Half-year Report

Schroder AsiaPacific Fund PLC

02 June 2026

 

LONDON STOCK EXCHANGE ANNOUNCEMENT

SCHRODER ASIAPACIFIC FUND PLC

HALF YEAR REPORT

Schroder AsiaPacific Fund plc (the "Company") hereby submits its Half Year Report for the six months ended 31 March 2026 as required by the Financial Conduct Authority's Disclosure Guidance and Transparency Rule 4.2.

Key Highlights

·      Asian equity markets delivered positive returns in sterling terms over the six months to 31 March 2026. The Company's NAV produced a total return of 3.7%, whilst the Benchmark's total return rose by 5.2% over the period.

·      Asia continues to provide access to a diverse set of high-quality companies across multiple markets and sectors, with valuations that appear attractive relative to long-term growth prospects.

·      The Company continued to be active in implementing its buyback policy, and the Board remains focused on managing discount volatility and helping to provide liquidity in the Company's shares.

The Half Year Report is also being published in hard copy format and an electronic copy of that document will shortly be available to download from the Company's web pages at www.schroders.co.uk/asiapacific.

The Company has submitted a copy of its Half Year Report to the National Storage Mechanism and it will shortly be available for inspection at https://data.fca.org.uk/#/nsm/nationalstoragemechanism. 

Enquiries:

Schroder Investment Management Limited

Charlotte Banks / Kirsty Preston (Press)	020 7658 2106
Natalia de Sousa (Company Secretarial)	020 7658 6000

HALF YEAR REPORT FOR THE SIX MONTHS ENDED 31 MARCH 2026

Chair's Statement

I am pleased to present my first interim Statement as Chair of the Company, having succeeded James Williams following the Company's AGM in January 2026. On behalf of the Board, I would like to record our thanks to James for his service to the Company and its shareholders, initially as a non-executive Director and subsequently as Chair.

Performance

Asian equity markets delivered a positive return in sterling terms over the six months to 31 March 2026, despite a sharp sell off in March triggered by the outbreak of hostilities in the Middle East, which reversed much of the earlier gains.

The Company's NAV produced a total return of 3.7% over the six-month period, lagging the Benchmark's total return of 5.2% over the same period. Performance was concentrated in certain sectors and driven by continued, and stronger than expected investment in AI data centres. This propelled Information Technology stocks and led to exceptional returns in markets such as Korea and Taiwan, while energy stocks also benefited from higher oil prices. As a result, Asian equity performance outpaced global markets.

Further detail on performance and portfolio activity can be found in the Investment Manager's Review.

Gearing

The Company was 3.0% geared at the start of the period, and by 31 March 2026 this had marginally increased to 3.8%. The Board continues to keep gearing under consideration and the Manager has access to a revolving credit facility, which will be used when the Investment Manager believes that the use of borrowing will be accretive to returns.

Discount management

The Company continued to be active in buying back its own shares. A total of 6,142,399 shares were purchased for cancellation during the period at a cost of £42 million, adding 0.4% to the NAV. Since the end of the period, the Company has bought back an additional  1,144,304 shares.

The Board remains focused on managing discount volatility and helping to provide liquidity in the Company's shares. The Board continues to follow a flexible strategy towards discount management and considers that a discount under 10% is a sensible target over the longer term in normal market conditions. During the period, the Company's shares traded at an average discount of 9.3%.

Board succession

The Board was pleased to welcome John Lydon and Ian Cadby as independent non-executive Directors on 1 May and 13 May 2026, respectively.

John has over 30 years' experience in M&A, capital markets, strategic advisory and investment across Europe, Asia, and North America. He has held various leadership roles in the financial sector at J.P. Morgan, Deutsche Bank and Davy Group, and in the industrial sector at CRH plc. John is currently a Venture Partner at Princeville Capital, a leading global growth-stage technology investor.

Ian has over 35 years' asset management experience, including seven years in Asia where he ran multi-asset portfolios. Formerly Chief Executive Officer and Chief Investment Officer of Liberty Ermitage Ltd, he brings deep expertise in board strategy & governance, derivative trading, and risk management. He has over 10 years' experience on investment trust boards, including as Chair of Aberdeen Asian Income Fund Ltd (until 12 May 2026) and remains Senior Independent Director of CQS New City High Yield Fund Ltd.

Both John and Ian will be put forward for election at the 2027 Annual General Meeting.

Portfolio management arrangements

The Board notes a refinement to the Company's portfolio management arrangements. Abbas Barkhordar will act as Lead Portfolio Manager, with Richard Sennitt as Alternate Portfolio Manager. Both will continue to work closely together, supporting continuity in oversight, decision-making and the application of the Company's established investment approach.

Schroders combination with Nuveen

On 12 February 2026, the Board of Schroders plc announced that it had agreed terms of a recommended cash acquisition by Nuveen LLC, to combine the two businesses. The transaction is not expected to complete until Q4 2026.

The Board of Schroder AsiaPacific Fund plc has been informed that Nuveen's intention is to maintain continuity across Schroders' existing investment and client-facing functions, and the Board will monitor progress in this regard.

Further details are available on the Schroders website: https://www.schroders.com/en/global/indivi dual/nuveenoffer/.

Outlook

The Board recognises that global equity markets face a more uncertain outlook as geopolitical risks and late cycle dynamics converge. While AI-driven investment has underpinned recent earnings and market gains, it has become increasingly concentrated and exposed to a potential cyclical correction, and the Iran conflict has introduced a material macro risk via sharply higher energy prices. Valuations across Asian markets are above long-term averages, reflecting stronger sentiment and confidence in the region's outlook. This supports a broadening earnings recovery with companies showing resilience despite some energy-related headwinds.  Overall, sustained earnings growth remains the key driver for continued performance.

From a longer term perspective, we agree with our Portfolio Manager that Asia continues to offer access to a diverse set of high-quality companies across multiple markets and sectors, many of which trade at attractive valuations relative to their growth potential.

Our investment approach remains focused on building a differentiated portfolio of the most compelling long-term opportunities across the region.

Nicky Richards

Chair

1 June 2026

Portfolio Manager Review

The six months to the end of March 2026 were volatile for Asian equity markets, with particularly sharp moves in the final month following the outbreak of war in the Middle East. For most of the period returns were strong, driven by continued global investment in Artificial Intelligence (AI) data centres. However, the escalation of the conflict in March unwound a significant portion of earlier gains. By the end of the period, Asian equities, as measured by the Benchmark Index were up around 5% in sterling terms, still outperforming global equity markets, which returned less than 2% over the same six months.

As in recent years, headline returns masked substantial divergence across countries and sectors. Information Technology (IT) was the standout sector, reflecting the strength of the AI investment cycle, which disproportionately benefited the IT heavy markets, Korea and Taiwan. Thailand also performed well, supported by a more decisive-than-expected election outcome and its index exposure to IT and energy stocks, the latter benefiting from higher oil and gas prices following the escalation of Middle East tensions. Outside of IT, energy and industrials, returns were far more subdued. Whereas Korea rose by over 50% during the period, several markets, including China and India, delivered double digit negative returns.

This uneven pattern of returns has further increased market concentration across the region, with a narrow set of themes - notably AI, defence and energy - accounting for the vast majority of positive performance. As a result, regional indices have become increasingly dominated by a small number of large stocks, with a declining proportion of constituents outperforming the market.

The scale of capital investment in AI data centres, which is already large, has continued to grow above market expectations. Spending has been led by large US technology companies, including established hyperscale cloud providers and internet platforms (Microsoft, Amazon, Google and Meta), alongside newer entrants such as Oracle and specialist "neocloud" providers. Earlier concerns around the sustainability of this spending have moderated as AI-related revenues have begun to accelerate for both data centre operators and the AI model developers, including OpenAI and Anthropic.

This spending ultimately translates into revenue for Asian technology hardware companies, which occupy critical positions in the AI supply chain. Taiwan Semiconductor Manufacturing Company (TSMC) remains the only manufacturer capable of mass producing leading-edge AI chips, such as those designed by Nvidia, Google and Amazon, while Korean companies Samsung Electronics and SK Hynix dominate advanced memory production. Beyond these well-known names, a broader ecosystem of Asian firms supplies essential components and services, including power management (Delta Electronics), chip design (MediaTek), packaging and testing (ASE Technology) and server assembly (Hon Hai).

Demand for AI-related components has proven largely unresponsive to price changes, reflecting the financial strength of the major US buyers, each willing to spend whatever is required to keep at the cutting-edge of this fast-evolving technology. At the same time, supply has remained relatively concentrated and disciplined. This combination has driven sharp increases in profitability across parts of the supply chain and has contributed to rising prices for key inputs, including commodity memory chips.

Not all sectors benefitted from the rapid adoption of AI. Share prices of software, IT services and certain internet platform companies were weak during the period as advances in AI capability raised questions over the long-term sustainability of existing business models. In particular, IT services companies such as Infosys, which provide relatively cheap software programming labour to companies in developed markets, came under pressure as they face existential risk from AI models which can now generate sophisticated code almost instantaneously and at low marginal cost. Similar concerns affected online platforms where AI agents may increasingly control customer acquisition, potentially weakening pricing power - including in areas such as online travel agents (OTAs), recruitment, marketplaces, classifieds, ride-hailing and delivery services. The Company's exposure to such companies was a drag on performance in markets such as India and China.

The most significant macroeconomic headwind during the period was the escalation of conflict in the Middle East from late February. Damage to energy infrastructure across the Persian Gulf and disruption to shipping through the Strait of Hormuz led to sharply higher oil and gas prices. Few economies or stocks in Asia stand to benefit from higher energy prices, and many Asian countries are heavily reliant on imported energy. The conflict is therefore a clear negative for the region, exacerbating inflationary pressures and weakening external balances. Higher energy prices also contributed to rising US inflation expectations and interest rate pressures, a backdrop that has historically been challenging for Asian equity markets.

Higher energy costs weighed on returns in India, Indonesia and the Philippines, where domestic economic momentum was already subdued. China's economy has also remained weak overall, with growth increasingly reliant on exports which have proved surprisingly resilient. In February, a US Supreme Court ruling struck down several tariffs imposed under International Emergency Economic Powers Act. While the administration signalled its intention to pursue alternative measures, these are more constrained (and in some cases time-limited), complicating the administration's negotiation position with trade partners. Despite this renewed policy uncertainty, investors have broadly welcomed the reduced scope for abrupt trade escalation compared with last year.

Performance

Over the six months to 31 March 2026, the Company's net asset value per share delivered a total return of +3.7%, lagging the MSCI All Country Asia ex Japan Index, which rose +5.2% over the same period.

Source: Schroders, Morningstar, GBP, cum income fair NAV.

Our underweight positions in China and India were positive contributors at an asset allocation level but were more than offset by negative stock selection, primarily within internet platform holdings. In China, detractors included OTA trip.com, music streaming service Tencent Music Entertainment, online recruitment platform Kanzhun, and social network giant Tencent, while in India OTA MakeMyTrip was the principal drag. Singapore-listed ride-hailing and local delivery platform Grab also underperformed. These disparate businesses experienced share price declines of between 25% and 60% during the period due to the same AI disruption concerns.

At this early stage of AI adoption, the risk of permanent value impairment remains difficult to assess. Investors have tended to price disruption risk aggressively, rather than wait for clarity on business model resilience. Our focus remains on platforms with distinct competitive advantages, such as proprietary datasets or physical logistics infrastructure, that should retain the ability to generate acceptable returns even if customer access channels evolve towards AI apps or 'agents'. We have historically liked the returns these kinds of companies can generate due to strong network effects and low capital intensity; it is unclear to what extent these characteristics will be eroded by the emerging technology, and it is a risk we continue to monitor closely.

Our underweight to Korea was a modest headwind, although this was largely offset by positive stock selection, notably Samsung Electronics and Samsung Electro Mechanics (SEMCO). The portfolio's overweight to IT, combined with favourable stock selection, supported relative returns. Additional positive contributors included our off-benchmark holding in Rio Tinto, and stock selection in Singapore, driven by Singtel and banks DBS and OCBC.

Portfolio activity

Five new positions were initiated during the period.

•     PB Fintech, operator of India's leading online insurance distribution platform PolicyBazaar, offers exposure to a long runway of growth as health and life insurance penetration increases alongside rising incomes and demographic change.

•     In Korea, holdings were added in Samsung C&T, which trades at a significant discount to net asset value and stands to benefit from improved capital allocation and higher dividend payouts, and Samsung Electro Mechanics, a key supplier of Multi-Layer Ceramic Capacitors (MLCCs) and semiconductor substrates, both of which are benefiting from strong AI-related demand and constrained industry capacity.

•     Full Truck Alliance was added for its online freight matching platform in China, which should continue to displace traditional brokers through superior efficiency, lower commission rates and strong network effects.

•     Sea Ltd provides exposure to leading e-commerce, gaming and fintech franchises across Southeast Asia and Brazil, underpinned by a strong logistics platform and a proven operational track record.

Several holdings were exited. In India, ICICI Bank and Infosys were sold amid deteriorating macro conditions and heightened AI disruption risk, respectively. In China, Meituan and Anta Sports were sold due to rising competitive pressures and a weak domestic consumption outlook. In ASEAN, profits were taken in Singapore Exchange, and Thai hospital exposure was consolidated into Bumrungrad Hospital by selling out of Bangkok Dusit Medical Services. We also sold our holding in the Vietnam Enterprise Investments Ltd investment trust, preferring direct stock exposure in Vietnam, and sold our remaining holding in BHP after strong performance.

Portfolio strategy

The portfolio remains focused on Taiwan, China, Korea, Hong Kong, Singapore, India and select ASEAN markets, with net gearing of 3.8%.

We remain overweight Taiwan, where exposure is concentrated in high-quality IT companies which are increasingly benefiting from AI-related capital expenditure. TSMC remains a significant holding, reflecting its dominant position in advanced semiconductor manufacturing and its critical role in enabling AI and other high performance computing applications.

We are underweight South Korea despite strong recent performance driven by earnings upgrades, valuation re-rating and governance reforms. While structural demand drivers exist across sectors such as technology, defence and shipbuilding, valuations now limit further upside in our view given the cyclical nature of most of these industries.

Our underweight to China reflects ongoing structural concerns, including adverse demographics, weak domestic demand and governance issues within state-owned enterprises. While exports have proven resilient, we believe further stimulus is unlikely to resolve deeper economic imbalances, such as excessive household savings rates.

In contrast to our position in China, we remain overweight Hong Kong, where valuations are more attractive, corporate governance and capital allocation discipline is stronger, and the market continues to play a central role in capital flows into and out of China, with many new listings on the local stock exchange.

In Southeast Asia, Singapore remains our largest exposure, benefiting from its role as a regional financial hub. Exposure to smaller ASEAN markets is more selective, despite attractive valuations, given sensitivity to trade restrictions, capital flows and energy prices. Domestic policy concerns continue to weigh on these markets as well, particularly in Indonesia. Vietnam remains an off-benchmark holding due to its long-term structural growth potential, despite near term macro risks.

India has become more attractive following recent underperformance, though remains relatively expensive in a regional context. Energy import dependence is a headwind while Gulf energy supplies are disrupted, but the long-term outlook for India remains positive, with a relatively young, growing population and rising incomes supporting stronger domestic consumption. As valuations fall, we continue to look for opportunities to buy well-governed, high-return businesses.

IT remains an overweight, supported by strong structural demand and high barriers to entry formed by decades of capital investment and R&D spending. After strong performance, valuations are now elevated and selectivity is increasingly important given sensitivity to any slowdown in AI-related capital expenditure. For now, however, there is little sign of such a slowdown and, in our view, technology remains one of the most structurally attractive sectors for long-term investors in the region to have exposure to.

We remain slightly overweight Financials, focusing on well-capitalised banks, insurers and exchanges, particularly in mature markets such as Singapore where valuations and dividend yields remain attractive. Interest rate direction will be a key driver of performance across the sector.

Investment outlook

At the time of writing, two issues dominate the outlook for Asian investors: the sustainability of the AI investment cycle and the duration of the conflict involving Iran. The latter has become the more immediate concern. The near closure of the Strait of Hormuz, through which roughly 20% of global oil and LNG flows, alongside damage to Gulf production and export infrastructure, has driven a sharp increase in energy prices.

Most Asian economies are large net energy importers with significant reliance on Gulf supplies, meaning a prolonged conflict risks higher inflation, weaker growth and pressure on external balances. That said, many countries now enter this period with stronger external positions and positive real interest rates than in previous cycles, providing a greater degree of resilience. Even so, growing concerns around energy availability have already led some governments to introduce energy saving measures, including working from home arrangements for public sector employees.

The key question for markets is the duration of the conflict - if tanker traffic resumes quickly, the impact should be manageable. A prolonged disruption, however, would materially increase risks for both the region and the global economy. Based on energy dependence and macro buffers, India, the Philippines, Thailand and Vietnam appear among the more vulnerable Asian economies should high oil prices persist. In contrast, wealthier economies such as Taiwan and Korea benefit from strategic reserves, fiscal capacity to subsidise energy costs, and lower energy intensity relative to GDP. While there are no clear beneficiaries in Asia, China appears relatively better placed given its lower reliance on Gulf energy supplies and a more diversified energy mix.

In the short-term, the Middle East conflict has overshadowed what remains a critical medium-term issue for Asian equities as an asset class: the durability of the global AI investment boom. Capital expenditure by large US technology companies continues at pace as data centre capacity is expanded, and forecasts have recently been revised upwards as cloud revenues show signs of acceleration. Nevertheless, returns on this investment remain under close scrutiny.

The semiconductor sector, while enjoying strong structural growth, remains cyclical. Supply dynamics - particularly in memory - are therefore a growing focus. Capacity additions over the next year are limited, with little meaningful new supply expected before the second half of 2027. However, past cycles suggest that supply responses can be brought forward, and equity markets typically anticipate this. Elevated pricing also risks curbing demand in more mature and price sensitive end markets such as smartphones, PCs and tablets. Taken together, these factors heighten the risk of a sharp correction once the AI investment cycle turns, particularly given the significant expansion in both earnings expectations and valuation multiples in recent years.

While AI-related spending has been a tailwind for Asia, investor attention has increasingly shifted towards potential losers from AI-driven disruption. Several businesses perceived to be at risk of disintermediation have already de-rated materially, and this overhang is likely to persist until the impact on profitability becomes clearer. In response, our focus remains on companies with durable competitive advantages that we believe can continue to generate attractive returns even as business models evolve.

From a regional perspective, the outlook for China remains a key determinant for broader Asian growth. We expect economic growth to remain subdued, with external strength continuing to offset weak domestic demand. While further stimulus has been anticipated, policy remains focused on reducing excess capacity and competitive pressures rather than aggressive demand support. Encouragingly, geopolitical tensions with the US appear to have eased somewhat, with selective tariffs and restrictions relaxed on both sides.

Much of the strong Asian market performance in recent months has been narrowly focused on certain themes, rather than reflecting a broad‑based recovery in earnings. This has pushed valuations higher, and the market now trades above long‑term averages on most metrics. That said, the region as a whole remains attractively valued relative to developed markets.

Looking ahead, sustained earnings delivery will need to play a greater role in supporting equity returns. Prior to recent Middle East developments, there were early signs that earnings growth was beginning to broaden beyond a small group of AI beneficiaries. The duration of the conflict will be critical in determining whether this trend can continue.

Conclusion

Despite increased volatility following the outbreak of the Middle East conflict, Asian equity markets have continued to deliver positive returns, extending the strong performance of recent years. With valuations now above long-term averages, continued market progress will require sustained and more broadly based earnings growth. At present, earnings momentum remains concentrated in a narrow set of AI-related names. Although some broadening had begun, a prolonged conflict involving Iran would increasingly pressure growth across the region through higher energy costs and inflation. The outlook for markets can therefore best be described as positive, but fragile, with an uncomfortable reliance on a single thematic driver.

Asia continues to offer access to a diverse set of high-quality companies across multiple markets and sectors, many of which trade at attractive valuations relative to their growth potential. Our investment approach remains focused on building a differentiated portfolio of the most compelling long-term opportunities across the region.

Abbas Barkhordar

Portfolio Manager

Schroder Investment Management Limited

1 June 2026

Investment Portfolio

At 31 March 2026

	Sector	£'000	%
Taiwan
TSMC	Information Technology	159,667	16.6
Hon Hai Precision Industry	Information Technology	23,966	2.5
ASE Technology	Information Technology	23,851	2.5
MediaTek	Information Technology	21,382	2.2
Delta Electronics	Information Technology	20,841	2.2
E Ink	Information Technology	8,337	0.9
Nien Made Enterprise	Consumer Discretionary	7,542	0.8
Total Taiwan		265,586	27.7
China
Tencent Holdings1	Communication Services	64,308	6.7
Contemporary Amperex Technology A	Industrials	21,538	2.2
Alibaba1	Consumer Discretionary	14,729	1.5
Shenzhen Inovance Technology A	Industrials	13,427	1.4
NetEase1	Communication Services	12,592	1.3
Midea1 (including A shares)	Consumer Discretionary	11,921	1.2
Centre Testing International A	Industrials	11,142	1.2
Trip.com1	Consumer Discretionary	10,296	1.1
Shenzhou International1	Consumer Discretionary	9,845	1.0
Sany Heavy Industry1	Industrials	9,340	1.0
Full Truck Alliance ADR2	Industrials	8,927	0.9
Tencent Music Entertainment ADR2	Communication Services	8,361	0.9
Kanzhun ADR2	Industrials	7,337	0.8
Total China		203,763	21.2
South Korea
Samsung Electronics (including preference shares)	Information Technology	96,399	10.0
Kia	Consumer Discretionary	11,645	1.2
Samsung C&T	Industrials	9,954	1.0
Samsung Electro-Mechanics	Information Technology	9,884	1.0
Total South Korea		127,882	13.2
Hong Kong (SAR)
AIA	Financials	34,918	3.6
Hong Kong Exchanges and Clearing	Financials	22,311	2.3
Techtronic Industries	Industrials	11,928	1.2
BOC Hong Kong	Financials	11,350	1.2
Swire Properties	Real Estate	10,610	1.1
Galaxy Entertainment	Consumer Discretionary	9,669	1.0
Samsonite International	Consumer Discretionary	9,346	0.9
Total Hong Kong (SAR)		110,132	11.3
Singapore
DBS	Financials	23,445	2.4
OCBC	Financials	20,970	2.2
Singapore Telecommunications	Communication Services	15,020	1.6
Sea ADR2	Consumer Discretionary	9,127	0.9
Grab2	Industrials	8,509	0.9
Total Singapore		77,071	8.0
India
HDFC Bank	Financials	22,204	2.3
PB Fintech	Financials	10,164	1.1
Apollo Hospitals Enterprise	Healthcare	9,609	1.0
Reliance Industries	Energy	9,536	1.0
InterGlobe Aviation	Industrials	8,597	0.9
Oberoi Realty	Real Estate	8,333	0.9
MakeMyTrip2	Consumer Discretionary	7,221	0.7
Total India		75,664	7.9
Philippines
ICTSI	Industrials	10,103	1.0
Bank of the Philippine Islands	Financials	8,814	0.9
Ayala Land	Real Estate	6,712	0.7
Total Philippines		25,629	2.6
Thailand
Bumrungrad Hospital	Healthcare	10,482	1.1
Kasikornbank NVDR	Financials	10,158	1.1
Total Thailand		20,640	2.2
Vietnam
Mobile World Investment	Consumer Discretionary	10,283	1.1
FPT	Information Technology	9,168	1.0
Total Vietnam		19,451	2.1
Australia
Rio Tinto3	Materials	16,182	1.7
Total Australia		16,182	1.7
Indonesia
Bank Mandiri	Financials	9,343	0.9
Total Indonesia		9,343	0.9
Collective Investment Funds
United Kingdom
Schroder Asian Discovery Fund Z Accumulation4	Investment Fund	11,470	1.2
Total United Kingdom		11,470	1.2
Total Collective Investment Funds		11,470	1.2
Total Investments5		962,813	100.0

Investments are classified by the Investment Manager in the region or country of their main business operations or listing.

Highlighted stocks are the twenty largest investments, which by value account for 67.6% of total investments (30 September 2025: 63.6% and 31 March 2025: 64.5%).

¹Listed in Hong Kong. ²Listed in the USA. ³Listed in the United Kingdom. ⁴Predominantly invested in Asia. ⁵Total investments comprises the following:

		£'000	%
Equities, including ADRs and NVDRs		917,078	95.2
Collective investment funds		11,470	1.2
Preference shares		34,265	3.6
Total Investments		962,813	100.0

Investments are classified by the Investment Manager in the region or country of their main business operations or listing.                  

The following abbreviations have been used above: ADR: American Depositary Receipt NVDR: Non-Voting Depositary Receipt.

Interim Management Statement

Principal risks and uncertainties

The principal risks associated with the Company's business fall into the following risk categories: strategy and competitiveness; investment management (including climate change); market; geopolitical; gearing and leverage; accounting, legal and regulatory change; and third-party services (including custody, depository and cyber security). A detailed explanation of the risks in each of these categories can be found on pages 41 to 44 and in note 20 on pages 82 to 86 of the Company's published Annual Report and Financial Statements for the year ended 30 September 2025.

In the view of the Board, the Company's principal risks and uncertainties have not changed during the six months ended 31 March 2026. However, the Board considers that the severity of some of the risks has increased. While assessing the financial statements, the Board noted that the outbreak of war in the Middle East, has contributed to heightened inflation expectations and concerns about slower global growth, which may adversely affect market sentiment. These matters will be closely monitored and reported on in the next Annual Report, as appropriate.

Going concern

Having assessed the principal risks and uncertainties, and the other matters discussed in connection with the viability statement as set out on page 45 of the published Annual Report and Financial Statements for the year ended 30 September 2025, the Directors consider it appropriate to adopt the going concern basis in preparing the financial statements.

Related party transactions

There have been no transactions with related parties that have materially affected the financial position or the performance of the Company during the six months ended 31 March 2026.

Directors' responsibility statement

The Directors confirm that, to the best of their knowledge:

-    the condensed set of financial statements contained within the Half Year Report has been prepared in accordance with United Kingdom Generally Accepted Accounting Practice, specifically adhering to Financial Reporting Standard 104 "Interim Financial Reporting" and the Statement of Recommended Practice, "Financial Statements of Investment Companies and Venture Capital Trusts" issued in July 2022; and

-    the Interim Management Report, together with the Chair's Statement and Portfolio Manager Review includes a fair review of the information required by the Disclosure Guidance and Transparency Rules 4.2.7R and 4.2.8R.

The Half Year Report has not been reviewed or audited by the Company's auditor.

The Half Year Report for the six months ended 31 March 2026 was approved by the Board and the above Responsibility Statement has been signed on its behalf.

Nicky Richards

Chair

For and on behalf of the Board

1 June 2026

Income Statement

for the six months ended 31 March 2026 (unaudited)

		(Unaudited)			(Unaudited)			(Audited)
		For the six months			For the six months			For the year
		ended 31 March			ended 31 March			ended 30 September
		2026	2026	2026	2025	2025	2025	2025	2025	2025
		Revenue	Capital	Total	Revenue	Capital	Total	Revenue	Capital	Total
	Note	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Gains/(Losses) on investments
held at fair value through profit or loss		-	27,773	27,773	-	(34,203)	(34,203)	-	110,620	110,620
Net foreign currency (losses)/gains		-	(629)	(629)	-	(1,685)	(1,685)	-	83	83
Income from investments		7,310	144	7,454	6,307	152	6,459	23,600	302	23,902
Other income		-	-	-	1	-	1	-	-	-
Other interest receivable and similar income		69	-	69	58	-	58	145	-	145
Gross return/(loss)		7,379	27,288	34,667	6,366	(35,736)	(29,370)	23,745	111,005	134,750
Investment management fee		(734)	(2,203)	(2,937)	(737)	(2,211)	(2,948)	(1,445)	(4,333)	(5,778)
Administrative expenses		(670)	-	(670)	(781)	-	(781)	(1,553)	-	(1,553)
Net return/(loss) before
finance costs and taxation		5,975	25,085	31,060	4,848	(37,947)	(33,099)	20,747	106,672	127,419
Finance costs		(263)	(791)	(1,054)	(223)	(670)	(893)	(441)	(1,323)	(1,764)
Net return/(loss) before
taxation		5,712	24,294	30,006	4,625	(38,617)	(33,992)	20,306	105,349	125,655
Taxation	3	(786)	3,342	2,556	(646)	984	338	(1,850)	(2,028)	(3,878)
Net return/(loss) after
taxation		4,926	27,636	32,562	3,979	(37,633)	(33,654)	18,456	103,321	121,777
Return/(loss) per share (pence)	4	3.76	21.10	24.86	2.79	(26.41)	(23.62)	13.21	73.95	87.16

The "Total" column of this statement is the profit and loss account of the Company. The "Revenue" and "Capital" columns represent supplementary information prepared under guidance issued by The Association of Investment Companies. The Company has no other items of other comprehensive income, and therefore the net return after taxation is also the total comprehensive income for the period.

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

Statement of Changes in Equity

for the six months ended 31 March 2026 (unaudited)

		Called-up		Capital	Warrant
		share	Share	redemption	exercise	Capital	Revenue
		capital	premium	reserve	reserve	reserves	reserve	Total
	Note	£'000	£'000	£'000	£'000	£'000	£'000	£'000
At 30 September 2025		13,398	100,956	6,746	8,704	799,898	22,948	952,650
Repurchase and cancellation of
the Company's own shares		(614)	-	614	-	(42,247)	-	(42,247)
Net return after taxation		-	-	-	-	27,636	4,926	32,562
Dividend paid in the period	5	-	-	-	-	-	(17,052)	(17,052)
At 31 March 2026		12,784	100,956	7,360	8,704	785,287	10,822	925,913
for the six months ended 31 March 2025 (unaudited)
		Called-up		Capital	Warrant
		share	Share	redemption	exercise	Capital	Revenue
		capital	premium	reserve	reserve	reserves	reserve	Total
	Note	£'000	£'000	£'000	£'000	£'000	£'000	£'000
At 30 September 2024		14,659	100,956	5,485	8,704	767,036	22,319	919,159
Repurchase and cancellation of
the Company's own shares		(755)	-	755	-	(41,081)	-	(41,081)
Net (loss)/return after taxation		-	-	-	-	(37,633)	3,979	(33,654)
Dividend paid in the period	5	-	-	-	-	-	(17,827)	(17,827)
At 31 March 2025		13,904	100,956	6,240	8,704	688,322	8,471	826,597
for the year ended 30 September 2025 (audited)
		Called-up		Capital	Warrant
		share	Share	redemption	exercise	Capital	Revenue
		capital	premium	reserve	reserve	reserves	reserve	Total
	Note	£'000	£'000	£'000	£'000	£'000	£'000	£'000
At 30 September 2024		14,659	100,956	5,485	8,704	767,036	22,319	919,159
Repurchase and cancellation of the Company's own shares		(1,261)	-	1,261	-	(70,459)	-	(70,459)
Net return after taxation		-	-	-	-	103,321	18,456	121,777
Dividend paid in the year	5	-	-	-	-	-	(17,827)	(17,827)
At 30 September 2025		13,398	100,956	6,746	8,704	799,898	22,948	952,650

Statement of Financial Position

at 31 March 2026 (unaudited)

		(Unaudited)	(Unaudited)	(Audited)
		31 March	31 March	30 September
		2026	2025	2025
	Note	£'000	£'000	£'000
Fixed assets
Investments held at fair value through profit or loss		962,813	860,992	993,743
Current assets
Debtors		5,684	10,632	2,264
Cash and cash equivalents		2,377	4,918	8,390
		8,061	15,550	10,654
Current liabilities
Creditors: amounts falling due within one year	6	(40,786)	(41,793)	(41,513)
Net current liabilities		(32,725)	(26,243)	(30,859)
Total assets less current liabilities		930,088	834,749	962,884
Non current liabilities
Deferred taxation		(4,175)	(8,152)	(10,234)
Net assets		925,913	826,597	952,650
Capital and reserves
Called-up share capital	7	12,784	13,904	13,398
Share premium		100,956	100,956	100,956
Capital redemption reserve		7,360	6,240	6,746
Warrant exercise reserve		8,704	8,704	8,704
Capital reserves		785,287	688,322	799,898
Revenue reserve		10,822	8,471	22,948
Total equity shareholders' funds		925,913	826,597	952,650
Net asset value per share (pence)	8	724.26	594.52	711.01

Registered in England and Wales as a public company limited by shares

Company registration number: 03104981

Notes to the Financial Statements

for the six months ended 31 March 2026

1. Financial statements

The information contained within the financial statements in this Half Year Report has not been audited or reviewed by the Company's independent auditor.

The figures and financial information for the year ended 30 September 2025 are extracted from the latest published financial statements of the Company and do not constitute statutory financial statements for that year. Those financial statements have been delivered to the Registrar of Companies and included the report of the auditor which was unqualified and did not contain a statement under either section 498(2) or 498(3) of the Companies Act 2006.

2. Accounting policies

Basis of accounting

The financial statements have been prepared in accordance with United Kingdom Generally Accepted Accounting Practice, in particular with Financial Reporting Standard 104 "Interim Financial Reporting" and with the Statement of Recommended Practice "Financial Statements of Investment Trust Companies and Venture Capital Trusts" issued by The Association of Investment Companies in July 2022.

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

The accounting policies applied to these financial statements are consistent with those applied in the financial statements for the year ended 30 September 2025.

3. Taxation

The Company's effective corporation tax rate is nil, as deductible expenses exceed taxable income. The taxation charge comprises irrecoverable overseas withholding tax on dividends receivable, and overseas capital gains tax.

4. Return/(loss) per share

	(Unaudited)	(Unaudited)
	Six months	Six months	(Audited)
	ended	ended	Year ended
	31 March	31 March	30 September
	2026	2025	2025
Revenue return (£'000)	4,926	3,979	18,456
Capital return/(loss) (£'000)	27,636	(37,633)	103,321
Total return/(loss)	32,562	(33,654)	121,777
Weighted average number of shares in issue during the period	130,964,559	142,496,002	139,772,896
Revenue return per share (pence)	3.76	2.79	13.21
Capital return/(loss) per share (pence)	21.10	(26.41)	73.95
Total return/(loss) per share (pence)	24.86	(23.62)	87.16

5. Dividends paid

	(Unaudited)	(Unaudited)
	Six months	Six months	(Audited)
	ended	ended	Year ended
	31 March	31 March	30 September
	2026	2025	2025
	£'000	£'000	£'000
2025 final dividend paid of 13.00p (2024: 12.5p)	17,052	17,827	17,418

No interim dividend has been declared in respect of the six months ended 31 March 2026 (2025: nil).

6. Creditors: amounts falling due within one year

	(Unaudited)	(Unaudited)	(Audited)
	31 March	31 March	30 September
	2026	2025	2025
	£'000	£'000	£'000
Bank loan	37,916	30,990	37,140
Repurchase of the Company's own shares	702	705	341
Securities purchased awaiting settlement	-	8,059	2,002
Other creditors and accruals	2,168	2,039	2,030
	40,786	41,793	41,513

The bank loan comprises of US$50 million (£37.9 million) drawn down on the Company's £75 million multicurrency revolving credit facility with The Bank of Nova Scotia, London Branch. The facility was secured from 2 July 2025 and has a maturity date of 1 July 2026. The amendment and renewal of the facility are subject to covenants and restrictions customary for a facility of this nature, all of which have been complied with throughout the period.

7. Called-up share capital

Changes in the number of shares in issue during the period were as follows:

	(Unaudited)	(Unaudited)
	Six months	Six months	(Audited)
	ended	ended	Year ended
	31 March	31 March	30 September
	2026	2025	2025
	£'000	£'000	£'000
Ordinary shares of 10p each, allotted, called-up and fully paid:
Opening balance of 133,985,233 (year ended 30 September 2025: 146,591,216 and period ended 31 March 2025: 146,591,216) ordinary shares of 10p each	13,398	14,659	14,659
Repurchase of 6,142,399 (year ended 30 September 2025: 12,605,983 and period ended 31 March 2025: 7,556,000) shares and cancelled	(614)	(756)	(1,261)
Closing balance of 127,842,834 (year ended 30 September 2025: 133,985,233 and period ended 31 March 2025: 139,035,216) shares in issue	12,784	13,903	13,398

8. Net asset value per share

	(Unaudited)	(Unaudited)	(Audited)
	31 March	31 March	30 September
	2026	2025	2025
Net assets attributable to shareholders (£'000)	925,913	826,597	952,650
Shares in issue at the period end	127,842,834	139,035,216	133,985,233
Net asset value per share (pence)	724.26	594.52	711.01

9. Financial instruments measured at fair value

The Company's financial instruments within the scope of FRS 102 that are held at fair value comprise its investment portfolio.

FRS 102 requires that financial instruments held at fair value are categorised into a hierarchy consisting of the three levels below. A fair value measurement is categorised in its entirety on the basis of the lowest level input that is significant to the fair value measurement.

Level 1 - valued using unadjusted quoted prices in active markets for identical assets.

Level 2 - valued using observable inputs other than quoted prices included within Level 1.

Level 3 - valued using inputs that are unobservable.

The Company's investment portfolio was categorised as follows:

	Level 1	Level 2	Level 3	Total
31 March 2026 (Unaudited)	£'000	£'000	£'000	£'000
Financial instruments held at fair value through profit or loss
Equity investments	951,343	11,470	-	962,813
Total	951,343	11,470	-	962,813
	Level 1	Level 2	Level 3	Total
31 March 2025 (Unaudited)	£'000	£'000	£'000	£'000
Financial instruments held at fair value through profit or loss
Equity investments	848,537	12,455	-	860,992
Total	848,537	12,455	-	860,992
	Level 1	Level 2	Level 3	Total
30 September 2025 (Audited)	£'000	£'000	£'000	£'000
Financial instruments held at fair value through profit or loss
Equity investments	982,037	11,706	-	993,743
Total	982,037	11,706	-	993,743

There have been no transfers between Levels 1, 2 or 3 during the six month period ended 31 March 2026.

10. Events after the reporting period

The Directors have evaluated the period since the half year date and have not noted any significant events requiring disclosure after the end of the reporting period to the date of this Half Year Report.

 

END