Annual Financial Report

RNS Number : 7654O

Henderson Opportunities Trust PLC

02 February 2023

 

JANUS HENDERSON FUND MANAGEMENT UK LIMITED

HENDERSON OPPORTUNITIES TRUST PLC

LEGAL ENTITY INDENTIFIER (LEI):  2138005D884NPGHFQS77

2 February 2023

HENDERSON OPPORTUNITIES TRUST PLC

Annual Financial Report for the year ended 31 October 2022

This announcement contains regulated information

Investment Objective

The Company aims to achieve capital growth in excess of the FTSE All-Share Index from a portfolio of primarily UK investments.

PERFORMANCE HIGHLIGHTS

Total Return Performance to 31 October 2022

	1 year %	3 years %	5 years %	10 years %
NAV¹	-26.4	8.0	2.4	130.3
Share price²	-24.7	18.0	7.6	161.9
Benchmark³	-2.8	7.1	12.7	83.2
Peer group NAV4	-24.6	-2.2	-0.3	92.3

	Year ended 31 October 2022	Year ended 31 October 2021
NAV per share at year end5	1,173.7p	1,626.9p
Share price at year end	1,018.0p	1,382.5p
Total return per share5	(424.7p)	607.5p
Net assets	£92.7m	£128.5m
Discount at year end5, 6	13.3%	15.0%
Ongoing charge (excluding performance fee)5	0.90%	0.87%
Ongoing charge (including performance fee) 5, 7	0.90%	1.85%
Dividend for year8	34.0p	27.5p

1 Net Asset Value ("NAV") per ordinary share total return (including dividends reinvested)

2 Share price total return (including dividends reinvested)

3 FTSE All-Share Index

4 AIC UK All Companies simple average

5 Alternative performance measure

6 Calculated based on the NAV per share and share price at year end

7 No performance fee was payable in the year ended 31 October 2022 (2021: £1.2m)

8 This represents three interim dividends of 7.0p each and a proposed final dividend of 13.0p which will be put to shareholders for approval at the Annual General Meeting on 8 March 2023.  See the Chaiman's statement for more details. The dividend yield⁵ for the year ended 31 October 2022 was 3.3% (2021: 2.0%) based on the share price at the year end

Sources: Morningstar Direct, Janus Henderson, Refinitiv Datastream

A glossary of terms and alternative performance measures can be found in the Annual Report

CHAIRMAN'S STATEMENT

Performance review

Against a backdrop of considerable uncertainty, caused in particular by Russia's war in Ukraine and by a rapid acceleration in inflation, it was a very difficult year for absolute and relative performance of this portfolio. During periods of growing investor caution, it is often smaller companies that fall quickest and most steeply. This year was no exception. While the FTSE All-Share Index, the Company's benchmark index, fell a modest 2.8% (as seen in the table below), the FTSE 250 Index of medium sized companies fell 20.5%, the FTSE Small-Cap Index fell 18.6% and the AIM All-Share Index of the smallest listed UK businesses fell 33.2%. The Company has always looked across the whole of the UK market for the best return opportunities. This breadth of investment universe has often led the Fund Managers to invest more than the Company's benchmark in AIM where, in their view, some of the large companies of tomorrow can be found. While this approach has driven good absolute and relative performance over the long term (see 10 year figures below), the portfolio has historically had years of sharp drawdown, driven by volatility in smaller company share prices, on the route to good performance. It is the Fund Managers' view (shared by the Board) that steep falls in UK smaller company share prices have left valuations at attractive levels. Therefore, despite the current uncertainty, it is these low valuation levels and the belief that the companies held can grow over the long term that lead us to think there is currently considerable opportunity for the patient investor.

Percentage change in	1 year (%)	3 years (%)	5 years (%)	10 years (%)
NAV	-26.4	8.0	2.4	130.3
Share price	-24.7	18.0	7.6	161.9
Benchmark	-2.8	7.1	12.7	83.2
Peer group NAV	-24.6	-2.2	-0.3	92.3

Income review

While it was a challenging year in capital terms, we are pleased to report an ongoing strong recovery in investment income. Revenue return per share rose 64% to 40.6p. This compares to 24.7p last year and is above the 29.9p achieved in 2019 pre the pandemic. The 40.6p revenue return per share comfortably covers the Company's full year dividend of 34.0p, allowing the Company to add £523,000 to its revenue reserves.

Fees and expenses

The ongoing charge for the year was 0.90%. This is notably lower than 1.85% the previous year, with the fall due to no performance fee being paid during the year. As a reminder, no performance fee will be paid if either the share price or net asset value is lower than their value at the preceding financial year end. The Board continues to monitor fees and other costs closely.

Continuation vote

Following the three year cycle, prescribed under the Company's Articles of Association ("Articles"), there will be a continuation vote at this year's Annual General Meeting ("AGM") (please see AGM details below). The NAV total return of the Company over the last three years has been 8.0%, while the FTSE All-Share total return was 7.1% and the AIC UK All Companies sector returned -2.2%. The dividend per share over the last three years has grown 30.8%, equivalent to compound annual growth of 9.3%.

It is the Fund Manager's view (shared by the Board) that the valuations of the stocks held within the portfolio are low, and that there is an attractive return opportunity particularly within UK smaller companies. The Directors recommend a vote in favour of continuation of the Company, and the Directors and Fund Managers will be voting their shares accordingly. If shareholders vote in favour, the next continuation vote will be in Spring 2026.

The discount level and share buybacks

During the year the Company's shares remained at a discount to net asset value, with the discount ranging from 8.6% to 20.5% and finishing the year at 13.3%. While it is frustrating for the shares to be trading at a persistent (albeit fluctuating) discount, weak sentiment towards UK equities (and in particular smaller companies) led to the AIC UK All Companies sector finishing the year at an average discount of 10.0%, and the AIC UK Smaller Companies sector finishing at an average discount of 14.5%.

There was no share issuance and no shares were bought back during the financial year. It remains the Board's position that were buybacks to be considered, this would be with the aim of enhancing the NAV for existing shareholders rather than seeking to maintain the discount at any specific level. The Board and the Fund Managers believe that the discount situation will improve once investor sentiment towards the UK equity market becomes more positive.

Gearing

Gearing was roughly unchanged over the year, finishing at 13.9% of net assets compared to 13.2% at the start of the year. Within this the Fund Managers were modest net sellers, with purchasing activity over the year being low partially as a result of the very limited Initial Public Offering ("IPO") activity in the UK market. The gearing level remains approximately in line with the Company's long-term average and reflects the fact that the Fund Managers continue to find good value opportunities within the UK equity market, and in particular within UK smaller companies, following the substantial underperformance seen in this area recently.

Annual General Meeting

Our AGM will be held on Wednesday 8 March 2023 at 2.30pm at Janus Henderson Investors' offices at 201 Bishopsgate, London EC2M 3AE. I hope as many shareholders as possible will be able to attend to take the opportunity to meet the Board and to hear a presentation from James Henderson. However, if you are unable to attend in person, you can watch the Meeting live by visiting www.janushenderson.com/trustslive . Full details are set out in the Notice of Meeting which has been sent to shareholders with this report and both are also available online at www.hendersonopportunitiestrust.com .

If shareholders would like to submit any questions in advance of the AGM, you are welcome to send these to the Corporate Secretary at [e-mail] .

Outlook

This portfolio should not be seen as a proxy for the UK economy. Within the breadth of the Company's investment universe there are many companies that are capable of growing substantially despite the wider backdrop. It is the Fund Managers' view that a significant number of these growth opportunities can be found in the smaller company area (and in particular on AIM), where current investor caution has resulted in very attractive valuations. In our view, for those like the Company who can invest flexibly across these opportunities and who continue to pay close attention to individual company fundamentals and dynamics, patience will be rewarded.

Wendy Colquhoun

Chairman

2 February 2023

FUND MANAGERS' REPORT

Investment backdrop

Russia's invasion of Ukraine has had a very considerable impact on the economy and therefore on equities. It has put upward pressure on prices, most notably energy. The upward move in oil and gas reverberates around the whole economy. The consumer has less to spend, and manufacturers find their costs going up. There is no escaping the havoc it causes. It should be understood that some inflationary problems were already becoming apparent before Russia's invasion of Ukraine. For example, the belated ending of quantitative easing and the ending of lockdown restrictions saw a rise in supply chain problems. Some of the problems were obvious and were therefore rapidly discounted. Others were a surprise: for instance, towards the end of the period the Bank of England had to step in and intervene as some in the pension fund industry had failed correctly to model what would happen to their portfolios on a rapid rise in bond yields. This led them to become forced sellers of UK Government bonds until the Bank of England provided liquidity. By the end of the period some calm had returned helped by a change of personnel at the Treasury.

Through all this economic noise many companies in the portfolio continued to increase their profits and dividends. Evidence of this can be seen in the jump in earnings of the portfolio. However, the share prices of companies seen as sensitive to the economy fell sharply. Smaller companies are especially vulnerable to a swing in investor sentiment. The fear is how long and deep the recession will be and for this to be answered how far interest rates will rise needs to be understood. In the meantime, companies with able management teams and a robust business model have fallen to very low valuations and this provides real opportunity to the patient investor.

Attribution

It was a very difficult year for managing a multi-cap fund relative to a concentrated index made up of predominantly large companies. As can be seen in the table below (Index total return column), larger companies in the FTSE 100 significantly outperformed smaller companies, with a difference in relative returns of more than 20% between the FTSE 100 and small/ medium sized companies (and more than 30% underperformance in the case of AIM stocks).

Percentage change in	Company weighting (%)	Benchmark weighting (%)	Index total return (%)
FTSE 100	27.9	83.3	1.7
FTSE 250	10.5	14.1	-20.5
FTSE Small-Cap	7.8	2.6	-18.6
FTSE AIM All-Share	52.6	n/a	-33.2

Note portfolio and index weights are as at financial year end, 31 October 2022. The portfolio weights do not add up to 100% as a small portion of the portfolio sits outside of major UK indices

The key reason for the size differential in performance this year was the make-up of the FTSE 100 Index, with its significant weighting in natural resources stocks that benefitted from rising commodity prices, as well as more defensive sectors such as consumer staples, utilities and pharmaceuticals (where there are significant economies of scale therefore these types of defensive companies tend mostly to exist as very large companies). For this portfolio, with its significant weighting in smaller companies and particularly those on AIM, the size distribution of the portfolio was therefore a significant headwind to performance. On our estimates, the size of the companies held within the portfolio drove the majority of the Company's underperformance relative to its benchmark this year.

Before looking in more detail at the stock-specific elements of performance, it is also worth noting the effect of gearing on underperformance. On our estimates gearing detracted 3.0% from NAV total return during the year and therefore drove a notable, though minority, portion of the underperformance. From a longer-term perspective gearing has been a positive contributor to returns and we continue to see its use as one of the key advantages of the investment trust structure.

Turning to stocks, it is notable that three of the top five performers came from the natural resources sector as energy prices (and particularly natural gas) prices rose. Outside of this, the best performers were companies with stock-specific drivers of earnings growth. For example, ZOO Digital (see share price table since first purchase below), which provides subtitling and dubbing services to content producers such as Disney, grew sales and earnings materially as the market for global content continues to grow. IQGeo also grew sales substantially (both organically and via acquisitions) and this allowed it to become EBITDA (earnings before interest, taxes, depreciation, and amortisation) positive in the first half of this year.

Data illustrating the ZOO Digital share price since first purchase (pence) chart in the Annual Report is set out below:

Date	Share price in pence
17 July 2018	165.0
31 January 2019	85.5
31 July 2019	79.5
31 January 2020	72.5
31 July 2020	61.5
29 January 2021	97.0
30 July 2021	137.0
31 January 2022	145.0
29 July 2022	127.5
31 October 2022	165.0

Source: Bloomberg. Share price shown since first purchase on 16 July 2018.

The top 10 contributors to relative return during the financial year were:

Company name	Contribution to relative return (%)	Share price total return (%)	Portfolio Classification
Serica Energy	1.9	54.8	Natural resources
Jersey Oil & Gas	1.5	101.0	Natural resources
ZOO Digital	0.6	30.4	Growth small cap
Deltic Energy	0.4	36.0	Natural resources
Scottish Mortgage Investment Trust (not held)	0.4	-51.3	n/a
IQGeo	0.4	26.2	Growth small cap
NatWest	0.3	10.9	Large cap
Ashtead Group (not held)	0.3	-24.7	n/a
Ocado Group (not held)	0.3	-73.8	n/a
Flutter Entertainment*	0.3	-16.1	Large cap

*Positive contribution relates to timing of purchases, with shares underperforming for the financial year as a whole

The top 10 detractors from relative return during the financial year were:

Company name	Contribution to relative return (%)	Share price total return (%)	Portfolio Classification
Shell (underweight)	-1.7	48.2	Natural resources
Ceres Power	-1.4	-73.7	Early stage
AFC Energy	-1.2	-64.6	Early stage
Springfield Properties	-1.2	-34.1	Small & mid cap compounders
Studio Retail	-1.2	-100.0	Small & mid cap compounders
SigmaRoc	-1.1	-50.6	Small & mid cap compounders
BP (not held)	-1.1	43.2	n/a
British American Tobacco (not held)	-1.0	44.4	n/a
Mirriad Advertising	-1.0	-83.4	Early stage
RWS Holdings	-1.0	-49.4	Small & mid cap compounders

In contrast to natural resources, a number of the largest underperformers were in the alternative energy area such as fuel cell companies Ceres Power and AFC Energy. Neither company has had material operational disappointments (Ceres has had some licence fee revenue from a joint venture deferred to early 2023 rather than late 2022, but this is a timing issue rather than a permanent loss of sales). The reason for the share price falls this year has been (in our view) related to a broader reduction in risk appetite in the market at the same time as a rise in interest rates is shifting investor focus towards companies producing cash today rather than those potentially capable of producing sizeable amounts of cash in the future. The alternative energy sector (which sits within the Company's 'early stage' allocation) is now a less than 2% aggregate weight in the portfolio. We believe that there will, for example, be a role for hydrogen to play in the energy transition in 'hard to electrify' areas such as heavy transportation. We therefore continue to think it is right to have a foothold in the area with companies that have the potential to become market leaders across different sectors (for example AFC Energy could become one of the market leaders in a fuel cell replacement for diesel generators).

Outside of alternative energy, the underperformers during the year tended to be cyclically exposed companies such as Scottish housebuilder Springfield Properties and European building materials company SigmaRoc. In both cases we think the businesses have good scope to grow sales and earnings over the medium term driven by, in Springfield's case, a sizeable landbank to work through and in SigmaRoc's case rising infrastructure spend (as well as the potential for further acquisitions). In the short term, however, the share prices of both have fallen materially on concerns of an economic slowdown impacting demand for their products.

Portfolio review

For a number of years, we have divided the portfolio into the classifications in the table below. This serves a dual purpose. Firstly, the guidance ranges around the percentage of the portfolio held in each classification help to ensure diversity, with different classifications expected to perform well in different economic backdrops. Secondly, we have found the classifications help our shareholders to understand the broad nature of the portfolio, with very different fundamental drivers depending on which classification the companies are in.

At the beginning of this financial year, we decided to go a step further and split the portfolio into two broader classifications of 'tomorrow's leaders' and 'stabilisers', which are split out in the table below. Tomorrow's leaders are companies which, in our view, have the capacity to grow sales and earnings materially over the long term. These companies exist across all stages of the company lifecycle, spanning from early-stage businesses operating in nascent but structurally growing end markets to companies which have existed for a long time but which we think have the potential to recover (whether through their own 'self-help' or an end market recovery). Stabilisers, on the other hand, span large companies and natural resource businesses. These are held with the aim of smoothing volatility in the overall portfolio (as well as generating an attractive total return), as we recognise that smaller companies, while on average good performers over the long term, go through periods of large drawdowns as we have seen this financial year. The stabilisers therefore provide exposure to different end markets, whether it is more defensive exposure as is often the case with larger companies or commodity-price exposure with the natural resource companies. The current split of the portfolio across classifications is shown below:

	Total (gross assets)1 %	Indicative range %	Largest three holdings
Stabilisers
Large cap (£1b +) These stocks are usually familiar to all investors. They are ballast for the portfolio and often generators of income as individual companies. We believe they remain capable of long-term earnings growth.	24 (+3)	10-30	Barclays, NatWest, HSBC
Natural resources These are companies that will benefit from rising commodity prices. The majority of this classification are smaller companies (outside of the FTSE 100) that are less well understood and where, in our view, we can add more value by paying close attention.	17 (+6)	5-15	Jersey Oil & Gas, Serica Energy, Anglo American
Tomorrow's Leaders
Growth small cap These are companies that in our view can be substantially larger businesses in time. They have strong management capability and they operate in fast growing end markets or are disruptors within more established markets.	17 (-3)	20-40	ZOO Digital, Next Fifteen Communications, Boku
Recovery Some of these companies, for example those exposed to the aerospace industry, have fallen into the recovery classification as a result of the pandemic. However, as the global economy recovers, earnings should be able to grow from current suppressed levels.	10 (-1)	0-30	Redcentric, STV, Babcock
Early stage companies These are companies that could serve large end markets with potentially disruptive technologies, however they are at an early stage of their life cycle and whether the technology becomes fully commercialised remains, to a degree, binary. They should perform largely independently of the broader economic cycle.	7 (-6)	0-20	Surface Transforms, Ilika, AFC Energy
Small & mid cap compounders These are good quality, long-term holdings with experienced management teams. Over time we expect them to steadily grow sales and earnings.	25 (+1)	20-40	Springfield Properties, Vertu Motors, Van Elle

¹ The number in brackets is the change in percentage compared to the previous financial year end

This financial year, the stabilisers substantially outperformed tomorrow's leaders. While the position in stabilisers provided some cushion to the Company's performance relative to, for example, the FTSE AIM All-Share Index, this exposure was not enough to offset the Company's significantly larger than benchmark holding in smaller companies (which tend to fall within tomorrow's leaders from the Company's portfolio perspective).

During the previous financial year, we added to the holdings in stabilisers, which consisted largely of adding to holdings in large banks such as Barclays as well as a number of natural resource companies such as Jersey Oil & Gas (these are described in more detail on page 7 of last year's annual report). While these additions were helpful for relative performance in the current financial year, in hindsight (as is often the case) we should have gone further in this portfolio rotation. This financial year, given the scale of performance difference between the two broader classifications, additions have largely been focused in the opposite direction (in other words adding to tomorrow's leaders) given the scale of de-rating we have seen in this area. We go into more detail on this in the section below.

Portfolio activity

During the year we were modest net sellers, purchasing £15.8m in aggregate and selling £20.6m. As a result of the fall in the Company's net asset value, this kept gearing approximately flat during the year, ending at 13.9% net assets relative to 13.2% at the previous year end. Purchasing activity was modest relative to the previous year (when we purchased £35.5m). This was partly a result of very subdued IPO activity in the UK, with the Company participating in only one IPO during the year in domestic appliance retailer Marks Electrical.

Unusually for this portfolio, which has a low average turnover, the largest new purchase for the year was also among the largest sales. Shell was purchased in December 2021 at approximately £17 per share and sold between March and September 2022 at between £19 and £22 per share. The purchase was driven by a combination of attractive cash generation and thinking the Shell integrated portfolio looked well placed during the period of energy transition. While both of these attributes still exist, the scale of the de-rating seen elsewhere in the UK equity market means that (in our view) there are better opportunities available. We also trimmed the natural resources exposure elsewhere, with Serica Energy being the largest individual sale during the year (despite this it remained a top five holding at the year end). As can be seen in the attribution tables set out earlier in this report, while Shell was a good performer in absolute terms for the portfolio, from a relative perspective it was the single largest detractor. This is because Shell forms such a significant weight in the FTSE All-Share Index, averaging 6.6% during the financial year and serves to highlight the challenge in managing a broad multi-cap fund relative to a concentrated benchmark.

Outside of Shell and Marks Electrical, the other new positions established during the year were Finsbury Food, Flutter Entertainment, Haleon (which was inherited from the holding in GlaxoSmithKline), Halfords, i3 Energy, Reckitt Benckiser and Renold. There were also sizable additions to existing positions such as Morgan Advanced Materials and Springfield Properties. Of these, all but two of the active additions were outside of larger companies (the exceptions being Flutter Entertainment and Reckitt Benckiser), as we sought to take advantage of the sharp underperformance and subsequent de-rating in the smaller company area. While these additions have no common attributes in terms of their end markets (they span areas as broad as food production, housebuilding, retailing and industrial components), what they share is having a degree of 'self help' that can help to offset often challenging end markets and a path to becoming substantially larger businesses in time.

Including Shell, six positions were sold in full during the year (the other five being Blue Prism, FranchiseBrands, Sensyne Health, Lloyds Banking and Quixant). Of these the largest individual sale was Blue Prism which was sold following a bid approach from US peer SS&C. We also took profits in some long held smaller company positions such as transportation software provider Tracsis and utilities/telecommunications software provider IQGeo. In both cases we continue to see a visible pathway to future sales and earnings growth but they had performed strongly so were reduced for portfolio balance reasons.

Income

This financial year saw a marked recovery in investment income, with earnings per share rising to 40.6p compared to 24.7p last year (and 29.9p in the 2019 financial year to provide a pre-pandemic context). This rise in investment income was helped by material special dividends received during the year, the largest of which was NatWest as it chose to distribute a portion of its excess capital. Excluding special dividends, the earnings per share figure was 37.1p. Stock lending also continued to be a good contributor to income, providing £197,000 income (net of fees) during the year (which compares to £267,000 last year).

Outlook

There are about a thousand companies quoted on the main list and AIM that we could invest in. Some of them over the next few years will become substantially larger regardless of the economic backdrop. The successes will come from many different areas of activity. They will have two things in common - dynamic management and strong business propositions. They will seize the opportunities that come along as well as having long-term strategies. There will also be many corporate failures. The current low valuation of the average company suggests the balance of probabilities is very much in the investors' favour as the corporate successes have current share prices that do not price in the prize of success. This is because despondency is high among investors with general concerns about the economy colouring appraisal of individual companies. The portfolio is a mixture of individual companies all with real growth potential. We need to pay attention to the individual companies and what they are achieving. We will keep with the approach of investing in UK companies of all sizes. We will buy companies when the valuation does not reflect their potential and recycle into the emerging success stories by selling those that have a valuation that appears to reflect the prospects.

James Henderson and Laura Foll

Fund Managers

2 February 2023

MANAGING OUR RISKS

The Board, with the assistance of the Manager, has carried out a robust assessment of the principal risks and uncertainties facing the Company, including those that would threaten its business model, future performance, solvency, liquidity and reputation. The principal risks and uncertainties facing the Company relate to investing in the shares of companies that are listed in the United Kingdom, including small companies. Although the Company invests almost entirely in securities that are listed on recognised markets, share prices may move rapidly, whether upwards or downwards, and it may not be possible to realise an investment at the Manager's assessment of its value. Falls in the value of the Company's investments can be caused by unexpected external events. The companies in which investments are made may operate unsuccessfully, or fail entirely, such that shareholder value is lost. The Company is also exposed to the operational risk that one or more of its contractors or sub-contractors may not provide the required level of service.

The Board considers regularly the principal risks facing the Company in order to mitigate them as far as practicable. The Board monitors the Manager, its other service providers and the internal and external environments in which the Company operates to identify new and emerging risks. The Board's policy on risk management has not materially changed from last year.

The Board has drawn up a risk map which identifies the substantial risks to which the Company is exposed. The Board has also put in place a schedule of investment limits and restrictions, appropriate to the Company's Investment Objective and Investment Policy. These principal risks fall broadly under the following categories:

Risk	Trend	Controls and mitigation
Investment activity and strategy An inappropriate investment strategy (for example, in terms of asset allocation, stock selection, failure to anticipate external shocks or the level of gearing) may lead to a reduction in NAV, underperformance against the Company's benchmark and the Company's peer group; it may also result in the Company's shares trading on a wider discount to NAV.	↑	The Manager provides the Directors with management information including performance data reports and portfolio analyses on a monthly basis. The Board monitors the implementation and results of the investment process with the Fund Managers, who attend all Board meetings, and reviews regularly data that monitors risk factors in respect of the portfolio. The Manager operates in accordance with investment limits and restrictions determined by the Board; these include limits on the extent to which borrowings may be used. The Board reviews its investment limits and restrictions regularly and the Manager confirms its compliance with them each month. The Board reviews investment strategy at each Board meeting. The Board seeks to manage these risks by ensuring a diversification of investments. The Board has regular meetings with the Fund Managers to review performance and the extent of borrowings.
Financial instruments and the management of risk By its nature as an investment trust, the Company is exposed in varying degrees to market risk, interest rate risk, liquidity risk, currency risk and credit and counterparty risk. Market risk arises from uncertainty about the future prices of the Company's investments.	↔	An analysis of these financial risks, including liquidity and gearing, and the Company's policies for managing them are set out in the Annual Report.
Operational and cyber Disruption to, or failure of, the Manager's accounting, dealing or payment systems or the Custodian or the Depositary's records could prevent the accurate reporting and monitoring of the Company's financial position. The Company is also exposed to the operational risk that one or more of its services providers may not provide the required level of service. The Company may also be exposed to the risk of cyber-attack on its service providers.	↔	The Manager has contracted some of its operational functions, principally those relating to trade processing, investment administration, accounting and cash management, to BNP Paribas. The Board monitors the services provided by the Manager and its other suppliers and receives reports on the key elements in place to provide effective internal control. During the year the Board received reports on the Manager's approach to information security and cyber attack defence.
Accounting, legal and regulatory A breach of Section 1158/9 of the Corporation Tax Act 2010 could lead to a loss of investment trust status, resulting in capital gains realised within the portfolio being subject to corporation tax. A breach of the FCA's Listing Rules could result in suspension of the Company's shares, while a breach of the Companies Act 2006 could lead to criminal proceedings, or financial or reputational damage.	↔	The Manager is contracted to provide investment, company secretarial, administration and accounting services through qualified professionals. The Board receives internal controls reports produced by Janus Henderson on a quarterly basis, which confirm regulatory compliance .
Failure of Janus Henderson A failure of the Manager's business, whether or not as a result of regulatory failure, cyber risk or other failure could result in the Manager being unable to meet its obligations and its duty of care to the Company.	↔	The Board meets regularly with representatives of the Manager's Investment Management, Risk, Compliance, Internal Audit and Investment Trust teams and reviews internal control reports from the Manager on a quarterly basis. The failure of the Manager would not necessarily lead to a loss of the Company's assets, however, this risk is mitigated by the Company's ability to change its investment manager if necessary, subject to the terms of its management agreement.

Details of how the Board monitors the services provided by Janus Henderson and its other suppliers, and the key elements designed to provide effective internal control, are explained further in the internal controls section of the Corporate Governance report  and the Audit and Risk Committee report in the Annual Report.

Emerging risks

In addition to the principal risks facing the Company, the Board also regularly considers potential emerging risks, which are defined as potential trends, sudden events or changing risks which are characterised by a high degree of uncertainty in terms of the probability of them happening and the possible effects on the Company. Should an emerging risk become sufficiently clear, it may be moved to a significant risk.

The Board has identified the following as potential emerging risks:

Demographic change

Ageing population, increasing financial inequality and new trends in social attitudes.

Technological change

Artificial intelligence, sector disruption, changes to existing job roles, ethical oversight of technological change, autonomous vehicles, electrification and healthcare impact.

Environmental sustainability

Climate change, decarbonisation, extreme bad weather events, increasing legislation/political action, resource scarcity and reputational consequences.

Political change

Tax risk (including impact on dividends paid by the Company to shareholders) and impact on performance if the UK were to remain out of favour.

The Company's emerging risks are macro-economic and political in nature and over which the Company has no control. The Board monitors these emerging risks and, if specific action relating to the investments, or the Company's marketing approach were to arise, the Board would take appropriate action.

BORROWINGS

The Company has an unsecured loan facility in place which allows it to borrow as and when appropriate. £30m (2021: £30m) is available under the facility. Net gearing is limited by the Board to 25% of net assets. The maximum amount drawn down in the period under review was £21.4m (2021: £19.8m), with borrowing costs for the year totalling £345,000 (2021: £150,000). £14.1m (2021: £18.4m) of the facility was in use at the year end. Net gearing at 31 October 2022 was 13.9% (2021: 13.2%) of net asset value.

VIABILITY STATEMENT AND GOING CONCERN

The Company is a long-term investor. The Board believes it is appropriate to assess the Company's viability over a five year period in recognition of its long-term investment horizon and what the Board believes to be investors' investment horizons, taking account of the Company's current position and the potential impact of the principal risks and uncertainties as documented in the Strategic Report in the Annual Report.

The assessment considered the impact and likelihood of the principal risks and uncertainties facing the Company. Key areas of focus were investment strategy and performance against benchmark, including a consideration of the risks around asset allocation, stock selection and gearing. Market risk was also assessed in terms of the impact of severe but plausible scenarios and the effectiveness of the mitigating controls in place.

The Directors took into account the liquidity of the portfolio and the borrowings in place when considering the viability of the Company over the next five years and its ability to meet liabilities as they fall due. This included consideration of the duration of the Company's borrowing facilities, consideration of the impact of rising interest rates and how a breach of any covenants could impact the Company's net asset value and share price.

The Directors do not expect there to be any significant change to the principal risks and adequacy of the mitigating controls in place. Large cap stocks are held as ballast for the portfolio and for liquidity, and the percentage of the portfolio holding of these stocks generally exceeds the gearing percentage. The Board actively monitors investment performance and even with the significant falls in the NAV at the height of the COVID-19 pandemic (which exceeded 25% in March 2020), liquidity requirements and covenant restrictions were all met. Other recent factors, for example Brexit and the heightened macroeconomic uncertainty following Russia's invasion of Ukraine, have not materially affected the long-term viability of the Company. The Board is therefore confident that significant market collapses would not impact the Company's viability. Also, the Directors do not envisage any change in strategy or objectives or any events that would prevent the Company from continuing to operate over that period as the majority of the Company's assets are liquid, its commitments are limited and the Company intends to continue to operate as an investment trust. In coming to this conclusion, the Board has considered the residual impact of COVID-19, Russia's ongoing invasion of Ukraine and the rise in interest rates. Indications are that income has recovered to historic income levels. The Board does not believe that the factors aforementioned will have a long-term impact on the viability of the Company and its ability to continue in operation, notwithstanding the short-term uncertainty they have caused in the markets.

The Directors recognise that there is a continuation vote that is due to take place at the AGM in March 2023. In the light of the above consideration of the Company's viability and going concern and  as no shareholders have indicated that they will not support the continuation vote, the Directors currently believe that the Company will continue to exist for the foreseeable future, and at least for the period of assessment.

Based on this assessment, the Board has a reasonable expectation that the Company will be able to continue in operation and meet its liabilities as they fall due over the next five year period.

The Directors consider it appropriate to adopt the going concern basis of accounting in preparing the Financial Statements (see the Annual Report for further details).

RELATED PARTY TRANSACTIONS

The Company's transactions with related parties in the year were with its Directors and the Manager. There have been no material transactions between the Company and its Directors during the year and the only amounts paid to them were in respect of expenses and remuneration for which there were no outstanding amounts payable at the year end. Directors' shareholdings are disclosed in the Annual Report.

In relation to the provision of services by the Manager, other than fees payable by the Company in the ordinary course of business and the facilitation of marketing activities with third parties, there have been no material transactions with the Manager affecting the financial position of the Company during the year under review. More details on transactions with the Manager, including amounts outstanding at the year end, are given in the Notes to the Financial Statements in the Annual Report.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

In accordance with Disclosure Guidance and Transparency Rule 4.1.12, each of the Directors, who are listed in note 13, confirms that, to the best of his or her knowledge:

•	the Company's Financial Statements, which have been prepared in accordance with UK Accounting Standards, give a true and fair view of the assets, liabilities, financial position and loss of the Company; and
•	the Annual Report and Financial Statements 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 it faces.

On behalf of the Board

Wendy Colquhoun

Chairman

2 February 2023

Twenty largest holdings at 31 October 2022

The stocks in the portfolio are a diverse mix of businesses operating in a wide range of end markets.

Ranking 2022 (2021)	Company	% of portfolio	Approximate market capitalisation	Valuation 2021 £'000	Purchases £'000	Sales £'000	Appreciation/  (depreciation)  £'000	Valuation 2022 £'000
1 (1)	Barclays	3.4	£23.4b	4,955	-	-	(1,335)	3,620
2 *	Jersey Oil & Gas¹	3.3	£95.2m	1,762	-	(102)	1,817	3,477
3 (2)	Serica Energy¹	3.3	£818.4m	4,635	-	(3,444)	2,253	3,444
4 (17)	ZOO Digital¹	2.9	£146.5m	2,388	-	-	706	3,094
5 (3)	Springfield Properties¹	2.9	£110.8m	4,226	678	-	(1,814)	3,090
6 (4)	Next Fifteen Communications¹	2.9	£864.1m	3,981	205	-	(1,113)	3,073
7 (6)	NatWest	2.7	£22.7b	3,538	-	(699)	(4)	2,835
8 (11)	HSBC	2.7	£89.3b	2,784	-	-	37	2,821
9 (7)	Boku¹	2.5	£390.6m	3,490	-	-	(845)	2,645
10 (13)	Anglo American	2.4	£32.0b	2,713	-	-	(170)	2,543
11 (5)	Vertu Motors¹	2.4	£159.3m	3,968	-	(690)	(773)	2,505
12 (20)	Rio Tinto	2.2	£74.9b	2,280	-	-	(11)	2,269
13 (8)	Tracsis¹	2.1	£255.6m	3,413	-	(1,095)	(108)	2,210
14 *	Standard Chartered	1.9	£15.1b	1,905	-	-	98	2,003
15 *	Deltic Energy¹	1.8	£61.6m	1,427	-	-	516	1,943
16 (18)	IQGeo¹	1.7	£102.9m	2,347	-	(995)	449	1,801
17 (19)	Surface Transforms¹	1.6	£102.1m	2,330	-	-	(643)	1,687
18 *	Direct Line Insurance	1.5	£2.6b	1,754	457	-	(597)	1,614
19 *	K3 Capital¹	1.5	£204.0m	1,597	291	-	(322)	1,566
20 *	Van Elle¹	1.4	£40.5m	1,987	-	-	(465)	1,522

At 31 October 2022 these investments totalled £49,762,000 or 47.1% of the portfolio.

* Not in the top 20 largest investments last year

¹ Quoted on AIM

Portfolio by sector

As a percentage of the investment portfolio excluding cash

	31 October 2022 %	31 October 2021 %
Basic Materials	6.7	5.4
Consumer Discretionary	17.1	17.3
Consumer Staples	3.1	1.0
Energy	13.1	11.5
Financials	20.6	21.1
Health Care	3.4	4.1
Industrials	21.1	22.1
Real Estate	0.9	1.0
Technology	11.7	13.7
Telecommunications	2.3	1.8
Utilities	0.0	1.0
	100.0	100.0

Portfolio by index

As a percentage of the investment portfolio excluding cash

	31 October 2022 %	31 October 2021 %
FTSE 100	27.9	21.8
FTSE 250	10.5	11.1
FTSE SmallCap	7.8	6.7
FTSE AIM	52.6	55.5
Other1	1.2	4.9
	100.0	100.0

¹ Other also includes AIM investments outside the FTSE AIM Index and shares listed on the main market which are not included in the FTSE All-Share Index

Market capitalisation of the portfolio at 31 October 2022

	Portfolio Weight %	Benchmark Weight %
Greater than £2b	31.4	88.9
£1b - £2b	3.5	5.3
£500m - £1b	13.6	3.3
£200m - £500m	15.8	2.1
£100m - £200m	16.4	0.4
£50m - £100m	11.0	0.0
Less than £50m	7.8	0.0
Other	0.5	0.0
	100.0	100.0

A glossary of terms can be found in the Annual Report

Sources: Morningstar Direct, Janus Henderson, Refinitiv Datastream

AUDITED INCOME STATEMENT

		Year ended 31 October 2022			Year ended 31 October 2021
Notes		Revenue return £'000	Capital return £'000	Total return £'000	Revenue return £'000	Capital return £'000	Total return £'000
2	(Losses)/gains on investments held at fair value through profit or loss	-	(36,112)	(36,112)	-	47,667	47,667
	Gain on foreign exchange	-	-	-	-	1	1
3	Income from investments held at fair value through profit or loss	3,715	-	3,715	2,317	108	2,425
4	Other interest receivable and other income	205	-	205	268	-	268
		---------	----------	----------	---------	----------	----------
	Gross revenue and capital gains/(losses)	3,920	(36,112)	(32,192)	2,585	47,776	50,361
5	Management and performance fees	(173)	(404)	(577)	(203)	(1,642)	(1,845)
	Other administrative expenses	(433)	-	(433)	(379)	-	(379)
		---------	----------	----------	---------	----------	----------
	Net return/(loss) before finance costs and taxation	3,314	(36,516)	(33,202)	2,003	46,134	48,137
	Finance costs	(104)	(241)	(345)	(45)	(105)	(150)
		-----------	----------	----------	-----------	----------	----------
	Net return/(loss) before taxation	3,210	(36,757)	(33,547)	1,958	46,029	47,987
	Taxation	(1)	-	(1)	(4)	-	(4)
		-----------	----------	----------	-----------	----------	----------
	Net return/(loss) after taxation	3,209	(36,757)	(33,548)	1,954	46,029	47,983
		======	======	======	======	======	======
6	Net return/(loss) per ordinary share -
	basic and diluted	40.63p	(465.37p)	(424.74p)	24.74p	582.77p	607.51p
		======	=======	======	======	=======	======

The total columns of this statement represent the Profit and Loss Account of the Company. The revenue return and capital return columns are supplementary to this and are prepared under guidance published by the Association of Investment Companies. All revenue and capital items in the above statement derive from continuing operations. The Company had no recognised gains or losses other than those disclosed in the Income Statement.

AUDITED STATEMENT OF CHANGES IN EQUITY

Year ended 31 October 2022	Called up share capital £'000	Share premium account £'000	Capital redemption reserve £'000	Other capital reserves £'000	Revenue reserve £'000	Total shareholders' funds £'000
At 1 November 2021	2,000	14,838	2,431	107,496	1,732	128,497
Ordinary dividends paid	-	-	-	-	(2,251)	(2,251)
Refund of unclaimed dividends over 12 years old	-	-	-	-	3	3
Net (loss)/return after taxation	-	-	-	(36,757)	3,209	(33,548)
	--------	----------	----------	----------	-----------	---------
At 31 October 2022	2,000	14,838	2,431	70,739	2,693	92,701
	=====	======	======	======	======	=====

Year ended 31 October 2021	Called up share capital £'000	Share premium account £'000	Capital redemption reserve £'000	Other capital reserves £'000	Revenue reserve £'000	Total shareholders' funds £'000
At 1 November 2020	2,000	14,838	2,431	61,467	1,907	82,643
Ordinary dividends paid	-	-	-	-	(2,131)	(2,131)
Refund of unclaimed dividends over 12 years old	-	-	-	-	2	2
Net return after taxation	-	-	-	46,029	1,954	47,983
	--------	----------	----------	----------	-----------	---------
At 31 October 2021	2,000	14,838	2,431	107,496	1,732	128,497
	=====	======	======	======	======	=====

AUDITED STATEMENT OF FINANCIAL POSITION

	31 October 2022 £'000	31 October 2021 £'000
Fixed assets
Investments held at fair value through profit or loss
Listed at market value	50,786	65,075
Quoted on AIM at market value	54,392	81,536
Unlisted at market value	517	493
	------------	------------
	105,695	147,104
	------------	------------
Current assets
Investment held at fair value through profit or loss	2	2
Debtors	216	90
Cash at bank and in hand	1,219	1,360
	------------	------------
	1,437	1,452
Creditors: amounts falling due within one year	(14,431)	(20,059)
	-----------	-----------
Net current liabilities	(12,994)	(18,607)
	-----------	-----------
Total assets less current liabilities	92,701	128,497
	-----------	-----------
Net assets	92,701	128,497
	=======	=======
Capital and reserves
Called up share capital	2,000	2,000
Share premium account	14,838	14,838
Capital redemption reserve	2,431	2,431
Other capital reserves	70,739	107,496
Revenue reserve	2,693	1,732
	------------	------------
Total shareholders' funds	92,701	128,497
	=======	=======
Net asset value per ordinary share - basic and diluted	1,173.7p	1,626.9p
	=======	=======

AUDITED STATEMENT OF CASH FLOWS

	Year ended 31 October 2022	Year ended 31 October 2021
	£'000	£'000
Cash flows from operating activities
Net (loss)/return before taxation	(33,547)	47,987
Add: finance costs	345	150
Add/(less): losses/(gains) on investments held at fair value through profit or loss	36,112	(47,667)
Add: gains on foreign exchange	-	1
Increase in other debtors	(127)	(28)
(Decrease)/increase in creditors	(1,361)	1,295
	----------	----------
Net cash inflow from operating activities	1,422	1,738
	----------	----------
Cash flows from investing activities
Purchase of investments	(15,811)	(36,086)
Sale of investments	20,625	30,812
Proceeds from capital dividends	483	-
	------------	------------
Net cash inflow/(outflow) from investing activities	5,297	(5,274)
	------------	------------
Cash flows from financing activities
Equity dividends paid	(2,248)	(2,129)
Net loans (repaid)/drawn down	(4,261)	4,263
Interest paid	(351)	(120)
	-----------	-----------
Net cash (outflow)/inflow from financing activities	(6,860)	2,014
	-----------	-----------
Net decrease in cash and cash equivalents	(141)	(1,522)
Cash and cash equivalents at start of year	1,360	2,882
	----------	----------
Cash and cash equivalents at end of year	1,219	1,360
	======	======
Comprising:
Cash at bank	1,219	1,360
	======	======

NOTES TO THE FINANCIAL STATEMENTS

1.	Accounting policies
	(a) Basis of accounting The Company is a registered investment company as defined in Section 833 of the Companies Act 2006 and is incorporated in the United Kingdom. It operates in the United Kingdom and is registered at 201 Bishopsgate, London EC2M 3AE. The Financial Statements have been prepared in accordance with the Companies Act 2006, FRS 102 - The Financial Reporting Standard applicable in the UK and Republic of Ireland and with the Statement of Recommended Practice: Financial Statements of Investment Trust Companies and Venture Capital Trusts (the "SORP") issued in April 2021. The principal accounting policies applied in the presentation of these Financial Statements are set out in the Annual Report. These policies have been consistently applied to all the years presented. The Financial Statements have been prepared under the historical cost basis except for the measurement of fair value of investments. In applying FRS 102, financial instruments have been accounted for in accordance with Section 11 and 12 of the standard. All of the Company's operations are of a continuing nature.
	(b) Going concern The Company's Articles of Association require that at the AGM of the Company held in 2008, and every third year thereafter, an ordinary resolution be put to approve the continuation of the Company. The resolution put to the AGM in 2020 was duly passed. The next triennial continuation resolution will be put to the AGM in 2023. In the light of the Directors' consideration of the Company's viability and going concern and as no shareholders have indicated that they will not support the continuation vote, the Directors believe that the Company will continue to exist for the foreseeable future. The assets of the Company consist almost entirely of securities that are listed (or quoted on AIM) and are readily realisable. The net current liabilities are primarily due to borrowings under the loan facility, and the Company's portfolio is sufficiently liquid to meet the net current liabilities in the unlikely event that the loan needed to be fully repaid. The Board has considered the portfolio's liquidity and covenant compliance in event of significant and prolonged market falls. The securities lending programme entered into by the Company is supported by indemnification and therefore does not impact the liquidity of the portfolio or the Company's going concern. Accordingly, the Directors believe that the Company has adequate resources to continue in operational existence for at least twelve months from the date of approval of the Financial Statements. Having assessed these factors and the principal risks, as well as considering the residual impact of COVID-19, Russia's ongoing invasion of Ukraine and the rise in interest rates, the Directors considered it appropriate to adopt the going concern basis of accounting in preparing the financial statements.
2.	(Losses)/gains on investments held at fair value through profit or loss	2022 £'000	2021 £'000
	Gains on the sale of investments based on historical cost	8,286	11,553
	Revaluation losses recognised in previous years	(6,736)	(1,075)
		----------	----------
	Gains on investments sold in the year based on carrying value at previous Statement of Financial Position date	1,550	10,478
	Revaluation (losses)/gains on investments held at 31 October	(37,662)	37,189
		----------	----------
		(36,112)	47,667
		======	======
	Included within (losses)/gains on investments are special capital dividends of £483,000 (2021: £149,000). These are accounted for in accordance with accounting policy 1f) (see Annual Report for more detail)

3.	Income from investments held at fair value through profit or loss							2022 £'000	2021 £'000
	UK:
	Dividends from listed investments							2,668	1,737
	Dividends from AIM investments							979	518
								-------	-------
								3,647	2,255
								-------	-------
	Non-UK:
	Dividends from listed investments							68	62
								-------	-------
								68	62
								-------	-------
								3,715	2,317
								====	====
4.	Other interest receivable and other income							2022 £'000	2021 £'000
	Deposit interest							7	-
	Stock lending commission							197	267
	Underwriting commission (allocated to revenue)							1	1
								-------	-------
								205	268
								====	====
	At 31 October 2022, the total value of securities on loan by the Company for stock lending purposes was £9,691,000 (2021: £14,011,000). The maximum aggregate value of securities on loan at any one time during the year ended 31 October 2022 was £17,350,000 (2021: £27,450,000). The Company's agent holds collateral at 31 October 2022 with the value of £10,203,000 (2021: £14,789,000) in respect of securities on loan, the value of which is reviewed on a daily basis and comprises CREST Delivery By Value ("DBVs") and Government Bonds with a market value of 105% (2021: 106%) of the market value of any securities on loan. During the year the Company was not required to take up shares in respect of underwriting commission; no commission was taken to capital (2021: same).
5.	Management and performance fees
		2022			2021
		Revenue return £'000	Capital return £'000	Total return £'000	Revenue return £'000		Capital return £'000		Total return £'000
	Management fee	173	404	577	203		474		677
	Performance fee	-	-	-	-		1,168		1,168
		--------	---------	---------	--------		---------		---------
		173	404	577	203		1,642		1,845
		=====	=====	=====	=====		=====		=====
	The basis on which the management fee is calculated is set out in the Strategic Report contained in the Annual Report. The performance fee is accrued as a liability throughout the year whenever the criteria for a performance fee to be payable are met. The performance fee crystallises and becomes payable at the Company's year end. The allocation between revenue return and capital return is explained in the Notes to the Financial Statements within the Annual Report.

6.	Net (loss)/return per ordinary share - basic and diluted
	The total loss per ordinary share is based on the total loss attributable to the ordinary shares of £33,548,000 (2021: total return of £ 47,983 ,000) and on 7,898,375 ordinary shares (2021: 7,898,375) being the weighted average number of shares in issue during the year. The (loss)/return per ordinary share can be further analysed as follows:
		2022 £'000	2021 £'000
	Revenue return	3,209	1,954
	Capital (loss)/return	(36,757)	46,029
		-----------	-----------
	Total (loss)/return	(33,548)	47,983
		======	======
	Weighted average number of ordinary shares	7,898,375	7,898,375
		======	======
		2022	2021
	Revenue return per ordinary share	40.63p	24.74p
	Capital (loss)/return per ordinary share	(465.37p)	582.77p
		-----------	-----------
	Total (loss)/return per ordinary share - basic and diluted	(424.74p)	607.51p
		======	======
7.	Net asset value per ordinary share - basic and diluted
	The net asset value per ordinary share at the year end was 1,173.7p (2021: 1,626.9p). The net asset value per ordinary share is based on the net assets attributable to the ordinary shares of £92,701,000 (2021: £128,497,000) and on the 7,898,375 ordinary shares in issue at 31 October 2022 (2021: 7,898,375). There are no dilutive securities so the basic and diluted net asset value per ordinary share are the same. The movements during the year of the assets attributable to the ordinary shares were as follows:
		2022 £'000	2021 £'000
	Total net assets at 1 November	128,497	82,643
	Total net (loss)/return	(33,548)	47,983
	Dividends paid in the year	(2,248)	(2,129)
		-----------	-----------
	Total net assets at 31 October	92,701	128,497
		======	======
8.	Called up share capital	2022 £'000	2021 £'000
	Allotted and issued ordinary shares of 25p each 7,898,375
	(2021: 7,898,375)	1,974	1,974
	Ordinary shares of 25p each held in treasury 102,483 (2021: 102,483)	26	26
		----------	----------
		2,000	2,000
		======	======
	During the year ended 31 October 2022 no ordinary shares of 25p each were issued or repurchased by the Company (2021: none). Shares held in treasury do not carry a right to receive dividends.

9.	Ordinary dividends paid	Record date	Payment date		2022 £'000	2021 £'000
	Amounts recognised as distributions to equity holders in the year:
	Third Interim dividend for the year ended 31 October 2020 of 6.5p	20 November 2020	18 December 2020		-	513
	Final dividend for the year ended 31 October 2020 of 7.5p	19 February 2021	26 March 2021		-	592
	First Interim dividend for the year ended 31 October 2021 of 6.5p	21 May 2021	25 June 2021		-	513
	Second Interim dividend for the year ended 31 October 2021 of 6.5p	20 August 2021	24 September 2021		-	513
	Third Interim dividend for the year ended 31 October 2021 of 6.5p	19 November 2021	17 December 2021		513	-
	Final dividend for the year ended 31 October 2021 of 8.0p	18 February 2022	25 March 2022		632	-
	First Interim dividend for the year ended 31 October 2022 of 7.0p	20 May 2022	24 June 2022		553	-
	Second Interim dividend for the year ended 31 October 2022 of 7.0p	19 August 2022	23 September 2022		553
	Unclaimed dividends				(3)	(2)
					---------	---------
					2,248	2,129
					=====	=====
	The Board declared a third interim dividend of 7.0p per ordinary share, paid on 16 December 2022 to shareholders on the register of the Company at the close of business on 18 November 2022. The ex-dividend date was 17 November 2022. Based on the number of ordinary shares in issue on 31 October 2022, the cost of this dividend was £553,000. Subject to approval at the AGM, the proposed final dividend of 13.0p per ordinary share will be paid on 24 March 2023 to shareholders on the register of members at the close of business on 17 February 2023. The shares will be quoted ex-dividend on 16 February 2023. The total dividends payable in respect of the financial year, which form the basis of the test under Section 1158 of the Corporation Tax Act 2010, are set out below:
				Year ended 31 October 2022		Year ended 31 October 2021
				£'000		£'000
	Revenue available for distribution by way of dividends for the year			3,209		1,954
	First interim dividend for the year ended 31 October 2022: 7.0p (2021: 6.5p)			(553)		(513)
	Second interim dividend for the year ended 31 October 2022: 7.0p (2021: 6.5p)			(553)		(513)
	Third interim dividend for the year ended 31 October 2022: 7.0p (2021: 6.5p)			(553)		(513)
	Proposed final dividend for the year ended 31 October 2022: 13.0p (based on the 7,898,375 ordinary shares in issue at 2 February 2023) (2021: 8.0p on 7,898,375 ordinary shares)			(1,027)		(632)
				-----------		-----------
	Transferred to/(from) revenue reserve1			523		(217)
				=======		=======
	All dividends have been paid or will be paid out of revenue profit and the revenue reserve. 1 Undistributed revenue comprises 13.3% of income from investments (2021: no undistributed revenue)

10.	2022 Financial Information
	The figures and financial information for the year ended 31 October 2022 are extracted from the Company's Annual Financial Statements for that period and do not constitute statutory financial statements for that period. The Company's Annual Financial Statements for the year ended 31 October 2022 have been audited but have not yet been delivered to the Registrar of Companies. The Independent Auditor's Report on the 2022 Financial Statements was unqualified, did not include a reference to any matter to which the Auditors drew attention without qualifying the report, and did not contain any statements under Sections 498(2) and 498(3) of the Companies Act 2006.
11.	2021 Financial Information The figures and financial information for the year ended 31 October 2021 are extracted from the Company's Annual Financial Statements for that period and do not constitute statutory financial statements for that period. The Company's Annual Financial Statements for the year ended 31 October 2021 have been audited and delivered to the Registrar of Companies. The Independent Auditor's Report on the 2020 Financial Statements was unqualified, did not include a reference to any matter to which the Auditors drew attention without qualifying the report, and did not contain any statements under Sections 498(2) and 498(3) of the Companies Act 2006.
12.	Annual Report and Annual General Meeting The Annual Report for the year ended 31 October 2022 will be posted to shareholders in February 2023 and will be available on the Company's website www.hendersonopportunitiestrust.com or from the Corporate Secretary at the Company's Registered Office, 201 Bishopsgate, London EC2M 3AE. The Annual General Meeting will be held on Wednesday 8 March 2023 at 2.30pm at 201 Bishopsgate, London, EC2M 3AE. The Notice of the Annual General Meeting will be posted to shareholders with the Annual Report and will be available on the Company's website.
13.	General Information
	Company Status: Henderson Opportunities Trust plc is registered in England and Wales (No. 01940906), has its registered office at 201 Bishopsgate, London EC2M 3AE and is listed on the London Stock Exchange. SEDOL/ISIN: 0853657/GB0008536574 London Stock Exchange (TIDM) Code: HOT Global Intermediary Identification Number (GIIN): LVAHJH.99999.SL.826 Legal Entity Identifier (LEI): 2138005D884NPGHFQS77 Directors and Corporate Secretary: T he Directors of the Company are Wendy Colquhoun (Chairman), Frances Daley (Audit and Risk Committee Chairman), Davina Curling and Harry Morgan. The Corporate Secretary is Janus Henderson Secretarial Services UK Limited, represented by Melanie Stoner (Fellow of the Chartered Governance Institute). Website: Details of the Company's share price and net asset value, together with general information about the Company, monthly factsheets and data, copies of announcements, reports and details of general meetings can be found at www.hendersonopportunitiestrust.com .

For further information, please contact:

James Henderson Fund Manager Henderson Opportunities Trust plc Telephone: [phone]		Harriet Hall Investment Trust PR Manager Janus Henderson Investors Telephone: [phone]
Dan Howe Head of Investment Trusts Janus Henderson Investors Telephone: [phone]

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

 

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