Annual Financial Report

CT Global Managed Portfolio Trust

29 July 2024

 

To:      RNS

Date:  29 July 2024

From: CT Global Managed Portfolio Trust PLC

LEI:     213800ZA6TW45NM9YY31

Statement of Audited Results for the year ended 31 May 2024

Income Shares - 2024 Highlights

-     Annual dividend of 7.40p per Income share (2023: 7.20p), an increase of 2.8%.

-     Dividend yield⁽¹⁾ of 6.2% at 31 May 2024, based on total dividends for the financial year of 7.40p per Income share. This compares to the yield on the FTSE All-Share Index of 3.6%. Dividends are paid quarterly.

-     Net asset value total return⁽²⁾ per Income share of +7.0% for the financial year (2023: -7.4%), underperforming the total return of the FTSE All-Share Index of +15.4% (2023: +0.4%) by -8.4 percentage points.

-     Share price total return⁽²⁾ per Income share of +5.2% for the financial year (2023: -2.1%), underperforming the total return of the FTSE All-Share Index of +15.4% (2023: +0.4%) by -10.2 percentage points.

Growth Shares - 2024 Highlights

-     Net asset value total return per Growth share of +12.7% for the financial year (2023: -5.8%), underperforming the total return of the FTSE All-Share Index total of +15.4% (2023: +0.4%) by -2.7 percentage points.

-     Share price total return⁽²⁾ per Growth share of +12.9% for the financial year (2023: -7.8%), underperforming the total return of the FTSE All-Share Index of +15.4% (2023: +0.4%) by -2.5 percentage points.

-     Net asset value total return⁽²⁾ per Growth share of +271.5% in the 15 years to 31 May 2024, the equivalent of +9.1% compound per year. This compares with the total return of the FTSE All-Share Index of +242.5%, the equivalent of +8.6% compound per year.

Notes:

(1)   Dividend yield - based on dividends at the annual rate of 7.40p per Income share for the financial year to 31 May 2024 and the Income share price of 119.0p at 31 May 2024.

(2)   Total return - the return to shareholders calculated on a per share basis taking into account both the reinvestment of any dividends paid in the period and the increase or decrease in the share price or NAV in the period.

Chairman's Statement

Performance

For the Company's financial year ended 31 May 2024 the NAV total return (capital performance plus the reinvestment of any dividends paid) was +7.0% for the Income shares and +12.7% for the Growth shares, both of which underperformed the +15.4% total return for the FTSE All-Share Index, the benchmark index for both share classes. Of relevance and for interest, the FTSE All-Share Closed End Investments Index total return was +12.2% for the year.

Both Portfolios invest in a range of conventional investment companies (which invest mainly in listed securities) and alternative investment companies (which invest mainly in unlisted, illiquid assets such as infrastructure, renewable energy infrastructure, property, private equity and debt).

A key factor behind the underperformance of the Income Portfolio was the performance of certain alternative investment companies. Discounts remained wide and interest rates which stayed 'higher for longer' led to reduced NAVs and share prices. In particular, this affected investment companies in the infrastructure, renewable energy infrastructure, property and debt sub-sectors where the Income Portfolio has a much higher exposure than the Growth Portfolio. Performance is discussed in greater depth in the Manager's Review.

For Income shareholders, dividends have now been increased in each of the last 13 years. For Growth shareholders seeking long term performance, while the last few financial years have been difficult, their net asset value compound annual growth rates to 31 May 2024 have been 6.6% over 10 years and 9.1% over 15 years, as compared to the compound annual growth rates of 5.9% and 8.6% respectively for the FTSE All-Share Index (total return) for the same periods.

Revenue and Dividends

For the financial year ended 31 May 2024, four interim dividends have now been paid, totalling 7.40p per Income share, which represents an increase of 2.8% from the prior financial year (2023: 7.20p per Income share). The fourth interim dividend was paid after the year end on 5 July 2024.

This is the thirteenth consecutive year of increase and the yield on the Income shares was 6.2% on the year end Income share price, compared with 3.6% for the FTSE All-Share Index. The last five years have seen tumultuous events and shocks which have led to periods of significantly increased inflation and economic disruptions. It is hopefully therefore reassuring that the total annual dividend has increased by 24.4%, the equivalent of 4.5% compound per year over the last five years. This is marginally ahead of inflation (CPI) of 24.1% over the same period.

In the absence of unforeseen circumstances, it is the Board's current intention, in accordance with the Company's stated dividend policy, to pay four quarterly interim dividends and each of at least 1.85p per Income share so that the aggregate dividends for the financial year ended 31 May 2025 will be at least 7.40p per Income share.

After allowing for the payment of the fourth interim dividend, CT Global Managed Portfolio Trust has a revenue reserve of £2.87 million, equivalent to approximately 75% of the current annual dividend cost (at 7.40p per Income share). In addition, the £29.6 million distributable reserve (the 2022 special reserve, which was created following the cancellation of the share premium account) is attributable to the Income Portfolio. This reserve can be drawn on to support the payment of dividends to Income shareholders if and when considered appropriate by the Board.

Borrowing

The Company has a £5 million unsecured term loan at a fixed interest rate of 2.78% (which is fully drawn down in the Income Portfolio) and a £5 million unsecured revolving credit facility ('RCF'), both with The Royal Bank of Scotland International Limited, which are available until 10 February 2025. At the year end £2 million (2023: £2 million) of the RCF had also been drawn down in the Income Portfolio, resulting in total borrowings of £7 million (2023: £7 million) in the Income Portfolio (10.4% of its gross assets (2023: 10.4%)) and zero in the Growth Portfolio.

The Board is responsible for the Company's gearing strategy and sets parameters within which the Investment Manager operates. Borrowings are not normally expected to exceed 20% of the total assets of the relevant Portfolio; in practice they have been modest and used to enhance total return and particularly the income in the Income Portfolio.

Management of Share Price Premium and Discount to NAV

In normal circumstances we aim to ensure the discount to NAV at which our shares trade is no more than 5% and, during the financial year ended 31 May 2024, the Income shares and Growth shares traded at average discounts of -0.2% and -2.5% respectively.

We are active in issuing shares to meet demand and buying back shares when this is appropriate. During the financial year 1,225,000 new Income shares were issued from the Company's block listing facilities at an average premium to NAV of 1.6%. In addition, 2,440,000 Growth shares were bought back into treasury at an average price of 231.76p per Growth share and at an average discount to NAV of -3.3%. No Income shares were bought back or Growth shares issued.

The Board is seeking shareholders' approval to renew the powers to allot shares, buy back shares and sell shares from treasury at the forthcoming Annual General Meeting ('AGM'). Specifically, the Board is seeking approval to allow the Company to issue (or sell from treasury) up to 20% of its Income shares and up to 20% of its Growth shares without rights of pre-emption and, in this respect, there are two resolutions proposed. Each resolution is for up to 10% and, therefore, for an aggregate of up to 20% of each of the Income shares and Growth shares. This approach allows any shareholder who may not wish to give approval to an aggregate limit higher than that recommended by corporate governance guidelines the ability to approve the first resolution for up to 10% and to also consider the second resolution separately for a further 10%. The Board believes the ability to issue and buy back shares helps to reduce the volatility in the premium or discount of the share prices to the underlying NAVs and the 20% overall share allotment authority and the 14.99% buy back authority with respect to both the Income shares and Growth shares are therefore in the best interests of all shareholders.

Share Conversion Facility

Shareholders have the opportunity to convert their Income shares into Growth shares or their Growth shares into Income shares annually subject to minimum and maximum conversion thresholds which may be reduced or increased at the discretion of the Board.

The ability to convert without incurring UK capital gains tax should be an attractive facility for shareholders who wish to do so, and the next conversion date (subject to minimum and maximum thresholds) will be on 24 October 2024. Information is provided in the Annual Report and Financial Statements and full details will be provided on the Company's website (ctglobalmanagedportfolio.co.uk) from 1 August 2024.

AGM

The Annual General Meeting is scheduled to be held on 2 October 2024 at Columbia Threadneedle Investments, Cannon Place, 78 Cannon Street, London, EC4N 6AG at 11.30am. Peter Hewitt, the Investment Manager, will as usual give a presentation and provide an overview of the financial year together with his view on the outlook.

Voting on all resolutions at the AGM will be held on a poll, the results of which will be announced and posted on the Company's website following the meeting. All shareholders are therefore encouraged to make use of the proxy form or form of direction provided, in order that they can lodge their votes.

Should shareholders have any questions or comments in advance, these can be raised with the Company Secretary ([e-mail]). Following the AGM, the Investment Manager's presentation will be available on the Company's website (ctglobalmanagedportfolio.co.uk).

Outlook

Many risks and uncertainties remain. Many are of a political nature, whether war or the threat of it, or recent and forthcoming elections. The economic fundamentals are more favourable for financial markets. The risk of recession has abated although could still happen should Central Banks continue with a too restrictive monetary policy for too long, especially in the US. That said, growth is modestly picking up in Europe and inflation is heading lower in most developed economies. This paves the way for interest rates to move lower over the next year. Investors have been disappointed by the 'higher for longer' approach to combat sticky inflation. It may require actual cuts to be delivered for sentiment to improve; however, it does appear a more favourable environment for equity markets is a distinct possibility, subject to negative political forces.

In this interest rate scenario, the UK stock market is well-placed to benefit and investment trusts, which remain on historically wide discounts, are particularly well-placed to deliver positive returns. Leadership within markets needs to broaden out as this is a key ingredient for active managers to outperform. There are signs this is beginning to take place but no guarantee it will. Whilst valuations in the US are high and setbacks possible, the profits and earnings growth from the technology sector remain very strong. The past two and a half years have been disappointing for your Company; however, there are reasons to be cautiously optimistic for both portfolios.

David Warnock

Chairman

26 July 2024

Investment Manager's Review

Stock Market Background

The difficult environment for equity markets, which has existed since interest rates started to rise in December of 2021, continued to be apparent during the first part of the year under review. Inflation, though turning downwards, was still nearly 9% in the UK at the start of the financial year which meant any reduction in interest rates was likely to be some way off.  Markets continued to be concerned about recession and this limited gains (except for large technology companies in the US) and prolonged uncertainty. As we moved into the second half of the financial year, an unexpectedly good inflation figure from the US in November, temporarily improved sentiment and at that stage expectations were that interest rate cuts would start in the first half of 2024 in the US, followed by Europe. Equity markets responded positively.

The start of 2024, however, brought indications of a strengthening US economy and a series of not as good as expected inflation data in the US. Expectations of interest rate cuts began to wane in the US, whilst in Europe some countries, including the UK, reported a technical but very mild recession in the first calendar quarter of 2024. Equity markets in Europe lost momentum and went sideways although the US, powered by the technology sector, continued to move ahead. The last three months of the financial year saw the UK equity market start to make some headway helped by a series of takeovers of UK companies and a growing appreciation of the attractive value that British companies offer.

Total Return by Region for Year Ended 31 May 2024 (sterling adjusted)

S&P 500 (US)	+24.8%
FTSE World ex UK	+21.6%
FTSE Europe ex UK	+18.1%
FTSE All-Share	+15.4%
FTSE Japan	+15.1%
FTSE Pacific ex Japan	+10.0%
MSCI Emerging Markets	+9.9%

Source: Columbia Threadneedle Investments

This was the best year for positive returns from equity markets globally since 2021. The majority of the gains came in the second half of the financial year as it became apparent that developed economies, especially Europe, were likely to move out of a shallow recession and if anything may experience slightly stronger activity levels as the year unfolded. In Europe, inflation steadily moved towards the 2% target, whilst in the US the resilience of the consumer maintained growth at a higher level, and, along with a tight labour market, meant inflation proved stickier. All regions achieved strong absolute gains with the UK at last not a laggard. Interestingly, in relative terms the UK stock market's performance got better as the year wore on such that looking at the final quarter to 31 May 2024 it produced the strongest return of any of the regions/markets.

Frequently currency movements can have a significant effect on equity market returns when translated back into sterling. However, with one notable exception, this was not the case in the year ended 31 May 2024. Sterling rose only 2.7% against the dollar and marginally by 0.9% against the Euro, thus reducing returns very slightly in sterling. The exception was the 15.5% appreciation of sterling relative to the Japanese Yen, which had the effect of diluting a strong local currency performance from the Tokyo stock market when translated back into sterling.

Over the last three years a feature of stock market returns in the UK, US and Europe has been the dominance of the largest companies in terms of market leadership. The table below highlights the performance trends within the UK stock market over the past year.

Total Returns for the Year Ended 31 May 2024

FTSE 100 Index                                                                                               +15.6%

FTSE 250 Index                                                                                               +14.6%

FTSE Small Cap (ex Investment Trusts) Index                                                    +20.9%

FTSE AIM All-Share Index                                                                                  +5.0%

FTSE All-Share Closed End Investments Index                                                  +12.2%

Source: Columbia Threadneedle Investments

The FTSE 100 Index has a very different make up to the rest of the UK stock market. It comprises 84% of the FTSE All-Share Index and has significant weightings in sectors like oils, banks, pharmaceuticals, mining, utilities and consumer staples. Most of these sectors, with the exception of pharmaceuticals, are viewed as 'old economy' low growth sectors. However, at times of acute uncertainty, investors exhibit a preference for larger companies which are perceived as better placed to survive an adverse environment of high inflation and interest rates. That has been the case for the past three years. Over the longer term it is the dominance of these sectors which has been a key factor behind the underperformance of UK equities. Most of the companies displaying better growth prospects are to be found in the mid and small cap sectors. In 2024 the 'large cap effect', whilst still evident, has gradually become less apparent. The FTSE SmallCap (ex-Investment Trusts) Index has done best but has shrunk so much it has become less representative as it accounts for only around 100 companies whereas the FTSE AIM All-Share Index has over 600 constituents and is where most UK investment managers seek their small cap exposure.  The trends noted above are mirrored in US and European stock markets.

Performance

For the year ended 31 May 2024 the FTSE All-Share Index recorded a 15.4% rise (in total return terms). Over the same period the net asset value of the Income Portfolio was up by 7.0% whilst that of the Growth Portfolio gained 12.7% (again in total return terms).

Similar to last year there were three key factors behind the performance.

The first and most important factor which affected the sector in general along with both portfolios has been wide discounts. The principal way shares prices of investment companies are valued by the stock market is by reference as to whether the share price trades at a discount or premium to the net asset value of the investment company in question.

The chart on page 18 of the Annual Report and Financial Statements highlights the volatile nature of discounts in the investment company sector over the past year. The average discount was around 14% at the start of the year, visited nearly 19% at the end of October before trending back to 13% by the calendar year end and concluding the financial year at just over 14%. There is no single factor which causes discounts. However, a perception that interest rates would need to remain higher for longer to tame inflation and a fear of recession caused sentiment amongst retail investors and private wealth managers to be both cautious and adverse and this led to an excess of supply over demand for shares in investment companies.

It is useful to put in perspective the magnitude of average sector discounts. The chart on page 19 of the Annual Report and Financial Statements illustrates what has happened over the past 10 years. For the first six years, discounts gently tightened and were less than 1% at the beginning of the new decade. They widened out sharply at the start of the COVID lockdown, but quickly reversed such that the average sector discount briefly became a premium in April 2021. Since then, due to a surge in inflation and rising interest rates, discounts have widened out to levels not seen for a very long time.

The second factor was the performance of the income-focused sub-sectors within the wider alternative investment company sector and, in particular, the infrastructure, renewable energy infrastructure, property and debt sub-sectors. The common theme is that their assets are valued by reference to a discount rate which is applied to the cash flows generated by the underlying assets. When interest rates rose, this was reflected in higher discount rates and a corresponding fall in asset values. In certain cases, from premiums a few years ago, share prices moved to sizeable discounts. Discounts of 20-40% have been common over the past year and, until interest rates move substantially lower, are likely to remain at wide levels. This affected the Income Portfolio where high dividends comprise a large part of the total return from many alternative sub-sectors. With one or two notable exceptions dividends have continued to be paid and even increased; however, asset values came under pressure and share prices fell sharply. This was a major cause of the underperformance of the Income Portfolio.

The third factor which has made it difficult for active fund managers to perform is alluded to in the earlier table which illustrated how various UK equity indices, split by size, performed over the past year. In terms of magnitude, the underperformance of medium and smaller companies was not as severe as the year before. However, it was still difficult for active fund managers to outperform where, for reasons of risk and diversity, they would not wish to have too concentrated a portfolio, dominated by large holdings in the very biggest companies. Over the long-term, medium and smaller sized companies tend to grow faster and perform better; however, due to higher interest rates and fear of recession, this was not the case in the most recent financial year.

Income Portfolio - Leaders and Laggards

A common theme amongst the underperformers in the Income Portfolio was widening share price discounts, much of which was the result of rising interest rates and importantly higher discount rates which are used to value future cash flows and assets for many alternative investment companies. The renewable energy infrastructure sector has been particularly affected as illustrated by The Renewables Infrastructure Group whose share price total return was -11%. The company's net asset value was impacted modestly by lower power prices and was broadly flat over the year; however, the share price discount widened sharply to over 20% which reflected investors' fears over the impact of higher interest rates. Where possible, companies have sought to prove valuations by selling certain assets and by increasing dividends. The Renewables Infrastructure Group increased its dividends by 4% to yield in excess of 7%. However, despite this, the shares lagged over the past year. Something similar occurred to Impact Healthcare REIT ('Impact') which has been held since its IPO in 2017. Impact operates as a real estate investment trust ('REIT') and acquires and develops real estate assets principally for care homes in the healthcare sector, but it does not manage the operations. The company has a conservative balance sheet and has steadily grown rental income and net asset value; however, the shares have de-rated to a discount of around 28% and are thoroughly out of favour. Encouragingly, the dividend has continued to move ahead such that the shares yield over 8%. Rather surprisingly, global equity income trust The Scottish American Investment Company ('Scottish American') delivered a marginally negative share price total return of -0.3% for the past year. The net asset performance of Scottish American has been good over the long term. However, the entire gain in net asset value over the past year was offset by the share price moving from trading around par a year ago to a discount of 9% by the end of May 2024. Scottish American was one of the Income Portfolio's best performers the previous year.

Turning to the leaders and the best performer in the Income Portfolio with a share price total return of 29% was UK equity income trust Temple Bar Investment Trust ('Temple Bar). Since Redwheel Partners took over management of the portfolio towards the end of 2020, Temple Bar has handsomely outperformed the FTSE All-Share Index. They employ a deep value style and work out an intrinsic value for each of its 25 holdings determined by free cash flow generation. Temple Bar has also benefitted from value stocks significantly outperforming growth stocks over the last three years after a long period in the doldrums. A number of holdings have been subject to bids which is not surprising given the cheapness of the underlying portfolio which is valued at a price earnings ratio of only 8.5x. Prospects for Temple Bar continue to be promising. Next best performer was The Mercantile Investment Trust ('Mercantile') with a share price total return of 27%. Mercantile, a strong performer over the long term, has a market value of £1.8bn and specialises in investments in the FTSE 250 Index. This is home to many of the UK's best growth companies. However, when inflation started to rise and interest rates were increased to combat inflation from the start of 2022 onwards, medium and smaller companies in the UK underperformed the FTSE 100 Index of the largest companies by a substantial margin. Valuations in the medium and smaller companies segment of the equity market have become very attractive and Mercantile has taken advantage of this. It has a good record of dividend growth with a 3.4% yield. Despite last year's share price performance, the discount remains wide at around 12%. The third best performer was another trust from the JPMorgan stable, that of JPMorgan Global Growth & Income which had a share price total return of 23%. The trust was also one of the best performers in the Income Portfolio last year and pays 4% of its year-end net asset value as a dividend. Around half of the dividend is generated from the underlying portfolio, with the balance coming from capital. This has allowed the trust to have large holdings in Nvidia, Microsoft, Amazon and Mastercard which typically either do not pay a dividend or only a small dividend. It has meant the trust is able to gain exposure to a series of strong performing technology companies which has been key to good performance. As a result, the trust has traded consistently at a small premium and has been able to issue shares. It has a dividend yield of 3.3% and a market value of £2.7bn.

Growth Portfolio - Leaders and Laggards

Starting with the underperformers in terms of magnitude, the largest was the 27% fall in the Syncona share price total return, which was a major disappointment. Syncona aims to create and build life science and biotechnology companies from UK science focussing on unmet medical needs for patients. It aims to have around 20-25 companies (mainly private) where it takes significant shareholdings. The net asset value has gone sideways over the last three years. However, over the next twelve months there are a series of key trial data announcements from portfolio companies which could boost the net asset value if results are positive. Syncona is well-financed and expects to be able to fund the next three years of development for underlying holdings at approximately £200m p.a. It has net cash of over £450m and a market value of around £700m. The shares have moved to a discount of over 40%, which highlights how unloved private biotechnology companies have been and accords very little value to the underlying holdings. Shares in BH Macro declined 11% over the past year and, similar to Syncona, the net asset value has been flat over the period and the share price has been a victim of discount widening moving from a small premium to a discount of 10%. BH Macro is a macro hedge fund which exploits opportunities in interest rates, bonds and foreign exchange. A key reason it is held is due to the nature of the returns it has generated which tend to be inversely correlated with the direction of equity markets which helps to cushion overall performance in bear markets. BH Macro has begun to repurchase shares. Finsbury Growth & Income Trust is a UK equity trust managed by well-known investor Nick Train. It has had a difficult past year after being one of the Growth Portfolio's better performers the previous year. The trust invests in large UK companies with consistent earnings growth. There is a focus on global consumer brands, digital transformation and data analytics. Certain of the consumer names, such as Diageo and Burberry, have had a challenging last year. However, more than half of the portfolio now comprises companies which benefit from data analytics, such as The London Stock Exchange, RELX and Experian, where prospects for growth are excellent. The shares fell 3% last year as the discount widened to 8%.

Just as widening discounts were a common theme amongst the laggards, exposure to companies with secular growth characteristics was a common theme amongst the leaders. Allianz Technology Trust and Polar Capital Technology Trust both saw share price gains of 35% whilst Scottish Mortgage Investment Trust was not far behind with a gain of 33% over the fiscal year. The rapid development of Artificial Intelligence was a key factor behind the share price performance of all three trusts. All three have built large holdings in Nvidia and ASML, which make semiconductors needed in AI, as well as Microsoft and Meta, which are also perceived beneficiaries. Although some believe AI is no more than a fad and a bubble, experienced investors and commentators on the technology sector liken the advent of AI and its development as akin to where the internet was in 1995. All of these have been long-term holdings for the Growth Portfolio. While all were reduced in January 2022, all were increased during the year under review.

(all share prices are total return)

Investment Strategy and Prospects

Equity markets did better than expected over the past year, once again led by the US. There was great uncertainty last year around the fear of a recession in developed economies and, although the UK and Europe did have a mild recession around the turn of the year, both have since emerged from it. The driver was the US economy, which through 2023 and the first part of this year was stronger than anticipated.

What does this mean for the coming year and beyond?

Fear of recession has abated. Although the US is showing signs of slowing, it is still growing, in part due to loose fiscal policy, which is not likely to change ahead of the Presidential election in November and this may well continue into next year. The UK and Europe are experiencing gently rising activity levels with low levels of unemployment and, although China's rate of growth has slowed, it remains well ahead of Europe and the US and is supportive of growth, especially in Asia.

What about prospects for stock markets?

Whilst inflation is clearly trending towards the 2% target level for most developed economies, it has proved stickier in the US, where growth has been notably more robust. Growth momentum is beginning to moderate in the US whilst the opposite is true for Europe, albeit from much lower levels. The key is that major Western Central Banks should be able to cut interest rates by the end of 2024. Expectations are for two cuts in the UK and Europe whilst only one in the US, with more likely in 2025. This is a favourable environment for stock markets. Lower interest rates should also permit leadership within equity markets to broaden out. In the US the top 10 companies by market value, dominated by large technology stocks, have driven stock market performance; however, even if their earnings growth remains strong, at an average forward price earnings ratio of 28x, their shares are, in relative terms, highly valued. This may mean dominance of stock market returns in the US by the largest companies will become less pronounced. Historically, lower interest rates have been a tailwind for medium sized and smaller companies, nowhere more so than the out of favour UK stock market.

How does this impact the investment strategy?

In terms of strategy this is reflected in the first of three key themes underpinning both portfolios. The first theme is UK equity investment companies, especially those with a bias to medium and smaller sized companies. The UK stock market is the only major market where valuations are below 20 year averages - the forward price earnings ratio is around 11x against a long-term average of 14x. Profits and earnings growth is picking up and a series of takeovers of a variety of UK companies across different sectors highlights that buyers, typically private equity and overseas companies, are seeking to take advantage of historically low valuations. Amongst smaller listed companies in the UK the de-rating has been severe; however, an environment of moderate growth in the domestic economy and lower interest rates is favourable for good stock market performance from this segment of the equity market.

Both Portfolios have increased their exposure to UK investment companies. As an illustration, they both have positions in The Law Debenture Corporation, Lowland Investment Company and the recently purchased JPMorgan UK Small Cap Growth & Income. The Growth Portfolio also has holdings in Fidelity Special Values, Aberforth Smaller Companies Trust, Aurora Investment Trust, Henderson Smaller Companies Investment Trust and Henderson Opportunities Trust, all UK equity specialists.

The Income Portfolio also has holdings in trusts focussed on UK equities which have attractive dividend yields. In addition to trusts mentioned above, examples also include The Mercantile Investment Trust, The Merchants Trust, Temple Bar Investment Trust, Edinburgh Investment Trust, Murray Income Trust and Invesco Perpetual UK Smaller Companies Investment Trust.

Many of the trusts featured above remain on historically wide discounts; for example, Lowland Investment Company and The Mercantile Investment Trust are on share price discounts of around 12% with most of the smaller company specialists on discounts of between 10% and 15%. These are historically wide levels and highlight how out of favour they have been and the excellent value on offer.

The second theme is private equity trusts. As a sector, they all moved out to very wide discounts, often in excess of 40%, in 2022 when both inflation and interest rates were on the rise and a fear of recession led to an expectation that underlying asset values for these trusts would fall. This proved not to be the case and most either held their value or in selective cases managed small gains. Most are now better placed to resume asset value growth, and many have introduced shareholder friendly capital allocation policies relating to dividends and share buybacks.  Both Portfolios have built up a number of holdings in the private equity sector. In the Growth Portfolio, the largest position and long-time holding is HgCapital Trust along with Oakley Capital Investments, Pantheon International, ICG Enterprise Trust, Literacy Capital, Augmentum Fintech and The Schiehallion Fund. In the Income Portfolio, certain private equity trusts that have a policy of paying dividends from capital reserves are also held. Examples are NB Private Equity Partners, Apax Global Alpha and Partners Group Private Equity Holding (formerly called Princess Private Equity Holding). Most of the trusts mentioned are on wide share price discounts and are well placed to generate good performance from current levels.

The final theme is holdings in trusts with secular growth characteristics. This has been a long-term investment theme. Trusts in this category have significant exposure to technology, healthcare, biotechnology and companies involved in digital disruption and transformation. Most of these types of holdings will appear in the Growth Portfolio and examples include Allianz Technology Trust, Polar Capital Technology Trust, Scottish Mortgage Investment Trust, The Monks Investment Trust, Herald Investment Trust, Worldwide Healthcare Trust and Biotech Growth Trust. It is much harder for the Income Portfolio to gain exposure because most of these trusts either do not pay a dividend or only a low dividend; however, a couple examples of trusts included are International Biotechnology Trust and Bellevue Healthcare Trust.

The Growth Portfolio has increased holdings in some of the trusts noted above over the past year. Although they can be volatile, for genuine long-term investors, it is from trusts with these secular growth characteristics multiple times the original investment can be made.

Conclusion

Looking ahead, there are many uncertainties that could undermine a favourable outlook for equity markets. These include geo-politics, especially Ukraine or the Middle East, political elections, particularly that of the US President in November, or an unanticipated decline into recession if the Federal Reserve in the US maintained a tight monetary policy for too long. However, coming back to the fundamentals, it does appear that there is every chance of a favourable environment developing for equity markets. The risk of recession appears to be fading. Inflation will not return to pre-pandemic levels but will come back in most developed economies towards the 2% target level of Central Banks. Although forecasting interest rates is hazardous, most Central Banks will be looking to move rates lower over the next year. Growth should respond and there are optimistic signs of this in Europe.

Against this more favourable backdrop, some cautious optimism on progress from equity markets seems justified. This is especially so with the UK equity market which has been anchored at the bottom of most performance league tables since the Brexit vote in 2016. It is interesting that, in the final quarter of the financial year ended 31 May 2024, the UK was amongst the best performing equity markets despite all the uncertainties. There is a chance that this may continue in the current year.

At the time of writing the average sector discount for investment companies is 15%. This is at one end of the spectrum and outstanding value is apparent across many different sub-sectors. Patience will be both required and tested. However, from current levels there is a genuine opportunity of positive returns from the two portfolios of high-quality investment companies with strong balance sheets and proven, experienced management.

Peter Hewitt

Investment Manager

Columbia Threadneedle Investment Business Limited

26 July 2024

Income Statement

For the Year ended 31 May 2024

	Notes	Revenue	Capital	Total
		£'000	£'000	£'000
Gains on investments		-	11,175	11,175
Foreign exchange losses		-	(6)	(6)
Income		5,167	-	5,167
Investment management fee		(280)	(702)	(982)
Other expenses		(659)	-	(659)
Return on ordinary activities before   finance costs and tax		4,228	10,467	14,695
Finance costs		(114)	(171)	(285)
Return on ordinary activities before tax		4,114	10,296	14,410
Tax on ordinary activities		-	-	-
Return attributable to shareholders		4,114	10,296	14,410
Return per Income share - basic and diluted	3	8.06p	(0.28p)	7.78p
Return per Growth share - basic and diluted	3	-	28.33p	28.33p

The total column of this statement is the Profit and Loss Account of the Company. The supplementary revenue and capital columns are prepared under guidance published by The Association of Investment Companies.

Segmental analysis, illustrating the two separate portfolios of assets, the Income Portfolio and the Growth Portfolio, is shown in note 2 to the financial statements.

All revenue and capital items in the Income Statement derive from continuing operations.

Return attributable to shareholders represents the profit/(loss) for the year and also total comprehensive income

Income Statement

For the Year ended 31 May 2023

	Notes	Revenue	Capital	Total
		£'000	£'000	£'000
Losses on investments		-	(13,698)	(13,698)
Foreign exchange losses		-	(5)	(5)
Income		5,019	-	5,019
Investment management fee		(293)	(730)	(1,023)
Other expenses		(689)	-	(689)
Return on ordinary activities before   finance costs and tax		4,037	(14,433)	(10,396)
Finance costs		(95)	(143)	(238)
Return on ordinary activities before tax		3,942	(14,576)	(10,634)
Tax on ordinary activities		(11)	-	(11)
Return attributable to shareholders		3,931	(14,576)	(10,645)
Return per Income share - basic and diluted	3	7.96p	(18.16p)	(10.20p)
Return per Growth share - basic and diluted	3	-	(14.51p)	(14.51p)

The total column of this statement is the Profit and Loss Account of the Company. The supplementary revenue and capital columns are prepared under guidance published by The Association of Investment Companies.

Segmental analysis, illustrating the two separate portfolios of assets, the Income Portfolio and the Growth Portfolio, is shown in note 2 to the financial statements.

All revenue and capital items in the Income Statement derive from continuing activities.

Return attributable to shareholders represents the profit/(loss) for the year and also total comprehensive income.

Balance Sheet

As at 31 May 2024

		Income shares	Growth shares	Total
	Notes	£'000	£'000	£'000
Fixed assets
Investments at fair value		65,994	91,861	157,855
Current assets
Debtors		293	208	501
Cash at bank and on deposit		1,200	476	1,676
		1,493	684	2,177
Creditors Amounts falling due within one year		(7,223)	(310)	(7,533)
Net current (liabilities)/ assets		(5,730)	374	(5,356)
Creditors Amounts falling due in more than one year		-	-	-
Net assets		60,264	92,235	152,499
Capital and reserves
Called-up share capital		3,134	2,353	5,487
Share premium		3,223	428	3,651
Capital redemption reserve		1,950	1,698	3,648
2022 special reserve		29,588	29,581	59,169
2008 special reserve		19,464	9,206	28,670
Capital reserves		(998)	48,969	47,971
Revenue reserve		3,903	-	3,903
Shareholders' funds		60,264	92,235	152,499
Net asset value per share (pence)	6	116.51p	259.29p

Balance Sheet

As at 31 May 2023

		Income shares	Growth shares	Total
	Notes	£'000	£'000	£'000
Fixed assets
Investments at fair value		64,183	82,360	146,543
Current assets
Debtors		198	68	266
Cash at bank and on deposit		3,002	5,610	8,612
		3,200	5,678	8,878
Creditors Amounts falling due within one year		(3,650)	(518)	(4,168)
Net current (liabilities)/ assets		(450)	5,160	4,710
Creditors Amounts falling due in more than one year		(5,000)	-	(5,000)
Net assets		58,733	87,520	146,253
Capital and reserves
Called-up share capital		3,247	2,500	5,747
Share premium		1,917	428	2,345
Capital redemption reserve		1,760	1,553	3,313
2022 special reserve		29,588	29,581	59,169
2008 special reserve		19,422	14,930	34,352
Capital reserves		(853)	38,528	37,675
Revenue reserve		3,652	-	3,652
Shareholders' funds		58,733	87,520	146,253
Net asset value per share (pence)	6	116.41p	230.12p

Cash Flow Statement

Year ended 31 May 2024

	Notes	Income shares	Growth shares	Total
		£'000	£'000	£'000
Net cash outflow from operations before dividends and interest		(615)	(943)	(1,558)
Dividends received		3,181	1,515	4,696
Interest received		57	133	190
Interest paid		(268)	-	(268)
Net cash inflow from operating activities		2,355	705	3,060
Investing activities
Purchases of investments		(10,193)	(10,167)	(20,360)
Sales of investments		8,474	10,054	18,528
Net cash flows from investing activities		(1,719)	(113)	(1,832)
Net cash flows before financing activities		636	592	1,228
Financing activities
Equity dividends paid Proceeds from issuance of new shares	4	(3,863) 1,381	- -	(3,863) 1,381
Share conversion - Income to Growth		(238)	238	-
Share conversion - Growth to Income		282	(282)	-
Shares purchased to be held in treasury		-	(5,682)	(5,682)
Net cash flows from financing activities		(2,438)	(5,726)	(8,164)
Net movement in cash and cash equivalents		(1,802)	(5,134)	(6,936)
Cash and cash equivalents at the beginning of the year		3,002	5,610	8,612
Cash and cash equivalents at the end of the year		1,200	476	1,676
Represented by: Cash at bank Short-term deposits		510 690	36 440	546 1,130
		1,200	476	1,676

Cash Flow Statement

Year ended 31 May 2023

		Income shares	Growth shares	Total
		£'000	£'000	£'000
Net cash outflow from operations before dividends and interest		(775)	(1,006)	(1,781)
Dividends received		3,409	1,556	4,965
Interest received		70	169	239
Interest paid		(220)	-	(220)
Net cash inflow from operating activities		2,484	719	3,203
Investing activities
Purchases of investments		(9,793)	(5,367)	(15,160)
Sales of investments		9,690	6,174	15,864
Net cash flows from investing activities		(103)	807	704
Net cash flows before financing activities		2,381	1,526	3,907
Financing activities
Equity dividends paid Proceeds from issuance of new shares		(3,441) 2,049	- 446	(3,441) 2,495
Share conversion - Income to Growth		(155)	155	-
Share conversion - Growth to Income		619	(619)	-
Shares purchased to be held in treasury		-	(1,827)	(1,827)
Net cash flows from financing activities		(928)	(1,845)	(2,773)
Net movement in cash and cash equivalents		1,453	(319)	1,134
Cash and cash equivalents at the beginning of the year		1,549	5,929	7,478
Cash and cash equivalents at the end of the year		3,002	5,610	8,612
Represented by: Cash at bank Short-term deposits		122 2,880	50 5,560	172 8,440
		3,002	5,610	8,612

Statement of Changes in Equity

For the Year ended 31 May 2024

Income shares	Share capital £'000	Share premium £'000	Capital redemption reserve £'000	2022 special reserve £'000	2008 special reserve £'000	Capital reserves £'000	Revenue reserve £'000	Total shareholders' funds £'000
As at 31 May 2023	3,247	1,917	1,760	29,588	19,422	(853)	3,652	58,733
Increase in share capital in issue, net of share issuance expenses	75	1,306	-	-	-	-	-	1,381
Share conversion	2	-	-	-	42	-	-	44
Cancellation of deferred shares	(190)	-	190	-	-	-	-	-
Transfer of net income from Growth to Income Portfolio	-	-	-	-	-	-	1,261	1,261
Transfer of capital from Income to Growth Portfolio	-	-	-	-	-	(1,261)	-	(1,261)
Dividends paid	-	-	-	-	-	-	(3,863)	(3,863)
Return attributable to shareholders	-	-	-	-	-	1,116	2,853	3,969
As at 31 May 2024	3,134	3,223	1,950	29,588	19,464	(998)	3,903	60,264
Growth shares
As at 31 May 2023	2,500	428	1,553	29,581	14,930	38,528	-	87,520
Increase in share capital in issue, net of share issuance expenses	-	-	-	-	-	-	-	-
Share conversion	(2)	-	-	-	(42)	-	-	(44)
Cancellation of deferred shares	(145)	-	145	-	-	-	-	-
Transfer of net income from Growth to Income Portfolio	-	-	-	-	-	-	(1,261)	(1,261)
Transfer of capital from Income to Growth Portfolio	-	-	-	-	-	1,261	-	1,261
Shares purchased for treasury	-	-	-	-	(5,682)	-	-	(5,682)
Return attributable to shareholders	-	-	-	-	-	9,180	1,261	10,441
As at 31 May 2024	2,353	428	1,698	29,581	9,206	48,969	-	92,235
Total Company
As at 31 May 2023	5,747	2,345	3,313	59,169	34,352	37,675	3,652	146,253
Increase in share capital in issue, net of share issuance expenses	75	1,306	-	-	-	-	-	1,381
Share conversion	-	-	-	-	-	-	-	-
Cancellation of deferred shares	(335)	-	335	-	-	-	-	-
Shares purchased for treasury	-	-	-	-	(5,682)	-	-	(5,682)
Dividends paid	-	-	-	-	-	-	(3,863)	(3,863)
Return attributable to shareholders	-	-	-	-	-	10,296	4,114	14,410
Total Company as at 31 May 2024	5,487	3,651	3,648	59,169	28,670	47,971	3,903	152,499

Statement of Changes in Equity

For the Year ended 31 May 2023

Income shares	Share capital £'000	Share premium £'000	Capital redemption reserve £'000	2022 special    reserve £'000	2008 special reserve £'000	Capital reserves £'000	Revenue reserve £'000	Total shareholders' funds £'000
As at 31 May 2022	4,596	-	257	29,588	18,980	8,109	3,162	64,692
Increase in share capital in issue, net of share issuance expenses	132	1,917	-	-	-	-	-	2,049
Share conversion	22	-	-	-	442	-	-	464
Cancellation of deferred shares	(1,503)	-	1,503	-	-	-	-	-
Transfer of net income from Growth to Income Portfolio	-	-	-	-	-	-	1,187	1,187
Transfer of capital from Income to Growth Portfolio	-	-	-	-	-	(1,187)	-	(1,187)
Dividends paid	-	-	-	-	-	-	(3,441)	(3,441)
Return attributable to shareholders	-	-	-	-	-	(7,775)	2,744	(5,031)
As at 31 May 2023	3,247	1,917	1,760	29,588	19,422	(853)	3,652	58,733
Growth shares
As at 31 May 2022	3,692	-	365	29,581	17,199	44,142	-	94,979
Increase in share capital in issue, net of share issuance expenses	18	428	-	-	-	-	-	446
Share conversion	(22)	-	-	-	(442)	-	-	(464)
Cancellation of deferred shares	(1,188)	-	1,188	-	-	-	-	-
Transfer of net income from Growth to Income Portfolio	-	-	-	-	-	-	(1,187)	(1,187)
Transfer of capital from Income to Growth Portfolio	-	-	-	-	-	1,187	-	1,187
Shares purchased for treasury	-	-	-	-	(1,827)	-	-	(1,827)
Return attributable to shareholders	-	-	-	-	-	(6,801)	1,187	(5,614)
As at 31 May 2023	2,500	428	1,553	29,581	14,930	38,528	-	87,520
Total Company
As at 31 May 2022	8,288	-	622	59,169	36,179	52,251	3,162	159,671
Increase in share capital in issue, net of share issuance expenses	150	2,345	-	-	-	-	-	2,495
Share conversion	-	-	-	-	-	-	-	-
Cancellation of deferred shares	(2,691)	-	2,691	-	-	-	-	-
Shares purchased for treasury	-	-	-	-	(1,827)	-	-	(1,827)
Dividends paid	-	-	-	-	-	-	(3,441)	(3,441)
Return attributable to shareholders	-	-	-	-	-	(14,576)	3,931	(10,645)
Total Company as at 31 May 2023	5,747	2,345	3,313	59,169	34,352	37,675	3,652	146,253

Principal Risks and Uncertainties

As an investment company, investing primarily in listed securities, most of the Company's principal risks and uncertainties that could threaten the achievement of its objective, strategy, future performance, liquidity and solvency are market-related.

A summary of the Company's risk management and internal controls arrangements is included within the Report of the Audit Committee in the Annual Report and Financial Statements. By means of the procedures set out in that summary, the Board has established an ongoing process for identifying, evaluating and managing the significant risks faced by the Company. The Board also considers emerging risks which might affect the Company and related updates from the Manager on such risks are also considered. During the year, significant risks included the outlook for inflation and ongoing macroeconomic and geopolitical concerns, together with recent and forthcoming elections in countries such as the UK and the US. Any emerging risks that are identified and that are considered to be of significance are included on the Company's risk register with any mitigations. These significant risks, emerging risks and other risks are regularly reviewed by the Audit Committee and the Board. The Audit Committee and the Board have also regularly reviewed the effectiveness of the Company's risk management and internal control systems for the period.

In November 2021, the Company's Manager, which was part of BMO GAM (EMEA), was acquired by Ameriprise Financial and the integration of its business with Columbia Threadneedle Investments then progressed. There has been little change for the Company; nevertheless, an acquisition such as this introduces some uncertainty until the integration of systems is fully implemented. A critical milestone was the move to a new order management system, Aladdin, which is widely regarded as market leading. This change was successfully completed in October 2023 and the integration risk is now viewed as reduced.

The principal risks and uncertainties faced by the Company, and the Board's mitigation approach, are described below.

Market risk

The Company's assets consist mainly of listed closed-end investment companies and its principal risks are therefore market-related and include market risk (comprising currency risk, interest rate risk and other price risk), liquidity risk and credit risk.

Climate change may also have an impact on investee companies in the coming years.

Uncertainty in markets, with events such as the war in Ukraine, increased conflict in the Middle East and recent and forthcoming elections, together with macroeconomic and geopolitical concerns have led to volatility in the Company's NAV.

No change in overall risk during the year, but, given macroeconomic and geopolitical concerns, this risk remains heightened.

Mitigation

The Board regularly considers the composition and diversification of the Income Portfolio and the Growth Portfolio and considers individual stock performance together with purchases and sales of investments. Investments and markets are discussed with the Investment Manager on a regular basis.

Engagement on financially material environmental, social and governance matters is undertaken by the Manager and its approach is explained on pages 23 and 24 of the Annual Report and Financial Statements.

The Board has, in particular, considered the impact of market volatility, macroeconomic and geopolitical concerns and inflation and they are discussed in the Chairman's Statement and Investment Manager's Review. As a closed-end investment company, it is not constrained by asset sales to meet redemptions so can remain invested through volatile market conditions and is well suited to investors seeking longer-term returns.

Investment performance risk

Incorrect strategy, asset allocation, stock selection (in the context of the market, economic or geopolitical backdrop) and the use of gearing could all lead to poor returns for shareholders.

No change in overall risk during the year, but, given macroeconomic and geopolitical concerns, this risk remains heightened.

Mitigation

The investment strategy and performance against peers and the benchmark are considered by the Board at each meeting and reviewed with the Investment Manager. The Board is responsible for setting the gearing range within which the Manager may operate and gearing is discussed at every meeting and related covenant limits are closely monitored. The Manager's Investment Risk team provide oversight on investment risk management.

The Income Portfolio and Growth Portfolio are diversified and comprise listed closed-end investment companies and their compositions are reviewed regularly by the Board.

Underlying dividends from investee companies are also closely monitored and the revenue reserve and the 2022 special reserve attributable to the Income Portfolio can be drawn to support the payment of dividends to Income shareholders.

If required, the Board can hold additional meetings at short notice to discuss any significant matters.

Third party service delivery and cyber risk

Failure of the Manager as the Company's main service provider or disruption to its business, or that of any other outsourced or third party service provider, could lead to an inability to provide accurate reporting and monitoring, leading to a potential breach of the Company's investment mandate or loss of shareholders' confidence.

The risk includes failure or disruption as a consequence of external events such as the COVID-19 pandemic.

External cyber attacks could cause such failure or could lead to the loss or sabotage of data.

No change in overall risk during the year, but, due to the integration with Columbia Threadneedle Investments' systems, this risk was heightened.

Mitigation:

The Board meets regularly with the management of the Manager and its Operational Risk Management team to review internal control and risk reports, which includes oversight of its own third party service providers. The Manager's appointment is reviewed annually and the contract can be terminated with six months' notice. The Manager has a business continuity plan in place to ensure that it is able to respond quickly and effectively to an unplanned event that could affect the continuity of its business.

The Manager has outsourced certain functions (such as fund accounting services) to State Street Bank and Trust Company ('State Street') and supervision of such third party service providers, including the administrator of the Manager's savings plans, has been maintained by the Manager. This includes the review of IT security and heightened cyber threats.

The Manager also closely monitors the performance of its technology platform to ensure it is functioning within acceptable service levels. During the year, the Audit Committee received a presentation from the Manager's Chief Information Security Office on its information and cyber security programme.

The Board receives quarterly reports from the Depositary confirming safe custody of the Company's assets and cash and holdings are reconciled to the Custodian's records. The Custodian's internal controls reports are also reviewed by the Manager and key points reported to the Audit Committee. The Board also receives periodic updates from the Custodian on its own cyber security controls.

The Depositary is specifically liable for loss of any of the Company's assets that constitute financial instruments under the AIFMD.

Viability Assessment and Statement

In accordance with the UK Corporate Governance Code, the Board is required to assess the future prospects for the Company and considered that a number of characteristics of the Company's business model and strategy were relevant to this assessment:

·      The Company's investment objective and policy, which are subject to regular Board monitoring, means that the Company is invested principally in two diversified Portfolios of listed closed-end investment companies and the level of borrowing is restricted.

·      The Company's investments are principally in listed securities which are traded in the UK on the London Stock Exchange's Main Market or other regulated exchanges and which are expected to be readily realisable.

·      The Company is a listed closed-end investment company whose shares are not subject to redemptions by shareholders.

·      Subject to shareholder continuation votes, the next of which will be at the AGM in 2028 and five yearly thereafter, the Company's business model and strategy is not time-limited.

Also relevant were a number of aspects of the Company's operational arrangements:

·      The Company retains title to all assets held by the Custodian under the terms of a formal agreement with the Custodian and Depositary.

·      The borrowing facilities, which remain available until February 2025, are subject to a formal agreement, including financial covenants with which the Company complied in full during the year.

·      Revenue and expenditure forecasts are reviewed by the Directors at each Board meeting.

·      The operational robustness of key service providers and the effectiveness of alternative working arrangements.

·      Alternative service providers can be engaged at relatively short notice if necessary.

In considering the viability of the Company, the Directors carried out a robust assessment of the principal risks and uncertainties which could threaten the Company's objective and strategy, future performance and solvency. This included the impact of market volatility and a significant fall in equity markets on the Company's investment Portfolios. These risks, their mitigations and the processes for monitoring them are set out in Principal Risks and Uncertainties and in the Report of the Audit Committee and in notes 18 to 23 to the financial statements in the Annual Report and Financial Statements.

The Directors also considered:

·      The level of ongoing charges incurred by the Company which are modest and predictable and (at 31 May 2024), excluding the ongoing charges of underlying funds, total 1.20% and 1.11% of average net assets for the Income shares and Growth shares respectively.

·      Future revenue and expenditure projections.

·      The Company's ability to meet liquidity requirements given its investment Portfolios consist principally of listed investment companies which can be realised if required.

·      The ability to undertake share buy-backs if required.

·      Whether the Company's investment objective and policy continue to be relevant to investors.

·      Directors are non-executive and the Company has no employees and consequently the Company does not have redundancy or other employment-related liabilities or responsibilities.

·      The uncertainty in markets and macroeconomic and geopolitical concerns and the prospects for the Company's investment Portfolios.

These matters were assessed over a five year period to July 2029, and the Board will continue to assess viability over five year rolling periods.

As part of this assessment the Board considered a number of stress tests and scenarios which considered the impact of inflation and substantial falls in investment values on shareholders' funds over a five year period. The results demonstrated the impact on the Company's net assets and its expenses and its ability to meet its liabilities over that period and adhere to its financial covenants.

A rolling five year period represents the horizon over which the Directors believe they can form a reasonable expectation of the Company's prospects, although they do have due regard to viability over the longer term.

Based on their assessment, and in the context of the Company's business model, strategy and operational arrangements set out above, the Directors have a reasonable expectation that the Company will be able to continue in operation and meet its liabilities as they fall due over the five year period to July 2029.

Responsibility Statement of the Directors in Respect of the Annual Report and Financial Statements

We confirm that to the best of our knowledge:

·      the financial statements, prepared in accordance with the applicable set of accounting standards, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company;

·      the Strategic Report and the Report of the Directors include a fair review of the development and performance of the business and the position of the Company, together with a description of the principal risks and uncertainties that the Company faces; and

·      we consider the Annual Report and Financial Statements, taken as a whole, is fair, balanced and understandable and provides the information necessary for shareholders to assess the Company's position and performance, business model and strategy.

On behalf of the Board

David Warnock

Chairman

26 July 2024

Notes

1.       The financial statements of the Company, which are the responsibility of, and were approved by, the Board on 26 July 2024, have been prepared on a going concern basis in accordance with the Disclosure Guidance and Transparency Rules of the Financial Conduct Authority, Financial Reporting Standards (FRS 102) and the Statement of Recommended Practice (SORP) "Financial Statements of Investment Trust Companies and Venture Capital Trusts" issued by The Association of Investment Companies (AIC). The audited financial statements for the Company comprise the Income Statement and the total columns of the Balance Sheet, the Cash Flow Statement and the Statement of Changes in Equity and the Company totals shown in the notes to the financial statements. The analysis showing the two separate Portfolios of assets attributable to the Income shares and Growth shares is disclosed to assist shareholders' understanding, but is additional to that required.

There have been no significant changes to the Company's accounting policies during the year ended 31 May 2024. 

The preparation of the Company's financial statements on occasion requires management to make judgements, estimates and assumptions that affect the reported amounts in the primary financial statements and accompanying disclosures. These assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in the current or future periods, depending on the circumstance. Management do not believe that any significant accounting judgements or estimates have been applied to this set of financial statements that have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities within the next financial year.

The Company's assets consist mainly of equity shares in closed-end investment companies which are traded in the UK or another Regulated Stock Exchange and in most circumstances, including in the current market environment, are expected to be readily realisable.

The Company has a £5 million unsecured fixed rate term loan and a £5 million unsecured revolving credit facility, both of which are available until 10 February 2025. The Board has set limits for borrowing and regularly reviews the Company's gearing levels and its compliance with bank covenants. As the current facilities are available until 10 February 2025, the Company's borrowings are disclosed as falling due within one year. At 31 May 2024 the Company had a net current liability position; however, it is expected that new loan facilities could be entered into when the current arrangements expire, but, if not, or should the Board decide not to renew these, any outstanding borrowing would be repaid through the use of cash and, if required, from the proceeds of the sale of the Company's investments from the relevant Portfolio.

The Board has considered the Company's principal risks and uncertainties and other matters, and has considered a number of stress tests and scenarios which considered the impact of severe stock market volatility on shareholders' funds and demonstrated that if required the Company had the ability to raise sufficient funds so as to remain within its debt covenants and meet its liabilities.

As such, and in light of the controls and review processes in place and the operational robustness of key service providers, and bearing in mind the nature of the Company's business and assets and revenue and expenditure projections, the Directors believe that the Company has adequate resources to continue in operational existence for a period of at least twelve months from the date of approval of the financial statements. For this reason, the Board continues to adopt the going concern basis in preparing the financial statements.

2.    Segmental Analysis

       The Company carries on business as an investment trust and manages two separate Portfolios of assets: the Income Portfolio and the Growth Portfolio.  The Company's Income Statement can be analysed as follows. This has been disclosed to assist shareholders' understanding, but this analysis is additional to that required.

Year ended 31 May 2024

	Income Portfolio			Growth Portfolio			Total
	Revenue	Capital	Total	Revenue	Capital	Total	Revenue	Capital	Total
	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Gains on     investments	-	1,543	1,543	-	9,632	9,632	-	11,175	11,175
Foreign exchange      losses	-	(6)	(6)	-	-	-	-	(6)	(6)
Income	3,395	-	3,395	1,772	-	1,772	5,167	-	5,167
Investment management  fee	(167)	(250)	(417)	(113)	(452)	(565)	(280)	(702)	(982)
Other expenses	(261)	-	(261)	(398)	-	(398)	(659)	-	(659)
Return on ordinary activities before finance costs and tax	2,967	1,287	4,254	1,261	9,180	10,441	4,228	10,467	14,695
Finance costs	(114)	(171)	(285)	-	-	-	(114)	(171)	(285)
Return on ordinary activities before tax	2,853	1,116	3,969	1,261	9,180	10,441	4,114	10,296	14,410
Tax on ordinary activities	-	-	-	-	-	-	-	-	-
Return  #	2,853	1,116	3,969	1,261	9,180	10,441	4,114	10,296	14,410

Year ended 31 May 2023

	Income Portfolio			Growth Portfolio			Total
	Revenue	Capital	Total	Revenue	Capital	Total	Revenue	Capital	Total
	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Losses on     investments	-	(7,363)	(7,363)	-	(6,335)	(6,335)	-	(13,698)	(13,698)
Foreign exchange      losses	-	(5)	(5)	-	-	-	-	(5)	(5)
Income	3,307	-	3,307	1,712	-	1,712	5,019	-	5,019
Investment management  fee	(176)	(264)	(440)	(117)	(466)	(583)	(293)	(730)	(1,023)
Other expenses	(281)	-	(281)	(408)	-	(408)	(689)	-	(689)
Return on ordinary activities before finance costs and tax	2,850	(7,632)	(4,782)	1,187	(6,801)	(5,614)	4,037	(14,433)	(10,396)
Finance costs	(95)	(143)	(238)	-	-	-	(95)	(143)	(238)
Return on ordinary activities before tax	2,755	(7,775)	(5,020)	1,187	(6,801)	(5,614)	3,942	(14,576)	(10,634)
Tax on ordinary activities	(11)	-	(11)	-	-	-	(11)	-	(11)
Return  #	2,744	(7,775)	(5,031)	1,187	(6,801)	(5,614)	3,931	(14,576)	(10,645)

# Any net revenue return attributable to the Growth Portfolio is transferred to the Income Portfolio and a corresponding transfer of an identical amount of capital is made from the Income Portfolio to the Growth Portfolio and accordingly the whole return in the Growth Portfolio is capital.  Refer to the Statement of Changes in Equity.

3.   Return per share

The return per share for the year ended 31 May 2024 is as follows:

	Income shares			Growth shares
	Revenue	Capital	Total	Revenue	Capital	Total
	£'000	£'000	£'000	£'000	£'000	£'000
Return attributable to Portfolios	2,853	1,116	3,969	1,261	9,180	10,441
Transfer of net income from Growth Portfolio to Income Portfolio	1,261	-	1,261	(1,261)	-	(1,261)
Transfer of capital from Income Portfolio to Growth Portfolio	-	(1,261)	(1,261)	-	1,261	1,261
Return attributable to shareholders	4,114	(145)	3,969	-	10,441	10,441
Return per share	8.06p	(0.28p)	7.78p	-	28.33p	28.33p
Weighted average number of shares in issue during the year (excluding shares held in treasury)	51,034,226			36,851,904

The return per share for the year ended 31 May 2023 is as follows:

	Income shares			Growth shares
	Revenue	Capital	Total	Revenue	Capital	Total
	£'000	£'000	£'000	£'000	£'000	£'000
Return attributable to Portfolios	2,744	(7,775)	(5,031)	1,187	(6,801)	(5,614)
Transfer of net income from Growth Portfolio to Income Portfolio	1,187	-	1,187	(1,187)	-	(1,187)
Transfer of capital from Income Portfolio to Growth Portfolio	-	(1,187)	(1,187)	-	1,187	1,187
Return attributable to shareholders	3,931	(8,962)	(5,031)	-	(5,614)	(5,614)
Return per share	7.96p	(18.16p)	(10.20p)	-	(14.51p)	(14.51p)
Weighted average number of shares in issue during the year (excluding shares held in treasury)	49,363,770			38,696,431

4.  Dividends

			2024 Income shares Total
Dividends on Income shares	Register date	Payment date	£'000
Amounts recognised as distributions during the year:
For the year ended 31 May 2023
- fourth interim dividend of 2.19p per Income share	16 June 2023	7 July 2023	1,105
For the year ended 31 May 2024
- first interim dividend of 1.80p per Income share	14 September 2023	6 October 2023	908
- second interim dividend of 1.80p per Income share	14 December 2023	12 January 2024	924
- third interim dividend of 1.80p per Income share	14 March 2024	9 April 2024	926
			3,863
Amounts relating to the year but not paid at the year end:
- fourth interim dividend of 2.00p per Income share*	14 June 2024	5 July 2024	1,036

* Based on 51,808,251 Income shares in issue at the record date of 14 June 2024.

The fourth interim dividend of 2.00p per Income share was paid on 5 July 2024 to shareholders on the register on 14 June 2024, with an ex-dividend date of 13 June 2024.

The Growth shares do not carry an entitlement to receive dividends.

5.  (a) Tax on ordinary activities

Year ended 31 May 2024

	Income Portfolio			Growth Portfolio			Total
	Revenue	Capital	Total	Revenue	Capital	Total	Revenue	Capital	Total
	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Current tax charge for the year (all irrecoverable overseas tax) being taxation on ordinary activities	-	-	-	-	-	-	-	-	-

       (b) Reconciliation of tax charge 

		2024
		Income shares	Growth shares	Total
		£'000	£'000	£'000
Gain on ordinary activities before tax:		3,969	10,441	14,410
Corporation tax at standard rate of 25%		992	2,610	3,602
Effects of:
Gains on investments not taxable		(384)	(2,408)	(2,792)
Overseas tax suffered		-	-	-
Non-taxable UK dividend income		(485)	(381)	(866)
Non-taxable overseas dividend income		(260)	(18)	(278)
Expenses not utilised		137	197	334
Tax charge (note 5 (a))		-	-	-

6.  The net asset value per Income share is calculated on net assets of £60,264,000 (2023: £58,733,000), divided by 51,723,251 (2023: 50,455,503) Income shares, being the number of Income shares in issue at the year-end (excluding any shares held in treasury).

     The net asset value per Growth share is calculated on net assets of £92,235,000 (2023: £87,520,000), divided by 35,572,608 (2023: 38,032,949) Growth shares, being the number of Growth shares in issue at the year-end (excluding any shares held in treasury). 

7.  During the year, the Company issued 1,225,000 (2023: 1,665,000) Income shares from the block listing facility for net proceeds of £1,381,000 (2023: £2,049,000). 

     During the year, valid conversion notices were received to convert 232,005 Income shares (which represented a value of £238,000). These were converted into 110,393 Growth shares in accordance with the Company's Articles and by reference to the ratio of the relative underlying net asset values of the Growth shares and Income shares on the conversion date.

The Company's Articles allow for Deferred shares to be allotted as part of the share conversion to ensure that the conversion does not result in a reduction of the aggregate par value of the Company's issued share capital. The Deferred shares were subsequently repurchased by the Company for nil consideration (as they have no economic value) and as authorised by shareholders at the September 2023 AGM.

Since the year end, the Company has issued 85,000 Income shares from the block listing facility receiving net proceeds of £101,000.

8.  During the year, the Company issued nil (2023: 190,000) Growth shares from the block listing facility for net proceeds of £nil (2023: £446,000). During the year, the Company bought back 2,440,000 (2023: 815,000) Growth shares through the market for treasury at a cost of £5,682,000 (2023: £1,827,000).

     During the year, valid conversion notices were received to convert 130,734 Growth shares (which represented a value of £282,000). These were converted into 274,753 Income shares in accordance with the Company's Articles and by reference to the ratio of the relative underlying net asset values of the Growth shares and Income shares on the conversion date.

The Company's Articles allow for Deferred shares to be allotted as part of the share conversion to ensure that the conversion does not result in a reduction of the aggregate par value of the Company's issued share capital. The Deferred shares were subsequently repurchased by the Company for nil consideration (as they have no economic value) and as authorised by shareholders at the September 2023 AGM.

Since the year end, the Company has bought back a further 275,000 Growth share for treasury at a cost of £702,000.

9.  Financial Instruments

     The Company's financial instruments comprise its investment Portfolios, cash balances, bank borrowings and debtors and creditors that arise directly from its operations. The Company, which is an investment trust, holds two Portfolios of financial assets in pursuit of its investment objective.

     Listed and quoted fixed asset investments held are valued at fair value.

     The fair value of the financial assets and liabilities of the Company at 31 May 2024 and 31 May 2023 is not materially different from their carrying value in the financial statements.

The main risks that the Company faces arising from its financial instruments are:

(i)       market price risk, being the risk that the value of investment holdings will fluctuate as a result of changes in market prices caused by factors other than interest rate or currency rate movements;

(ii)      interest rate risk, being the risk that the future cash flows of a financial instrument will fluctuate because of changes in market interest rates;

(iii)      foreign currency risk, being the risk that the value of investment holdings, investment purchases, investment sales and income will fluctuate because of movements in currency rates;

(iv)     credit risk, being the risk that a counterparty to a financial instrument will fail to discharge an obligation or commitment that it has entered into with the Company; and

(v)      liquidity risk, being the risk that the Company may not be able to liquidate its investments quickly or otherwise raise funds to meet financial commitments.

Market Price Risk

       The management of market price risk is part of the fund management process and is typical of equity and debt investment. The Portfolios are managed with an awareness of the effects of adverse price movements through detailed and continuing analysis with an objective of maximising overall returns to shareholders.

Interest Rate Risk

       Floating Rate

       When the Company retains cash balances the majority of the cash is held in variable rate bank accounts yielding rates of interest linked to the UK base rate which was 5.25% at 31 May 2024 (2023: 4.5%). There are no other assets which are directly exposed to floating interest rate risk.

         When the Company draws down amounts under its revolving credit facility, interest is payable based on SONIA (which can vary on a daily basis) plus a margin.

Fixed Rate

Movements in market interest rates will affect the market value of fixed interest investments. Neither the Income Portfolio nor the Growth Portfolio holds any fixed interest investments.

       The Company has a £5 million fixed rate term loan with an interest rate of 2.78% per annum.

Foreign Currency Risk

       The Company may invest in overseas securities which give rise to currency risks.  At 31 May 2024, the Income Portfolio had Euro denominated investments valued at £1,487,000 (2023: £nil), and a US Dollar denominated investment valued at £1,182,000 (2023: £1,327,000). At 31 May 2024, the Growth Portfolio had a US Dollar denominated investment valued at £840,000 (2023: £542,000).

       As the remainder of the Company's investments and all other assets and liabilities are denominated in sterling there is no other direct foreign currency risk.  However, although the Company's performance is measured in sterling and the Company's investments (other than the above) are denominated in sterling, a proportion of their underlying assets are quoted in currencies other than sterling. Therefore movements in the rates of exchange between sterling and other currencies may affect the market price of the Company's investments and therefore the market price risk includes an element of currency exposure.

Credit Risk

Credit risk is the risk that a counterparty to a financial instrument will fail to discharge an obligation or commitment that it has entered into with the Company. The Manager has in place a monitoring procedure in respect of counterparty risk which is reviewed on an ongoing basis. The carrying amounts of financial assets best represents the maximum credit risk exposure at the Balance Sheet date.

       Credit risk arising on transactions with brokers relates to transactions awaiting settlement. Risk relating to unsettled transactions is considered to be small due to the short settlement period involved and the acceptable credit quality of the brokers used. The Manager monitors the quality of service provided by the brokers used to further mitigate this risk.

All the assets of the Company which are traded on a recognised exchange are held by JPMorgan Chase Bank, the Company's Custodian. Bankruptcy or insolvency of the Custodian may cause the Company's rights with respect to securities held by the Custodian to be delayed or limited. The Board monitors the Company's risk by reviewing the Custodian's internal control reports as described in the Report of the Audit Committee in the Annual Report and Financial Statements.

The credit risk on liquid funds is controlled because the counterparties are banks with acceptable credit ratings, normally rated A or higher, assigned by international credit rating agencies. Bankruptcy or insolvency of such financial institutions may cause the Company's ability to access cash placed on deposit to be delayed, limited or lost.

Liquidity Risk

Liquidity risk is the risk that the Company will encounter difficulty in realising assets or otherwise raising funds to meet financial commitments.  The risk of the Company not having sufficient liquidity at any time is not considered by the Board to be significant, given that the Company's listed and quoted securities are considered to be readily realisable.

The Company's liquidity risk is managed on an ongoing basis by the Manager in accordance with policies and procedures in place as described in the Report of the Directors in the Annual Report and Financial Statements. The Company's overall liquidity risks are monitored on a quarterly basis by the Board.

The Company maintains sufficient investments in cash and readily realisable securities to pay accounts payable and accrued expenses which are settled in accordance with suppliers stated terms. The Company has a £5 million fixed rate term loan and a £5 million unsecured revolving credit facility which are both available until 10 February 2025 with The Royal Bank of Scotland International Limited. As at 31 May 2024, £5 million of the fixed rate term loan was drawn down (2023: £5 million) and £2 million of the unsecured revolving credit facility was drawn down (2023: £2 million). The interest rate on the fixed rate term loan, which is fully drawn, is 2.78% per annum. The interest rate on the unsecured revolving credit facility is variable, and a non-utilisation fee is payable on undrawn amounts.

10.   Subject to certain minimum and maximum thresholds which may be set by the Board of CT Global Managed Portfolio Trust PLC from time to time, shareholders have the right to convert their Income shares into Growth shares and/or their Growth shares into Income shares upon certain dates, the next of which will be on 24 October 2024 and then annually or close to annually thereafter. Under current law, such conversions will not be treated as disposals for UK capital gains tax purposes. The Conversion notice period commences on 1 August 2024 and full details will be provided on the Company's website and in the Company's Annual Report and Financial Statements.

11.   The Board of Directors (the "Board") is considered a related party. Under the FCA Listing Rules, the Manager is also defined as a related party. However, the existence of an independent Board of Directors demonstrates that the Company is free to pursue its own financial and operating policies and therefore, under the AIC SORP, the Manager is not considered to be a related party for accounting purposes.

There are no transactions with the Board other than aggregated remuneration for services as Directors as disclosed in the Directors' Remuneration Report within the Annual Report and Financial Statements. The beneficial interests of the Directors in the Income shares and Growth shares of the Company are disclosed in the Annual Report and Financial Statements. There are no outstanding balances with the Board at the year-end.

David Warnock is a non-executive director of ICG Enterprise Trust plc. The Growth Portfolio has a holding of 190,000 shares in this company valued at £2,314,000 at 31 May 2024. Simon Longfellow is a non-executive director of Invesco Perpetual UK Smaller Companies Investment Trust plc. The Income Portfolio has a holding of 450,000 shares in this company valued at £1,935,000 at 31 May 2024.

Transactions between the Company and the Manager are detailed in the notes to the financial statements in the Annual Report and Financial Statements. 

12.   This statement was approved by the Board on 26 July 2024. It is not the Company's full statutory accounts in terms of Section 434 of the Companies Act 2006. The statutory Annual Report and Financial Statements for the year ended 31 May 2024 has been approved and audited and received an unqualified audit report and did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying the report, and did not contain a statement under Section 498 of the Companies Act. This will be sent to shareholders during August and will be available for inspection at 6^th Floor, Quartermile 4, 7a Nightingale Way, Edinburgh, EH3 9EG the registered office of the Company. 

The statutory Annual Report and Financial Statements for the year ended 31 May 2023 also received an unqualified audit report and did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying the report, and did not contain a statement under Section 498 of the Companies Act.

The full Annual Report and Financial Statements are available on the Company's website

ctglobalmanagedportfolio.co.uk

The Annual General Meeting of CT Global Managed Portfolio Trust PLC will be held at 11.30am on 2 October 2024 at Columbia Threadneedle Investments, Cannon Place, 78 Cannon Street, London EC4N 6AG.

       The audited financial statements for the year to 31 May 2023 have been lodged with the Registrar of Companies and the audited financial statements for the year to 31 May 2024 will be lodged with the Registrar of Companies following the Annual General Meeting.

Alternative Performance Measures ('APMs')

The Company uses the following APMs. These are not statutory accounting measures and are not intended as a substitute for statutory measures.

Discount/premium - the share price of an investment company is derived from buyers and sellers trading their shares on the stockmarket. This price is not identical to the net asset value (NAV) per share of the underlying assets less liabilities of the Company. If the share price is lower than the NAV per share, the shares are trading at a discount. This usually indicates that there are more sellers of shares than buyers. Shares trading at a price above NAV per share are deemed to be at a premium, usually indicating there are more buyers of shares than sellers.

		31 May 2024			31 May 2023
		Income	Growth		Income	Growth
		shares	shares		shares	shares
Net asset value per share	(a)	116.51p	259.29p		116.41p	230.12p
Share price	(b)	119.00p	254.00p		121.00p	225.00p
+Premium/ -discount (c = (b-a)/(a))	(c)	+2.1%	-2.0%		+3.9%	-2.2%

Average discount/premium to NAV during the financial year - this is the average difference between the share price and NAV per share during the financial year.

Ongoing charges - all operating costs (attributable to the relevant share class of the Company), incurred and expected to be incurred in the foreseeable future, whether charged to capital or revenue in the Company's Income Statement, expressed as a proportion of the average daily net assets (of the relevant share class of the Company) over the reporting year. In accordance with the AIC methodology, the costs of buying and selling investments are excluded in calculating ongoing charges, as are any performance fee, the cost of the Company's borrowings, taxation, non-recurring costs and the costs of buying back or issuing shares. The Company's ongoing charges calculated in accordance with this methodology are shown in column A in the following tables.

The AIC recommends that investment companies also disclose ongoing charges including any performance fee. Effective 29 September 2022, the performance fee which was payable annually to the Manager, if certain conditions were met, ceased. The last performance fee generated and payable to the Manager was in the year ended 31 May 2021.

The AIC recommends that investment companies with a substantial proportion of their portfolio invested in other funds and where the relevant information is readily available should consider incorporating a relevant proportion of ongoing charges of the underlying funds into its own ongoing charges figure. These calculations are shown in column B in the following tables.

The Key Information Document ('KID') on the Company's website contains a measure of costs calculated in accordance with the UK version of the EU PRIIPs regulation as it forms part of UK law following Brexit. In addition to the costs included within the Company's ongoing charges figure in column A in the following tables, the KID methodology for calculating costs (attributable to the relevant share class of the Company) includes the costs of buying and selling investments, the cost of the Company's borrowings, any performance fee and a relevant proportion of the ongoing costs of the underlying funds. These underlying costs cover operational costs, performance fees and borrowing costs. The aggregate KID costs are expressed as a proportion of the average daily net assets (of the relevant share class of the Company) over the year.  For completeness the Company has included a reconciliation in the following tables, between the methodologies.

Ongoing charges calculations - Income Portfolio

		31 May 2024		31 May 2023
		Column A(1)	Column B(2)	Column A(1)	Column B(2)
		£'000	£'000	£'000	£'000
Investment management fee		417	417	440	440
Other expenses		261	261	281	281
Plus/less non-recurring credits/(costs)		5	5	(11)	(11)
Ongoing charges of   underlying funds		-	584	-	595
Total	(a)	683	1,267	710	1,305
Average daily net assets	(b)	56,934	56,934	60,679	60,679
Ongoing charges (c=a/b)	(c)	1.20%	2.23%	1.17%	2.15%
Ongoing charges above		1.20%
Borrowing costs (Company   level)		0.50%
Costs of underlying funds (including borrowing costs)		1.37%
Performance fees (underlying funds)		0.18%
Portfolio transaction costs		0.34%
Costs per KID methodology		3.59%

⁽¹⁾ Excluding ongoing charges of underlying funds

⁽²⁾ AIC methodology including ongoing charges of underlying funds

Ongoing charges calculations - Growth Portfolio

		31 May 2024		31 May 2023
		Column A(1)	Column B(2)	Column A(1)	Column B(2)
		£'000	£'000	£'000	£'000
Investment management fee		565	565	583	583
Other expenses		398	398	408	408
Plus/less non-recurring credits/(costs)		3	3	(20)	(20)
Ongoing charges of underlying funds		-	913	-	792
Total	(a)	966	1,879	971	1,763
Average daily net assets	(b)	86,982	86,982	90,576	90,576
Ongoing charges (c=a/b)	(c)	1.11%	2.16%	1.07%	1.95%
Ongoing charges above		1.11%
Borrowing costs (Company level)		n/a
Costs of underlying funds (including borrowing costs)		1.31%
Performance fees (underlying funds)		0.34%
Portfolio transaction costs		0.18%
Costs per KID methodology		2.94%

⁽¹⁾ Excluding ongoing charges of underlying funds

⁽²⁾ AIC methodology including ongoing charges of underlying funds

Total return - the return to shareholders calculated on a per share basis taking into account both any dividends paid in the year and the increase or decrease in the share price or NAV in the year. The dividends are assumed to have been re-invested in the form of shares or net assets, respectively, on the date on which the shares were quoted ex-dividend.

The effect of reinvesting these dividends on the respective ex-dividend dates and the share price total returns and NAV total returns are shown below.

	31 May 2024			31 May 2023
	Income shares	Growth shares		Income shares	Growth shares
NAV per share at start of financial year	116.41p	230.12p		133.67p	244.41p
NAV per share at end of financial year	116.51p	259.29p		116.41p	230.12p
Change in the year	0.1%	12.7%		-12.9%	-5.8%
Impact of dividend reinvestments†	6.9%	n/a		5.5%	n/a
NAV total return for the year	7.0%	12.7%		-7.4%	-5.8%

†     During the year ended 31 May 2024 dividends totalling 7.59p went ex-dividend with respect to the Income shares. During the year ended 31 May 2023 the equivalent figure was 7.01p.

	31 May 2024			31 May 2023
	Income shares	Growth shares		Income shares	Growth shares
Share price per share at start of financial year	121.0p	225.0p		131.0p	244.0p
Share price per share at end of financial year	119.0p	254.0p		121.0p	225.0p
Change in the year	-1.7%	12.9%		-7.6%	-7.8%
Impact of dividend reinvestment†	6.9%	n/a		5.5%	n/a
Share price total return for the year	5.2%	12.9%		-2.1%	-7.8%

†     During the year ended 31 May 2024 dividends totalling 7.59p went ex-dividend with respect to the Income shares. During the year ended 31 May 2023 the equivalent figure was 7.01p.

Compound annual growth rate - converts the total return over a period of more than one year to a constant annual rate of return applied to the compounded value at the start of each year.

				31 May 2024
				Income shares	Growth shares
Indexed NAV total return at 31 May 2009				100.0	100.0
Indexed NAV total return at end of financial year				328.9	371.5
Period (years)				15.0	15.0
Compound annual growth rate				8.3%	9.1%

Yield - the total annual dividend expressed as a percentage of the year-end share price.

		31 May 2024	31 May 2023
Annual dividend	(a)	7.40p	7.20p
Income share price	(b)	119.0p	121.0p
Yield (c = a/b)	(c)	6.2%	6.0%

Net gearing/net cash - this is calculated by expressing the Company's borrowings less cash and cash equivalents as a percentage of shareholders' funds. If the amount calculated is positive, this is described as net gearing. If the amount calculated is negative, this is described as net cash.

	31 May 2024		31 May 2023
	Income shares £'000	Growth shares £'000	Income shares £'000	Growth shares £'000
Borrowings	7,000	-	7,000	-
Less cash and cash equivalents	(1,200)	(476)	(3,002)	(5,610)
	5,800	(476)	3,998	(5,610)
Shareholders' funds	60,264	92,235	58,733	87,520
Net gearing/-net cash	9.6%	-0.5%	6.8%	-6.4%

For further information, please contact:

Peter Hewitt, Columbia Threadneedle Investment Business Limited          0131 573 8360

Ian Ridge, Columbia Threadneedle Investment Business Limited              0131 573 8316

Sarah Gibbons-Cook, Quill PR                                                               07702 412680

 

END