Annual Financial Report

JPMorgan US Smaller Co. IT

17 April 2026

 

LONDON STOCK EXCHANGE ANNOUNCEMENT

JPMORGAN US SMALLER COMPANIES INVESTMENT TRUST PLC

FINAL RESULTS FOR THE YEAR ENDED 31ST DECEMBER 2025

Legal Entity Identifier: 549300MDD7SOXDMBN667

Information disclosed in accordance with the DTR 4.1.3

Highlights

•        NAV total return of -10.9% for the year ended 31st December 2025 in sterling terms, compared with +4.8% for the Russell 2000 benchmark (total return with net dividends reinvested) in sterling terms. Share price total return of -15.3% for the same period

•        Five-year cumulative NAV total return of +12.0% compared with +35.2% for the Benchmark; five-year share price cumulative total return of +2.7%

•        Ongoing Charges Ratio for the year was 1.00%.  With effect from 1st January 2026, the management fee was reduced to 0.70% per annum on net assets up to £300 million, and 0.60% on all assets above that value. Previously, the fee was 0.70% per annum charged against gross assets, which included a fee on the investments funded by borrowings. This change is expected to benefit shareholders by lowering ongoing costs.

•        During the year, the Company repurchased 6,886,958 shares into Treasury (representing 11.4% of the share capital in issue at 31st December 2024) at an average discount of 9.3%

•        The Board has recommended a final dividend of 3.2p per share for the year ended 31st December 2025, subject to shareholder approval, making a total dividend of 3.2p per share for FY25, a slight increase on last year's total dividend of 3.1p per share.

Dominic Neary, Chair, commented:

"After a tough year for your Company it is concerning to have begun 2026 with increased uncertainty and volatility, which look likely to significantly impact inflation and growth prospects for some time to come. While we cannot control near-term geopolitical developments, we can make some hopeful observations in support of the outlook for your Company's portfolio for the long term. The valuations of US smaller capitalisation stocks relative to larger capitalisation stocks are now at historical lows, signalling that a rebound in smaller capitalisation stocks is well overdue. While the timing of any such recovery is difficult to judge, the outperformance of smaller companies in the latter half of 2025 suggests investors may already be starting to recognise the attractively-priced opportunities available in this area of the market.

The Board believes that the Manager's disciplined approach will allow them to continue to identify and capitalise on opportunities to invest in great US companies. My fellow directors and I are confident that their efforts will ensure that the Company delivers strong performance to its shareholders over time, despite the market's recent preference for alternative investment styles."

Don San Jose, Jon Brachle and Dan Percella, the Company's Portfolio Managers, commented:

"Our portfolio seeks to invest in high-quality companies at a reasonable valuation. The increase in investor appetite for risk particularly around speculative themes such as meme stocks, bitcoin miners, and lower-quality companies, fuelled a rally that created significant headwinds for our investment approach during most of 2025.

After a difficult 2025, where returns in US small cap companies were concentrated in a narrow group of AI-related stocks and focused on speculative themes, as we look ahead to 2026, we see promising opportunities across the sector.

Our investment philosophy remains focused on finding companies with durable franchises, good management teams and stable earnings, that trade at a discount to their intrinsic value. We stand by our conviction that the investment case for smaller companies is appealing, especially for long-term investors as they include innovative companies that serve market niches and thereby can be a way to access innovation early in its development."

CHAIR'S STATEMENT

Introduction

The Company's investment objective is to generate capital growth from investing in US smaller companies with a sustainable competitive advantage, that are run by proven management teams, and that trade at a discount to their intrinsic value. Total returns in 2025 significantly lagged the Company's benchmark, the Russell 2000 Index. The majority of the under-performance was realised over the three-month period from August to October when high expectations for the potential benefits of artificial intelligence (AI) drove related stocks to elevated levels. These market conditions proved very challenging for the Company, given its focus on high-quality, reasonably priced stocks.

The Board regularly monitors and reviews the Investment Manager, their investment philosophy, process and the underlying investments in the Company's investment portfolio. In 2025 additional scrutiny of all aspects of the Company's investment management was undertaken in the face of performance challenges.

Despite the recent setback, the Board believes that the Company's long-term investment philosophy, combined with the investment trust structure, continues to offer shareholders significant investment benefits over the long run. Further, the Board currently believes that the Manager's scale, resources and experienced investment team will serve the Company well over time. Shareholders also indicated their support for the Company's approach at the June 2025 Annual General Meeting (AGM) by voting for the continuation of the Company for a further five years.

Market overview

2025 delivered record highs in US equity markets despite bouts of severe volatility. The year began on a positive note, thanks to initial optimism about the new administration's pro-growth agenda. This confidence gave way to concerns over tariffs, tighter immigration controls and shifting foreign policy priorities which were seen as inflationary and less supportive of growth. The market's negative reaction to these developments prompted some moderation in policy which was sufficient to calm market fears and clear the way for a significant market rebound in the second half of the year. This rally was led by the same very small cohort of high-growth technology and AI-oriented stocks that has driven market returns in recent years. Across the broader market, expensive, speculative growth stocks and lower quality names fared best, while other stocks lagged.

Across the investment trust sector corporate activity remained elevated, with record M&A, high levels of share buybacks, and continued activist investor presence in the market.

Performance

Over the 12 months to 31st December 2025, the Company's net asset value (NAV) total return was -10.9%, underperforming the Russell 2000 Index which rose by 4.8%.

The total return to shareholders was -15.3%, reflecting a widening in the share price discount to NAV from 1.8% at the end of 2024 to 6.7% on 31st December 2025. (The discount averaged 7.3% over the year).

The significant short term underperformance of the benchmark reflects the narrow market breadth over the period; the shares of lower-quality, growth-oriented companies exposed to AI and related themes significantly outperformed the attractively-valued, higher-quality area of the market to which your portfolio is predominantly exposed.

A full explanation of portfolio performance is provided in the Investment Manager's Report, along with details of recent portfolio activity and the Portfolio Managers' view on the outlook for the market and Company.

Discount management, share issuance and buybacks

The Board remains committed to active discount management to enhance shareholder value, and to minimise the discrepancy between the share price and the net asset value. Our ability to do so depends on the prevailing market conditions. With the Company trading at a discount to net asset value over the entirety of 2025 the Board's focus was on stimulating demand for the Company's shares. To this end we have two key levers at our disposal: an active, value-enhancing share buyback programme, and effective ongoing marketing activities.

During the year to 31st December 2025 the Company repurchased 6,886,958 shares into treasury, representing 11.4% of the share capital in issue (excluding shares held in Treasury) at 31st December 2024, at an average discount of 9.3%. Since the period end a further 1,607,113 shares have been repurchased at an average discount of 8.0% as at 15th April 2026.

Marketing activity remained strong over the year, promoting the Company as a vehicle to profitably 'Invest in the Heart of America,' through shareholder events, and regular video and article updates from the Investment Manager (available on the Company's website). Since the year end the Company launched its LinkedIn page www.linkedin.com/company/jpmorgan-us-smaller-companies-investment-trustplc where shareholders can follow updates and thought pieces related to the Company.

Dividend

The Board is delighted to recommend the payment of a dividend of 3.2p in respect of the financial year ended 31st December 2025 (2024: 3.1p). Subject to shareholders' approval at the forthcoming AGM, this dividend will be paid on 10th July 2026 to shareholders on the register at the close of business on 12th June 2026. The ex-dividend date is 11th June 2026.

The Company's objective is unchanged and remains one of capital growth. The dividend distribution amount will normally be driven by the minimum dividend required to maintain the Company's investment trust status. Therefore, the dividend level may fluctuate as the distributions typically reflect the naturally occurring income on the underlying portfolio.

Gearing

The Board believes that the use of gearing is a key advantage of the investment trust structure. Our policy is to adjust gearing levels according to the Board and Manager's long-term expectations for market returns. At the beginning of the year, the Company had fully drawn down its US$30 million revolving credit facility with Scotiabank. The Board renewed the loan facility in March 2025 with a new provider, Bank of America. This new facility is for US$35 million, with a US$5 million accordion option.

As at 31st December 2025, the Company had drawn down US$35 million (£26 million) and closed the year with gearing of 9.7% (2024: 7.7%).

Board and succession planning

In January 2026, the Board, through its Nomination Committee, carried out a comprehensive evaluation of the Board, its committees, the individual Directors and the Chair. Topics discussed included the size, composition and diversity of the Board, Board processes and information sources, shareholder engagement, and Director training and accountability. The resulting report demonstrated that the Board is working effectively for shareholders and in line with expectations. Additionally, the Board meets the FCA Listing Rules targets on gender diversity, female representation in a senior role, and ethnic representation.

The Board has detailed succession plans in place. These are particularly important for a small board to ensure that no discontinuity is caused by the retirement of non-executive directors after nine years' service, according to our policy, and as recommended by the Association of Investment Companies' Code of Corporate Governance. In line with our succession framework, Shefaly Yogendra will retire from the Board at the conclusion of the 2026 AGM. On behalf of the Board and shareholders I would like to thank Shefaly for her dedication to the Company and her insightful challenge and support over the nine years she has served as a director.

Further, as announced on 26th March 2026, Christopher Metcalfe retired on 1st April 2026 after over seven years on the Board. We would like to thank Christopher for his guidance and significant contributions to the Company over his tenure, including his additional responsibilities as Senior Independent Director. Shefaly and Christopher will be missed, and we wish them both well in their future endeavours.

With effect from 1st April 2026, Mandy Donald has assumed the role of the Senior Independent Director of the Company.

The Board appointed an external executive search firm to assist in the recruitment of a new Director in 2025, and we were delighted to announce the appointment of Cindy Rampersaud, effective 1st November 2025. Cindy is a senior leader with over 25 years of executive and 15 years of board experience across a range of sectors including the publishing, technology and music industries. Her current roles include Deputy Chair and Audit and Risk Committee Chair of the UK Health Security Agency, and Non-Executive Director at Sage Homes.

The Board has recently appointed an external executive search firm to aid in the recruitment of a new Director following Christopher Metcalfe's departure. The recruitment process is underway and we expect to announce the appointment of a new director by, or shortly after, the AGM on 15th June 2026.

As a result of these changes Dominic Neary and Mandy Donald will offer themselves for re-appointment at the forthcoming AGM, while Cindy Rampersaud will offer herself for appointment for the first time.

Review of Manager Services and Fees

During the year, the Board, through its Management Engagement Committee, carried out a thorough review of the investment management, secretarial and marketing services provided to the Company by the Manager. As part of this review a reduction to the investment management fee arrangement was agreed. With effect from 1st January 2026, a fee of 0.70% per annum will be charged on net assets (i.e. excluding borrowed funds) up to £300 million, and 0.60% per annum on all assets above that value. Previously the fee was 0.70% per annum charged against gross assets (excluding any holdings in the JPMorgan Liquidity Fund), which included a fee on the investments funded by borrowings.

Following this review the Board has concluded that the continued appointment of the Manager on the terms agreed is in the interests of the shareholders.

Portfolio Company Engagement

As detailed in the Manager's Investment Process on pages 16 to 19 of the Annual Report, extensive engagement with company management teams is a vital element of stock selection. Company engagement is led by the Portfolio Managers and analysts with the intention of gaining a full insight into the attractiveness of a company, and the outlook for its shares. This incorporates a deep understanding of the company's current health, strategic direction, competitor landscape and its future prospects. In addition, focus is placed on assessing how various financially material ESG factors may affect the risk profile of the business.

The Board shares the Investment Manager's view of the importance of this combined approach to company engagement as a central component of the investment process in seeking to deliver attractive risk-adjusted returns for shareholders.

Annual General Meeting

The Board invites shareholders to join us in person for the Company's AGM to be held on Monday, 15th June 2026 at 2.30 p.m. at 60 Victoria Embankment, London EC4Y 0JP. We hope to welcome as many shareholders as possible.

As with previous years, shareholders will have the opportunity to hear from the Portfolio Managers. Their presentation will be followed by a question-and-answer session. There will be refreshments afterwards when shareholders will be able to meet members of the Board. Shareholders wishing to follow the AGM proceedings but choosing not to attend in person will be able to do so online and will be able to ask questions through conferencing software. Details on how to register together with access details can be found on the Company's website: www.jpmussmallercompanies.co.uk, or by contacting the Company Secretary at [e-mail].

In accordance with best practice, all voting on the resolutions will be conducted on a poll. Shareholders viewing the meeting via conferencing software will not be able to vote on the poll and we therefore encourage all shareholders, and particularly those who cannot attend physically, to submit their proxy votes in advance of the meeting, so that they are registered and recorded at the AGM. Proxy votes can be lodged in advance of the AGM either by post or electronically. Detailed instructions are included in the Notes to the Notice of Annual General Meeting in the Annual Report. Please ensure that you act promptly on the notifications for voting, and that you contact your share platform or wealth manager by their stipulated deadline to ensure that your votes are submitted on time. In addition, shareholders are encouraged to send any questions ahead of the AGM to the Board via the Company Secretary at the email address above. We will endeavour to answer relevant questions at the meeting or via the website depending on arrangements in place at the time.

If there are any changes to the above AGM arrangements, the Company will update shareholders through its website and, as appropriate, through an announcement on the London Stock Exchange.

My fellow Board members, representatives of JPMorgan and I look forward to the opportunity to meet and speak with shareholders after the formalities of the meeting have been concluded.

Outlook

After a tough year for your Company it is concerning to have begun 2026 with increased uncertainty and volatility, driven by the recent developments in Iran and the wider Middle East, which look likely to significantly impact inflation and growth prospects for some time to come. While we cannot control near-term geopolitical developments, we can make some hopeful observations in support of the outlook for your Company's portfolio for the long-term. First, the valuations of US smaller capitalisation stocks relative to larger capitalisation stocks are now at historical lows, signalling that a rebound in smaller capitalisation stocks is well overdue. While the timing of any such recovery is difficult to judge, particularly in light of recent events, the outperformance of smaller companies in the latter half of 2025 suggests investors may have been starting to recognise the attractively-priced opportunities available in this area of the market.

The Board believes that the Manager's disciplined approach will allow them to continue to identify and capitalise on opportunities to invest in great US companies. My fellow directors and I are confident that their efforts will ensure that the Company delivers strong performance to its shareholders over time, despite the market's recent preference for alternative investment styles.

We thank you for your patience and support.

Stay informed

The Company delivers email updates with regular news and views, as well as up-to-date performance data. If you have not already signed up to receive these communications and you wish to do so, you can opt in via https://tinyurl.com/JUSC-Sign-Up or by scanning the QR code on page 2 of the Annual Report.

Further, the Board and I are keen to continue to develop our relationship with shareholders, and we therefore welcome your questions and observations via email at [e-mail].

Dominic Neary

Chair                                                                                                                16th April 2026

INVESTMENT MANAGER'S REPORT

Market Review

2025 will be remembered as a year of extraordinary uncertainty for investors, yet markets ultimately delivered impressive results. The S&P 500 posted a robust return of +17.9% in US dollar terms, marking its third consecutive year of double-digit gains, while the Russell 2000 Index returned +12.8% in US dollar terms. This remarkable climb came despite a lack of clarity on US tariffs, uncertainty about the trajectory of interest rates, concerns about the durability of AI-driven growth, and the longest government shutdown in US history.

The year began with a period of significant volatility. In the first four months, US equities neared bear market territory as the US administration's approach to tariff and other key policies left investors on unstable ground. A sharp April sell-off, led by the 'Magnificent 7' tech giants, and growing doubts about the sustainability of AI's momentum, added to the turbulence as the year progressed. The S&P 500 fell 19% from peak to trough before bottoming on April 8, then rallied by an impressive 39% through to year-end. Notably, corporate earnings growth proved more resilient to tariffs than many had anticipated.

Investors were also troubled by the uncertain direction of monetary policy. The Federal Reserve paused its rate-cutting cycle in the first half of the year, responding to fears about tariff-induced price pressures and recession. As conditions stabilised, the Fed resumed cuts in September, delivering three 25 basis point reductions before year-end. This contributed to a 40-basis point decline in the 10-year Treasury yield, which closed the year at 4.17% - its first year-on-year decline since 2020.

Late in the year, the government shut down for 43 days in October and November, suspending normal government business, including public services, payments and some data releases. Despite these inconveniences, markets continued to post gains, consistent with historical patterns during extended closures. Congress reached a deal in mid-November, clearing the way for the resumption of regular government activity.

Against this challenging backdrop, the S&P 500 demonstrated remarkable resilience, surging to record highs by year-end. Behind the strong returns, market leadership in 2025 remained narrow; 10 stocks drove 60% of the S&P 500's return, while roughly 355 stocks (more than 60% of the benchmark) underperformed the market, with nearly 190 stocks (15% of the benchmark) declining over the year.

Within the small cap space, we saw a similar overall picture: the Russell 2000 Index fell 24% from peak to trough, its worst ever drawdown, before bottoming in early April. The index then rallied an impressive 42% through to year-end. For the full year, the Russell 2000 Index posted a +12.8% gain in US dollar terms, though this performance trailed large caps for the fifth consecutive year. As in the large cap sector of the market, the year was characterised by very narrow market breadth, with AI and related themes propelling index returns. The market environment favoured growth-oriented investments and speculative activity in a variety of industries such as quantum computing, bitcoin miners, nuclear power and flying taxis. Considerations related to fundamental business quality were overshadowed, and quality factors like profitability and valuation underperformed significantly.

As a result, returns were notably concentrated, with the top 10 contributors driving 28% of the Russell 2000's gains for the year. Four of the top five contributors had AI exposure. Despite this concentration in returns, most sectors of the index rose over the year. Telecommunications, basic materials and health care were the top performing sectors, while consumer staples and consumer discretionary were the main detractors.

The following chart provides an overview of the returns of different investment styles in the US market during 2025, as well as the sector performance of the Russell 2000 over the year. Large, Mid, and Small represent the size of the companies by market capitalisation. A value style represents companies that are trading at lower valuations relative to fundamentals, while a growth style represents companies priced for faster-than-average future earnings expansion, often at higher valuations.

2025 US Equity Market Performance (in US$)

2025	Value	Blend	Growth
Large	15.9%	17.9%	18.6%
Mid	11.0%	10.6%	8.7%
Small	12.6%	12.8%	13.0%

2025 Russell 2000 Index performance (in US$)

Chart included in the Annual Report.

Performance

Against this background, the Company's net asset value declined by 10.9% in 2025, diverging from its benchmark, the Russell 2000 Index (net), which gained 4.8% in sterling terms. Our portfolio seeks to invest in high-quality companies at a reasonable valuation. The increase in investor appetite for risk particularly around speculative themes such as meme stocks, bitcoin miners, and lower-quality companies, fuelled a rally that created significant headwinds for our investment approach during most of 2025. This environment not only weighed on the stocks held within the portfolio but also meant that a substantial portion of the underperformance stemmed from not holding certain names that benefited disproportionately from this speculative momentum. In other words, the shortfall was not solely a result of poor stock selection within the portfolio - a meaningful share of the drag came from the opportunity cost of being underweight or absent from key benchmark constituents that rallied sharply amid this environment.

Stock selection challenges in several sectors also detracted from relative performance. Stock selection in the industrials and health care sectors had the most detrimental impact. Within industrials, our exposure to WillScot was the largest detractor. WillScot is one of the largest providers of modular office space and portable storage solutions to a broad range of US commercial and industrial customers. The stock struggled throughout 2025 due to mixed financial performance and ongoing challenges. The company faced year-over-year revenue declines, primarily from a write-off of unrecoverable account receivables and lower delivery and installation revenues. Despite some improvements in adjusted EBITDA margins, overall revenue and leasing revenues faced headwinds. Additionally, the company adopted a more conservative full-year guidance, reflecting a cautious outlook amidst cyclical headwinds and competitive pressures. However, we continue to like the business, its valuation is attractive, and we expect volumes to stabilise or turn positive, so we have maintained our holding, but we are closely monitoring the position.

The portfolio was underweight in the healthcare sector, even though it was among the top-performing sectors in both 4Q 2025 and for the year overall. This positioning reflects our investment approach, which emphasises profitability, valuation and quality factors, and thus does not invest in biotech stocks which drove most of the relative outperformance of the sector.

Consumer staples detracted more modestly, in part due to our exposure to Freshpet. The performance of this business lagged during 2025 due to a combination of slower-than-expected sales growth and increased competition. Despite improvements in profitability, including higher gross margins and positive free cash flow, the company struggled to maintain its rapid growth rate. The introduction of new products and expanded distribution channels showed promise, but the overall pet food category's softness and economic uncertainties impacted consumer spending. We remain invested.

On the positive side, our sector allocation in consumer discretionary and stock selection in real estate contributed to performance.

Within consumer discretionary, our exposure to Five Below and BJs Wholesale Club proved beneficial. Five Below sells trendy discount products primarily priced under five dollars. The stock rallied on the heels of significant financial improvements and strategic initiatives. The company reported strong sales growth, driven by increased transactions and higher average ticket prices. Operational efficiencies, better inventory management, and effective marketing campaigns also contributed to performance. Additionally, the company successfully mitigated the price impact of higher tariffs and managed to reduce the adverse effects of inventory losses due to damage, theft and errors (known as 'shrink rates'). The appointment of new executives, including a CFO and Chief Merchandising Officer, further bolstered investor confidence. BJs Wholesale Club is a membership-based warehouse club which offers discounted groceries and general merchandise. The company experienced strong performance over the past year, driven by consistent financial improvements and strategic initiatives. As a result, the company reported record net sales, membership growth, and adjusted earnings per share. Membership fee income increased, and higher-tier membership penetration reached new highs. The company also saw positive traffic growth and strong performance in its digital sales. Additionally, BJs maintained robust cost discipline and expanded its footprint with new club openings, which contributed to its overall financial health and stock performance.

Elsewhere, our exposure to RBC Bearings added to performance. This precision engineering company saw significant growth in its aerospace and defence segment, with increased sales and gross margins. The industrial segment also showed steady performance, while the acquisition of its competitor, VACCO, contributed to a substantial increase in its order book.

Performance Attribution

Year ended 31st December 2025

	%	%
Contributions to total returns
Benchmark return		4.8
Asset Allocation	0.4
Stock Selection*	(16.5)
Investment Manager Contribution		(16.1)
Portfolio total return		(11.3)
Impact of cash/gearing*	0.5
Management fee and Other administrative expenses	(1.0)
Share buybacks	0.9
Other effects		0.4
Net Asset Value total return		(10.9)
Share Price total return		(15.3)

*     Includes impact of FX movements.

Source: Morningstar/J.P. Morgan. All figures are on a total return basis.

Performance attribution analyses how the Company achieved its recorded performance relative to its benchmark index.

A glossary of terms and APMs is provided on pages 96 to 98 of the Annual Report.

Portfolio Positioning

Our investment philosophy remains focused on finding companies with durable franchises, good management teams and stable earnings, that trade at a discount to their intrinsic value. We stand by our conviction that the investment case for smaller companies is appealing, especially for long-term investors, as they include innovative companies that serve market niches and thereby can be a way to access innovation early in its development.

We took the opportunities provided by the pronounced dislocation in the US small caps market over the past year to selectively increase exposure to high-quality names across several sectors. We also took some profits, and reduced risk, by trimming some positions in higher-beta cyclicals and rate-sensitive positions.

On both an absolute and a relative basis, our largest overweight is in the industrials sector, followed by financials. Conversely, our most significant underweights are in the health care, technology, and telecommunications sectors.

Market Outlook

After a difficult 2025, where returns in US small cap companies were concentrated in a narrow group of AI-related stocks and focused on speculative themes, as we look ahead to 2026, we see promising opportunities across the sector. Several factors point to better times ahead, for 2026 and beyond.

The valuation case for quality smaller companies is now even more compelling. High-quality, profitable small caps fell to historically low valuations in 2025, underperforming weaker companies by record margins. History suggests these extremes typically reverse, creating attractive entry points. Importantly, small caps are beginning to show clear signs of recovery. They have outperformed the broader market significantly since last April's lows. Even more encouraging, small cap earnings growth exceeded large cap growth for the first time in over three years during the third quarter of 2025. This was partly an earnings phenomenon as small cap earnings growth topped that of large caps for the first time in 13 reporting seasons.

Additionally, we remain optimistic about the health of the US economy as it continues to demonstrate resilience and adaptability, outperforming many forecasts, despite the past year's pervasive uncertainties. The unemployment rate is holding relatively steady and consumer financial conditions remain manageable. That said, geopolitical uncertainty and elevated energy prices in the first quarter of 2026 have impacted the prospects for significant rate cuts, and made the range of economic outcomes appear wider. Our research analysts anticipate strong earnings growth for the S&P 500, projecting a 15% increase in 2026 and 13% in 2027. These positive forecasts reinforce our confidence in the market's potential. However, we remain alert to risks that could introduce volatility, such as risks due to tariff impacts, cracks in the labour market and continued policy uncertainty.

Against this generally encouraging backdrop, we intend to maintain our search for innovative, high-quality, smaller cap companies with attractive investment cases. And just as we did in the past year we will continue to use any bouts of market volatility to capitalise on compelling stock selection opportunities, with a view to building on the Company's long-term track record of strong capital growth. We acknowledge that the relative performance of the Company in 2025 was challenging and frustrating. Our focus on high-quality companies that can deliver over a cycle did not keep up with the market's enthusiasm for AI and related themes. Over the long term, we maintain conviction that a high-quality portfolio of US smaller companies can add value over time.

Thank you for your continued support.

Don San Jose

Jon Brachle

Dan Percella

Portfolio Managers                                                                                                   16th April 2026

PRINCIPAL AND EMERGING RISKS

The Directors confirm that they have carried out a robust assessment of the principal and emerging risks facing the Company, including those that would threaten its business model, future performance, solvency or liquidity.

With the assistance of the Manager, the Audit Committee maintains a risk matrix which identifies the principal risks to which the Company is exposed and methods of mitigating against them as far as practicable. The risks identified and the broad categories in which they fall, and the ways in which they are managed or mitigated, are summarised below.

The AIC Code of Corporate Governance requires the Audit Committee to put in place procedures to identify emerging risks. At each meeting, the Board reviews all potential risks and considers emerging risks which it defines as potential trends, sudden events or changing risks which are characterised by a high degree of uncertainty in terms of occurrence probability and possible effects on the Company. As the impact of emerging risks is understood, these risks may be entered on the Company's risk matrix and mitigating actions considered as necessary.

In assessing the risks and how they can be mitigated, the Board has given particular attention to those risks that might threaten the viability of the Company.

These principal and emerging risks are listed below. It should be noted that the emergence of, or a change in, a risk can have an impact on another risk:

			Change in risk
			status during
Principal risk	Description	Mitigating activities	the year
Demand driven factors
Lack of demand for shares	Demand for the Company's shares may fall due to: • Reduced interest in investment in the US market. • Competing products and technologies (e.g. ETFs). • Poor performance. • Real or spurious adverse publicity about the Company or the Manager. • Reduced UK equity market depth.	• The Manager's sales team works with the Company's broker to engage existing and potential shareholders throughout the year, especially in times of volatile markets and periods of under-performance (also see Underperformance section below). • The Manager and broker provide sales activity updates to the Board and are available to discuss issues throughout the year. • The Manager's marketing activity is tailored to reach retail shareholders, who make up a significant part of the shareholder base.	ã
Hostile shareholder action	•  Activist, arbitrage or hostile shareholder activity could increase volatility and distract from normal business.	• The share register is monitored and significant transactions are reviewed. • The Manager regularly discusses developments with the Company's broker and reports these to the Board. • The Board seeks broker feedback on major shareholder movements and market sentiment. • Board and Chair actively encourage communication with shareholders.	áâ
Shareholder communication challenges	Increasing structural barriers within the investment trust community/sector to: •  Direct and regular communication with shareholders. •  Engagement around shareholder meetings and important votes.	• The Manager runs an investor communication programme, including meetings and presentations for major institutional investors and wider communications via different channels. • The Board meets major institutional shareholders, responds to questions raised at AGMs and during the year, and oversees shareholder communications. • Retail shareholders are contacted through formal notifications (including signposting interim and annual reports) and encouraged to register for Company updates. • The Board monitors the Manager's sales, marketing and PR activity and challenges the Manager where appropriate.	áâ
Supply driven factors
Underperformance	Underperformance of the benchmark and/or peers may be caused by: • Market cyclicality, leading to sustained underperformance of style-biased investment strategies. • Inappropriate investment decisions (e.g. poor asset allocation and gearing).	• A broadly diversified portfolio is managed within Board‑approved investment guidelines and restrictions. • The Manager monitors investments and provides the Board with timely reporting (including performance, attribution, liquidity and risk analysis). • The Board regularly reviews results and the investment process, and challenges the Portfolio Managers at Board meetings. • Additional oversight is provided through periodic reviews by the Manager's senior investment leadership, and the Board holds a dedicated annual strategy session.	ã
Outsourcing	Disruptions (including cyber incidents) at key service providers could: • Disrupt accounting, reporting, dealing, payments, or record‑keeping. • Increase the risk of loss or misappropriation of assets.	• The Board oversees the services provided by the Manager and key providers and reviews the related risk management and internal controls framework. • The Manager has dedicated cyber security resources to identify and address threats. • The Manager maintains and tests business continuity and disaster recovery arrangements (including alternative sites and remote working). • Cyber controls, business continuity testing, and mitigation plans are reported to the Board, including planning for loss of office access.	áâ
Cyber Crime	Cyber attacks on the Manager, its affiliates and its systems could: • Disrupt operations or compromise information. • Result in denial of service and/or ransomware.	• The Manager runs a cyber security management programme with a dedicated annual budget and has a third‑party oversight team which sets governance expectations and enforces policies and standards for outsourced providers. • The Company benefits directly and/or indirectly from all elements of JPMorgan's Cyber Security programme. • Controls are regularly tested, with updates reported through the quarterly risk process to relevant Board/Audit committee forums. • Key technology and physical security controls are independently audited on a regular cycle against recognised standards. • The Company and Manager obtain assurance from major service providers that appropriate cyber security and resilience practices are in place.	áâ
Investment Team changes	An unexpected change of Portfolio Manager(s) or loss of the Investment Team could: • Disrupt the investment process. • Impact investment performance. • Damage the Company's reputation.	• The Board seeks and obtains periodic assurance that the Manager has effective succession planning and a team‑based approach to reduce reliance on individuals. • The Board engages with the Manager's senior leadership to monitor this risk and the related actions.	áâ
Market environment
Market and Economic	Market factors (e.g. geopolitical events, interest rate and inflation concerns) and change in regulation may: •  Impact economic growth. •  Change investors' risk appetites. •  Reduce the value of the Company's investments. •  Affect performance.	• Risk is partly managed through diversification and ongoing review of investment strategy and portfolio construction with the Manager. • The Board oversees asset allocation, stock selection and gearing within agreed guidelines and monitors how the investment process is being implemented. • The Board can draw on the Manager's market strategists and, where needed, external experts. • If appropriate, and with shareholder approval where required, the Board can change the investment policy and objectives to reflect market conditions.	ã
			Change in risk
			status during
Emerging risk	Description	Mitigating activities	the year
Emerging risk
Artificial Intelligence (AI)	AI has become a powerful tool that will impact a huge range of areas. It could: • Be a significant driver for new business. • Be a disrupter to current business models and processes. • Lead to emerging uncertainty in corporate valuations. • Lead to an increased potential risk from cyber related crime.	• The Manager's investment process integrates financially material considerations of the impact of AI when taking investment decisions. • The Board works with the Manager to monitor the developments concerning AI and its potential impact on the portfolio, our service providers and the wider market.	ã

Change Key

ã Heightened    áâ Stable    ä Reduced

TRANSACTIONS WITH THE MANAGER

Details of the management contract are set out in the Directors' Report on page 42 of the Annual Report. The management fee payable to the Manager for the year was £1,935,000 (2024: £2,033,000) of which £nil (2024: £2,000) was outstanding at the year end.

Included in administration expenses in note 6 on page 75 of the Annual Report are safe custody fees amounting to £2,000 (2024: £3,000) payable to JPMorgan Chase Bank N.A. of which £nil (2024: £nil) was outstanding at the year end.

Other capital charges (handling charges) on dealing transactions amounting to £12,000 (2024: £10,000) were payable to JPMorgan Chase Bank N.A. during the year of which £2,000 (2024: £2,000) was outstanding at the year end.

The Company also invests in the JPMorgan US Dollar Liquidity Fund, which is managed by JPMorgan Asset Management (Europe) S.à.r.l. At the year end this was valued at £1,168,000 (2024: £1,265,000). Income amounting to £313,000 (2024: £578,000) was receivable during the year of which £nil (2024: £nil) was outstanding at the year end. The JPMorgan USD Liquidity Fund does not charge a fee and the Company does not invest in any other investment fund managed or advised by JPMorgan.

At the year end, total cash of £2,545,000 (2024: £10,000) was held with JPMorgan Chase Bank N.A. A net amount of interest of £1,000 (2024: £1,000) was receivable by the Company during the year from JPMorgan Chase Bank, N.A. of which £nil (2024: £nil) was outstanding at the year end.

TRANSACTIONS WITH RELATED PARTIES

Full details of Directors' remuneration and shareholdings can be found on pages 57 and 58 and in note 6 on page 75 of the Annual Report.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The Directors are responsible for preparing the Annual Report and the Financial Statements in accordance with applicable law and regulations.

Company law requires the Directors to prepare the Annual Report and Financial Statements for each financial year. Under that law, the Directors have elected to prepare the Financial Statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards, comprising Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) and applicable law). Under company law the Directors must not approve the Financial Statements unless they are satisfied that taken as a whole, the Annual Report and Financial Statements are fair, balanced and understandable, provide the information necessary for shareholders to assess the Company's position and performance, business model and strategy, and that they give a true and fair view of the state of affairs of the Company and of the net return or loss of the Company for that period. In order to provide these confirmations, and in preparing these Financial Statements, the Directors are required to:

•    select suitable accounting policies and then apply them consistently;

•    make judgements and estimates that are reasonable and prudent;

•    state whether applicable UK Accounting Standards, comprising FRS 102, have been followed, subject to any material departures disclosed and explained in the Financial Statements; and

•    prepare the Financial Statements on a going concern basis unless it is inappropriate to presume that the Company will continue in business,

and the Directors confirm that they have done so.

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and to enable them to ensure that the Financial Statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The Financial Statements are published on the www.jpmussmallercompanies.co.uk website, which is maintained by the Manager. The maintenance and integrity of the website maintained by the Manager is, so far as it relates to the Company, the responsibility of the Manager. The work carried out by the Auditors does not involve consideration of the maintenance and integrity of this website and, accordingly, the Auditor accepts no responsibility for any changes that have occurred to the accounts since they were initially presented to the website. The accounts are prepared in accordance with UK legislation, which may differ from legislation in other jurisdictions.

Under applicable law and regulations the Directors are also responsible for preparing a Directors' Report and Directors' Remuneration Report that comply with that law and those regulations.

Each of the Directors, whose names and functions are listed on page 41 of the Annual Report confirm that, to the best of their knowledge:

•    the Financial Statements, which have been prepared in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law), give a true and fair view of the assets, liabilities, financial position and return or loss of the Company; and

•    the Strategic Report includes a fair review of the development and performance of the business and the position of the Company, together with a description of the principal and emerging risks and uncertainties that it faces.

The Board confirms that it is satisfied that the Annual Report and Financial Statements taken as a whole are fair, balanced and understandable and provide the information necessary for shareholders to assess the Company's position and performance, business model and strategy.

The Board also confirms that it is satisfied that the Strategic Report and Directors' Report include a fair review of the development and performance of the business, and the Company, together with a description of the principal risks and uncertainties that it faces.

For and on behalf of the Board

Dominic Neary

Chair

16th April 2026

STATEMENT OF COMPREHENSIVE INCOME

	Year ended			Year ended
	31st December 2025			31st December 2024
	Revenue	Capital	Total	Revenue	Capital	Total
	£'000	£'000	£'000	£'000	£'000	£'000
Net (losses)/gains on investments held at fair value
through profit or loss	-	(35,610)	(35,610)	-	28,833	28,833
Net foreign currency gains/(losses)	-	1,301	1,301	-	(383)	(383)
Income from investments	3,422	-	3,422	3,466	97	3,563
Interest receivable	314	-	314	579	-	579
Gross return/(loss)	3,736	(34,309)	(30,573)	4,045	28,547	32,592
Management fee	(387)	(1,548)	(1,935)	(407)	(1,626)	(2,033)
Other administrative expenses	(610)	-	(610)	(572)	-	(572)
Net return/(loss) before finance costs and taxation	2,739	(35,857)	(33,118)	3,066	26,921	29,987
Finance costs	(279)	(1,117)	(1,396)	(256)	(1,021)	(1,277)
Net return/(loss) before taxation	2,460	(36,974)	(34,514)	2,810	25,900	28,710
Taxation	(494)	-	(494)	(489)	-	(489)
Net return/(loss) after taxation	1,966	(36,974)	(35,008)	2,321	25,900	28,221
Return/(loss) per ordinary share	3.39p	(63.77)p	(60.38)p	3.74p	41.72p	45.46p

A dividend of 3.2p (2024: 3.1p) per ordinary share in respect of the financial year ended 31st December 2025, amounting to £1,720,000 (2024: £1,879,000), is recommended for approval by shareholders. Further information on dividends is given in note 10 on page 79 of the Annual Report.

All revenue and capital items in the above statement derive from continuing operations. No operations were acquired or discontinued in the year.

The 'Total' column of this statement is the profit and loss account of the Company and the 'Revenue' and 'Capital' columns represent supplementary information prepared under guidance issued by the Association of Investment Companies.

Net return/(loss) after taxation represents the profit/(loss) for the year and also Total Comprehensive Income.

STATEMENT OF CHANGES IN EQUITY

For the year ended 31st December

	Called up	Share	Capital
	share	premium	redemption	Capital	Revenue
	capital	account	reserve	reserves1	reserve1	Total
	£'000	£'000	£'000	£'000	£'000	£'000
At 31st December 2023	1,638	45,758	1,851	226,987	3,491	279,725
Repurchase of ordinary shares into Treasury	-	-	-	(12,242)	-	(12,242)
Repurchase and cancellation of forfeited shares2,3	(3)	-	3	(42)	-	(42)
Net return	-	-	-	25,900	2,321	28,221
Dividends paid in the year (note 10)	-	-	-	-	(1,890)	(1,890)
Forfeiture of unclaimed dividends (note 10)2	-	-	-	-	17	17
At 31st December 2024	1,635	45,758	1,854	240,603	3,939	293,789
Repurchase of ordinary shares into Treasury	-	-	-	(26,717)	-	(26,717)
Net (loss)/return after taxation	-	-	-	(36,974)	1,966	(35,008)
Dividends paid in the year (note 10)	-	-	-	-	(1,830)	(1,830)
At 31st December 2025	1,635	45,758	1,854	176,912	4,075	230,234

¹   These reserves form the distributable reserves of the Company and may be used to fund distributions to shareholders. Further details can be found in note 15 on page 79 of the Annual Report.

²     During 2024, the Company undertook an Asset Reunification Program to reunite inactive shareholders with their shares and unclaimed dividends. In accordance with the Company's Articles of Association, the Company exercised its right to forfeit the shares belonging to untraced shareholders for a period of 12 years or more. These shares were bought back by the Company and cancelled. The proceeds, net of costs, were returned to the Company. In addition, any unclaimed dividends older than 12 years from the date of payment of such dividend were forfeited and returned to the Company.

³     The Company repurchased and subsequently cancelled forfeited shares at a total cost of £400,000. The amount due on these forfeited shares was £358,000, leading to a net cost of £42,000.

STATEMENT OF FINANCIAL POSITION

	At	At
	31st December	31st December
	2025	2024
	£'000	£'000
Fixed assets
Investments held at fair value through profit or loss	252,670	316,510
Current assets
Debtors	235	265
Current asset investments	1,168	1,265
Cash at bank	2,545	10
	3,948	1,540
Current liabilities
Creditors: amounts falling due within one year	(26,384)	(24,261)
Net current liabilities	(22,436)	(22,721)
Total assets less current liabilities	230,234	293,789
Net assets	230,234	293,789
Capital and reserves
Called up share capital	1,635	1,635
Share premium account	45,758	45,758
Capital redemption reserve	1,854	1,854
Capital reserves	176,912	240,603
Revenue reserve	4,075	3,939
Total shareholders' funds	230,234	293,789
Net asset value per ordinary share	428.5p	484.6p

STATEMENT OF CASH FLOWS

	Year ended	Year ended
	31st December	31st December
	2025	2024
	£'000	£'000
Cash flows from operating activities
Net (loss)/return before finance costs and taxation	(33,118)	29,987
Adjustment for:
Net losses/(gains) on investments held at fair value through profit or loss	35,610	(28,833)
Net foreign currency (gains)/losses	(1,301)	383
Dividend income	(3,422)	(3,563)
Interest income	(314)	(579)
Realised (losses)/gains on foreign exchange transactions	(76)	44
Realised foreign currency exchange losses on JPMorgan USD Liquidity Fund	(410)	(464)
(Increase)/decrease in other debtors	(7)	1
(Decrease)/increase in accrued expenses	(49)	62
Net cash outflow from operations before dividends, interest and taxation	(3,087)	(2,962)
Dividends received	2,946	3,009
Interest received	314	657
Overseas withholding tax recovered	19	29
Net cash inflow from operating activities	192	733
Purchases of investments	(90,096)	(120,370)
Sales of investments	118,326	116,679
Net cash inflow/(outflow) from investing activities	28,230	(3,691)
Dividends paid	(1,830)	(1,890)
Refund from forfeiture of unclaimed dividends	-	17
Net cost of repurchasing and cancelling forfeited shares1	-	(42)
Repurchase of ordinary shares into Treasury	(26,616)	(12,242)
Repayment of bank loan2	(23,228)	(7,850)
Draw down of bank loan2	27,099	7,888
Loan interest paid	(1,392)	(1,305)
Net cash outflow from financing activities	(25,967)	(15,424)
Increase/(decrease) in cash and cash equivalents	2,455	(18,382)
Cash and cash equivalents at start of year	1,275	19,237
Foreign currency exchange movements	(17)	420
Cash and cash equivalents at end of year	3,713	1,275
Cash and cash equivalents consist of:
Cash at bank	2,545	10
Current asset investment in JPMorgan USD Liquidity Fund	1,168	1,265
Total	3,713	1,275

¹    The Company repurchased and subsequently cancelled forfeited shares at a total cost of £400,000. The amount due on these forfeited shares was £358,000, leading to a net cash outflow of £42,000.

²     Repayment and draw down of the bank loans are settled on a net basis.

NOTES TO THE FINANCIAL STATEMENTS-

For the year ended 31st December 2025

1.       Accounting policies

(a)     General information and basis of accounting

The Financial Statements are prepared under the historical cost convention, modified to include fixed asset investments at fair value, and in accordance with the Companies Act 2006, United Kingdom Generally Accepted Accounting Practice (UK GAAP), including 'the Financial Reporting Standard applicable in the UK and Republic of Ireland' (FRS 102) and with the Statement of Recommended Practice 'Financial Statements of Investment Trust Companies and Venture Capital Trusts' (the SORP) issued by the Association of Investment Companies in July 2022.

All of the Company's operations are of a continuing nature.

The Directors believe that having considered the Company's investment objective (see page 27 of the Annual Report), risk management policies (see pages 27 and 28 of the Annual Report), capital management policies and procedures (see page 29 of the Annual Report), the nature of the portfolio and expenditure projections, the Company has adequate resources, an appropriate financial structure and suitable management arrangements in place to continue in operational existence to 30th April 2027, being at least 12 months from the date of approval of these Financial Statements. The Board has, in particular, considered the impact of market volatility from the ongoing conflicts between Ukraine and Russia and in the Middle East as well as continued uncertainty regarding US domestic and foreign policy, and does not believe the Company's going concern status is affected. For these reasons, the Directors consider it appropriate to adopt the going concern basis of accounting in preparing the Company's Financial Statements. They have not identified any material uncertainties to the Company's ability to continue as a going concern.

The policies applied in these Financial Statements are consistent with those applied in the preceding year.

2.       Dividends

(a)     Dividends paid and declared

	2025		2024
	Pence	£'000	Pence	£'000
Dividend paid
Final dividend in respect of prior year	3.1	1,830	3.0	1,890
Total dividends paid in the year	3.1	1,830	3.0	1,890
Forfeiture of unclaimed dividends over 12 years	-	-	-	(17)
Net dividends	3.1	1,830	3.0	1,873

All dividends paid and declared in the year have been funded from the revenue available for distribution.

The final dividend proposed in respect of the year ended 31st December 2024 amounted to £1,879,000. However, the amount paid amounted to £1,830,000 due to shares repurchased after the balance sheet date but prior to the record date.

(b)     Dividends for the purposes of Section 1158 of the Corporation Tax Act 2010 (Section 1158)

The requirements of Section 1158 are considered on the basis of dividends declared in respect of the financial year, shown below.

The revenue available for distribution by way of dividend for the year is £1,966,000 (2024: £2,321,000).

	2025		2024
	Pence	£'000	Pence	£'000
Final dividend	3.2	1,720	3.1	1,879
Total dividend for Section 1158 purposes	3.2	1,720	3.1	1,879

In accordance with the accounting policy of the Company, the final dividend declared in respect of the year ended 31st December 2025, will be reflected in the Financial Statements for the year ending 31st December 2026.

3.       (Loss)/return per ordinary share

	2025	2024
	£'000	£'000
Revenue return	1,966	2,321
Capital (loss)/return	(36,974)	25,900
Total (loss)/return	(35,008)	28,221
Weighted average number of ordinary shares, excluding Treasury shares, in issue
during the year	57,978,084	62,082,503
Revenue return per ordinary share	3.39p	3.74p
Capital (loss)/return per ordinary share	(63.77)p	41.72p
Total (loss)/return per ordinary share	(60.38)p	45.46p

4.       Net asset value per ordinary share

	2025	2024
Net assets (£'000)	230,234	293,789
Number of ordinary shares in issue	53,735,306	60,622,264
Net asset value per ordinary share	428.5p	484.6p

16th April 2026

For further information, please contact:

Priyanka Vijay Anand

For and on behalf of

JPMorgan Funds Limited - Company Secretary

E-mail: [e-mail]

Telephone: [phone] or or [phone]

ENDS 

Neither the contents of the Company's website nor the contents of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated into, or forms part of, this announcement.

A copy of the full Annual Report will be submitted to the National Storage Mechanism and will be available for inspection at https://data.fca.org.uk/#/nsm/nationalstoragemechanism and also on the Company's website at www.jpmussmallercompanies.co.uk where up to date information on the Company, including daily NAV and share prices, factsheets and portfolio information can also be found.

 

END