Annual Financial Report

THE DIVERSE INCOME TRUST PLC

ANNUAL REPORT AND ACCOUNTS FOR THE YEAR TO 31 MAY 2023

AND

NOTICE OF ANNUAL GENERAL MEETING

The Diverse Income Trust plc (the “Company”, “Diverse” or the “Trust”) announces its annual results for the year ended 31 May 2023 and the publication of its annual report and accounts for the same period, which includes the notice of Annual General Meeting.

HIGHLIGHTS

SUMMARY OF RESULTS FOR THE YEAR TO 31 MAY 2023

• NAV total return* to shareholders of -16.2%. This includes the change in NAV, plus the dividends paid during the year and compares with a decrease in the Numis All-Share Index of -0.4% on a total return basis over the year to 31 May 2023.
• 4.05p of ordinary dividends for the year. The three interim dividends and the proposed final dividend for the year amount to 4.05p, compared with 3.90p in the previous year, an increase of 3.8%.
• Share price total return* to shareholders of -15.37%. The share price total return was -15.37%, reflecting a slightly narrower discount at the end of May 2023 than a year earlier.
• Revenue reserves were £16.1m. The Company’s revenue return after taxation was £14.4m, which exceeded the £14.2m in dividends distributed to shareholders during the year. Accordingly, at the year-end there were £16.1m of revenue reserves (2022: £15.9m) which are available to help fund future dividend payments to shareholders.

	31 May 2023	31 May 2022	Change
NAV per ordinary share*	88.87p	110.55p	(19.6)%
Ordinary share price	83.40p	103.00p	(19.0)%
(Discount)/premium to NAV*	(6.20%)	(6.83%)
Revenue return per ordinary share*	4.05p	4.01p
Ordinary dividends per ordinary share	4.05p	3.90p	3.8%
Ongoing charges*	1.09%	1.05%
Ordinary shares in issue	355,870,647	361,920,105

KEY PERFORMANCE INDICATORS

The Board has the following Key Performance Indicators (KPIs) that are used to gauge the success of the Company’s strategy and its outcome for shareholders.

NAV total return* – Over the year, the NAV total return of the Trust was -16.2% (2022: -3.4%), which compares to 0.8% for the Peer Group** and -0.4% for the Numis All-Share Index. Since launch to 31 May 2023, its NAV total return including compounded dividend income was 175.1% which compares to 146.5% for the Peer Group** and 89.4% for the Numis All-Share Index.

Growth of ordinary dividends to shareholders – Over the year, the four dividends to shareholders have increased from 3.90p to 4.05p. The Trust has maintained an unbroken good and growing dividend record without distributing capital.

Discount* – Over the year to 31 May 2023, the share price discount averaged at 5.0% (2022: 1.4%). Over the twelve years since listing, the Company’s share price has largely matched its NAV.

Ongoing charges* – The ongoing charges for the year to 31 May 2023 are 1.09% of NAV (2022: 1.05%), which compares with 0.57% for the Peer Group**. The Board pays careful attention to expenses and believes that the Trust’s overall costs are justifiable in the context of its wide investment universe and premium returns it has delivered since launch. Further details of the ongoing charges are provided in the full Annual Report.

* Alternative performance measure. Details provided in the Glossary in the full Annual Report.

** The Peer Group is also defined in the Glossary.

CHAIRMAN’S STATEMENT

To combat a surge in inflation that had been generally underestimated, the period since the end of 2021 has seen global interest rates rise. This precipitated falls in bond markets, where yields rose from absurdly low levels. Equities now have to contend with the competing attractions of higher deposit rates and bond yields, amid fears of an economic downturn.

In the UK, bearish market conditions were compounded by political instability during the first half of our financial year, which saw three Prime Ministers and four Chancellors of the Exchequer. A fall of 10% in the UK market in the period to the end of the Truss Premiership in October 2022 was reversed by the end of May 2023, as a semblance of policy stability was restored and the UK avoided the recession that had been widely forecast.

The earlier fall in confidence was worst felt by smaller companies, seen as both more exposed to the UK domestic economy and more dependent on increasingly expensive bank borrowings, whereas the share prices of large cash generative companies outperformed. Although a second half recovery was seen across the size spectrum, the differential performance remained. The Numis Large Cap Index (consisting mainly of equity income stocks), as well as outperforming smaller UK stocks, began to perform better against major international indices, despite fund redemptions by domestic investors.

In the year to 31 May 2023, the Numis Large Cap Index (ex ICs) delivered a total return of +1.7% (including 4% of dividend income). In contrast, the share prices of many smaller listed and AIM-quoted income stocks were weak in the year under review. In their case ongoing UK OEIC redemptions were not offset by global investor buying. Over the year to May 2023 the total return on the Numis Small Cap Plus AIM Index (ex ICs) was -11.1%.

Performance, and Dividends to shareholders

The majority of the Trust’s portfolio is typically invested in mid and small cap income stocks. With just over a quarter of the portfolio invested in larger UK stocks, the Trust’s NAV total return was down 16.2% over the year to May 2023, affected by the weak returns from smaller companies. This compares with the total return of +1.7% from the Numis Large Cap Index (ex ICs) at one end of the spectrum and -18.9% from the Numis Alternative Markets Index (ex ICs) (covering AIM-quoted stocks) at the other.

Despite the disappointing outcome over the past year, taking a longer-term perspective, the Trust’s NAV total return since issue is +175.1%, well ahead of the total returns from the Numis Large Cap Index (ex ICs) +85.3%, the Numis Small Cap Plus AIM Index (ex ICs) +87.5% and the Numis Alternative Markets Index -4.6%. No complacency is implied by this, but the past two years have been notable for the decoupling between the UK’s larger companies, which attract international attention, and their smaller siblings which have suffered from the relative sidelining of the UK market.

Total returns of the Trust and various Numis indices between April 2011 and May 2023

	%
The Diverse Income Trust Plc	175.1
Numis Large Cap Index ex ICs	85.3
Numis Small Cap Plus AIM Index ex ICS	87.5
Numis Alternative Markets Index ex ICs	-4.6

Source: Morningstar                               “ICs”: Investment Companies

The Trust’s income performance has continued to improve. Having avoided the worst of the wide-ranging dividend cuts during the pandemic, the Trust’s Revenue per Share increased by 1% this year to 4.05p. This is 2.5% higher than the Trust’s pre-pandemic Revenue per Share, in contrast to the wider UK market whose income level remains more than 10% lower than in May 2019. The Trust increased its dividend to shareholders this year from 3.9p to 4.05p, which includes the three interim payments already declared and a recommended final dividend of 1.20p to be approved at the AGM.

Market valuation and share redemptions

Given the unsettled stock market background the Trust’s share price traded at an average 5% discount to its NAV over the year, while narrowing marginally from -6.8% at 31 May 2022 to -6.2% at 31 May 2023. This compares well with the widespread deterioration in discounts across the investment company sector during the year. Since the Trust was launched, the share price has on average traded at a minimal discount of -0.7% to its NAV.

However, in order to keep any discount to a modest level, each year the Board offers shareholders a voluntary redemption. At the end of April, 37,330,005 shares were offered for redemption, representing 10.49% of the Trust’s equity. The Board redeemed these for cash that had built up in the portfolio in part due to the takeover of K3 Capital plc. The redemption price was 89.35p, being the Net Asset Value at the close of business on 30 May 2023.

Prospects

Underlying stock market trends often persist for many years, but then change without fanfare. In the late 1960s and early 1970s, as the decades of low inflation came to an end, certain US mega cap stocks (known at the time as the Nifty Fifty) outperformed, with their perceived growth credentials attracting ever-rising valuations. The enthusiasm for US technology stocks in recent years (tempered by a setback in 2022) shows some parallels.

In that earlier era, when central banks faced high inflation, interest rates rose sharply and economic growth was disappointing and volatile. This put pressure on profit margins and led to a derating of the most optimistically valued stocks. Some went on to further success while others fell by the wayside.

At such times, investors may be driven to find something more reassuring than adrenaline. Equity earnings visibility and cash income count for more if 4-5% can be earned on cash deposits, whereas zero rates encourage investment in more speculative ideas, not all of which will come true. Growth has a major part to play in human progress and economic productivity but, when there is less liquidity around, enthusiasm is likely to be allocated more sparingly.

The UK market fell out of favour in recent decades, partly due to perceptions that it consisted of dull, mature companies and was under-represented in faster growth sectors. International investors were also deterred by the uncertainty over Brexit, with the UK economy and politics yet to adjust fully to be comfortable with the new structures. In addition, over the longer-term, regulatory changes encouraged progressive equity disinvestment by the UK pension fund industry, reducing its UK equity holdings from around 50% of fund assets twenty-five years ago to 6% in 2021. This removed a key domestic source of support from companies’ growth plans. As a result, the UK has become both lowly-rated and under-owned. When this will change is open to debate but there are some signs of hope from recent policy announcements encouraging investment in growing UK companies and reviewing potential obstacles to companies deciding to list in the UK.

The Trust’s approach of building a diversified portfolio of cash-generative and attractively valued companies is inherently contrarian. With UK mid-cap and smaller stocks currently cheaply rated compared with a UK market that is itself lowly rated internationally, our Managers are particularly excited about the opportunity.

As the past two years reminds us, going against the crowd is not always rewarded in the short-term but the longer-term is more reassuring. It is worth recalling Warren Buffett’s aphorism that in the short run the stock market is a voting machine but in the long run it is a weighing machine.

Andrew Bell

Chairman

7 August 2023

MANAGER’S REPORT

When access to debt and risk capital becomes scarcer...

The UK stock market has started outperforming.

During globalisation, the best performing stocks are often those drawing upon cash abundance to accelerate their growth rate.

When interest rates increase however, they suppress demand and usher in a scarcity of risk capital. UK equity income stocks have a real advantage when risk capital is scarce because they generate surplus cash. After a long period of under-performance during globalisation, the UK majors have started outperforming over the last two and half years.

If UK quoted companies other than the UK majors were to outperform as they have in the past, then a multicap equity income strategy that includes both may be set to outperform international stock markets in the future.

When risk capital is scarce, quoted companies have an advantage.

Daily transactions on the stock exchange provide insight. The live interface between willing buyer and seller helps every management team to keep aware of their cost of capital. When they review transactions, they can use this metric to determine those with the greatest commercial upsides in the context of the cost of any additional capital.

When market conditions are easy, the returns on corporate transactions are hampered by wide-ranging competition. When capital is restricted however, quoted companies paying a stream of dividend income retain access to institutional capital. In short, when risk capital is scarce quoted companies often get much higher returns on transactions because other companies are unable to compete for lack of risk capital.

When acquisition costs are low, the prospects for a multicap strategy are enhanced compared with the majors alone.

During economic recessions, the prospects for quoted companies are sometimes enhanced by acquiring overleveraged but otherwise viable businesses from the receiver, debt-free and at very low prices.

When the acquiring business is large relative to the scale of the acquisition, the scale of the improvement tends to be incremental. If the acquirer is a quoted smallcap however, the same acquisition offers much greater upside potential, as the value uplift is a much greater proportion of its market capitalisation.

In short, during recessions when access to additional debt and risk capital is scarce, there is opportunity for AIM-listed stock to enhance their returns.

UK smallcaps have a long history of delivering premium returns.

Since 1955, UK-listed companies in the bottom ten per cent in market capitalisation terms (typically known as "smallcaps" in the UK) have generated much higher returns than those in all other size bands. Furthermore, if this factor is combined with those that stand on overlooked valuations as they
often are when they stand on premium yields, then their returns have been even greater.

Finally, when interest rates are elevated, the returns on the global exchanges are often more limited, and hence any source of outperformance becomes more important. In summary, the prospect for a strategy dedicated to UK quoted multicap equity income stocks, such as that of the Diverse Income Trust portfolio, may have greater opportunity to add value when access to debt and capital becomes scarcer.

...counterintuitively, UK quoted multicap prospects often improve.

Furthermore, when addressing the environmental, social and governance agenda…

Any organisation that knowingly operates contrary to the interests of the wider public, would in time find that its social licence to operate suffered. Hence, well managed investment portfolios need to invest with an authentic sense of purpose, as well as employing a successful commercial strategy. 

Mainstream stocks have vast numbers of shareholders, so typically their leadership teams only meet a small proportion. Alongside, with their long list of shareholders, they are offered an extraordinarily wide range of advice regarding their stance on environmental, social and governance issues. The bottom line is that institutional investors have fewer opportunities either to gauge the authenticity of the management team’s sense of purpose or to influence their corporate agenda significantly.

In contrast, there are fewer institutional smallcap investors. So, most smallcap management teams are keen to meet a significant portion of them, even if they are not shareholders. Smallcap investors therefore have greater opportunity to address and influence their environmental, social and governance issues.

AIM-listed companies do issue formal reports covering non-financial metrics such as sustainability, although these are typically less comprehensive. Even so, the Manager can compare the content of the sustainability reports with the detail of the senior management’s actions. When variance is identified, it can imply potential inauthenticity.

Many mining management teams our Manager meets for example, say they start every meeting with safety. And yet, in far too many cases, their safety data isn’t covered by the first slide in their corporate presentation and safety isn’t the first matter of substance in their annual report.

Furthermore, as smallcap leadership teams are smaller, they have scope to be more agile than the majors. Typically, this is reflected in a somewhat stronger sense of corporate purpose and motivation than some majors.

To conclude, whilst the formal reports from a multicap portfolio are often less comprehensive than the majors alone, the Manager tends to stand at an advantage when addressing the environmental, social and governance agenda.

…a UK multicap portfolio has numerous advantages.

Inflation and higher interest rates are potentially more problematic beyond globalisation. If the current trends are sustained, we outline below why they can drive an improved trajectory for the Trust relative to others.

Investor interest in returns generated by the compounding of equity dividends has increased, and hence the UK stock market has started outperforming.

During globalisation, the best performing stocks have often been those drawing upon the abundance of credit and risk capital to accelerate their growth rate.

When interest rates rise however, they suppress demand and usher in a scarcity of risk capital. Companies generating surplus cash have major advantages when risk capital is scarce as those that are short of cash suffer. After a long period of underperformance during globalisation, many of the UK’s largest cash generative stocks have started outperforming over recent years.

If UK smallcaps were to outperform the UK majors as they have in the past, then a multicap equity income strategy that includes both may be set to perform much better relative to international stock markets than they have during the period of globalisation.

It is worth highlighting that quoted smallcap returns are not necessarily in sync with the fluctuations of the mainstream stock market indices. This risk can be moderated by investing in mainstream and smallcap stocks together, as in the Diverse Income Trust portfolio.

In summary, when access to credit and risk capital are scarcer – as at present - counterintuitively we believe that the prospects for the Trust’s strategy may actually have better opportunities to deliver premium returns.

The following Q&A provide details of the portfolio positioning, why it has declined in market value over the year under review and why we are so upbeat about its prospects.

In the light of the Trust’s declining NAV over the year to May, to what degree have the prospects of various portfolio holdings deteriorated?

Over the year to May, the total return on the Numis All-Share Index was -0.4%, which compares with a 0.8% return for the Peer Group. When these figures are set alongside the return of the Trust’s NAV that declined by 16.2%, then many might assume that the prospects for the Trust portfolio of stocks have deteriorated relative to those over the very largest UK quoted companies. Interestingly, we disagree with this conclusion.

Specifically, although the Trust’s NAV total return has underperformed that of the Numis All-Share Index and Peer Group significantly over the last two years, it is notable that the Trust’s revenue from portfolio dividends has continued to increase steadily. Indeed, when the numerous dividend cuts announced during 2020 are included in the analysis, the Trust’s Revenue per Share has recovered following the setback in 2020, whereas the UK’s stream of dividends remains below previous highs. In short, we ascribe the main reason for the underperformance of UK mid and small cap equity income share prices relative to their larger comparatives over the last two years to a decline in their valuation rather than to a period of inferior trading performance and dividends.

As noted in the Chairman’s statement, over the last two years, sales of UK-invested OEICs have been very significant, as portfolios have been adjusted to reflect the increase in the yields on UK bonds and cash deposits compared with their previous ultra-low levels. Alongside, global investors have started to reweight their equity portfolios back into stocks that pay good and growing dividends, and in doing so have boosted the demand for mainstream UK equity income stocks. This pattern has not extended down the market capitalisation bands, so the share prices of mid and small cap equity income stocks have reflected the marginal sellers, and greatly underperformed the returns of the UK mainstream equity income stocks.

How has the Trust performed over the twelve years since listing in April 2011?

Despite the Trust’s NAV total return underperforming that of the Numis All-Share Index over the last two years, this pattern differs from its returns since listing in April 2011, of 175.1%. Over that period, the Numis Large Cap Index (ex ICs) has generated a total return of 85.3%, the Numis Small Cap Plus AIM Index (ex ICs) has returned 87.5% whilst the Numis Alternative Markets Index (which are those stocks listed on the AIM exchange) has fallen by 4.6%.

Countering this, UK investors have become more cautious, initially worried that the UK could leave the EU in a chaotic manner without an agreement and, subsequently, given the uncertainty of the global pandemic, and more recently increasing with inflation and interest rate rises, regarding the prospect of global recession.

It was always anticipated that a large part of the return on Diverse Income Trust would be generated from the receipt of good and growing dividends. But alongside, if these grew well, it was anticipated they might drag up the relevant share prices. Overall, the Trust’s NAV has appreciated by 90% in capital terms. In addition, the aggregate value of all the dividends paid has added a further 45% of return, so the NAV total return of the Trust is 175.1%. The returns of the comparative indices are shown in the table below.

Total returns of the Trust and various Numis indices between April 2011 and May 2023

	%
The Diverse Income Trust Plc	175.1
Numis LargeCap Index ex ICs	85.3
Numis Small Cap Plus AIM Index ex ICS	87.5
Numis Alternative Markets Index ex ICs	-4.6

Source: Morningstar                               “ICs”: Investment Companies

As interest rate rises suppress demand, which stocks can sustain profit margins, when others are cutting prices to retain customers?

During globalisation, abundant imports of low-cost goods – which typically exceeded local demand – subdued inflationary pressures. During these decades, when economic growth slowed, central banks were able to engineer an economic recovery through reducing interest rates or more latterly via Quantitative Easing* that boosted demand. Inflation remained subdued, as the prices of additional goods remained determined by their plentiful global supply.

Following the global pandemic and the Ukrainian invasion, global economic supply was compromised, and hence the economic stimulus was accompanied by renewed inflation. To bring this mismatch back into balance, central banks have increased interest rates rapidly to choke off demand.

As demand moderates, suppressing demand represents a major business challenge, as there are fewer sales to go around. Hence, when demand declines, it often sparks price wars that drive down profit margins as well. The outcome is that corporate profitability often comes under pressure, so that over-levered companies risk insolvency.

In our view, businesses with poor customer service are vulnerable to the loss of sales, and reduced profit margins. Conversely, companies delivering not only good, but outstanding levels of customer service are more likely to retain customers even when others are offering similar services at lower prices.

With this in mind, we question management teams closely about whether they collect data on customer service, so that we can select for those delivering outstanding customer service. Whilst such companies may not be immune to an adverse economic trend, it is anticipated that they will show greater resilience than others.

*The definition of Quantitative Easing can be found in the Glossary in the full Annual Report.

What is the outlook for the Trust?

As outlined on the inside cover of the full Annual Report, following the Diverse Income Trust’s recent underperformance, most of the holdings appear to be standing on exceptionally low valuations. But just how out of line are they?

One way to gauge valuation is via the Price/Book ratio. After some decades of underperformance, the UK market is already standing at a ratio of around 1.6x, which is a substantial discount compared to US exchanges for example.

Price to Book* ratio of the Diverse Income Trust, the UK market and the US market as at 31 May 2023

US Market1	4.0
UK Market2	1.6
Diverse Income Trust	1.2

1 as represented by the ishares S&P500 ETF

2 as represented by the FTSE All Share Index.

*The definition of Price to Book ratio can be found in the Glossary in the full Annual Report.

After the recent underperformance of the Diverse Income Trust earlier this year, its price/book ratio had fallen to just 0.85x by the end of November 2022.

In short, whereas the UK stock market is lowly valued, the Diverse Income Trust’s portfolio appears exceptionally lowly valued relative to international stock markets such as the US.

Some presume that these low valuations are justified by an unfavourable outlook for UK equities. But such arguments don’t stand up to scrutiny. Numerous UK-quoted stocks are capital-intensive in nature. When capital is abundant, as during globalisation, new participants are often quick to compete away premium returns. But when capital is more costly, and the supply/demand curves are steeper, it is more difficult to raise new capital, and premium returns in some capital-intensive areas can persist.

Many capital-intensive businesses typically produce a large part of their returns via a stream of good and growing dividends. Cash compounding strategies such as these are much less reliant on stock market appreciation to deliver return.

Companies generating cash surpluses have the advantage during recessions, as they can use their cash to acquire overindebted but otherwise viable businesses from the receiver, debt-free at knockdown valuations. As with Next plc that recently acquired Made.com for £3.4m versus its previous peak market valuation of £700m, these deals tend to accelerate earnings and dividend growth.

Even if UK equities were similarly valued to international comparatives, for risk diversification reasons we would anticipate increased capital allocations. With them being so lowly valued, we believe that UK equity capital allocations are about to move from a trickle into a flood.

The bottom line is that we believe the Diverse Income Trust’s strategy now has the potential not only to outperform the mainstream indices in the UK, as it has done since issue, but also to outperform international markets - as the UK stock market itself outperforms. When the asset class in question (UK-quoted multicap equity income stocks) starts at a particularly low valuation, along with very modest institutional allocations, such favourable trends can persist over very long time periods. We believe the prospects for the Trust’s strategy are the greatest they have been for thirty years.

Gervais Williams and Martin Turner came together as a team in April 2011 and are responsible for the day-to-day management of the Trust’s portfolio.

Gervais Williams
Gervais joined Miton in March 2011 and is now Head of Equities in Premier Miton. He has been an equity fund manager since 1985, including 17 years at Gartmore. He was named Fund Manager of the Year by What Investment? in 2014. Gervais is also a board member of the Quoted Companies Alliance and a member of the AIM Advisory Council.

Martin Turner
Martin joined Miton in May 2011. Martin and Gervais have had a close working relationship since 2004, with complementary expertise that led them to back a series of successful companies. Martin qualified as a Chartered Accountant with Arthur Anderson and had senior roles and extensive experience at Merrill Lynch and Collins Stewart.

Gervais Williams and Martin Turner

7 August 2023

PORTFOLIO INFORMATION

As at 31 May 2023

Rank Company	Sector & main activity	Valuation £000	% of net assets	Yield1%
1 Kenmare Resources	Basic Materials	7,881	2.5	9.8
2 I3 Energy2	Energy	6,567	2.1	11.5
3 Mears	Industrials	5,896	1.9	4.4
4 XPS Pensions	Financials	5,859	1.8	4.6
5 CMC Markets	Financials	5,516	1.7	6.9
6 MAN	Financials	5,255	1.7	5.8
7 BT	Telecommunications	5,095	1.6	5.2
8 Phoenix	Financials	5,007	1.6	9.2
9 Just	Financials	4,981	1.6	2.1
10 Galliford Try	Industrials	4,934	1.5	4.9
Top 10 investments		56,991	18.0
11 Legal & General	Financials	4,834	1.5	8.5
12 Hostelworld	Consumer Discretionary	4,739	1.5	-
13 Tesco	Consumer Staples	4,734	1.5	4.2
14 Sainsbury (J)	Consumer Staples	4,568	1.5	4.8
15 Vanquis Banking	Financials	4,453	1.4	7.1
16 Savannah Energy2	Energy	4,407	1.4	-
17 Drax	Utilities	4,338	1.4	3.8
18 TP ICAP	Financials	4,204	1.3	8.2
19 Bloomsbury Publishing	Consumer Discretionary	4,137	1.3	2.9
20 Admiral	Financials	3,997	1.3	4.8
Top 20 investments		101,402	32.1
21          BAE Systems	Industrials	3,922	1.2	2.9
22 Diversified Energy	Energy	3,861	1.2	16.6
23 Sabre Insurance	Financials	3,762	1.2	3.2
24 Paypoint	Industrials	3,700	1.2	9.4
25 Plus500	Financials	3,633	1.2	5.3
26 Conduit Holdings	Financials	3,630	1.1	6.0
27 Accrol2	Consumer Staples	3,589	1.1	-
28 National Grid	Utilities	3,325	1.1	5.0
29 DWF	Industrials	3,241	1.0	7.9
30 ME Group international	Consumer Discretionary	3,213	1.0	9.2
Top 30 investments		137,278	43.4
31 Rio Tinto	Basic Materials	3,183	1.0	8.3
32 Centamin	Basic Materials	3,164	1.0	6.0
33 AVIVA	Financials	3,117	1.0	7.9
34 FRP Advisory2	Industrials	3,077	1.0	4.1
35 Kitwave2	Consumer Staples	3,064	1.0	3.5
36 BP	Energy	3,024	0.9	4.5
37 Concurrent Technologies2	Technology	2,923	0.9	2.2
38 Vistry	Consumer Discretionary	2,891	0.9	7.6
39 M&G	Financials	2,859	0.9	9.9
40 Lords Group Trading2	Industrials	2,858	0.9	3.1
Top 40 investments		167,438	52.9
Balance held in 81 equity investments		111,495	35.3
Total equity investments		278,933	88.2
Fixed interest investments		-	-
Total equity and fixed interest investments		278,933	88.2
Listed Put OptionUKX – December 2023 5,700 Put		848	0.3
Total investment portfolio		279,781	88.5
Other net current assets		36,494	11.5
Net assets		316,275	100.0

A copy of the full portfolio of investments as at 31 May 2023 is available on the Company’s website, www.diverseincometrust.com.

1 Source: Refinitiv. Based on historical yields and therefore not representative of future yields. Includes special dividends where applicable.

2 AIM/AQUIS listed.

Portfolio exposure by sector (%)	£279.8 million
	%
Financials	30.1
Industrials	18.3
Basic Materials	10.6
Energy	10.6
Consumer Discretionary	9.8
Consumer Staples	6.8
Real Estate	4.1
Telecomms	2.9
Technology	2.9
Utilities	2.7
Health Care	1.2

Actual income by sector (%)	£15.8 million
	%
Financials	39.0
Industrials	16.7
Basic Materials	11.3
Energy	8.3
Consumer Discretionary	7.9
Consumer Staples	4.5
Utilities	4.3
Telecomms	3.4
Real Estate	3.3
Technology	0.7
Health Care	0.6

Source: Thomson Reuters.

NOTICE OF ANNUAL GENERAL MEETING

The twelfth Annual General Meeting of the Company will be held on Tuesday, 17 October 2023 at 11.30 am at the offices of Stephenson Harwood LLP, 1 Finsbury Circus, London EC2M 7SH. The formal Notice of AGM can be found within the Annual Report.

FURTHER INFORMATION

The Diverse Income Trust Plc’s annual report and accounts for the year ended 31 May 2023 (which includes the notice of meeting for the Company's AGM) will be available today on www.diverseincometrust.com.

It will also be submitted shortly in full unedited text to the Financial Conduct Authority's National Storage Mechanism and will be available for inspection at data.fca.org.uk/#/nsm/nationalstoragemechanism in accordance with DTR 6.3.5(1A) of the Financial Conduct Authority's Disclosure Guidance and Transparency Rules.

ENDS

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

LEI: 2138005QFXYHJM551U45

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