Good morning investment trust investors, 

Contents

1. Overview for the week
2. Frostrow Retail Investor Events
3. Investment Themes
4. Sector data for the week

1. Overview for the week

We have seen a number of renewable energy funds report updates citing less sun and particularly less wind this week. The meteorologists are separately telling us what we all know also, that we haven’t had much rain either. In fact, we already have drought conditions in the UK with the driest Spring in 69 years so far. No drought of news though in our financial markets as the tariffs kept coming this week with Trump starting the week commenting that he will apply 100% tariffs to the non-US film industry. Trump also met with Mark Carney, the new Canadian PM, telling him “some things are never for sale”. Also in the US, the Federal Reserve held interest rates given that tariffs have created "so much uncertainty". That is the third in a row without action.

In Germany, Merz just about became Germany’s new Chancellor after worryingly falling short in the first vote. The UK managed to sign not one, but two, trade deals, one with India (6th largest economy) and one with the US (largest economy globally). Pretty significant stuff given this is the US’s first trade deal post tariffs and India is forecast to become the world's third largest economy in a few years. It likely fires the starter’s gun on other lead economies negotiating bilateral deals now. For the UK, Europe must be next. The Bank of England cut by 25 basis points from 4.5% to 4.25%, a vote widely expected but with the Committee divided with five voting for the cut, two voting for a 50bps cut and two voting for no change. The rationale for cutting was inflation getting more under control, especially with the tariff uncertainty.

Meanwhile there are plenty of articles in the newspapers in recent days commenting that investors need to hurry up and put money into savings accounts before interest rates are cut. That may of course be correct (certainly was this week) and the BoE have cut four times now since last summer. However, if you look at the bond market, 2-year UK gilts yielded 4.23% a year ago and now yield 3.89%, only c30bps less (and 10-year Gilts yield about 40bps more today than a year ago). If, as is reported also this week, global debt levels have risen by another $7.5 trillion to $324 trillion, one would presume that bonds for investors are less attractive unless investors are compensated to invest in them by increasing yields and push up inflation. So perhaps not quite the need to rush to put savings into cash accounts. One could argue equities and equity focused investment trusts are really the only way to navigate this environment sensibly. Am I bias? Possibly. But it is very clear others also have decisions like this to make. Let’s see if Greg Abel at Berkshire Hathaway puts his $348bn in cash accounts / US Treasuries or back into equities in the coming weeks, and if equities, equities where exactly.

In the investment trust sector, we have seen an interesting capital allocation policy update from Chrysalis Investments having come under pressure from Asset Value Investors and the LondonMetric (LMP LN) scheme to acquire Urban Logistics (SHED LN) is pushing forward also. Further in the REIT space, we note a continuation of positive news from the real estate sector with Frostrow client, Custodian Property Income REIT (CREI LN) saying “it would not be unreasonable to view UK real estate as a relatively safe haven for investors seeking stable asset backed income in established and secure jurisdictions. This should be particularly true for the Company’s diversified investment strategy that generally targets sub £10m, higher yielding, regional assets across the UK, that principally serve a local and/or domestic market". The Company highlights a little frustration with the share rating by highlighting also “despite the fact that we continually demonstrate our ability to realise sales at premiums to book value, the discount remains somewhat less than the UK listed real estate market average discount of c. 28%. This suggests to us that while investors value the income, they also still overplay the risk in UK real estate which should be set against a backdrop of falling interest rates, rising property prices, growing rents and falling vacancy rates which are normally associated with a reduction in risk." "...private equity is seeing value in the sector while others are letting the grass grow under their feet."

2. Frostrow Retail Investor Events

Augmentum Fintech (AUGM LN, Financials & Financial Innovation, £140.5m mkt capn, 48.9% discount to NAV): Please contact Frostrow for interest in seeing Tim Levene in London and the regions in 2025. The AUGM Capital Markets Day will take place on Wednesday 2 July 2025 at Searcy’s at The Gherkin, between approx. 8:30am and 1:30pm (timings and line up still to be finalised). The latest Frostrow webinar is available to see on You Tube.

https://www.youtube.com/channel/UCAptpfmx0HITqvlI68psd7Q

Aurora UK Alpha (ARR LN, UK All Companies, £287.6m mkt capn, 8.1% discount to NAV): the Phoenix investment team are available for meetings with investors in 2025. The last webinar was recorded on 20 January 2025 and is available on the following link:

https://www.youtube.com/watch?v=0hl0yNZgRlM

A recent article from UK Investor Magazine to read also:

https://ukinvestormagazine.co.uk/aurora-uk-alpha-the-north-star-of-intrinsic-value/

Biotech Growth Trust (BIOG LN, Biotechnology & Healthcare, £184.5m mkt cap, 8.8% discount to NAV): the latest webinar took place at 3pm UK on Tuesday 25 February 2025. You can hear the recording on the following link:

https://www.youtube.com/watch?v=wxOUIC0oT5s

CC Japan Income & Growth Trust (CCJI LN, Japan, £252.6m mkt capn, 5.8% discount to NAV): please contact Frostrow Capital in order to arrange a meeting with management in 2025. In addition, The last webinar was recorded on 22 January 2025 and is available on the following link:

https://www.youtube.com/watch?v=MmbViKRnsdA

CQS Natural Resources Growth & Income (CYN LN, Commodities & Natural Resources, £127.4m mkt capn, 4.4% discount to NAV): please contact Frostrow to arrange a one-on-one meeting with management in 2025. Please see the link to the last webinar on 4 November 2024:

https://www.youtube.com/watch?v=dhSC3wNKLxM

Custodian Property Income REIT (CREI LN, Property UK Commercial, £348.3m mkt capn, 18.9% discount to NAV): Richard Shepherd-Cross, lead manager, available for meetings in 2025 (physical throughout UK, or zoom, as per preference). In addition, the last webinar was recorded in January 2025 and is available on the following link:

https://www.youtube.com/watch?v=Qd1-ciXoC2o

Ecofin Global Utilities (EGL LN, Infrastructure Securities, £218.3m mkt capn, 9.6% discount to NAV) : Jean-Hugues de laMaze, lead manager of the Trust presented at a webinar with Frostrow on Wednesday 23 April 2025. The link to the recording will be available on the link below:

https://www.youtube.com/watch?v=lVkYbR67ecE

Finsbury Growth & Income Trust (FGT LN, UK Equity Income, £1,323.6m mkt capn, 6.7% discount to NAV): Nick Train’s AGM presentation was recorded and is available to view on the Frostrow You Tube page. Click the link here to see it, it is worth a view:

https://www.youtube.com/watch?v=yE9HV__Iwlc

There is also a good “insider interview” from Interactive Investor as Nick explains the “generational” opportunity to buy UK growth firms

https://www.ii.co.uk/analysis-commentary/nick-train-generational-opportunity-buy-uk-growth-firms-ii534473

MIGO Opportunities Trust (MIGO LN, Flexible Investment, £63.6m mkt capn, 5.1% discount to NAV): Following on from the HY results release, Nick Greenwood and Charlotte Cuthbertson presented on a webinar at 11am on 24 January 2025. This one stop shop is a great way to play the discounts on offer generally in the listed fund sector. The recording can be accessed on Frostrow’s You Tube page here:

https://www.youtube.com/watch?v=XuSoFuNKSXk

Mobius Investment Trust (MMIT LN, Global Emerging Markets, £147.7m mkt capn, 5.8% discount to NAV): Carlos Hardenberg, lead manager, presented at webinar this week from his trip to Taiwan. Please see below the link to the recording:

https://www.youtube.com/watch?v=sMBNxj6ZD-o

Temple Bar Investment Trust (TMPL LN, UK Equity Income, £849.5m mkt capn, 2.6% discount to NAV): Ian Lance and Nick Purves presented on the trust at a webinar on 18 March 2025. Please do click on the link below to see the recording as well as the link to ‘reflections on current market volatility’ or to hear the Chairman, Richard Wyatt, or to see the recent AGM update

https://www.youtube.com/watch?v=wkaifQndXaQ

https://www.templebarinvestments.co.uk/media/insights/reflections-current-market-volatility/

https://www.investormeetcompany.com/updates/an-update-from-the-chairman/show

https://www.youtube.com/watch?v=AcVspDPT3-c

Worldwide Healthcare Trust (WWH LN, Biotechnology & Healthcare, £1,405.4m mkt capn, 10.7% discount to NAV): Sven Borho and Trevor Polischuk recently completed the latest webinar overview (November 2024). See the Frostrow You tube page for the recording. Further updates available on request.

https://www.youtube.com/watch?v=tppMeH6W9Zo

In addition, if you did not make the 30-year anniversary event and you would like a copy of the presentation, please contact Frostrow

Frostrow Investor Relations team – Messrs Grant Challis, Neil Winward, Matt Burrows, Matt Norfolk-Clarke & Nicholas Todd

Please contact us on ir@frostrow.com

Trump is doing his best to re-set the world trade order and in so doing will potentially re-set the investment landscape. Trade deals are happening now. There will be others clearly. What has worked for the last few years (ie US Equity trackers, passive investments and short dated bonds) will not necessarily be the best idea in the coming periods. The investment trust sector in the UK represents one third of the FTSE 250 Index and half of the FTSE Small Cap Index. There are highly valuable listed fund vehicles using the structure appropriately available to use for savings and investment today, as there have been for the last 150 + years.

Find us on the web:  https://www.frostrow.com/

Find us on You Tube:  https://www.youtube.com/channel/UCAptpfmx0HITqvlI68psd7Q

Check out our April 2025 summary podcast also: FROSTROW CAPITAL - Frostrow Talks Trusts - AI Podcast - InvestorMeetCompany

Frostrow Capital, bringing you high quality, differentiated product in a UK listed closed-ended form

3. Further investment themes evident in the investment trust sector this week include:

Discount Control

Trump is doing his best to re-set the world trade order and in so doing will potentially re-set the investment landscape. Trade deals are happening now. There will be others clearly. What has worked for the last few years (ie US Equity trackers, passive investments and short dated bonds) will not necessarily be the best idea in the coming periods. The investment trust sector in the UK represents one third of the FTSE 250 Index and half of the FTSE Small Cap Index. There are highly valuable listed fund vehicles using the structure appropriately available to use for savings and investment today, as there have been for the last 150 + years.

Foresight Solar Fund Q1 NAV to 31 March 2025 (FSFL LN, Renewable Energy Infrastructure, £430.5m mkt capn, 29.7% discount to NAV): NAV 111.0p (31 Dec 112.3p); "Lower power price forecasts for the UK and Spain, especially in the medium and long term, were the primary drivers of the reduced NAV in the quarter." "The Company continued its buyback programme, repurchasing 5.6 million shares, returning £4.2 million to shareholders, and adding 0.4pps to NAV in the first quarter of 2025. FSFL has delivered a cumulative 2.6pps increase in NAV since the buyback began in May 2023." Gearing of 40% of gross asset value (Dec 31 39.4%). "The sale of the Australian operational solar and development-stage BESS portfolio is progressing. The investment manager is working with technical advisors to complete the necessary forecasting assessments, but, as previously explained, this has taken longer than expected. There may be further knock-on effects on the deal timeline as the investment manager balances an expeditious sale with maximising shareholder value."

Octopus Renewables Infrastructure Q1 NAV to 31 March 2025 (ORIT LN, Renewable Energy Infrastructure, £390.4m mkt capn, 30.6% discount to NAV): NAV 101.62p (31 Dec 102.65p); "Sustained high interest rates and bond yields - themselves a response to persistent inflationary pressures - continue to shape discount rate benchmarks across the sector. The increase in underlying discount rates reflects alignment with prevailing market conditions, supported by transaction evidence observed by the Investment Manager, and resulted in a £7.5 million reduction in portfolio valuation over the period." "During 2024, the Company launched a share buyback programme with an initial tranche of up to £10 million, which was subsequently increased to £30 million. In Q1 2025, ORIT repurchased 4,088,206 shares for approximately £2.6 million at an average price of 64.8 pence per Ordinary Share. Following these buybacks, the total number of voting rights in the Company as at 31 March 2025 was 551,570,568."

European Opportunities Trust (EOT LN, Europe, £559.9m mkt capn, 5.7% discount to NAV): produces a circular in regard to a tender offer (announced in February) of up to 25% of issued share capital at NAV less 2% less costs; "For the avoidance of doubt, the Board's intention to arrange for the conditional tender offer in 2026 is not affected by the present Tender Offer." (based on the three-year performance to 31 May 2026); the Board also seek "renewal of its authority to make market purchases of up to 14.99 per cent. of the Shares currently in issue at the General Meeting."

M&A news

Harmony Energy Income Trust (HEIT LN, Renewable Energy Infrastructure, £219.2m mkt capn, 4.5% premium to NAV) has published the Scheme Document in relation to its recommended cash acquisition by PP Bidco Limited (controlled by Foresight) at 92.4pps.

Assura plc (AGR LN, £1,580m mkt capn) delayed the publication of the scheme document in relation to KKR’s recommended cash offer, due to a delay in obtaining approval from the JSE to post said document, until 1700 BST on 21 May 2025.

Care REIT (CRT LN, Property – UK Healthcare, £446.7m mkt capn, 13.0% discount to NAV) has confirmed today, 8 May 2025, will be the final day of trading in shares as the Scheme has become fully unconditional, with the Court Order expected to be delivered on 9 May 2025, at which point the Scheme will be Effective. The Company subsequently confirmed that it has become effective.

LondonMetric Property (LMP LN, £3,930m mkt capn) and Urban Logistics REIT (SHED LN) have agreed terms on a recommended cash and share offer pursuant to which LMP will acquired SHED, with SHED shareholders receiving 0.5612 new shares of LMP and 42.8pps – as well as the retention of dividend in respect of H2, expected to be 4.35pps which is expected to be declared on or around the publication of the Scheme Document. Irrevocables from Achilles Investment Company (AIC LN), North Atlantic Smaller Companies (NAS LN) and TR Property (TRY LN) have been undertaken, representing 5.73% of SHED’s ISC. Total irrevocables received of 6.37% of shareholders. The Scheme is expected to become effective by 30 June 2025.

Management update

Ecofin US Renewables (RNEW LN, Renewable Energy Infrastructure, £34.9m mkt capn, 43.4% discount to NAV) has applied to the FCA to register as a self-managed alternative investment fund, having been served notice by its existing manager in February 2025 appointing “Sustainability Partners Services, LLC, to provide day-to-day operational support.” “Nancy Johnson, currently VP, Finance and Asset Management at Ecofin Advsiors, has accepted a new role with Sustainability Partners as CFO and will continue to oversee the management of the assets.” EA has agreed to waive all fees payable to it by the Company pursuant to the AIFM Agreement between the date of this announcement and the Effective Date. Upon the early termination of Ecofin's appointment on the Effective Date, Ecofin has agreed to pay the Company the sum of US$100,000. "the Company has agreed to pay Sustainability Partners a one-off setup fee of US$50,000 and an ongoing annual services fee equal to the lesser of one per cent. of the market value of the Company's ordinary shares or the Company's Net Asset Value, subject to a minimum annual fee of US$325,000."

Target Healthcare REIT (THRL LN, Property – UK Healthcare, £627.7m mkt capn, 14.9% discount to NAV) EPRA NTA as at 31 March 2025: +0.3% over calendar Q1 2025 to 113pps, driven by LFL valuation increase driven by inflation-linked rent reviews. EPRA EPS 1.472p vs DPS 1.471p (declared today); LTV 22.9%; WAULT 25.8 years. THRL is “nearing resolution in a process to re-tenant an asset where rent was not being paid… this has resulted in a short-term detrimental impact on rental income and additional administration costs, and the drop in EPRA earnings and lower rent collection in the quarter, which are expected to recover following resolution of this matter.” "Gordon Bland, the Manager's Finance Director, has decided to leave the business next month after 12 years. I'd like to thank him for his excellent work during that period, and we wish him well for the future. An Interim FD is in place as we transition to a permanent replacement, with a full search process being well advanced."

Continuation vote

Chrysalis Investments (CHRY LN, Growth Capital, £525.5m mkt capn, 35.7% discount to NAV): top five holdings account for 81% of NAV; "While it is disappointing that recent stock market volatility has delayed the IPO of Klarna, we do not believe these conditions will have a detrimental impact on its financial performance, placing it in a good position to float when uncertainty abates." Total cash of £117m (decreased over the quarter due to the ongoing share buyback programnme). "With improved liquidity visibility, the Board has reviewed the business plan and, where appropriate, will propose amendments to the CAP for consideration at the 2026 AGM." "As of May 2025, approximately £57 million has been returned to shareholders through buybacks. At the current pace, the Company is on track to meet the full £100 million target by September 2025 - achieving in 18 months what was initially expected to be achieved in 36 months. Thereafter, the Company has committed under the CAP to continue to return at least 25% of net realised gains on the Company's investments, with such gains being measured as net realised gains against historical cost price (and not NAV)." With CHRY having a circa 40% discount to NAV, the Board "continues to target a materially narrower discount over time." "Asset Value Investors (AVI), the Company's largest shareholder (as the manager of a number of underlying funds), recently wrote to the Board requesting that a continuation vote be proposed at the 2026 AGM. The letter was co-signed by a group of other shareholders, with the signatories collectively representing approximately 27% of the Company's shares at the time. The Board believes that the appropriate timing for the next continuation vote remains the 2027 AGM, as stated in the Company's articles, but in light of the shareholder letter will put forward an ordinary resolution to the 2026 AGM (see below) to seek shareholders' reaffirmation of the current CAP, or, where appropriate, propose amendments to the CAP, pending the continuation vote in 2027." Also, no new investments to be made and all net realisations proceeds to be returned at NAV

Dividend news

Chelverton UK Dividend Trust (SDV LN, UK Equity Income, £29.5m mkt capn, 4.8% discount to NAV): Zeros have been repaid and thus the Company has no borrowings. "As the Company is now ungeared, post the repayment of the final capital entitlement of the 2025 ZDPs, the underlying income from the restructured portfolio will lead to reduced dividend payments to ordinary shareholders. However, the Company has significant revenue reserves (£2.8m as at 31 October 2024, the last reported date), which can be used to supplement the underlying income. Consequently, the Board announces its intention to pay 2.5p per ordinary share on a quarterly basis being a total of 10.00p per ordinary share per annum for the next three years ending 30 April 2028 (subject inter alia to market conditions at the time), effective from the first interim dividend in respect of the year to April 2026. The shares will therefore provide a yield of 7.6% (based on the closing share price as at 8 May 2025). This dividend target takes into account the Company's revenue reserves and assumes no change in the underlying portfolio income."

Results / updates

The Renewables Infrastructure Group (TRIG LN, Renewable Energy Infrastructure, £1,911.5m mkt capn, 32.5% discount to NAV) NAV as at 31 March 2025: -2.8% over calendar Q1 2025 to 112.7pps, driven by “a reduction in Swedish power price forecasts (-1.2pps), an increase in European discount rates (-1.2pps) and low wind resource in the quarter (-1pps).” “Portfolio performance was below forecasts for the quarter. Generation was 13% below budget predominantly driven by lower-than-average wind levels, particularly for UK wind projects… Whilst this will impact operational cash flows in the short term, TRIG expects to cover its target dividend of 7.55pps for FY2025.”

Greencoat Renewables (GRP LN, Renewable Energy Infrastructure, £810.6m mkt capn, 31.2% discount to NAV): NAT at end March 2025 105.1c and dividend of 1.7025c; cash generated Eur48m, 14% below budget due primarily to lower wind speeds than average; gross dividend cover 2.5x; 6.81c dividend target for 2025; total cash available of Eur147m and Eur149m RCF also; 54% gearing

North Atlantic Smaller Companies FY results to 31 January 2025 (NAS LN, Global Smaller Companies, £488.4m mkt capn, 31.0% discount to NAV): NAV TR +6.5% vs Russell 2000 Index £ +20.0%; "During the year, 241,575 shares (2024: 140,493) were acquired at a substantial discount to the net asset value. This benefits all long-term shareholders by creating an immediate uplift in the net asset value per share. At the forthcoming AGM shareholders will once again be asked to support a Rule 9 waiver allowing the company to continue to repurchase shares without requiring our Chief Executive, and persons and companies presumed to be acting in concert with him, to make a mandatory offer under Rule 9 of the Takeover Code for the company." "Your directors are seeking to improve liquidity of shares in the trust and have therefore recommended a 10 for 1 share sub-division which will require shareholder approve at the AGM."

BlackRock Smaller Companies FY results to 28 February 2025 (BRSC LN, UK Smaller Companies, £561.2m mkt capn, 12.2% discount to NAV): NAV TR -0.6% vs FTSE AIM All-Share Index -2.6%; EPS +4.5% due to increased revenue and share buybacks; 44p total dividend for year (+4.8% 2024); net gearing of 13.3% of net assets (2024: 11.5%); "During the year, the Company bought back a total of 3,515,000 ordinary shares at a total cost of £47.1 million to be held in treasury. All shares were bought back at a discount to NAV, delivering an uplift to the NAV per share of 0.7% for continuing shareholders for the year under review."

3i Infrastructure (3IN LN, Infrastructure, £3,080.6m mkt capn, 13.8% discount to NAV) FY results to 31 March 2025: NAV TR +10.1% to 386.2pps; FY2026 dividend target +6.3% to 13.45pps. 3IN “delivered a solid performance this year… set against the backdrop of a persistently challenging listed market." "The average gearing across the portfolio stands at a modest 35% (2024: 32%) of enterprise value, with no material refinancing requirements until 2028."

HgCapital Trust (HGT LN, Private Equity, £2,334.4m mkt capn, 3.4% discount to NAV) Quarterly NAV as at 31 March 2025: -2%; share price -5.5%. “Trading performance across the portfolio continues to be strong and in-line with that seen in recent quarters, contributing 5% to NAV growth in the quarter, however in aggregate this was offset by lower valuation multiples.” LTM “sales and EBITDA growth of 20% and 21% respectively, with EBITDA margins of 33%” across investment portfolio. £49m of realisations over the quarter with post-period exits of £102m, vs £46m deployed during the quarter (and post-period investments of £232m). £461m of liquid resources (19% of NAV) of commitments of £1.4bn (59% of NAV) for the next 3 to 4 years

Partners Group Private Equity (PEY/S LN, Private Equity, £641.7m mkt capn, 33.5% discount to NAV) NAV as at 31 March 2025: NAV -3.9% over the month to €14.33, driven by portfolio revaluations (-1.8%, mostly KinderCare) and FX (-1.7%). €2m invested during month vs “minimal” distributions.

Custodian Property Income REIT (CREI LN, Property – UK Commercial, £348.3m mkt capn, 18.9% discount to NAV) NAV as at 31 March 2025: TR +3.4% to 96.1pps; EPRA EPS 1.6p vs DPS 1.5p. Target dividends per share of no less than 6.0p for the year ending 31 March 2026. This target dividend represents a 7.9% yield based on the prevailing 76p share price"...during periods of trade uncertainty such as the one the world now finds itself in, it would not be unreasonable to view UK real estate as a relatively safe haven for investors seeking stable asset backed income in established and secure jurisdictions. This should be particularly true for the Company’s diversified investment strategy that generally targets sub £10m, higher yielding, regional assets across the UK, that principally serve a local and/or domestic market". Net gearing was 27.9% loan-to-value at 31 March 2025 (31 Dec 24: 28.5%). "Despite the fact that we continually demonstrate our ability to realise sales at premiums to book value, the discount remains somewhat less than the UK listed real estate market average discount of c. 28%. This suggests to us that while investors value the income, they also still overplay the risk in UK real estate which should be set against a backdrop of falling interest rates, rising property prices, growing rents and falling vacancy rates which are normally associated with a reduction in risk." "...private equity is seeing value in the sector while others are letting the grass grow under their feet."

Wind up news

Aquila European Renewables (AERI/S LN, Renewable Energy Infrastructure, £211.7m mkt capn, 34.7% discount to NAV) NAV as at 31 March 2025: TR +0.1% over calendar Q1 2025 to €0.8395, as the dividend offset a small increase (+0.2%) in the portfolio discount rate which is now 7.5%; “European power price curves across all relevant power price regions of the portfolio remained stable over the last quarter.” €0.0079 dividend declared in respect of the period. “The Board, together with its advisers, continues to work on the divestment of the remainder of the company's portfolio… there can be no guarantee that a similar outcome can be achieved on the sale of the company's remaining portfolio.” AERI “is currently targeting for the managed wind-down process to be completed by way of two discrete portfolio disposals… [and] AERI has agreed non-binding Heads of Terms and entered into exclusivity with a preferred bidder for the proposed disposal of a portfolio of assets that represents a majority of the portfolio. Due diligence is progressing as planned, and AERI expects to be able to provide an update to shareholders by the end of June 2025.” AERI “is simultaneously pursuing a focussed sale process in relation to a portfolio of assets representing a single geography.”

Tariff impact

Tritax BigBox REIT trading update (BBOX LN, Property – UK Logistics, £3,535.0m mkt capn, 21.7% discount to NAV): "Despite a period of challenging investment market conditions, we have successfully sold £634 million of assets at or above their book valuations since the September 2022 mini-budget...We expect our investment portfolio, which our clients primarily use to serve the UK domestic market, to remain unaffected by US tariff changes...We continue to make good progress on our asset management initiatives and, with a higher proportion of leases subject to review in H2 2025, expect to see an acceleration in rent income capture as the year progresses."

Portfolio news

Picton Property Income (PCTN LN, £397.6m mkt capn) has announced an interim dividend of 0.95pps in respect of calendar Q1 2025. PCTN has also “secured approval, via permitted development rights, to create an additional floor of residential accommodation above offices at 50 Farringdon Road, London EC1.” The consent allows for the creation of a new fourth storey, comprising 13 residential flats and totalling approximately 8,200 sq ft, all with views across the London skyline towards St Paul's Cathedral.

BioPharma Credit (BPCR LN, Debt – Direct Lending, £996.1m mkt capn, 11.1% discount to NAV) has received $30m and $1,6069,464 of accrued interest and prepayment fees from its share of the BioCryst Pharmaceuticals loan which has been partially prepaid. BPCR borrower Evolus (EOLS US) has amended and restated its loan agreement with the company and BioPharma V and BPCR’s allocation to the new tranche is up to $20.8m.

Apax Global Alpha (APAX LN, Private Equity, £577.0m mkt capn, 39.2% discount to NAV) will invest approx. €14m, on a look-through basis, in Norva24 Group, a “provider of underground infrastructure maintenance services in Northern Europe.”

Baker Steel Resources (BSRT LN, Commodities & Natural Resources, £55.4m mkt capn, 42.1% discount to NAV): Futura and International Resources Holdings RSC LTD completed an agreement for a US$15m loan to Futura. "...the Company and other Futura shareholders, representing in excess of 50.1% of the fully diluted share capital of Futura, have signed option agreements giving IRH the right to acquire their respective shares at A$3.15 per Futura share within 9 months, which would value Futura at an Enterprise Value (EV) of some A$250 million. The A$3.15 price per share compares with the Company's current carrying value of A$2.21 per share and its acquisition price of A$1 per share. This transaction does not affect the Company's 1.5% Gross Revenue Royalty over production from Futura's mines." "Despite heightened uncertainty in commodity markets resulting from the trade tariff war, the Futura management team views the current weakness in the coking coal market as a short-term setback. They do not believe it will alter the longer-term positive outlook, with medium-term supply constraints balanced by expected strong demand increases anticipated for seaborne imports, most notably from India."

4. Sector data this week (AIC data, as at Thursday's close)

Equity Capital Markets

EJF Investments (EJFI LN, Debt – Structured Finance, £70.0m mkt capn, 28.2% discount to NAV): Further to the Rollover Offer, valid elections were received from 2025 ZDP Shareholders by the Closing Date in respect of a total 7,982,227 2025 ZDP Shares (representing approximately 41 % of the total number of 2025 ZDP Shares in issue). The Rollover Value attributed to each 2025 ZDP Share will be the Accrued Capital Entitlement of the 2025 ZDP Shares as at the Rollover Date of 139.0980 pence. A total of 11,102,466 new 2029 ZDP Shares will be issued pursuant to the Rollover Offer at the issue price of 100 pence per 2029 ZDP Share. The 2029 ZDP Initial Placing will be open until 1.00pm on 9 May 2025. The Company subsequently announced that a retail offer for the 2029 Zeros which is expected to be launched via RetailBook

Ex Dividend

AEET 36.837p special, AEWU 2p, AFL LN 3.45p, CVCG/E 2.3125p / €0.018125, FSV 3.36p, GCP 1.75p, PEY €0.375, PHLL $0.105, TMI/P $0.02, TORO €0.0178

China and the US meet in Switzerland this weekend so likely all eyes on that as we enter the new week.