount/premium - the share price of an investment company is derived from buyers and sellers trading their shares on the stock market. This price is not identical to the net asset value ('NAV') per share of the underlying assets less liabilities of the Company. If the share price is lower than the NAV per share, the shares are trading at a discount. This usually indicates that there are more sellers of shares than buyers. Shares trading at a price above NAV per share are deemed to be at a premium, usually indicating there are more buyers of shares than sellers.
|
|
31 May 2026 |
|
31 May 2025 |
|||
|
|
Growth |
Income |
|
Growth |
Income |
|
|
Shares |
shares |
|
shares |
shares |
||
|
Net asset value per share |
(a) |
332.59p |
130.77p |
|
265.86p |
113.36p |
|
Share price |
(b) |
324.00p |
131.00p |
|
258.00p |
115.50p |
|
+Premium/ -discount (c = (b-a)/(a)) |
(c) |
-2.6% |
+0.2% |
|
-3.0% |
+1.9% |
Average discount/premium to NAV during the financial year - this is the average difference between the share price and NAV per share during the financial year.
Yield - the total annual dividend per Income share expressed as a percentage of the year-end share price.
|
|
|
31 May 2026 |
31 May 2025 |
|
Annual dividend |
(a) |
7.85p |
7.60p |
|
Income share price |
(b) |
131.0p |
115.5p |
|
Yield (c = a/b) |
(c) |
6.0% |
6.6% |
Three-year dividend increase - the increase of the total annual dividend per Income share over the last three financial years.
|
|
|
|
31 May 2026 |
|
Annual dividend for the 2023 financial year |
|
|
7.20p |
|
Annual dividend for the 2026 financial year |
|
|
7.85p |
|
Three-year dividend increase |
|
|
9.0% |
The aim of increasing dividends by at least as much as inflation (as measured by CPI) over rolling three-year periods (based on financial years) was first adopted for the three-year period which ended 31 May 2026.
Ongoing charges - all operating costs (attributable to the relevant share class of the Company), incurred and expected to be incurred in the foreseeable future, whether charged to capital or revenue in the Company's Income Statement, expressed as a proportion of the average daily net assets (of the relevant share class of the Company) over the financial year. In accordance with the AIC methodology, the costs of buying and selling investments are excluded in calculating ongoing charges, as are the cost of the Company's borrowings, taxation, non-recurring costs and the costs of buying back or issuing shares. The Company's ongoing charges calculated in accordance with this methodology are shown in column A in the following tables.
The AIC recommends that investment companies with a substantial proportion of their portfolio invested in other funds and where the relevant information is readily available should consider incorporating a relevant proportion of ongoing charges of the underlying funds into its own ongoing charges figure. These calculations are shown in column B in the following tables.
Ongoing charges calculations - Growth Portfolio
|
|
|
31 May 2026 |
31 May 2025 |
||
|
|
|
Column A(1) |
Column B(2) |
Column A(1) |
Column B(2) |
|
|
|
£'000 |
£'000 |
£'000 |
£'000 |
|
Investment management fee |
|
617 |
617 |
594 |
594 |
|
Other expenses |
|
426 |
426 |
443 |
443 |
|
Less non-recurring costs |
|
(22) |
(22) |
(15) |
(15) |
|
Plus non-recurring credits |
|
11 |
11 |
|
|
|
Ongoing charges of underlying funds |
|
- |
1,096 |
- |
833 |
|
Total |
(a) |
1,032 |
2,128 |
1,022 |
1,855 |
|
Average daily net assets |
(b) |
99,853 |
99,853 |
91,989 |
91,989 |
|
Ongoing charges (c=a/b) |
(c) |
1.03% |
2.13% |
1.11% |
2.02% |
(1) Excluding ongoing charges of underlying funds
(2) Including ongoing charges of underlying funds
Ongoing charges calculations - Income Portfolio
|
|
|
31 May 2026 |
31 May 2025 |
||
|
|
|
Column A(1) |
Column B(2) |
Column A(1) |
Column B(2) |
|
|
|
£'000 |
£'000 |
£'000 |
£'000 |
|
Investment management fee |
|
448 |
448 |
428 |
428 |
|
Other expenses |
|
296 |
296 |
301 |
301 |
|
Less non-recurring costs |
|
(17) |
(17) |
(7) |
(7) |
|
Plus non-recurring credits |
|
8 |
8 |
- |
- |
|
Ongoing charges of underlying funds |
|
- |
708 |
- |
566 |
|
Total |
(a) |
735 |
1,443 |
722 |
1,288 |
|
Average daily net assets |
(b) |
68,964 |
68,964 |
59,328 |
59,328 |
|
Ongoing charges (c=a/b) |
(c) |
1.07% |
2.09% |
1.22% |
2.17% |
(1) Excluding ongoing charges of underlying funds
(2) Including ongoing charges of underlying funds
Net gearing/net cash - this is calculated by expressing the Company's borrowings less cash and cash equivalents as a percentage of shareholders' funds. If the amount calculated is positive, this is described as net gearing. If the amount calculated is negative, this is described as net cash.
|
|
31 May 2026 |
31 May 2025 |
||
|
|
Growth shares £'000 |
Income shares £'000 |
Growth shares £'000 |
Income shares £'000 |
|
Borrowings |
- |
7,000 |
- |
7,000 |
|
Less cash and cash equivalents |
(2,243) |
(1,790) |
(3,592) |
(1,332) |
|
|
(2,243) |
5,210 |
(3,592) |
5,668 |
|
Shareholders' funds |
113,027 |
79,610 |
91,405 |
60,975 |
|
-Net cash/ net gearing |
-2.0% |
6.5% |
-3.9% |
9.3% |
For further information, please contact:
Adam Norris, Columbia Threadneedle Investment Business Limited 0131 573 8360
Paul Green, Columbia Threadneedle Investment Business Limited 0131 573 8360
Ian Ridge, Columbia Threadneedle Investment Business Limited 0131 573 8316
Sarah Gibbons-Cook, Quill PR 07702 412680
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