Final Results

JPMorgan Global Core Real Assets Ld

30 June 2023

 

LONDON STOCK EXCHANGE ANNOUNCEMENT

JPMORGAN GLOBAL CORE REAL ASSETS LIMITED

(the "Company")

FINAL RESULTS FOR THE YEAR ENDED 28^TH FEBRUARY 2023

CHAIRMAN'S STATEMENT

I am pleased to present a robust set of results for the Company for the year ended 28th February 2023 (the 'Period') against a challenging and volatile macroeconomic environment.

Performance

The Company's strategy is continuing to generate attractive returns for investors, delivering a share price total return of +7.0% for the Period, but it must be recognised that a significant part of this return derives from the strengthening of the US dollar against our reference currency, sterling. The Company's NAV performance was +11.6%, the difference between this number and the share price return reflecting the higher discount prevailing at the end of the Period as compared with that at the start of the year. During the Period the price at which the Company's shares traded relative to its underlying NAV fluctuated from a discount at the start of -10.8%, to a premium in the middle (which allowed for incremental share issuance in August 2022), with the Company ending its financial year at a discount of -14.9%. The discount has since narrowed and, at the time of writing, stands at -9.5% to NAV. The share price has been relatively stable post year end, through what has been a volatile time for markets overall.

It is worth noting that over the Period significant changes were seen in global financial markets, with the end of an extended period of very low interest rates. This has had a major impact on asset prices, especially in the public markets. Higher rates have weighed on real assets, although not to the same extent seen in the public markets. Within our portfolio, an appropriate debt structure and some inflation linkage for cashflows have been important in offsetting the impact of higher rates, which JARA has to date been able to manage well.

Measured in local currency terms, the Listed Real Assets investment registered a decline in its NAV, but the other strategies in which the Company was invested posted positive returns over the Period in their local currencies. Given the testing macroeconomic and financial conditions during the year, the Board regards this as a respectable outcome, one which supports both the diversification and in aggregate defensive characteristics of the portfolio.

Most of the Company's assets are denominated in U.S. dollars and a variety of other currencies, so returns were significantly assisted by sterling's general weakness over the Period. One of JARA's attributes is that it offers shareholders access to real assets globally and with this comes a global currency exposure. It should be noted that, subsequent to the Period end, sterling has strengthened and acted as a drag on the NAV. Later in this Statement I describe the Board's recent actions to reduce the Company's exposure to foreign exchange volatility.

The Investment Manager's Report reviews the Company's performance and gives a detailed commentary on the investment strategy and portfolio construction, and an outlook for the individual strategies which comprise JARA's portfolio.

Portfolio

As described in more detail in the Investment Manager's Report, the Company remains well diversified across a range of different sectors throughout the real asset spectrum. Relatively new additions to the portfolio mix, such as real estate debt, have offered useful stability and a growing income stream, with potential for further increases due to its exposure to floating rates. An important aspect of JARA is its diversification, which aims to ensure no over-exposure to any one sector, asset or counterparty. JARA benefits from the active management at both the portfolio and underlying strategy level to drive returns and manage risk for investors. One example of this active allocation saw a reduction in office exposure by 4% and an increase in energy logistics.

Since the Period end, the Investment Manager has started the process of restoring the allocations in infrastructure and transport to their target range after strong performance in the other portfolio allocations. This rebalancing should help increase the level of portfolio income and provide further stability to the NAV given the long-term predicable nature of the cashflows of the underlying transport and infrastructure assets.

Share Issuance

The Company grew its share capital by circa 1% through the issue of 2,000,000 new shares. As at 28th February 2023, the Company had 219,407,952 shares in issue and net assets of £223.7 million. These proceeds were invested in line with the Company's investment policies across the underlying investment strategies.

Share issuance is always executed at a premium to the prevailing cum-income NAV per share and so is accretive to existing shareholders. If conditions are appropriate, the Company will continue to issue new shares which, as well as assisting with premium management, will also enhance liquidity and continue to underpin the Company as an attractive investment. The Board also assesses the need for buybacks when the shares are trading at a discount to NAV and will aim to balance factors such as changes on the shareholder register and whether buybacks would be more accretive to NAV when compared to any foregone opportunity for potential investment opportunities.

Revenue and Dividends

The Board declared total dividends of 4.05 pence per share in respect of the financial year under review, comprising three quarterly dividends of 1 penny per share and a fourth quarterly dividend of 1.05 pence per share, providing an uplift on the prior year (2022: 4.00 pence per share). This dividend has been delivered notwithstanding the macroeconomic challenges of recent years, including inflation, Covid-19, energy shortages and the impact of the war consequent upon the Russian invasion of the Ukraine, all of which have affected valuations and revenues across all sectors of real assets.

The first interim dividend for the financial year ending 29th February 2024, being 1.05 pence per share, was paid to shareholders on 31st May 2023; the Directors intend for there to be three further interim dividends and - following the pattern established in the 2022/23 financial year - if the Directors believe that an increase in distributions is warranted this will be paid as part of the last dividend for the financial year.

Your Board believes that, over the longer term, the success of the underlying businesses and strategies into which JARA invests will facilitate a steadily growing level of dividends.

Currency Exposure

Since JARA's IPO in September 2019 there has been no currency hedging employed across the portfolio (although the ability to do so has always been available) and it has therefore been primarily exposed to currencies other than the Company's base currency of GBP.

Currency volatility since IPO has been significantly above long-run levels, and this has resulted in additional volatility in the NAV. Following a review of the approach to currency exposure, and taking into account recent investor feedback, the Board has resolved to introduce a currency hedging strategy with the aim of reducing, but not eliminating, the currency-related volatility in returns.

The initial step in this strategy will be the reallocation of the existing unhedged investment in the Infrastructure allocation to the GBP hedged investment and the Board will continue to monitor its currency hedging strategy.

The Board and Corporate Governance

In accordance with the Company's Articles of Incorporation and the AIC Code of Corporate Governance, all Directors will be retiring and seeking re-election by shareholders at the Company's Annual General Meeting. The Board's knowledge and experience is detailed in the Company's full annual report.

The Board recognises the importance of having a diverse range of views and experiences, along with broad professional expertise, to support decision-making. The current Board composition - with one female director on a board of four and no director from a minority ethnic background - means that the Board composition does not currently comply with the recommendations made by the FTSE Women Leaders Review (the successor of the Hampton-Alexander Review and the Davies Review) and Parker Review as well as the Financial Conduct Authority's Listing Rule. The Board's succession planning is considered and discussed by the Nomination Committee, which will take into account these recommendations for future Board appointments.

Environmental, Social and Governance ('ESG')

The Investment Manager continues to enhance its ESG approach which ensures it best captures the fundamental insights of the investment team. The Board continues to engage with the Investment Manager on ESG considerations and how the investment team integrates ESG into investment decisions.

Across the portfolio the Investment Manager considers climate change risk and mitigation, which is strongly supported by the Board. This involves identifying and measuring physical risks, then assessing and developing mitigation strategies for high-risk assets. Finally, it involves analysing climate-related transition risks and opportunities. Further details can be found in the ESG Report in the Company's full annual report.

Keeping Investors Informed

The Company releases monthly NAVs to the market, as well as quarterly NAVs with more detailed commentary at the end of May, August, November and February, all via the London Stock Exchange's Regulatory News Service. The monthly NAVs contain the latest pricing for the liquid strategy and exchange rates, with the private strategies being priced on a quarterly basis.

Annual General Meeting

The Company's fourth Annual General Meeting ('AGM') will be held on Wednesday, 2nd August 2023 at 12.30p.m. at the offices of JPMorgan, Level 3, Mill Court, La Charroterie, St Peter Port, Guernsey GY1 1EJ. I would encourage all shareholders to vote.

If shareholders are unable to attend the AGM, they are welcome to raise any questions in advance of the meeting with the Company Secretary at the Company's registered address, or by writing to the Company Secretary at the address provided in the Company's full annual report, or via email to [e-mail].

Outlook

The current environment is both at the political and macro level one of the most uncertain in the last decade, if not since the global financial crisis of 2008/09. The public capital markets have adjusted rapidly to the increase in central bank rates and monetary tightening; the private markets have begun this process, but the market has been and will continue to go through a process of price discovery as views on the trajectory of inflation and rate movements become clearer and therefore allow both buyers and sellers to focus on what is an acceptable range of pricing.

The resetting of rates has also led many investors to revisit levels of leverage and portfolio allocations, leading to a large dispersion of sector and asset level returns. In many ways the Company was designed with such an environment in mind, given that its exposure to multiple asset classes and interest rate environments ensures that no one external change either at the monetary, economic or political level should threaten the viability of the Company. Overall, the Board believes that the Company is well placed to continue navigating the evolving core real asset landscape, given the experience and scale of the underlying strategies and overall size and reach of the Alternatives Platform. The Board is confident that the portfolio will, in aggregate, benefit from the inflation which has become a feature in all Western economies, and which seems likely to be with us for some time. On the basis of this confidence, the Board envisages providing shareholders with a progressive dividend profile, paid quarterly, but as in the Period under review, with increments paid as part of the fourth distribution.

There remains a significant appetite for new capital, not least in the area of decarbonising our energy cycle, notably the substitution of wind, solar and nuclear electricity for fossil fuelled generation. An advantage enjoyed by your Company is that, even as the current environment sees capital raising in the investment trust market all but closed, the underlying strategies in which the Company is invested, given their perpetual life and core nature, are able to recycle capital and change their allocations to adapt to this shift. Global, secular trends such as the drive to net zero and increasing digitisation of industry and consumer experience, will be long term asset growth drivers, fundamental to shaping the economies of tomorrow. JARA, through its underlying portfolios, is well placed to harness these opportunities.

John Scott

Chairman

29th June 2023

INVESTMENT MANAGER'S REPORT

Portfolio Review

During the financial year, the Company continued to implement its multi-alternatives allocation strategy across global real estate, infrastructure and transportation markets, providing access to many investment opportunities that are otherwise difficult for UK retail investors to access. JARA's low UK exposure means it is well-positioned to complement UK investors' allocations to domestic real assets. (See graphic in the Company's full annual report showing the portfolio's weighting to each sector as at end February 2023.)

A central tenet of JARA's investment philosophy is to provide shareholders with a diversified real asset portfolio allocated not only across asset classes, but also across end user counterparties and regions. This flexibility proved crucial in the past year, as inflation, rising interest rates and geopolitical events had a significant impact on financial markets, and some real assets were also challenged. At the year-end, JARA's allocation remained truly global and very diversified.

This diversification allowed the Company to weather the year's market volatility and deliver an NAV total return of +11.6% (in GBP terms), while the local currency performance was +3.9%. The difference between the GBP return and the local currency return was caused by the weakness of sterling, which was accretive to the Company's GBP NAV. This was the case because, as always, the Company's portfolio is unhedged and therefore foreign exchange risk is incurred when allocating to overseas markets. This can impact performance in GBP terms both positively, as in the past year, and negatively.

The table below shows the contributors to JARA's performance calculated using each strategy's investment performance and its average weighting within the portfolio throughout the year.

U.S. Real Estate	+0.5%
Asia-Pacific Real Estate	+1.1%
Global Infrastructure	+1.1%
Global Transportation	+2.2%
U.S. RE Mezzanine Debt	+0.4%
Listed Real Assets	-1.4%
Total Local Return	3.9%
Currency Impact	8.0%
Company Level Costs	-0.4%
Total GBP Return	11.6%

Source: J.P. Morgan Asset Management. Numbers may not sum due to rounding. Currency impact also includes return earned from cash holdings over the year. Table shows the components of return contribution made up of income and capital. Strategy level returns are net of associated management fees. Company level costs includes the management fee charged by JPMF (0.05% pa) and the Company's other administration expenses. The strategy returns above are net returns and include the impact of the relevant management fee of each strategy. Capital contribution may be negative for reasons including asset depreciation, asset write downs or due to income return including some return of capital.

Interest rates rose rapidly and significantly from their historic lows across most developed markets in the year just past, making the extent, cost and nature of leverage across private real asset markets a clear focus for investors, including JARA. At the year-end, JARA had no company level leverage. However, on a look-through basis, JARA's underlying vehicles do utilise leverage, primarily at an asset level. The weighted average loan-to-value for JARA's private asset exposure was 36.6% at the end of the reporting period. Importantly, over 70% of this debt is fixed rate, which provided the portfolio with significant protection from the year's rates hikes.

As is to be expected in the current market environment, higher interest rates have lifted discount rates. The weighted average discount rate of the portfolio's private assets was 7.9% at year end, up from 7.3% at the end of the previous year. This increase in discount rates over the year has, to some extent, been offset by increasing allocations to lower risk sectors such as liquid natural gas and utilities, whose discount rates are, on average, relatively lower due to their risk profile.

Portfolio Movement

As shown in the table in the Company's full annual report, at the year end, JARA was fully invested across a range of different sectors throughout the real asset universe. This positioning aligns with both our strategic asset allocation and also areas of conviction in the medium term.

Review of underlying strategies

A further detailed review of the individual underlying strategies can be found below.

Global Private Real Estate

The Company's investments in global private real estate fall into several categories:

•   High quality real estate equity, across the US and Asia-Pacific regions. The focus is on core property sectors - logistics, warehouses, residential, office and retail - in major growth markets and in the most dynamic gateway cities, which are important hubs for economic growth. These core real assets are low risk investments which have reliable, highly predictable, long-term cash flows;

•   'Extended core' real estate equity. The strategy seeks assets with exposure to structural shifts in the way we shop, work and live. This includes 'extended core' sectors, for example truck terminals, outdoor storage, and other facilities which serve new, high growth industries such as healthcare and biotech companies. These assets tend to cluster in parts of the market overlooked by other property investors; and

•   Core real estate mezzanine debt in the US. This is an income-producing portfolio of loans backed by high quality, moderately leveraged core real estate assets. These investments were new to the portfolio over the past year, and serve as both an income diversifier, and as a dampener on volatility, as mezzanine real estate debt is less sensitive to macroeconomic fluctuations than real estate equity. In addition, by being more senior in the debtors' capital structure than equity financing, this allocation is less exposed to changes in real estate values.

The financial year under review was a tale of two halves within the real estate sector. The year began on a positive note, supported by extraordinary demand fuelled by a tight job market, upbeat consumers and relative supply constraints. However, this very strong early year performance cooled, and in some cases, reversed, in the second half as investors became increasing concerned about the pace of interest rate increases and their inevitable adverse impact on the sector.

The Company's overall allocation to real estate has been broadly stable over the review period.

During much of the first two quarters, JPMorgan's real asset platform (explained in further detail in the Company's full annual report) utilised the favourable real estate environment to evolve its exposure, focusing on sectors, geographies and assets in which we have the highest long-term conviction. For example, we increased our exposure to Industrial Logistics by 1%, via investments in both infill locations (assets near urban areas) and assets across the Asia-Pacific market. 

In early 2022, the global energy supply chain was upended by Russia's invasion of Ukraine. This caused a major shift in how countries, particularly in Europe, source their energy and think about their future energy security. These major ructions benefitted assets involved in the transportation of oil and gas around the globe (referred to as Energy Logistics), which saw a surge in demand. In response, we increased exposure to Energy Logistics by 2%.

The other significant change to the Company's real estate positioning was a £14.4 million allocation to real estate mezzanine debt, for reasons discussed above. This investment, which represented 7% of the Company's real estate holdings at year end, was made at the end of February 2022, and unitised on 1st April 2022.

In terms of divestments, the underlying strategy sold more than $4 billion of retail and office assets that fell short of its long-term growth objectives. For example, the disposal of some US office investments was motivated by what was perceived as a structural decline in demand for office space, as this market adapts to more flexible working patterns.

As the year progressed, the twin drags of higher borrowing costs and reduced liquidity adversely impacted both real estate transaction activity and valuations. However, these effects were not felt equally across all real estate markets, and as such, JARA's global exposure and diversification across both real estate equity and debt provided significant stability compared with standalone sector and country-specific allocations. This can be seen in the returns;  JARA's US real estate exposure contributed 0.5% to the Company's total return over the year, while our Asia-Pacific exposure added 1.1% and real estate debt contributed a further 0.4%.

US real estate saw the greatest reversal over the course of the year. Sectors that have seen the greatest appreciation in the last few years - namely industrial and residential - gave back most of the gains realised in H122. While these sectors generally continued to see growth in rents, some moderation in the rate of rental increases saw cap rates expand, driving valuations lower.

Asia-Pacific (APAC) real estate outperformed, remaining consistently positive throughout the year. This sector did not experience the same appreciation in 2021 and early 2022 as the US, and so escaped the same degree of subsequent decline. This relative stability was driven in part by the diversity of the region, where economies are in varying stages of their economic cycles and interest rate tightening journeys. There are also specific trends in the APAC region which helped create differentiated performance relative to other regions. For example, while the US office sector has been one of the most operationally challenged, due to the widespread adoption of flexible working, this has not been the case in much of the APAC region, where flexible working has proved less popular amongst workers and employers. This has underpinned the APAC office market, especially in business hubs like Singapore.

The allocation to real estate debt, initiated just before the beginning of the financial year, was also a consistent, but more modest, performer. The interest rate structure of the debt within the strategy's portfolio of real estate loans is primarily floating rate, which generated increasing income as rates rose over the year - the annualised yield of this allocation is now in excess of 8%.

At end-February 2023, the real estate allocation, on a look through basis, held 299 assets and loans globally, equating to $49 billion in value (including leverage). The average leverage (loan-to-value) across the real estate portfolio was 25%.

Global Private Infrastructure & Transportation

JARA invests in core and core+ infrastructure and transportation assets. Within Infrastructure, the Company has exposure to a global portfolio of +20 operating company platforms, each benefiting from dedicated management, and are active across a diverse range of infrastructure sectors such as power generation, regulated and unregulated utilities and fixed transportation. JARA's infrastructure allocation therefore represents a conglomerate of separately managed and incentivised businesses operating to maximise efficiency and grow within their respective market places.

These investments come with specialised management teams and a unique avenue of capital deployment due to the ability to add smaller assets over time via acquisitions, developments and build outs.  This approach can provide the means for long term value creation. While there were some larger transactions in the past financial year, over the last ten years, investment through this platform investment approach has accounted for approximately half of all capital deployed. We continue to see significant opportunities to employ this form of investment, especially in the utility and renewables spaces. These industries are currently fragmented, and thus ripe for consolidation, and there will be an ongoing need for investment as the global transition to renewable energy gathers momentum.

Over the past year, overall exposure to infrastructure was stable but the Company's infrastructure allocation has shifted away from 'GDP-sensitive' assets such as airports and seaports, towards contracted power provision and utilities. In our view, these sectors exhibit strong cash-flow generation, with lower sensitivity to fluctuations in demand and macroeconomic developments, which leaves them well-positioned to cope with slowing growth. In addition, these sectors will remain supported by broader structural trends - primarily the push towards net zero carbon emissions.

JARA's private infrastructure allocation had a strong year, contributing 1.1% to the Company's total return. In this part of the portfolio, a significant majority of the return is generated by income, with income returns typically within the 6%-9% range. This performance illustrates the resilience of infrastructure markets, and the sector's ongoing popularity amongst investors seeking refuge from declines in conventional equity and bond markets.

Power generation was one area of outperformance, as this industry has benefited from significantly higher energy prices. Whilst JARA's exposure is primarily focused on fixed long-term energy supply contracts, many assets do retain some merchant (spot market) exposure - typically in the region of 20%-30% - and these served to enhance returns over the past year as spot prices rose. In addition, several of the underlying strategy's fixed transportation assets, such as ports and airports, which comprise part of our infrastructure portfolio, also performed strongly, thanks to post-COVID rebounds, which had been delayed in some cases by congestion and operational challenges such as shortages of trained staff. Japan's decision to re-open its borders to foreign tourists last October, which was closely followed by China's surprise decision to lift all pandemic restrictions, also boosted the performance of these assets.

At year end, the underlying strategy owned a total of 141 infrastructure assets (or 931, if look-through assets are considered), equating to $62 billion in asset value (including leverage)). The average loan-to-value ratio of these assets was 47%.

The strategy within the transportation sector focuses on leasing out large, 'backbone' transport assets such as ships, aircraft, rail and fleet leasing and energy logistics, which are critical to the functioning of global trade. It is preferred, on average, to deal with investment grade counterparties, and these assets are leased to some of the largest corporates in the world.

JARA's exposure to transportation assets rose marginally over the past year and this sector contributed +2.1% to the Company's total return over the period. As is the case with infrastructure investments, most of the return on the Company's transport allocation is income orientated. Performance from our transport allocation was in line with expectations, and the strategy collected all lease payments on time.

Although JARA's exposure in Energy Logistics real assets benefited from changes to the energy sector sparked by Russia's invasion of Ukraine, as mentioned above, the Company's largest exposure to recent developments in the energy market is via its investments in liquid natural gas (LNG) carriers. Demand for these vessels has surged as gas pipelines have become less reliable, and we believe that the carriers to which JARA is exposed are particularly competitive and attractive, as they are new and highly fuel efficient.

Towards the end of the year, the strategy added exposure to several new transportation sub-sectors, including electric vehicle (EV) charging points and railcar leasing. Demand for EV charging points is certain to increase as these vehicles become more popular. Railcar leasing is an integral part of the North American supply chain, currently representing c. 26% of annual US freight ton miles. This share is likely to rise over time as moving freight by rail rather than road significantly reduces greenhouse gas emissions. Demand for existing railcar inventory is therefore likely to strengthen, and there is scope for the sector to grow substantially as efforts to achieve 'net zero' carbon emissions intensify.

Liquid Real Assets

JARA's exposure to liquid real assets comprises listed investments across real estate, infrastructure and transportation securities. The Company's listed real asset allocation is made up of two distinct strategies: US all-tranche REITs, in which investments are diversified into debt securities; and a broader allocation across a variety of other listed real assets, including sectors such as data centres and medical real estate. We are currently equally weighted between these two strategies. Our allocations to liquid real assets bring dual benefits. Their liquidity provides us with greater flexibility within our asset allocation process, and they are also an additional diversifier in terms of both returns and sectoral exposure. Overall exposure to liquid real assets declined over the year.

The past year was a volatile period for public markets and, as a result, our allocation to liquid real assets was the only area which detracted from returns. Our investments in liquid assets declined by 1.4% over the period. However, historically, such sell-offs in public markets are typically followed by rebounds, and these rebounds often coincide with sell-offs in private markets, which tend to lag developments in public markets. This lack of correlation between the returns across public and private markets helps smooth performance across the portfolio over time, and we expect a similar dynamic to play out in the current market environment. Indeed, public markets began to rebound in the months since the Company's year-end.

Real Asset Market Outlook

Inflation is expected to remain elevated throughout the course of 2023, with labour shortages and pricing pressures likely to continue. This suggests that the current high interest rate environment will remain in place throughout 2023. The impact these high rates will have on real assets, as well as other financial markets, will thus remain a major focus for investors, and volatility will stay high across asset classes. Other macroeconomic drivers such as China's faltering recovery, combined with simmering geo-political tensions, may add further uncertainty to the prevailing climate. However, on the positive side, core real assets provide essential economic services, and are thus largely immune to adverse short-term macroeconomic developments.

The impact of higher rates on real asset markets will be dependent on several factors, including the timing of refinancing, the level of fixed vs. floating debt and assumptions regarding the trajectory of interest rates and the equity cost of capital over the long-term. Possibly most importantly, performance will hinge on the extent of repricing of both debt and equity required to reflect the new, higher rate environment. Investors who based valuations on consistent long-term methodologies - typically inherent across most core real asset markets - will be best placed to cope with current tight monetary conditions.

Global Real Estate Outlook: Divergence across markets calls for a diversified approach

We expect to see divergence across real estate markets by sectors, regions and security types over coming months, although by the end of 2023, asset valuations should stabilise, as the outlook for inflation and interest rates becomes clearer. In this climate, diversified portfolios should prove most resilient, so adopting a globally diversified approach remains as important as ever.

In the US real estate market, we expect the risk of recession to linger, while growth in rents will slow further and transaction volumes will stay low. The availability of debt financing is likely to remain limited and will be further constrained as US regional banks reassess their lending practices in the wake of recent turmoil in the sector. As mentioned above, office real estate has been under pressure due to the enduring popularity of flexible working patterns. Going forward, tenants are likely to be more selective in the office space they rent. This can already be seen in the net absorption levels - the net newly occupied space minus the newly vacant space (see graph in the Company's full annual report). As shown in the graph in the Company's full annual report, newer assets, are continuing to see demand a premium whilst older, lower quality assets are struggling.

In the APAC real estate markets, performance patterns have differed markedly from other regions, for reasons discussed above, and we expect the APAC region to maintain its comparatively steady course, due to the lack of correlation in economies across the region and the nuances of local market dynamics. Real estate across the region will be the main beneficiary of China's reopening. These factors all support the case for ongoing exposure to the APAC region.

On the positive side, commercial vacancy rates are still comparatively low, and despite the recent slowdown, rent growth is still trending above its long-term average, so real estate fundamentals are broadly holding up. This, combined with low levels of liquidity, suggests that it is a lenders' market for investors such as JARA. We believe core mezzanine lending constitutes a particularly attractive way to invest during the current market dislocation, as it provides a high-quality hedge against rising rates, declining values and inflation, and thus helps to moderate volatility in returns. We will therefore remain vigilant for opportunities to add more of this form of real estate debt to our portfolio.

Longer-term, real estate performance will continue to be driven by how we consume, work and live. Investors therefore need to look beyond the current market volatility and uncertainties and consider how best to reposition their portfolios to take advantage of longer-term trends in consumption, working practices and lifestyles. We believe it is especially important to focus on opportunities in 'extended' subsectors, such as truck terminals, outdoor storage, single family rentals, age-restricted housing and life sciences facilities, so we will be monitoring these areas closely.

Infrastructure Outlook: Positive, with the transition to renewable energy set to boost certain energy assets

The outlook for core private infrastructure remains strong, despite the macroeconomic headwinds. The asset class offers investors a highly attractive mix of built-in inflation protection, uncorrelated returns and consistent income. Core private infrastructure is proving to be immune to the economic cycle, in large part due to the essential nature of the services provided by the underlying assets. This should ensure relatively low volatility and steady returns. Yields are therefore likely to remain consistent, and in some sectors, especially core focused infrastructure, the ability to pass on commodity cost increases to end customers will boost revenues.

The cycle agnostic nature of utilities can be seen on the right-hand side of the chart in the Company's full annual report- the chart shows how household utility spending has not, in the past, been negatively impacted by periods of recession.

The transition to renewable energy is expected to remain foremost in the considerations for many investors, in both the immediate future and over the mid- to long-term. This represents a major opportunity for utilities and renewable energy assets contributing to the decarbonisation of energy sources.

On the downside, persistently high interest rates will hamper some more opportunistic approaches to infrastructure, as most projects are reliance on leverage, which is more expensive in the current environment.

Transportation outlook: Ship and aircraft leasing rates should remain well-supported

We are also constructive on global transportation in the year ahead, and longer-term. We do not expect further significant bottlenecks in ports, as the backlogs that accumulated during the pandemic have now largely dissipated. However, sanctions against Russia are shifting and lengthening supply chains, especially in energy transport, and causing other forms of disruption.

While the global transport fleet has been growing steadily, worldwide order books for new ships remain relatively weak. The graph in the Company's full annual report on the right-hand side shows how the Orderbook as a percentage of the operating fleet has dropped and remains significantly lower than during the Global Financial Crisis. In our view, this is due at least in part to uncertainties related to future asset designs. In any case, shipyards are already operating above full capacity, so the supply of new assets will remain tight. These supply constraints, combined with shifting supply chains, should continue to support lease rates across the industry.

Beyond shipping markets, we are also positive on the prospects for aviation and land-based transport assets. The continued recovery in travel demand, combined with inflation kickers and a limited supply of new aircraft, should all have a positive impact on aircraft lease rates in 2023/2024. Sovereign-backed carriers should remain attractive counterparties if governments prioritise airline services and support national carriers, as they have done in the past. In the land-based transport sector, rail freight will remain a highly fuel-efficient means of transporting cargo, compared to road haulage, and is thus an attractive alternative for shippers in the current, higher fuel cost environment, and longer-term, as they step-up their efforts to reduce carbon-emissions.

Real assets - worthy of a place in all truly diversified portfolios

Recent events attest to the resilience of real asset markets, even in times of extreme market uncertainty. Investment in real assets also provides diversification benefits, inflation protection and exposure to major investment themes such as the transition to renewable energy. All this suggests that real assets deserve a place in any fully diversified portfolio, especially at times when the performance of more traditional asset classes such as equities and bonds has been disappointing. We believe JARA offers investors the ideal means of investing in this exciting, but otherwise hard to access, asset class.

Investment Manager

J.P. Morgan Asset Management, Inc.

Security Capital Research & Management Inc. and J.P. Morgan Alternative Asset Management Inc.

29th June 2023

PRINCIPAL AND EMERGING RISKS

The Board has overall responsibility for the Company's system of risk management and internal controls. The Directors confirm that they have carried out a robust assessment of the principal risks facing the Company, including those that would threaten its business model, future performance, solvency or liquidity. With the assistance of JPMF, the Audit Committee and Market Risk Committee, chaired by Helen Green and Simon Holden, respectively, have drawn up a risk matrix, which identifies the key risks to the Company. These are reviewed and noted by the Board. The principal and emerging risks identified and the broad categories in which they fall, and the ways in which they are managed or mitigated, are summarised below. The AIC Code of Corporate Governance requires the Audit Committee to put in place procedures to identify emerging risks and to provide an explanation of how these are managed or mitigated.

Principal risk	Description	Mitigating activities
Investment management and performance
Discount control risk	Investment company shares often trade at discounts to their underlying NAVs, although they can also trade at a premium. Discounts and premiums can fluctuate considerably leading to volatile returns for shareholders.	The Board monitors the level of both the absolute and sector relative premium/discount at which the shares trade. The Board reviews both sales and marketing activity and sector relative performance, which it believes are the primary drivers of the relative premium/discount level. In addition, the Company has authority, when it deems appropriate, to buy back its existing shares to enhance the NAV per share for remaining shareholders and to reduce the absolute level of discount and discount volatility.
Foreign exchange risk to income	There is a risk that material sterling strength or volatility will result in a diminution of the value of income received when converted into sterling.	A decision was taken at launch not to hedge the capital value of the portfolio into sterling, nor to hedge the income generated by the portfolio into sterling. One of JARA's attributes is that it offers shareholders access to real assets globally and with this comes a global currency exposure. Whilst this currency impact has benefited the Company over the last year and post the year end, experience of recent years suggests that currency movements have a habit of reversing themselves and should represent a neutral impact for shareholder returns in the long run. The Board keeps the decision on whether to hedge the capital value or income generation under review. Please see the Chairman's Statement above for further details.
Foreign exchange risk to NAV/share price volatility	There is a risk that material sterling strength or volatility will result in a volatile NAV/share price since most the Company's assets are denominated in U.S. dollars, or in currencies which tend to be closely correlated with the dollar.
Income generation risk	There is a risk that the Company fails to generate sufficient income from its investment portfolio to meet the Company's target annual dividend yield of 4 to 6%, based on the initial issue price of 100.0p per share.	The Board reviews quarterly detailed estimates of revenue income and expenditure prepared by the Manager and, if required, challenges the Manager as to the underlying assumptions made in earnings from the underlying strategies and the Company's expenditure. Under Guernsey company law, the Company is permitted to pay dividends despite losses provided solvency tests are performed and passed ahead of dividend declaration.
Underperformance	Poor implementation of the investment strategy, for example as to thematic exposure, sector allocation, undue concentration of holdings, factor risk exposure or the degree of total portfolio risk, may lead to the Company not achieving its investment objective of providing a stable income and capital appreciation, and/or underperformance against the Company's peer companies.	The Board manages these risks by diversification of investments and through its investment restrictions and guidelines, which are monitored and reported on by the Manager. The Manager provides the Directors with timely and accurate management information, including performance data, revenue estimates, liquidity reports and shareholder analyses.
Operational risks
Corporate strategy and shareholder demand	The corporate strategy, including the investment objectives and policies, may not be of sufficient interest to current or prospective shareholders. Certain buyers within the sector will only consider investing into an investment trust where its AUM is over a certain level; the Company's AUM currently stands below these levels.	The Manager has a dedicated investment company sales team that engages with both existing and prospective shareholders of the Company. This engagement includes the education/description of how JARA's portfolio is invested and the exposures that this generates. The Board regularly reviews its strategy, and assesses, with its broker and Manager, shareholder demand.
Cyber crime	The threat of cyber attack, in all guises, is regarded as at least as important as more traditional physical threats to business continuity and security. In addition to threatening the Company's operations, such an attack is likely to raise reputational issues which may damage the Company's share price and reduce demand for its shares.	The Company benefits directly or indirectly from all elements of JPMorgan's Cyber Security programme. The information technology controls around physical security of JPMorgan's data centres, security of its networks and security of its trading applications, are tested by independent auditors and reported every six months against the AAF Standard.
Counterparty risk	The nature of the contractual frameworks that underpin many of the real assets within the underlying strategies necessitate close partnerships with a range of counterparties. In addition to the financial risks arising from exposure to customers, client and lenders, there are a large number of operational counterparties including construction and maintenance subcontractors. Counterparty risk would primarily manifest itself as either counterparty failure or underperformance of contractors.	The Board is able to seek information from the Manager in relation to counterparty concentration and correlation of providers. As counterparty quality is key to maintaining predictable income streams, the Manager seeks regular contact with key counterparties throughout the supply chain and with revenue-providing counterparties, while also actively monitoring the financial strength and stability of all these entities.
Investment delay	Investment into underlying strategies could be delayed resulting in loss of expected income and capital growth opportunity.	The Manager monitors and reports to the Board on 'queue' length and the underlying pattern of deployment in the underlying strategies. Any slowing of deployment patterns is reported to Board and the income impact is modelled.
Outsourcing	Disruption to, or failure of, the Manager's accounting, dealing or payments systems or the Depositary or Custodian's records may prevent accurate reporting and monitoring of the Company's financial position or a misappropriation of assets.	Details of how the Board monitors the services provided by JPM and its associates and the key elements designed to provide effective risk management and internal control are included within the Risk Management and Internal Controls section of the Corporate Governance Statement in the Company's full annual report. The Manager has a comprehensive business continuity plan which facilitates continued operation of the business in the event of a service disruption (including and disruption resulting from the COVID-19 pathogen). Directors have received reassurance that the Manager and its key service providers have business continuity plans in place and that these are regularly tested.
Regulatory risks
Regulatory change	Various legal and regulatory changes may adversely impact the Company and its underlying investments. This could take the form of legislation impacting the supply chain or contractual costs or obligations to which the underlying strategies are exposed. Certain investments in the underlying strategies are subject to regulatory oversight. Regular price control reviews by regulators determine levels of investment and service that the portfolio company must deliver and revenue that may be generated. Particularly severe reviews may result in poor financial performance of the affected investment. The Company invests in real assets via a series of private funds. The operation of these entities including their ability to be bought, held or sold by investors across a number of jurisdictions and the taxation suffered within the funds and by investors into the funds depend on a complex mix of regulatory and tax laws and regulations across a wide range of countries. These may be subject to change that may threaten the Company's access to and returns earned from the private funds.	The Manager and its advisers continually monitor any potential or actual changes to regulations to ensure its assets and service providers remain compliant. Most social and transportation infrastructure concessions provide a degree of protection, through their contractual structures, in relation to changes in legislation which affect either the asset or the way the services are provided. Regulators seek to balance protecting customer interests with making sure that investments have enough money to finance their functions.
Environmental risks
Climate change	Climate change is one of the most critical emerging issues confronting asset managers and their investors. Climate change may have a disruptive effect on the business models and profitability of individual investments, and indeed, whole sectors. The Board is also considering the threat posed by the direct impact of climate change on the operations of the Manager and other major service providers. The Company may be exposed to substantial risk of loss from environmental claims arising in respect of its underlying real assets that have environmental problems, and the loss may exceed the value of such underlying assets, although for some real assets this can be mitigated to some extent by contracted lease commitments. Furthermore, changes in environmental laws and regulations or in the environmental condition of investments may create liabilities that did not exist at the time of acquisition of an underlying asset and that could not have been foreseen. It is also possible that certain underlying assets to which the Company will be exposed could be subject to risks associated with natural disasters (including wildfire, storms, hurricanes, cyclones, typhoons, hail storms, blizzards and floods) or non climate related manmade disasters (including terrorist activities, acts of war or incidents caused by human error).	In the Board's and Manager's view, investments that successfully manage climate change risks will perform better in the long-term. Consideration of climate change risks and opportunities is an integral part of the investment process. The Manager aims to influence the management of climate related risks through engagement and voting with respect to the equity portion of the portfolio, and is a participant of Climate Action 100+ and a signatory of the United Nations Principles for Responsible Investment. Generally, the Manager (or, in the case of an investment made by a JPMAM product, the relevant manager) performs market practice environmental due diligence of all of the investments to identify potential sources of pollution, contamination or other environmental hazard for which such investment may be responsible and to assess the status of environmental regulatory compliance.
Global risks
Geopolitical risk	The Company's investments are exposed to various geopolitical and macro-economic risks incidental to investing. Political, economic, military and other events around the world (including trade disputes) may impact the economic conditions in which the Company operates, by, for example, causing exchange rate fluctuations, interest rate changes, heightened or lessened competition, tax advantages or disadvantages, inflation, reduced economic growth or recession, and so on. Such events are not in the control of the Company and may impact the Company's performance. The crisis in Ukraine has affected energy and commodity markets and may cause further damage to the global economy. The ongoing conflict between Russia and Ukraine has heightened the possibility that tensions will spill over and intensify geo-political unrest between other countries sharing a common border.	This risk is managed to some extent by diversification of investments and by regular communication with the Manager on matters of investment strategy and portfolio construction which will directly or indirectly include an assessment of these risks. The Board can, with shareholder approval, look to amend the investment policy and objectives of the Company to gain exposure to or mitigate the risks arising from geopolitical instability although this is limited if it is truly global.
Inflation	Excessive inflation is likely to increase the Company's cost of capital and cost of operations.	There is a degree of inflationary linkage within the investment portfolio, albeit on a lagging basis. Global inflation is largely stablising. However, the Board is unable to forecast macro-economic developments.
Emerging risk	Description	Mitigating activities
Technological and behavioural change	The returns generated from the underlying investment strategies in which the Company is invested may be materially affected by new or emerging changes in technology which change the behaviour of individuals or corporations, or may require substantial investment in new or replacement technologies. Such changes may include the decline in demand for office space as remote working technologies become widespread, material changes in transport technologies and new technologies for the generation and transmission of energy.	The Board manages these risks through maintaining a diversified portfolio of investments, ensuring the underlying investment team consider these threats in portfolio construction and investment plans and are aware of the investment opportunities as well as the threats presented by these shifts in the sectors in which they invest.
Pandemics	The emergence of COVID-19 has highlighted the speed and extent of economic damage that can arise from a pandemic from both known or unknown pathogens, or unforeseen global emergencies. The Company is at risk from both the financial impacts of such an event, as well as possible disruption to the day-to-day activities of its service providers.	During the year under review, much of the world adapted to living with COVID-19 and the disruption caused by the pandemic. The Board receives reports on the business continuity plans of the Manager and other key service providers. The effectiveness of these measures have been assessed throughout the course of the COVID-19 pandemic and the Board will continue to monitor developments as they occur and seek to learn lessons which may be of use in the event of future pandemics. China in particular was affected by its pursuit of 'Zero COVID'. This approach changed by the end of the year, when restrictions were removed. The Company has minimal exposure to China, circa 3% of the Company's NAV.
Real Estate	Material shift in real estate usage patterns (increasing working from home, accelerating decline of retail) or substantial increase in environmental standards expected of new and built properties renders current real estate strategies inappropriate or unable to meet expected returns.	The portfolio is actively managed with a focus on ensuring that the properties are ESG rated in accordance with GRESB. Please see the ESG Report in the Company's full annual report.
Transport	Significant reduction in global trade reduces demand/pricing for maritime assets. Rising environmental awareness reduces demand for aviation and increased emission obligations increase the cost and reduce the demand for aviation.	The assets are on long term leases.
Energy	Cost of renewable energy drops materially either through increased supply or new rival technologies (e.g. fusion) materially reducing returns from renewable energy projects.	The Company has a broadly diversified portfolio and has exposure to energy transition assets which expands both traditional and renewable sources. Renewable assets tend to be on long-tern off-take agreements providing a stabilised cash flow.

Emerging Risks

The Board continually monitors the changing risk landscape and any emerging and increasing threats to the Company's business model, as they come into view via a variety of means, including advice from the Manager, the Company's professional advisors and Directors' knowledge of markets, changes and events. These threats and/or changes have a degree of uncertainty in terms of probability of occurrence and possible effects on the Company. Should an emerging risk become sufficiently clear and the implications evaluated, it may be moved to a principal risk. The Board escalated Climate Change and Geopolitical risks as Principal Risks from Emerging Risks.

TRANSACTIONS WITH THE MANAGER AND RELATED PARTIES

Details of the management contract are set out in the Directors' Report in the Company's full annual report. The management fee payable to the Manager for the year was £2,231,000 (2022: £1,628,000) of which £27,000 (2022: £67,000) was outstanding at the year end.

The Company holds cash in JPMorgan Sterling Liquidity Fund, which is managed by JPMF. At the year end, this was valued at £0.71 million (2022: £0.01 million). Interest amounting to £28,000 (2022: £4,000) was receivable during the year of which £nil (2022: £nil) was outstanding at the year end.

The Company holds cash in JPMorgan US Dollar Liquidity Fund, which is managed by JPMF. At the year end, this was valued at £0.46 million (2022: £0.1 million). Interest amounting to £9,000 (2022: £8,000) was receivable during the year of which £nil (2022: £nil) was outstanding at the year end.

Included in administrative expenses in note 7 in the Company's full annual report are safe custody fees amounting to £1,000 (2022: £2,000) payable to JPMorgan Chase N.A. of which £nil (2022: £1,000) was outstanding at the year end.

Handling charges on dealing transactions amounting to £27,000 (2022: £30,000) were payable to JPMorgan Chase N.A. during the year of which £nil (2022: £4,000) was outstanding at the year end.

At the year end, a bank balance of £2,374,000 (2022: £1,052,000) was held with JPMorgan Chase N.A. A net amount of interest of £7,000 (2022: £171,000) was receivable by the Company during the year from JPMorgan Chase N.A. of which £nil (2022: £nil) was outstanding at the year end.

Please see below for details of the Directors' remuneration.

Single total figure of remuneration¹

The single total figure of remuneration for each Director is detailed below.

	2023	2022
	Total	Total
Directors	£	£
John Scott	61,800	60,000
Helen Green	51,500	50,000
Simon Holden	55,650	54,000
Chris Russell	43,300	42,000
Total	212,250	206,000

¹     Other subject headings for the single figure table are not included because there is nothing to disclose in relation thereto.

Whilst not required by the Company and not constituting part of the Directors' remuneration, the Directors own shares in the Company. The Directors' received a dividend from their shares over the reporting period commensurate with their shareholdings, which does not constitute part of their remuneration. There are no balances payable to the Directors at the year end.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The Directors are responsible for preparing the Annual Report & Financial Statements in accordance with applicable law and regulations.

The Companies (Guernsey) Law, 2008 ('the law') requires the Directors to prepare the Financial Statements for each financial year. Under that law, the Directors have elected to prepare the financial statements in accordance with International Financial Reporting Standards to meet the requirements of applicable law and regulations. Under Company law the Directors must not approve the Financial Statements unless they are satisfied that, taken as a whole, the Annual Report & Financial Statements are fair, balanced and understandable, provide the information necessary for shareholders to assess the Company's position, performance, business model and strategy and that they give a true and fair view of the state of affairs of the Company and of the total return or loss of the Company for that period. In order to provide these confirmations, and in preparing these financial statements, the Directors are required to:

•   select suitable accounting policies and then apply them consistently;

•   make judgements and accounting estimates that are reasonable and prudent;

•   state whether applicable International Financial Reporting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

•   prepare the financial statements on a going concern basis unless it is inappropriate to presume that the Company will continue in business

and the Directors confirm that they have done so.

The Directors are responsible for keeping proper accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and to enable them to ensure that the financial statements comply with the law. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The accounts are published on the www.jpmrealassets.co.uk website, which is maintained by the Company's Manager. The maintenance and integrity of the website maintained by the Manager is, so far as it relates to the Company, the responsibility of the Manager. The work carried out by the Auditor does not involve consideration of the maintenance and integrity of this website and, accordingly, the Auditor accepts no responsibility for any changes that have occurred to the accounts since they were initially presented on the website. Legislation in Guernsey governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions. The accounts are prepared in accordance with International Financial Reporting Standards.

Under applicable law and regulations the Directors are also responsible for preparing a Directors' Report, Corporate Governance Statement and Directors' Remuneration Report that comply with that law and those regulations.

Each of the Directors, whose names and functions are listed in the Company's full annual report confirms that, to the best of their knowledge:

•   the financial statements, which have been prepared in accordance with International Financial Reporting Standards and applicable law, give a true and fair view of the assets, liabilities, financial position and return or loss of the Company; and

•   the Strategic Report includes a fair review of the development and performance of the business and the position of the Company, together with a description of the principal and emerging risks and uncertainties that it faces.

The Board also confirms that it is satisfied that the Strategic Report and Directors' Report 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 and emerging risks and uncertainties that the Company faces.

For and on behalf of the Board

John Scott

Chairman

29th June 2023

STATEMENT OF COMPREHENSIVE INCOME

For the year ended 28th February 2023

	Year ended	Year ended
	28th February	28th February
	2023	2022
	£'000	£'000
Gains on investments held at fair value through profit or loss	16,763	15,896
Net foreign currency gains	183	905
Investment income	10,853	9,846
Interest receivable and similar income	44	183
Total return	27,843	26,830
Management fee	(2,231)	(1,628)
Other administrative expenses	(687)	(1,023)
Return before finance costs and taxation	24,925	24,179
Finance costs	(1)	(1)
Return before taxation	24,924	24,178
Taxation	(1,094)	(485)
Return for the year	23,830	23,693
Return per share	10.91p	11.06p

STATEMENT OF CHANGES IN EQUITY

	Share	Retained
	premium	earnings	Total
	£'000	£'000	£'000
Year ended 28th February 2022
At 28th February 2021	209,136	(25,619)	183,517
Issue of ordinary shares	7,987	-	7,987
Return for the year	-	23,693	23,693
Dividends paid in the year (note 2)	-	(8,608)	(8,608)
At 28th February 2022	217,123	(10,534)	206,589
Year ended 28th February 2023
At 28th February 2022	217,123	(10,534)	206,589
Issue of ordinary shares	2,155	-	2,155
Return for the year	-	23,830	23,830
Dividends paid in the year (note 2)	-	(8,846)	(8,846)
At 28th February 2023	219,278	4,450	223,728

STATEMENT OF FINANCIAL POSITION

At 28th February 2023

	2023	2022
	£'000	£'000
Assets
Non current assets
Investments held at fair value through profit or loss	219,960	204,667
Current assets
Other receivables	990	1,063
Cash and cash equivalents	3,541	1,175
	4,531	2,238
Liabilities
Current liabilities
Other payables	(763)	(316)
Net current assets	3,768	1,922
Total assets less current liabilities	223,728	206,589
Net assets	223,728	206,589
Amounts attributable to shareholders
Share premium	219,278	217,123
Retained earnings	4,450	(10,534)
Total shareholders' funds	223,728	206,589
Net asset value per share	102.0p	95.0p

STATEMENT OF CASH FLOWS

For the year ended 28th February 2023

	Year ended	Year ended
	28th February	28th February
	2023	2022
	£'000	£'000
Operating activities
Return before taxation	24,924	24,179
Deduct dividend income	(10,770)	(9,730)
Deduct investment income - interest	(83)	(116)
Deduct deposit and liquidity fund interest income	(44)	(183)
Less interest expense	(1)	(1)
Add indirect management fee	1,265	880
Add performance fee	128	-
Deduct gains on investments held at fair value through profit or loss	(16,763)	(15,896)
Decrease/(increase) in prepayments and accrued income	6	(14)
Increase/(decrease) in other payables	255	(101)
(Deduct exchange gains)/add exchange losses on cash and cash equivalents	(6)	107
Taxation	(1,101)	(484)
Net cash outflow from operating activities before interest and taxation	(2,190)	(1,359)
Dividends received	10,856	9,413
Investment income - interest	80	150
Deposit and liquidity fund interest received	44	183
Interest expense	1	-
Purchases of investments held at fair value through profit or loss	(21,148)	(53,630)
Sales of investments held at fair value through profit or loss	21,408	27,279
Net cash inflow/(outflow) from operating activities	9,051	(17,964)
Financing activities
Issue of ordinary shares	2,155	7,987
Dividends paid	(8,846)	(8,608)
Net cash outflow from financing activities	(6,691)	(621)
Increase/(decrease) in cash and cash equivalents	2,360	(18,585)
Cash and cash equivalents at start of year	1,175	19,867
Exchange movements	6	(107)
Cash and cash equivalents at end of year1	3,541	1,175

¹     Cash and cash equivalents includes liquidity funds.

NOTES TO THE FINANCIAL STATEMENTS

For the year ended 28th February 2023

1.  General information

The Company is a closed-ended investment company incorporated in accordance with The Companies (Guernsey) Law, 2008. The address of its registered office is Level 3, Mill Court, La Charroterie, St Peter Port, Guernsey GY1 1EJ.  

The principal activity of the Company is investing in securities as set out in the Company's Objective and Investment Policies.

The Company was incorporated on 22nd February 2019. The Company was admitted to the Main Market of the London Stock Exchange and had its first day of trading on 24th September 2019.

Investment objective

The Company will seek to provide Shareholders with stable income and capital appreciation from exposure to a globally diversified portfolio of core real assets.

Investment policy

The Company will pursue its investment objective through diversified investment in private funds or accounts managed or advised by entities within J.P. Morgan Asset Management (together referred to as 'JPMAM'), the asset management business of JPMorgan Chase & Co. These JPMAM Products will comprise 'Private Funds', being private collective investment vehicles, and 'Managed Accounts', which will typically take the form of a custody account the assets in which are managed by a discretionary manager.

2.  Dividends

	2023	2022
	£'000	£'000
Dividends paid
2022/2023 First interim dividend of 1.00p (2022: 1.00p) per share	2,174	2,088
2022/2023 Second interim dividend of 1.00p (2022: 1.00p) per share	2,174	2,172
2022/2023 Third interim dividend of 1.00p (2022: 1.00p) per share	2,194	2,174
2022/2023 Fourth interim dividend of 1.05p (2022: 1.00p) per share	2,304	2,174
Total dividends paid in the year	8,846	8,608
Dividend declared
2023/2024 First interim dividend declared of 1.05p (2022: 1.00p)	2,304	2,174

3.  Return per share

	2023	2022
	£'000	£'000
Total return	23,830	23,693
Weighted average number of shares in issue during the year	218,481,925	214,182,610
Total return per share	10.91p	11.06p

4.  Net asset value per share

	2023	2022
Shareholders' funds (£'000)	223,728	206,589
Number of shares in issue	219,407,952	217,407,952
Net asset value per share	102.0p	95.0p

5. Status of announcement

          2022 Financial Information

 The figures and financial information for 2022 are extracted from the Annual Report and Financial Statements for the year ended 28th February 2022 and do not constitute the statutory accounts for the year. The Annual Report & Financial Statements includes the Report of the Independent Auditors which was unqualified. 

          2023 Financial Information

 The figures and financial information for 2023 are extracted from the published Annual Report and Financial Statements for the year ended 28th February 2023 and do not constitute the statutory accounts for that year.  The Annual Report and Financial Statements include the Report of the Independent Auditors which is unqualified.

 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.

29th June 2023

For further information:

Emma Lamb,

JPMorgan Funds Limited            

020 7742 4000

ENDS

A copy of the annual report will shortly be submitted to the FCA's National Storage Mechanism and will be available for inspection at https://data.fca.org.uk/#/nsm/nationalstoragemechanism

The annual report will shortly be available on the Company's website at www.jpmrealassets.co.uk where up-to-date information on the Company, including daily NAV and share prices, factsheets and portfolio information can also be found.

JPMORGAN FUNDS LIMITED

 

END