Annual Financial Report

RNS Number : 5604V

Majedie Investments PLC

14 December 2021

 

MAJEDIE INVESTMENTS PLC

ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED 30 SEPTEMBER 2021

The full Annual Report and Accounts ("Annual Report") will shortly be available via the Company's website at www.majedieinvestments.com or by contacting the Company Secretary on telephone number 0207 7945 9566.

The Directors present the results of the Company for the year ended 30 September 2021.

INVESTMENT OBJECTIVE

The Company's investment objective is to maximise total shareholder return whilst increasing dividends by more than the rate of inflation over the long term.

Highlights	2021	2020
Total shareholder return (including dividends):	37.1%	-27.6%
Net asset value total return (debt at fair value including dividends):	22.5%	-11.7%
Net asset value total return (debt at par including dividends):	20.6%	-11.6%
Total dividends (per share):	11.4p	11.4p
Directors' valuation of investment in Majedie Asset Management Limited:	£25.2m	£31.0m

YEAR'S SUMMARY

Capital Structure	Note (see below)		2021	2020	%
As at 30 September
Total assets		1	£173.0m	£152.2m	+13.7
Which are attributable to:
Financial liabilities (debt at par value)		2	£20.8m	£20.9m	+15.9
Equity Shareholders Funds			£152.2m	£131.3m
Gearing		4	12.3%	11.0%
Potential Gearing		4	13.7%	15.9%
Total returns (capital growth plus dividends)		5
Net asset value per share (debt at par value)		3	+20.6%	-11.6%
Net asset value per share (debt at fair value)		3	+22.5%	-11.7%
Share price			+37.1%	-27.6%
Capital returns
Net asset value per share (debt at par value)		3	287.1p	247.7p	+15.9
Net asset value per share (debt at fair value)			281.4p	239.5p	+17.5
Share price			230.0p	176.5p	+30.3
Discount of share price to net asset value per share
Debt at par value			19.9%	28.7%
Debt at fair value			18.3%	26.3%
Revenue and dividends
Net revenue available to Equity Shareholders			£5.0m	£4.8m
Net revenue return per share			9.4p	9.1p	+3.3
Total dividends per share			11.4p	11.4p	0.0
Total administrative expenses and management fees			£1.6m	£1.7m
Ongoing Charges Ratio		6	1.2%	1.3%

Notes:

Alternative Performance Measures (APM) definitions used in the Annual Report are as follows:

1.  Total Assets : Total assets are defined as total assets less current liabilities.

2.  Debt at par or fair value : Par value is the carrying value of the debenture which will equate to the nominal value at maturity. Fair value is the estimated market value the Company would pay (on the relevant reporting date), as a willing buyer, to a debenture holder, as a willing seller, in an arms-length transaction.

3.  Net Asset Value : The Net Asset Value (NAV) is the value of all of the Company's assets less all liabilities. The NAV is usually expressed as an amount per share.

4.  Gearing and Potential Gearing : Gearing represents the amount of borrowing that a company has and is calculated using the Association of Investment Companies (AIC) guidance. It is usually expressed as a percentage of equity shareholders' funds and a positive percentage or ratio above one shows the extent of the level of borrowings. Gearing is calculated as borrowings less net current assets to arrive at a net borrowings figure. Potential Gearing excludes cash from the calculation. Details of the calculation for the Company are in note 22.

5.  Total Return : Total returns include any dividends paid as well as capital returns as a result of an increase or decrease in a company's share price or NAV.

6.  Ongoing Charges Ratio (OCR) : Ongoing charges are a measure of the regular ongoing administration costs of running a company, as calculated in accordance with AIC guidance. Further information is shown in the Business Review section of the Strategic Report.

7.  Adjusted Capital and Reserves : This is as defined in the debenture Trust Deed. It essentially removes unrealised gains from the Company's reserves (see investment policy.

8.  Adjusted Equity Shareholders' Funds : Equity Shareholders' Funds restated to include debt at its fair value, rather than par value (see note 22).

Year's high/low		2021	2020
Share price	high	252.5p	265.0p
	low	176.0p	138.5p
Net asset value - debt at par	high	304.2p	313.6p
	low	245.0p	221.0p
Discount - debt at par	high	30.0%	37.8%
	low	13.3%	4.1%
Discount - debt at fair value	high	27.9%	35.4%
	low	11.2%	0.6%

 

Ten Year Record

to 30 September 2021

Year End	Total Assets £000	Equity share-holders' Funds £000	NAV Per Share (Debt at par value) Pence	Share Price Pence	Discount %	Earnings Pence	Total Dividend** Pence	Gearing† %	Potential Gearing† %	Ongoing Charges Ratio# %
2012	146,057	112,234	215.6	155.8	27.74	4.90	10.50	9.24	30.14	1.83
2013	159,013	125,166	240.5	160.0	33.47	6.80	10.50	21.47	27.04	1.73
2014	167,934	134,061	256.7	229.0	10.79	9.36	7.50	23.39	25.27	1.66
2015	183,708	149,807	281.9	257.3	8.74	9.42	8.00	21.25	22.63	1.88
2016	203,917	169,986	318.1	257.1	19.18	9.25	8.75	18.46	19.96	1.58
2017	216,507	182,544	341.6	281.5	17.59	11.14	9.75	17.09	18.61	1.54
2018	199,151	178,626	334.3	277.5	16.99	12.47	11.00	10.01	11.49	1.33
2019	175,621	155,074	292.3	256.0	12.42	12.92	11.40	11.50	13.25	1.34
2020	152,153	131,333	247.7	176.5	28.74	9.11	11.40	10.97	15.85	1.34
2021	172,951	152,153	287.1	230.0	19.89	9.41	11.40	12.26	13.67	1.25

Notes:

** Dividends disclosed represent dividends that relate to the Company's financial year. Under International Accounting Standards dividends are not accrued until paid or approved. Total dividends include special dividends paid, if any.

† Calculated in accordance with AIC guidance.

# As of May 2012, under AIC guidance, Ongoing Charges Ratio replaced previous cost ratios.

STRATEGIC REPORT

CHAIRMAN'S STATEMENT

In the year ended 30 September 2021 the NAV at par and fair value (net asset value with debt at par and fair value) rose by 20.6% and 22.5% respectively on a total return basis. The share price rose by 37.1% also on a total return basis as the discount narrowed from 29% to 20%. By way of comparison, the FTSE All-Share Index rose by 27.9% and the MSCI All Country Index rose by 22.1% in sterling terms and in both cases, on a total return basis.

On 7 December 2021 Liontrust Asset Management PLC (Liontrust) announced that it had entered into a conditional agreement to purchase the entire share capital of Majedie Asset Management Limited (MAM) for up to £120 million. The consideration is made up of shares in Liontrust and cash and payable partly upon completion of the transaction and partly at later dates upon satisfaction of certain conditions. The entire investment team managing the MAM Funds into which the Company invests will move across to Liontrust and the investment approach will remain unchanged.

The initial stage of the transaction is expected to complete on 1 April 2022 and therefore the valuation methodology for MAM at 30 September 2021 is the same as in prior quarters. Please see the section in the CEO's report for further details about the valuation of MAM.

Results and Dividends

In the twelve months to 30 September the Company increased in capital value by £21.9m despite a reduction in value for the Company's holding in MAM from £31.0m to £25.2m, excluding the dividends received from MAM.

Total Income received from investments was £6.1m compared to £6.0m in the twelve months to 30 September 2020. The dividend received from MAM was £4.0m, the same as in the previous year and the income from MAM Funds was £2.1m compared to £1.9m in 2020. Total administration costs and management fees were £1.6m compared to £1.7m and finance costs were unchanged at £1.5m. The ongoing charges ratio is 1.2%.

The net revenue return after tax increased from £4.8m in the year to 30 September 2020 to £5.0m in the year to 30 September 2021. The interim dividend was maintained at 4.4p and the Board is recommending a final dividend of 7.0p which is the same as in the prior year. The total paid in dividends to shareholders, and proposed for this year, is £6.0m and the Company holds £24.3m in revenue reserves. In view of the exceptional circumstances since March 2020, the Board believes it is appropriate to draw £1.0m from revenue reserves to maintain the level of the dividend.

The final dividend will be payable on 28 January 2022 to shareholders on the register at 14 January 2022 and the Company's shares go ex-dividend on 13 January 2022.

Investment Performance

The Company's asset allocation gives exposure to funds across all geographies that are managed by MAM (84.9% of total assets), and a stake in MAM itself, (14.5% of total assets).

MAM's assets under management fell from £8.1bn to £6.0bn during the year to 30 September. The reasons for the outflows are twofold. First, the flows reflect an ongoing trend by pension fund trustees de-risking their portfolios by selling equities and buying bonds and MAM, as a significant investment manager to these schemes, has inevitably suffered withdrawals. Second, a large, longstanding client, St James' Place, took the decision to move to a more style specific investment approach meaning that MAM's flexible investment style was no longer deemed to be appropriate. The Funds were not redeemed until mid July, but the Company has reflected the reduced earnings in its valuation of MAM since 31 March 2021.

The investment performance across MAM Funds in which the Company is invested has been good with only one fund marginally underperforming through the year. The Company has a higher proportion of its assets in UK equities than many of its peers in the AIC Global Income Sector and the Board has retained this position. It is particularly encouraging that the UK Equity market after five years of underperformance, outperformed Global Equities in the year to   30 September 2021.

Outlook

In the aftermath of the pandemic and its consequences, opinions on the Global economy vary in the extreme. The most obvious questions relate to Inflation: muted for 20 years, but it is now rising and there is considerable debate whether this is of a transient nature or the beginning of something more persistent. Interest rates remain at historically low levels and but are expected to rise.

In a background of economic uncertainty, The Board is confident that investing in MAM Funds whose style is flexible and one that can react quickly to new information will provide good returns for shareholders over the longer term. MAM's investment process is built on highly detailed fundamental stock analysis and given the wide range of macroeconomic outcomes, such an investment process should provide a sound basis for good investment returns. The strong performance of the funds in the last two years show the strength of a flexible investment process in a period of unprecedented market volatility.

Board

After three years as Chairman and ten years as a non-executive director I am retiring from the Board following the AGM in January. The Board has undertaken a thorough selection process for my replacement and I am pleased that Christopher Getley will take my place as Chairman. Christopher has extensive knowledge of the investment industry and Investment Companies. Further information about Christopher can be found on page 29 of the Annual Report.

Responsible Investing

The Board considers Responsible Investing to be of the great importance and it is very supportive of the proactive and detailed approach taken by MAM. A summary of their processes is presented on page 20 of the Annual Report.

MAM is a signatory to the Stewardship Code 2020 and to the Principles of Responsible Investing. In February 2021, it joined the Net Zero Asset Managers Initiative.

Marketing

The Company normally conducts marketing through face to face meetings with the Chief Executive together with research from Kepler to targeted wealth managers. Lockdowns have prevented meetings in person and, in their place, a number of webinars have been convened which have reached a wide audience. It is increasingly evident that Investment Companies are particularly attractive to retail investors and in order to reach this broader audience the Company has joined doceo, a new web portal that provides, to retail investors, financial information and video presentations by the MAM managers who are responsible for the funds in which the Company invests together with an overview of the Company. The link to the Majedie Investments page on doceo is https://doceo.tv/funds/majedie-investments/ .

A recent addition to the Company's website is the Global Infusions podcast series where two of MAM's Global fund managers discuss topical investment themes. The podcasts are available on the Company's website.

Arrangements for the AGM

The AGM will, once again, be held at the City of London Club, 19 Old Broad Street, London EC2N 1DS at 12.00pm on Wednesday 19 January 2022. I very much look forward to welcoming shareholders after last year's meeting was not able to be held as a public event.

Shareholders should check the Company's website for updates about arrangements for the AGM before they travel in case Government guidelines require changes to be made.

R David C Henderson

Chairman

13 December 2021

CHIEF EXECUTIVE'S REPORT

The Company's assets are allocated at the discretion of the Board between four investment strategies managed by MAM and an equity holding in MAM of 17.6%. The Company has no overall benchmark; rather each fund has its own benchmark. The monthly factsheets of the relevant MAM funds are available on the Company's website, as are the monthly factsheets of the Company which show the allocation between the funds and the top twenty holdings on a look through basis. The Company's total assets at 30 September 2021 were £173.0m as defined on page 2 of the Annual Report.

There were no transactions, by the Company, in MAM shares over the period, though a small buyback by MAM of their own shares resulted in the Company's stake in MAM increasing from 17.2% to 17.6%. During the year the Board took the decision to consolidate its fund holdings and redeemed its holdings in the UK Income Fund and the US Equity Fund and reinvested the proceeds into the UK Equity Segregated Portfolio and Global Equity Fund respectively. The reallocation has reduced the exposure to US equities and increased exposure to Emerging Markets and Europe. UK equity exposure is broadly unchanged.

Asset Allocation at 30 September 2021	Value £000	% of Total Assets
UK Equity Segregated Portfolio	67,107	38.8
Global Equity Fund	44,217	25.6
International Equity Fund	13,593	7.9
Tortoise Fund	21,848	12.6
MAM	25,161	14.5
Net cash/realisation fund*	1,025	0.6
Total Assets	172,951	100.0

*Net cash and realisation fund does not include cash held in the MAM UK Equity Segregated Portfolio or any MAM funds.

MAM Performance

During the year ended 30 September 2021 the value of the MAM shareholding has fallen from £31.0m to £25.2m and the Company has received a dividend of £4.0m.

The methodology for valuing MAM annualises the most recent quarter's earnings (excluding performance fees) and applies a median peer group price earnings multiple adjusted for an unlisted liquidity discount of 20%. Performance fee earnings are rolling twelve month actual numbers, to avoid seasonality. The price earnings multiple, for performance fee earnings, is then discounted by a further 50%. Surplus net assets are then added after deducting 200% of Regulatory Capital. The valuation is updated quarterly and the Board believes it enhances the transparency of the Company's investment in MAM. The methodology is the same as used last year, the Board having taken external advice on valuation in May 2020.

Earnings after tax (last 3 months annualised ex notified outflows)	£8.0m
Peer median group multiple	13.7
Liquidity discount	20%
Peer Group Multiple after liquidity discount	11.0
Performance Fee earnings after tax (12 month rolling)	£3.7m
50% of peer group median multiple and 20% liquidity discount	5.5
Surplus net assets having deducted 200% of Regulatory Capital	£34.5m
Valuation of MAM	£143.2m
Valuation of the Company's 17.6% holding in MAM		£25.2m

As noted in the Chairman's statement Liontrust has entered into a conditional agreement to acquire the entire share capital of MAM. The consideration for MAM shareholders is made up of shares in Liontrust and cash. On completion the Company is expected to be paid £7.7m in the form of dividends and special dividends. At the share price of Liontrust on 7 December 2021, the value of the share consideration is £14.7m. This initial consideration of £22.4mis £2.8m below the year end valuation of £25.2m. There is a further deferred consideration of cash and shares of up to £5.6m which may potentially be due three years after completion and dependent on future investment performance and growth in assets under management. The investment in MAM, though latterly disappointing, has been a great success for the Company with an IRR in excess of 20% per annum over 19 years. Following the announcement of the transaction, the Company's daily NAV announcements will value MAM using the value Liontrust shares and cash that is due to be received in dividends and special dividends. At this stage no value has been placed on the deferred consideration.

MAM Funds and Investment Performance

It is encouraging that the MAM funds largely outperformed their respective benchmarks in the twelve months to 30 September and is a sound endorsement of MAM's flexible investment process. The underlying portfolio has many different investment themes. In particular, the Tortoise Fund has had a particularly strong year whilst retaining its downside market protection. The Tortoise Fund has historically performed well in periods of market turbulence and given the current market uncertainties, the holding is viewed as a key differentiator for the Company.

A further feature has been the significant swings in style and sentiment that the Investment Managers have successfully navigated and shows the resilience of the investment process.

	12 months to 30 September 2021			Since MI invested (% annualised)
	% Fund return	% Benchmark return	% Relative performance	% Fund return	% Benchmark return	% Relative performance
UK Equity Segregated
Portfolio	29.1	27.9	1.2	40.7	47.1	(6.4)
Global Equity Fund	24.0	22.2	1.8	164.6	140.1	24.5
International Equity Fund	18.1	18.7	(0.6)	40.4	16.0	24.4
Tortoise Fund	36.0			16.0

Development of Net Asset Value

The table below outlines the change in the Company's NAV (debt at par) over the year to 30 September 2021. In aggregate the NAV has increased by £20.9m, comprised of net investment gains at the MAM Funds, including the UK Equity Segregated Portfolio, of £31.7m, a write down of the investment in MAM of £5.8m (after dividends received from MAM of £4.0m), expenses and finance costs of £3.0m and dividends paid to shareholders of £6.0m.

NAV 30.09.20	£131.3m
UKES Segregated Portfolio	£14.0m
Tortoise Fund	£5.8m
UK Income Fund	£1.5m
Global Equity Fund	£7.6m
International Equity Fund	£2.1m
US Equity Fund	£0.7m
MAM	(£1.8m)
Admin Costs & Other	(£1.5m)
Finance Costs	(£1.5m)
Dividend Paid	(£6.0m)
NAV 30.09.21	£152.5m

* MAM Funds comprise the UK Income Fund, Global Equity Fund, International Equity Fund, US Equity Fund and Tortoise Fund.

UK Equity Segregated Portfolio

The UK Equity Fund launched in March 2003. Its objective is to produce a total return in excess of the FTSE All-Share Index after costs, over any five year period, through a diversified portfolio of predominantly UK Equities with the flexibility to invest up to 20% in shares listed outside the UK. The fund incorporates a dedicated investment in smaller companies. Since inception to 30 September 2021 the fund has returned 548.2% net of fees compared to the benchmark return of 334.7%. The Company's assets are invested in a segregated portfolio that is managed pari passu to the UK Equity Fund. In the year to 30 September 2021, the UK Equity Segregated Portfolio returned 29.1% net of fees which is an outperformance of 1.2% against its benchmark.

The most significant positive and negative sector contributors to the relative performance of the UK Equity Segregated Portfolio for the twelve months to 30 September 2021, in %

Industrials	1.69	Overweight
Consumer Staples	1.55	Overweight
Financials	0.56	Overweight
Utilities	0.47	Overweight
Consumer Discretionary	0.15	Overweight
Real Estate	0.11	Overweight
Telecommunications	0.07	Overweight
Technology	-0.04	Underweight
Health Care	-0.11	Underweight
Energy	-1.12	Underweight
Basic Materials	-1.57	Underweight

The table below shows most significant positive and negative stock contributors to the relative performance of the UK Equity Segregated Portfolio for the year to 30 September 2021, in %

NatWest	1.14	Overweight
GlaxoSmithKline	0.90	Overweight
Majedie UK Smaller Companies	0.80	Overweight
British American Tobacco	0.74	Overweight
Ashtead Group	0.68	Overweight
Roche	-0.55	Underweight
Fevertree Drinks	-0.58	Underweight
BP	-0.62	Underweight
Barrick Gold	-0.73	Underweight
Glencore	-0.82	Underweight

The principal overweight and underweight sector positions of the UK Equity Segregated Portfolio at 30 September 2021 relative to the FTSE All-Share Index, in %

Consumer Discretionary	8.64	Overweight
Majedie UK Smaller Companies	7.70	Overweight
Industrials	7.16	Overweight
Technology	5.55	Overweight
Telecommunications	-1.44	Underweight
Utilities	-2.27	Underweight
Consumer Staples	-2.43	Underweight
Real Estate	-3.10	Underweight
Health Care	-3.13	Underweight
Energy	-3.58	Underweight
Basic Materials	-6.14	Underweight
Financials	-8.86	Underweight

The table below shows the principal overweight and underweight positions of the UK Equity Segregated Portfolio at 30 September 2021 relative to the FTSE All-Share Index, in %

Ascential	2.66	Overweight
Electrocomponents	2.62	Overweight
NatWest	2.21	Overweight
AVEVA Fevertree Drinks	2.12 2.06	Overweight
British American Tobacco	-2.45	Underweight
HSBC	-2.63	Underweight
Diageo	-2.67	Underweight
BP	-2.79	Underweight
GlaxoSmithKline	-2.86	Underweight

The Global Equity Fund

The Global Equity Fund was launched in June 2014 and its objective is to produce a total return in excess of the MSCI All Country World Index after costs over any five year period through investment in a diversified portfolio of global equities. Since inception to 30 September 2021 the Global Equity Fund has returned 164.6% net of fees for the sterling share class, which represents an outperformance of 24.5% against its benchmark. In the year to 30 September 2021 the Global Equity Fund returned 24.0% net of fees which represents an outperformance of 1.8%.

The most significant positive and negative sector contributors were to the relative performance of the Global Equity Fund for twelve months to 30 September 2021, in %

Information Technology	3.36	Overweight
Industrials	2.24	Overweight
Consumer Staples	1.47	Overweight
Utilities	0.39	Overweight
Real Estate	0.11	Overweight
Materials	0.08	Overweight
Health Care	-0.43	Underweight
Communication Services	-0.77	Underweight
Energy	-0.85	Underweight
Consumer Discretionary	-1.11	Underweight
Financials	-1.76	Underweight

The table below shows most significant positive and negative stock contributors to the relative performance of the Global Equity Fund for the year to 30 September 2021, in %

A.P. Moller - Maersk	0.94	Overweight
ON Semiconductor	0.77	Overweight
Alibaba	0.71	Overweight
American Eagle Outfitters	0.65	Overweight
Gartner	0.58	Overweight
Altice USA	-0.43	Underweight
Ionis Pharmaceuticals	-0.45	Underweight
SoftBank	-0.58	Underweight
Barrick Gold	-0.89	Underweight
New Oriental Education & Technology	-1.86	Underweight

The principal overweight and underweight sector positions of the Global Equity Fund at 30 September 2021 relative to the MSCI All Country Index, in %

Communications services	10.1	Overweight
Consumer Discretionary	5.2	Overweight
Health Care	1.7	Overweight
Industrials	1.4	Overweight
Materials	1.1	Overweight
Real Estate	-2.6	Underweight
Utilities	-2.6	Underweight
Energy	-2.8	Underweight
Information Technology	-4.0	Underweight
Financials	-4.7	Underweight
Consumer Staples	-5.2	Underweight

The table below shows the principal overweight and underweight positions of the Global Equity Fund at 30 September 2021 relative to the MSCI All Country Index, in %

Facebook	3.0	Overweight
Electronic Arts	2.3	Overweight
Fiserv	2.3	Overweight
Zimmer Biomet	2.1	Overweight
A.P. Moller - Maersk	2.0	Overweight
Visa	-0.6	Underweight
Johnson & Johnson	-0.6	Underweight
JPMorgan Chase	-0.8	Underweight
Tesla	-1.0	Underweight
Apple	-3.6	Underweight

The International Equity Fund

The International Equity Fund was launched in December 2019 and its objective is to produce a total return in excess of the MSCI All Country World Index ex US after costs over any period of five years. It is a high conviction portfolio which captures developed and emerging market opportunities and can invest up to a maximum of 10% in US equities. Since inception the International Equity Fund has returned 40.4% net of fees for the sterling share class, which represents an outperformance of 24.4% against it benchmark. In the year to 30 September 2021 the International Equity Fund returned 18.1% net of fees which represents an underperformance of 0.6%.

The most significant positive and negative sector contributors to relative performance of the International Equity Fund for the twelve months to 30 September 2021, in %

Information Technology	2.13	Overweight
Health Care	1.50	Overweight
Industrials	1.22	Overweight
Communication Services	0.79	Overweight
Consumer Staples	0.36	Overweight
Utilities	0.30	Overweight
Real Estate	0.21	Overweight
Materials	0.07	Overweight
Energy	-1.10	Underweight
Financials	-2.26	Underweight
Consumer Discretionary	-2.63	Underweight

The table below shows most significant positive and negative stock contributors to the relative performance of the International Equity Fund for the year to 30 September 2021, in %

zooplus	2.32	Overweight
Alibaba	1.61	Overweight
Samsung SDI	1.33	Overweight
MercadoLibre	1.18	Overweight
A.P. Moller - Maersk	1.11	Overweight
SoftBank	-0.95	Underweight
Ionis Pharmaceuticals	-1.04	Underweight
Barrick Gold	-1.17	Underweight
Prosus	-1.42	Underweight
New Oriental Education & Technology	-4.60	Underweight

The principal overweight and underweight sector positions of the International Equity Fund at 30 September 2021 relative to the MSCI All Country Index ex US, in %

Health Care	14.1	Overweight
Consumer Discretionary	7.4	Overweight
Communication Services	5.4	Overweight
Information Technology	3.3	Overweight
Materials	1.7	Overweight
Real Estate	-2.5	Underweight
Utilities	-3.0	Underweight
Energy	-4.9	Underweight
Consumer Staples	-7.1	Underweight
Financials	-11.3	Underweight

The table below shows the principal overweight and underweight positions of the International Equity Fund at 30 September 2021 relative to the MSCI All Country Index ex US, in %

Samsung SDI	4.2	Overweight
MercadoLibre	4.1	Overweight
zooplus	4.0	Overweight
Prosus	3.6	Overweight
M3	3.6	Overweight
Roche	-1.0	Underweight
Alibaba	-1.0	Underweight
ASML	-1.2	Underweight
Tencent	-1.3	Underweight
Nestle	-1.3	Underweight

The Tortoise Fund

The Tortoise Fund is a global absolute return fund which was launched in August 2007. Its objective is to achieve positive absolute returns in all market conditions, through investment primarily in long and synthetic short positions in equities over rolling three year periods, with less volatility than a conventional long only equity fund. Since inception the Tortoise Fund has returned 147.5% net of fees. In the year to 30 September 2021 the Tortoise Fund returned 36.0% net of fees.

The table below shows most significant positive and negative stock contributors to the relative performance of the Tortoise Fund for the year to 30 September 2021, in %

Financials	9.60	Overweight
Consumer Discretionary	7.43	Overweight
Industrials	6.34	Overweight
Energy	5.00	Overweight
Information Technology	4.39	Overweight
Communication Services	3.11	Overweight
Materials	2.67	Overweight
Consumer Staples	1.23	Overweight
Utilities	0.71	Overweight
Real Estate	0.49	Overweight
Health Care	0.10	Overweight
US Future Short	-7.36	Underweight

The table below shows most significant positive and negative stock contributors to the relative performance of the Tortoise Fund for the year to 30 September 2021, in %

Freeport-McMoRan	2.65	Overweight
Banco Santander	2.19	Overweight
Societe Generale	2.02	Overweight
ON Semiconductor	1.95	Overweight
NatWest	1.93	Overweight
Mosaic	-0.16	Underweight
Newmont	-0.20	Underweight
Viatris	-0.31	Underweight
Barrick Gold	-0.43	Underweight
Gold Fields	-0.95	Underweight

The principal long and short sector positions of the Tortoise Fund at 30 September 2021, in %

Industrials	16.0	Overweight
Financials	11.2	Overweight
Health Care	10.4	Overweight
Communication Services	9.2	Overweight
Consumer Discretionary	9.2	Overweight
Materials	8.7	Overweight
Information Technology	7.7	Overweight
Consumer Staples	7.4	Overweight
Energy	6.8	Overweight
Real Estate	3.7	Overweight
Utilities	3.2	Overweight
US Future Short	-40.7	Underweight

The table below shows the principal long and short stock positions of the Tortoise Fund at 30 September 2021, in %

Royal Dutch Shell	3.0	Overweight
TotalEnergies	2.6	Overweight
Intel	2.3	Overweight
HeidelbergCement	2.2	Overweight
International Business Machines	2.1	Overweight
Union Pacific	-0.8	Underweight

Geographic and Sector Exposure

	Europe ex UK %	UK %	Emerging Markets %	Asia Pacific %	North America %	Cash %	Total %
Basic Materials		1.8	1.0		1.5		4.3
Consumer Staples	0.3	6.2		0.1	1.0		7.6
Consumer Discretionary	1.7	10.4	1.5	0.4	7.8		21.8
Financials	1.1	7.1	0.8	0.5	2.4		11.9
Real Estate					0.6		0.6
Health Care	4.0	3.0		0.7	3.6		11.4
Industrials	2.6	9.8	0.1	0.8	3.4		16.7
Energy	0.8	2.5			0.2		3.5
Technology	0.4	3.6	4.2	0.5	7.1		15.8
Telecommunications	1.8	0.3		0.9	0.1		3.1
Utilities	0.3	0.5					0.8
Cash						2.5	2.5
Total	13.0	45.2	7.6	3.9	27.7	2.5	100.0
Futures*					(6.5)

The assets analysed above are the net exposure of the UK Equity Segregated Portfolio, Global Equity Fund, International Equity Fund and the Tortoise Fund. The Tortoise Fund, an absolute return fund invests through equities, CFDs for short positions and futures. The net exposure is shown in the table. The aggregate of the funds represents 84.9% of the Companies total assets.

Exposures are classified by the stock exchange on which the underlying equity is listed and by the relevant FTSE sector classification.

* The Tortoise Fund has short futures positions on the S&P 500 and NASDAQ 100 indices.

Thirty Largest Holdings at 30 September 2021

	Value £000		% of Total Assets
Majedie Asset Management Limited	25,161		14.5
Royal Dutch Shell Plc	3,574		2.1
AstraZeneca PLC	2,458		1.4
NatWest Group PLC	2,232		1.3
Tesco PLC	2,128		1.2
Electrocomponents plc	1,899		1.1
Facebook, Inc.	1,884		1.1
Ascential Plc	1,872		1.1
Unilever PLC	1,788		1.0
RELX PLC	1,758		1.0
Anglo American PLC	1,747		1.0
Amazon.com, Inc.	1,743		1.0
3i Group plc	1,686		1.0
Ashtead Group plc	1,613		0.9
Royal KPN NV	1,604		0.9
AVEVA Group plc	1,542		0.9
Taiwan Semiconductor Manufacturing Co., Ltd.	1,498		0.9
Alphabet Inc.	1,496		0.9
A.P. Moller - Maersk A/S Class B	1,449		0.8
Samsung SDI Co., Ltd	1,418		0.8
St. James's Place Plc	1,415		0.8
Fevertree Drinks Plc	1,377		0.8
Microsoft Corporation	1,375		0.8
Equifax Inc.	1,333		0.8
Compass Group PLC	1,324		0.8
SoftBank Group Corp.	1,311		0.8
MercadoLibre, Inc.	1,293		0.7
Daily Mail and General Trust plc	1,287		0.7
Weir Group PLC	1,287		0.7
Serco Group plc	1,265		0.7
	73,817		42.7

Outlook

The strong rebound in markets throughout the year has led to stock markets reaching all time highs in the US. The initial recovery from the sell off was prompted by fiscal and monetary stimulus on a massive scale and, following the successful vaccine roll out and general opening up of economies, growth has been higher than expected. Corporate earnings in Q3 2021 have again been higher than forecast in the US, Europe and the UK. Importantly, corporate earnings guidance has been revised up for the full year. Inflation remains a concern, having been driven by the massive dislocations caused by the pandemic. Initially, consumer spending switched from services to goods whilst the supply of goods was constrained by the supply chain being out of kilter. At the same time labour markets tightened rapidly, as a significant proportion withdrew from the work force causing upward pressure on the price of goods and labour. As economies reopen, the global supply chain will rebalance and the labour market pressures will ease causing the initial inflationary pressures to slow. In the medium term economies are expected to have higher level in inflation than the abnormally low levels seen in the last ten years.

The UK equity market having under performed Global markets since the Brexit vote in 2016, is at a 40% discount to the MSCI All Country World Index with a forward PE multiple of 12 times. It has been argued that the higher representation of Banks and Energy explain the discount, but this is not the case. If these sectors are excluded, the discount is still close to its historic record. It is also notable that the dividend expectations for the UK market have risen throughout the year. Logic suggests the discount anomaly will narrow. The significant corporate activity, across the market, in the last year shows global companies view the UK as significantly undervalued. The valuation gap presents a good opportunity and the Company retains a high weighting in the UK, in part through its holding in MAM, compared to its peers in the AIC Global Income Sector.

At a stock level the massive uncertainty through the pandemic and subsequent corporate upheaval has presented a good opportunity for fundamental investors such as MAM to own companies that the market has materially mispriced. The performance of the funds in which the Company invests over the last two years, suggest the managers are well placed in the current environment to continue to perform well.

J William Barlow

CEO

13 December 2021

 

RESPONSIBLE CAPITALISM

This section on responsible capitalism has been produced by Majedie Asset Management and has been included with their permission.

Stewardship, ESG and Responsible Capitalism

At Majedie Asset Management, stewardship is a part of who we are. We believe that knowing our companies and being active in our relationship with them is fundamental to our investment decisions. We engage our companies regularly on matters central to their longer-term well-being. We integrate our assessment of a company's key risks and opportunities into our investment decisions and proxy voting. Being involved with our holdings and knowing what we own is our hallmark.

For us, the components of stewardship, or Responsible Capitalism, all sit under one roof. We see the management of assets as going hand in hand with engagement, proxy voting, and reporting. We make our own voting decisions and, as part of our fundamental investment process, undertake materiality assessment on the key risks and opportunities that our investments face. We don't expect our investments to be perfect or to solve all the world's problems, but we do expect them to manage their business in a way that benefits shareholders and stakeholders.

There are times when we need to escalate our engagement with our holdings. In these instances, we state our objectives, targets, and the time scales we have in mind. We communicate our expectations, as well as the rationale for these expectations, to our investee companies. Any subsequent actions by the company (or lack thereof) directly impact our investment decisions.

Our clients are vital to our stewardship framework, as well. We have built long term relationships with our clients and engage them frequently so we know what matters most to them. We report to our clients and in the public domain on developments in our holdings and how our investment decisions are impacted by the actions our companies take.

Majedie is a signatory to the Stewardship Code 2020 and to the Principles of Responsible Investment. We engage collectively through our memberships with the Investor Forum and Climate Action 100+. In February 2021, Majedie also joined the Net Zero Asset Managers' Initiative through which we are committed to achieve net zero in our funds and in our business by 2050.

For further detail on our approach in this area please see our Responsible Capitalism Report 2020 on our website or follow this link: www.majedie.com.

Engagement examples

· Anglo American

In November 2020, we engaged with Anglo American, the multinational mining company. We invest in Anglo as we feel the group is a well-diversified miner with attractive growth in copper. Anglo continues to invest in sustainable technologies for its mines and the company is now set to reap the rewards from this as it rolls out sustainable initiatives across its operations.

The objectives of our engagement with Anglo included encouraging the group to demerge from its thermal coal assets and also stressing the need for the group to link pay more directly to progress towards its net zero target.

We engaged Anglo by virtual meeting and followed up by writing a letter to the group's Chairman to encourage Anglo to sell down its thermal coal holdings (which focused on its Carrejon JV assets and its South African asset, Thungela Resources). We were concerned that Anglo's time frame (at least 2.5 years) for parting with these assets was too elongated, especially as investors are finding it increasingly difficult to justify holding companies with exposure to thermal coal. (Thermal coal constitutes one of the largest contributors, along with methane, to Anglo's total carbon emissions.) We also asked the group to link more closely its climate transition targets to pay and LTIP.

Anglo noted our concern and in June 2021 entered into an agreement to sell these assets. Anglo has a target to be carbon neutral across its operations by 2040, with an interim target of reducing its GHG emissions by 30% by 2030. In terms of pay, Anglo stated that it has a 20% weighting in its bonus objectives to SHE (social, health, environmental). Within the group's LTIP, there is also a 20% weighting for ESG factors, which include metrics for energy efficiency and GHG emissions. Anglo expects to develop these metrics further so that they will be aligned with its 2030 commitments.

We have attributed an average resiliency score to Anglo, as the group is implementing sustainability-oriented technology and has a climate target. Our conviction score remains unchanged.

· Newmont Goldcorp

In April 2021, we met with Newmont, the world's largest gold mining company, which has its headquarters in Colorado, USA. We invest in Newmont as we remain reasonably bullish on the gold price in the medium term, given the prevailing political and monetary policy environment. Newmont has a high-quality asset base in North America, South America, Australia, and Africa. The group anticipates 6-7 million ounces of production each year for the next decade with averages slightly higher in the medium term. Also, the group's CEO, previously a senior manager at Rio Tinto, is bringing a greater level of industrialised operational rigour to Newmont.

The objectives of our engagement included learning more about the group's safety programmes and safety spending, especially following Covid, and understand the group's tax situation.

We engaged the group on its safety performance, which has remained excellent, during the disruption of the pandemic and its mines being ramped up and down. Newmont changed the metric it looks at regarding safety - switching from a lagging metric of injuries and fatalities to a more holistic consideration of the causes or indicators of fatality and injury risks. This gives the group more of a heads-up on what might happen rather than looking solely backwards. The group feels it now has a proper focus on critical controls; it has moved people off-site (a positive outcome from the pandemic) which has helped reduce distractions for those still at the mine.

In terms of its tax situation, Newmont had previously suggested there might be some political pressure in Nevada for miners to pay higher taxes given that the state had lost some gambling revenue during the pandemic. Newmont values operating in countries where there is tax and governmental stability and works to maintain a good working relationship with state and local government.

We have attributed an average resiliency score to Newmont, given the group's ability to operate safe and efficient mines across the world and provide employment and tax revenue in remote and often reasonably poor places. Our conviction score remains unchanged.

BUSINESS REVIEW

Introduction and Strategy

Majedie Investments PLC, (the Company), is a listed investment company and an Alternative Investment Fund (AIF), which invests in companies around the world. The investment objective is to maximise total shareholder return whilst increasing dividends by more than the rate of inflation over the long term. In seeking to achieve this objective, the Board has determined an investment policy and related guidelines or limits. The investment objective and policy (as detailed on pages 22 and 23 of the Annual Report) were both last approved by shareholders at a General Meeting of the Company on 27 February 2014. The Board does not envisage any change in the Company's activity in the future.

Following the UK's exit from the EU and the end of the transition period on 31 December 2020, the Company is now subject to the UK Alternative Investment Fund Managers Directive (UK AIFMD) which generally maintains the previous rules set out in the AIFMD. The UK AIFMD regulates the Alternative Investment Fund Managers (AIFMs) of AIFs. The Company is a self-managed AIF (i.e., it is an AIFM and an AIF), which requires it to be authorised and regulated by the Financial Conduct Authority (FCA).

The Company's broker is J.P. Morgan Cazenove, and the Company is a member of the AIC.

The purpose of the Strategic Report is to inform the shareholders of the Company by:

· analysing development and performance using appropriate Key Performance Indicators (KPIs);

· providing a fair and balanced review of the Company's business;

· outlining the principal risks and uncertainties affecting the Company;

· describing how the Company manages these risks;

· setting out the Company's environmental, social and ethical policy;

· outlining the main trends and factors likely to affect the future development, performance and position of the Company's business;

· explaining the future business plans of the Company; and

· explaining how the Board has performed its duty to promote the success of the Company in accordance with Section 172 of the Companies Act 2006.

Business Model

The self-managed business model deployed by the Company means that it undertakes all administrative operations but also delegates certain arrangements to other service providers including fund management to MAM. These delegations are in accordance with the UK AIFMD (details of the material delegations can be found on pages 33 and 35 of the Annual Report), but the Board, as AIFM, and in accordance with the Company's investment objective and policy, directs and monitors the overall performance, operations and direction of the Company.

The Company's Employee, Social, Environmental, Ethical and Human Rights policy is contained in the Directors' Report on page 32 of the Annual Report.

Investment Objective

The Company's investment objective is to maximise total shareholder return whilst increasing dividends by more than the rate of inflation over the long term.

Investment Policy

· General

The Company invests principally in securities of publicly quoted companies worldwide and in funds managed by its investment manager, though it may invest in unquoted securities up to levels set periodically by the Board, including its investment in MAM. Investments in unquoted securities, other than those managed by its investment manager or made prior to the date of adoption of this investment policy (measured by reference to the Company's cost of investment), will not exceed 10% of the Company's gross assets.

· Risk Diversification

Whilst the Company will at all times invest and manage its assets in a manner that is consistent with spreading investment risk, there will be no rigid industry, sector, region or country restrictions. The overall approach is based on an analysis of global economies, sector trends with a focus on companies and sectors judged likely to deliver strong growth over the long term. The number of investments held, together with the geographic and sector diversity of the portfolio, enable the Company to spread its risks with regard to liquidity, market volatility, currency movements and revenue streams.

The Company will not invest in any holding that would, at the time of investment, represent more than 15% of the value of its gross assets save that the Company may invest up to 25% of its gross assets in any single fund managed by its Investment Manager where the Board believes that the investment policy of such funds is consistent with the Company's objective of spreading investment risk.

The Company may utilise derivative instruments including index-linked notes, contracts for difference, covered options and other equity-related derivative instruments for efficient portfolio management and investment purposes.

Any use of derivatives for investment purposes will be made on the basis of the same principles of risk spreading and diversification that apply to the Company's direct investments, as described above.

Investment Restrictions

For the avoidance of doubt, as a listed investment company, if and for so long as required by the Listing Rules in relation to closed-ended investment companies, the Company will also continue to comply with the following investment and other restrictions:

●	the Company will at all times invest and manage its assets in a way which is consistent with its object of spreading investment risk and in accordance with its published investment policy;
●	the Company will not conduct any trading activity which is significant in the context of the Company (or if applicable its Group as a whole); and
●	not more than 10% in aggregate of the value of the gross assets of the Company at the time the investment is made will be invested in other closed-ended investment funds which are listed on the Official List (except to the extent that those funds have published investment policies to invest no more than 15% of their gross assets in other investment companies which are listed on the Official List). However no more than 15% of the gross assets of the Company at the time the investment is made will be invested in other closed-ended investment funds which are listed on the Official List.

· Asset Allocation

The assets of the Company will be allocated principally between investments in publicly quoted companies worldwide and in investments intended to provide an absolute return (in each case either directly or through other funds or collective investment schemes managed by the Company's investment manager) and the Company's investment in MAM itself.

· Benchmark

The Company does not have one overall benchmark, rather each distinct group of assets is viewed independently. Any investments made into funds managed by the Company's investment manager will be measured against the benchmark or benchmarks, if any, whose constituent investments appear to the Company to correspond most closely to those investments. It is important to note that in all cases investment decisions and portfolio construction are made on an independent basis. The Board however sets various specific portfolio limits for stocks and sectors in order to restrict risk levels from time to time, which remain subject to the investment restrictions set out in this section.

· Gearing

The Company uses gearing currently via a long-term debenture. The Board has the ability to borrow up to 100% of adjusted capital and reserves. The Board also reviews the level of gearing (borrowings less cash) on an ongoing basis and sets a range at its discretion, as appropriate. The Company's current debenture borrowings are limited by covenant to 66 2/3%, and any additional indebtedness is not to exceed 20%, of adjusted capital and reserves.

Regulatory and Competitive Environment

The Company is an investment company with a premium listing on the London Stock Exchange. This year, following the end of the transition period on 31 December 2020 after the UK's exit from the EU, EU rules and regulations no longer apply in the UK. The Company remains subject to United Kingdom legislation and regulations including UK company law, UK AIFMD, the Listing Rules, the Prospectus Rules, the Disclosure Guidance and Transparency Rules, taxation law (all as were required to be amended to include EU rules and regulations as a consequence of Brexit) and the Company's own Articles of Association. The Directors are charged with ensuring that the Company complies with its objectives as well as these regulations.

Under section 833 of the Companies Act 2006 the Company is defined as an investment company.

The Company's requirements under the UK AIFMD are in respect of risk management, conflicts of interest, leverage, liquidity management, delegation, the requirement to appoint a depositary (the Company has appointed The Bank of New York Mellon (International) Limited), regulatory capital, valuations, disclosure of information to investors or potential investors, remuneration and marketing.

The financial statements report on profits, the changes in equity, the balance sheet position and the cash flows in the current and prior financial period. This is in compliance with current international accounting standards in conformity with the requirements of the Companies Act 2006, supplemented by the Statement of Recommended Practice for Investment Trust Companies and Venture Capital Trusts (SORP) issued in October 2019. The principal accounting policies of the Company are set out in note 1 to the accounts on pages 65 to 72 of the Annual Report.

Total Return Philosophy and Dividend Policy

The Board believes that investment returns will be maximised if a total return policy is followed. The policy aim is to increase dividends by more than inflation over the long term. Further details are under the Dividend Growth section on page 25.of the Annual Report The Company has a comparatively high level of revenue reserves for the investment trust sector and at £24.3m, revenue reserves represent over four times the current annual dividend distribution. The strength of these reserves will assist in underpinning the Company's dividend policy in years when the income from investments is insufficient to completely cover the annual distribution.

Performance Management

The Board uses the following KPIs to help assess progress against the Company's objectives. Further comments on these KPIs are contained in the Chairman's Statement and Chief Executive's Report sections of the Strategic Report respectively.

· NAV and Total Shareholder Return:

The Board believes that the NAV return is fundamental to delivering value over the long-term and is a key determinant of shareholder return. The Board further believes that, in accordance with the Company's objective, the total return basis (which includes dividends paid out to shareholders) is the best measure of how to assess long-term shareholder return. The Board, at each meeting, receives reports detailing the Company's NAV and shareholder total return performance, asset allocation and related analyses. Details of the NAV and share price total return performance for the year are shown in the Year's Summary on page 2 of the Annual Report.

· Investment performance:

The Board believes that, after asset allocation, the performance of each of the investment groups, being the MAM Funds (including the UK Equity Segregated Portfolio - UKES) and MAM, is the key driver of NAV return and hence shareholder return. The Board receives, at each meeting, detailed reports showing the performance of the investment groups which also includes relevant attribution analysis. The Chief Executive's Report provides further detail on each investment group's performance for the year.

· Share price premium/discount:

As a closed-ended listed investment company, the share price of the Company can and does differ from that of the NAV. This can give rise to either a premium or discount and as such is another component of Total Shareholder Return. During the year the discount has decreased marginally, ending the year at a lower value to that at the start of the year (with the NAV with debt at par), resulting in the Company's share price gain being more than the gain in the Company's NAV (with debt at par).

The Board continually monitors the Company's premium or discount, and does have the ability to buy back shares if thought appropriate, although it must be noted that this ability is limited by the majority shareholding held by members of the Barlow family. Additionally, the Board has approval (and is seeking to renew such approval for another year) to issue new shares, at a premium to the relevant NAV (with debt at fair value), in order to meet any natural market demand for shares. Details of movements in the Company's share price discount over the year are shown in the Year's Summary on page 2 of the Annual Report.

· Expenses:

The Board is aware of the impact of costs on returns and is conscious of seeking to minimise these (taking into account the Company's self-managed status). The current industry-wide measure for investment trusts is the OCR, which seeks to quantify the ongoing costs of running the Company. This measures the annual ongoing running costs of an investment trust, excluding performance fees, one-off expenses, marketing costs, finance costs and investment dealing costs, as a percentage of average equity shareholders' funds. Any investments made into pooled funds are included using the Company's share of estimated ongoing fund running costs. The Chairman's Statement on page 4 of the Annual Report provides further details on the expenses incurred during the year. Details of the OCR for the year are shown in the Year's Summary on page 2 of the Annual Report.

· Dividend Growth:

Dividends paid to shareholders are an important component of Total Shareholder Return and this has been included in the Company's investment objective. The Board is aware of the importance of this objective to the Company's shareholders but wishes to be prudent. As such, a sustainable and progressive long-term dividend policy which pays dividends out of current year income is the goal, but recognising that using reserves may be required in certain circumstances.

The Board receives detailed management accounts and forecasts which show the actual and forecast financial outturns for the Company. For the 7 years to 30 September 2021, following the rebasing of the dividend in 2014, average dividend growth has been 6.3% per annum, which is well ahead of inflation.

Emerging and Principal Risks

The emerging and principal risks and the Company's policies for managing these risks and the policy and practices are summarised below and in note 22 to the accounts.

i. Investment Risk:

The Company has a range of equity investments, including a substantial investment in an unlisted asset management business, UK and global equities (both on a direct basis, via the UKES, and via collective investment vehicles (the MAM Funds)), and an investment in an absolute return fund, the Tortoise Fund. The major risk for the Company remains investment risk, primarily market risk; however, it is recognised that the investment in MAM is a concentration risk for the Company. Furthermore, this year political concerns, notably the US and China, and the nascent inflation led recovery from the COVID-19 pandemic are an emerging risk, which provide heightened uncertainty to the investment risk faced by the Company.

The number of investments held, together with the geographic and sector diversity of the portfolio, enables the Company to spread its risks with regard to liquidity, market volatility, currency movements and revenue streams.

Under the terms of the Investment Agreement, the Fund Manager manages the majority of the Company's investment assets. The portfolios of the UKES and the MAM Funds are actively managed by MAM against benchmarks and each have specific limits for individual stocks and market sectors that are monitored in real time. It should be noted that the UKES and the MAM Funds' returns will differ from the benchmark returns. The Tortoise Fund is an absolute return fund whose returns are not correlated to equity markets.

The investment risks are moderated by strict control of position sizing, low use of leverage and investing in liquid stocks. Also, the level of risk at a net asset value level increases with gearing. In certain circumstances cash balances may be raised to reduce the effective level of gearing. This would result in a lower level of risk in absolute terms.

Other risks faced by the Company include the following:

ii. Strategy Risk:

An inappropriate investment strategy could result in poor returns for shareholders and the introduction or widening of the discount of the share price to the NAV per share. It is important to note that the investments in the UKES and the MAM Funds do provide the Company with exposure to a range of strategies.

The Board regularly reviews strategy in relation to a range of issues including investment objective and policy, the allocation of assets between investment groups, the level and effect of gearing and sector, currency and geographic exposure.

iii. Business Risk:

Inappropriate management or controls in the Company or at MAM could result in financial loss, reputational risk and regulatory censure. The Board has representation on the MAM governing board to monitor business financial performance and operations and receives detailed reports from Company management on financial and non-financial performance.

iv. Compliance Risk:

Failure to comply with regulations could result in the Company losing its listing, losing its FCA authorisation as a self-managed AIF or being subjected to corporation tax on its capital gains.

The Board receives and reviews regular reports from its service providers and Company management on the controls in place to prevent non-compliance of the Company with rules and regulations. The Board also receives regular investment portfolio reports and income forecasts as part of its monitoring of compliance with section 1158 of the Corporation Tax Act 2010.

v. Operational Risk:

Inadequate financial controls, failure by an outsourced supplier to perform to the required standard, or dependency on a small number of individuals could result in misappropriation of assets, loss of income and mis-reporting of NAVs. The Board and Audit Committee regularly review statements on internal controls and procedures, receive detailed reports and presentations from the Company's depositary and the Company is subject to an annual external audit. The COVID-19 pandemic continues, however both the Company and its service providers implemented business continuity plans and service levels have been maintained.

The Corporate Governance Statement and the Report of the Audit Committee in the Company's Annual Report and Accounts provide further information in respect of internal control systems and risk management procedures.

How the Board meets its obligations under section 172 of the Companies Act

Under Section 172(1) of the Companies Act 2006, directors of a company must act in a way that they consider, in good faith, would be most likely to promote the success of the company for the benefit of its members as a whole. In doing so they should have regard to, inter alia, the likely long-term consequences of their decisions, the interests of the company's employees, fostering relationships with suppliers, customers and others, the impact of operations on the community and environment, maintaining a reputation for high standards and lastly to act fairly as between shareholders of the company.

The Company is a self-managed investment company and its key stakeholders comprise its one and only class of shareholders (it does not have customers), its employees, and also its third-party service providers (including its Company Secretary, Fund Manager, Custodian, Depositary, Stockbroker, Registrar, Auditor and Solicitor - see Shareholder Information on page 104 of the Annual Report). Additionally, the Company interacts with the wider community and the environment primarily through its holdings in investee companies worldwide.

In accordance with its duty to promote the success of the Company, the Board utilises the investment objective (see page 22 of the Annual Report), various comprehensive procedures and policies, including the Company's investment policy (see page 22of the Annual Report), and committees with defined roles and responsibilities against which executive management and third-party providers are monitored, challenged and assessed. The Board regularly reviews the objective, procedures and policies and Committee responsibilities to ensure they remain effective.

In performing its duties, the Board receives regular and detailed reporting from both executive management and third-party service providers. As an investment company, investment performance is fundamentally important and, as such, a significant portion of the Board's time is spent in this area. The Company has been established for a very long time, with a cornerstone shareholder base, and as a closed ended listed investment company is a long-term investor in global equity markets and the Board is mindful of this in undertaking its duties.

The Board recognises the importance of having experienced, trained and motivated staff as an integral part of the successful running of the Company. As such it has ensured that appropriate HR policies and procedures are in place, with staff being appropriately remunerated. As a small Company, the Board, which includes an Executive Director, has a close relationship and regular engagement with staff, monitors morale and the Company has a very low staff turnover.

The Company, in conducting its operations, utilises its third-party service providers as listed previously. The Board believes that maintaining effective continuing relationships is important to its duty under s172(1). In particular the relationship with the Fund Manager is of critical value to the Company and its long-term success. The relationship is strong and includes the Chief Executive sitting on their board as a non-executive director. The Board receives regular detailed reports and presentations from the Fund Manager from an investment and business perspective and marketing updates from Kepler Partners. The Company's other service providers provide regular reports and advice with the Board ensuring two-way communications are in place. All major service providers have relevant metrics which are used to measure performance. The Board monitors operations to ensure that in undertaking its operations the Company operates to the standard befitting an FCA regulated LSE listed investment company.

The Company is a small investment company with a very limited physical presence in the City of London. The Board is conscious of its community and its direct environmental impact and seeks to be aware of these when making decisions. The Company invests, indirectly, in many investee companies worldwide through its Fund Manager. The Fund Manager has a long-standing focus on ESG (it is a signatory to the FRC 2020 Stewardship Code) which is embedded in its investment decision making process (see the Responsible Capitalism section page 22 to 21 of the Annual Report), which includes a dedicated ESG manager and it engages regularly with investee companies in this area. The Fund Manager makes available to the Board an extensive amount of information on these activities in this area.

The Board recognises the need for good communications with its shareholders and is committed to listening to their views. Further details on how the Board interacts with its shareholders are described on page 40 of the Annual Report. In addition, the Board consults with them, where appropriate, concerning major decisions before they are taken.

During the year the following material decisions have been made:

●	The Board, at each meeting, reviewed the Company's asset allocation positioning over the year, and whilst taking a longer-term view, concluded that no substantive change was considered appropriate. However, the Board were of the view, after consulting various parties and after receiving comments from investors, that the allocation across the MAM funds could be streamlined, without materially impacting exposures across sectors and markets. As a result the UK Income Fund and the US Equity Fund holdings were redeemed in full and reinvested into the UKES and the Global Equity Fund respectively. The Board continues to keep the asset allocation of the Company under review at each Board meeting;
●	As was noted in the last year's report, the Chairman, Mr Henderson, will retire following the 2022 AGM. The Board undertook a process to determine his successor. The process is set out in the nomination committee section of the Corporate Governance Statement on page 39 of the Annual Report, and included shareholder views, which resulted in Mr Getley being appointed. This was released to the market via an RNS on 21 October 2021;
●	The Board, is always conscious of minimising the costs of running the Company, approved an application to HMRC for a change in the Company's VAT methodology. This was approved by HMRC, was retrospective, and as a result a substantial VAT refund was received and a much lower irrecoverable VAT expense will be incurred going forward;
●	The Board, as part of the MAM fund restructuring exercise, agreed certain reductions in management fees with MAM resulting in a material reduction in fund management costs. The Board remains committed to ensuring that costs are appropriate for the Company, taking into account its self-managed nature and size;
●	As the recovery from the COVID-19 pandemic has continued the Board ensured, through discussions with providers and employees, that the Company's operational performance continued to remain robust and employees continued to manage the risks associated with the virus. The nascent recovery, along with the MAM business performance, meant that the Board had to carefully consider the future dividend levels for the Company after taking into account known shareholder views in this area. The Board received a detailed revenue forecast and projections to take account of the changing outlook for dividend receipts from investee companies and MAM. The Board decided to maintain the current year dividend utilising reserves to do so;
●	The Board continued to review the Company's discount level and following discussions with its Stockbroker bought back a very small number of shares at the year end. The Company is subject to constraints in this area which limit what can be done and which have been communicated to shareholders. The Board is aware of investor and shareholder views concerning share liquidity and remains determined to raise investor awareness and interest in the Company, Although the pandemic has limited physical meetings and seminars the Board has engaged doceo, a new web-based investment trust retail marketing provider, which resulted in the Company being included on their website along with various videos and commentary. The Board pays close attention to marketing where it engages third parties to assist its efforts.

On behalf of the Board

R David Henderson

Chairman

13 December 2021

DIRECTORS' REPORT

The Directors submit their report and the accounts for the year ended 30 September 2021.

Introduction

The Directors' Report includes the Corporate Governance Statement, the Report of the Audit Committee and the Directors' Remuneration Report. A review of the Company's business is contained in the Strategic Report (which includes the Chairman's Statement) and should be read in conjunction with the Directors' Report.

Principal Activity and Status

The Company is a public limited company and an investment company under section 833 of the Companies Act 2006. It operates as an investment trust and is not a close company. The Company has been a member of the AIC since 20 January 2014.

The Company has historic written confirmation from HM Revenue & Customs that it meets the eligibility conditions and is an approved investment trust for taxation purposes under section 1158 of the Corporation Tax Act 2010, with effect from 1 October 2012, subject to it continuing to meet the eligibility conditions and on-going requirements. In the opinion of the Directors, the Company continues to direct its affairs so as to enable it to continue to qualify as an approved investment trust.

Results and Dividend

The net revenue return before taxation arising from operations amounted to £5,004,000 (2020: net revenue return of £4,843,000).

The Directors recommend a final ordinary dividend of 7.0p per ordinary share, payable on 28 January 2022 to shareholders on the register at the close of business on 14 January 2022. Together with the interim dividend of 4.4p per share paid on 18 June 2021, this makes a total distribution of 11.4p per share in respect of the financial year (2020: 11.4p per share).

Risk Management and Objectives

The Company, as an investment company, is subject to various risks in pursuing its objective. The nature of these risks and the controls and policies in place that are used to minimise these risks are further detailed in the Strategic Report and in note 22 of the Accounts.

Directors

The general powers of the Directors are contained within the relevant UK legislation and the Company's Articles. The Directors are entitled to exercise all powers of the Company, subject to any limitations imposed by the Articles or applicable legislation.

The Directors in office at the date of this report are listed on page 29 of the Company's Annual Report and Accounts.

Mr RDC Henderson will retire following the 2022 AGM and will be replaced as Chairman by Mr CD Getley (see page 39 of the Annual Report for further details).

Directors' retirement by rotation and appointment is subject to the minimum requirements of the Company's Articles of Association and the AIC Code of Corporate Governance (AIC Code).

The Company's Articles of Association require that at every AGM any Director who has not retired from office at the preceding two AGMs and who was not appointed by the Company in a general meeting, at either such meeting, shall retire from office and be eligible for re-election or election respectively, by the Company.

However, in accordance with the AIC Code, all Directors are to be re-elected annually. As such Messrs. CD Getley, RW Killingbeck, AMJ Little and Ms JM Lewis will retire at the forthcoming AGM and, being eligible, will offer themselves for re-election. Mr RDC Henderson will retire following the 2022 AGM and will not offer himself for re-election.

In accordance with Listing Rule 15.2.13A, Mr JWM Barlow, being a Non Executive Director of Majedie Asset Management Limited, the Fund Manager, must submit himself for annual re-election.

The Board believes that the performance of the Directors continues to be effective, that they demonstrate commitment to their roles and that they have a range of business, financial and asset management skills and experience relevant to the direction and control of the Company.

The Board, having considered the Directors' performance within the annual Board performance evaluation, hereby recommend that shareholders vote in favour of the proposed re-elections.

Qualifying Third Party Indemnity Provisions

There are no qualifying third-party indemnity provisions or qualifying pension scheme indemnity provisions which would require disclosure under section 236 of the Companies Act 2006.

Directors' Interests

Beneficial interests in ordinary shares as at:

	30 September 2021		1 October 2020
Mr RDC Henderson	24,700		24,700
Mr JWM Barlow	409,224		409,224
Mr AMJ Little	9,879		9,879
Ms JM Lewis	8,000		5,803
Mr CD Getley	36,830		33,830
Mr RW Killingbeck	20,000		20,000

Non-beneficial interests in ordinary shares as trustees for various settlements as at:

	30 September 2021		1 October 2020
Mr JWM Barlow	3,111,110		3,111,110

Substantial Shareholdings

At 30 September 2021, the Company has been notified of the following substantial holdings in shares carrying voting rights:

Mr HS Barlow		15,017,619	28.10%
Mr JWM Barlow	Non-Beneficial	3,111,110	5.82%
1607 Capital Partners LLC		2,654,600	5.01%
Miss AE Barlow		2,029,148	3.80%
Mr MHD Barlow		1,776,241	3.32%
Oakwood Nominees Limited		1,631,602	3.05%
Aviva plc		1,432,574	2.70%

The substantial voting rights disclosed above include the total holdings of shares within certain trusts where there are other beneficiaries.

The Company has not been notified any change in substantial holdings from 1 October 2021 up to the date of this report.

AGM

In accordance with government directives currently in effect, arrangements for the AGM include a physical meeting at the City of London Club, 19 Old Broad Street, London EC2N 1DS. Shareholders should check the Company's website for updates about arrangements for the AGM in case Government guidelines require changes to be made.

The Board considers that Resolutions 1 to 14 are likely to promote the success of the Company and are in the best interests of the Company and its shareholders as a whole. The Directors unanimously recommend that you vote in favour of the Resolutions as they intend to do in respect of their own beneficial holdings.

Issue and Buyback of Shares

The Board continues to be of the view that an increase of the Company's stock in issue provides benefits to shareholders including a dilution of the Company's gearing and cost of its debentures, a reduction in the Company's administrative expenses on a per share basis and increased liquidity in the Company's shares. As such the Board sought and received approval, at the AGM on 20 January 2021, to allot new shares for cash, and without first offering them to existing shareholders in proportion to their holdings, up to a maximum of 5,296,087 shares (being approximately 9.99% of the Company's existing share capital at that time). These two existing authorities will expire at the 2022 AGM.

During the year, as the Company's shares remained at a discount, no shares have been allotted (2020: Nil).

The Board continues to be prepared to issue new shares in order to meet natural market demand, subject to the restriction that any new shares will be issued at a premium, and as such shareholder approval is sought at the AGM to renew the authority to issue new shares, without first offering them to existing shareholders in proportion to their holdings, up to a maximum of 5,294,579 shares (being approximately 9.99% of the Company's existing share capital). The renewed authority will expire at the 2023 AGM.

The Directors undertake not to allot any such new shares unless they are allotted at a price representing a premium to the Company's then prevailing NAV per share, with debt at fair value.

In response to the continued excessive share price discount, in part, reflecting the COVID-19 pandemic, and in the best interests of shareholders, the Company has maintained its intention to buyback for cancellation its ordinary shares, noting however the restrictions that exist for the Company in respect of share buybacks. Since 1 October 2020 and up to the date of this report the Company bought back for cancellation 15,092 ordinary shares with a nominal value of £1,509.20, and at a total cost of £34,000. At the AGM in 2021 the Directors were given power to buy back 7,951,130 ordinary shares (being 14.99% of the Company's existing share capital). This authority will also expire at the 2022 AGM.

In order to provide maximum flexibility, the Directors consider it appropriate that the Company be authorised to make such purchases and accordingly shareholder approval is sought at the AGM to renew the authority of the Company to exercise the power contained in its Articles of Association to make buybacks of its own shares. The maximum number of shares which may be purchased shall be 7,944,519 ordinary shares (being approximately 14.99% of the Company's issued share capital). Any shares so purchased will be cancelled or held in treasury. The restrictions on such purchases (including minimum and maximum prices) are outlined in the Notice of Meeting. The authority will be used where the Directors consider it to be in the best interests of the shareholders and will expire at the 2023 AGM.

Capital Structure

As part of its corporate governance the Board keeps under review the capital structure of the Company.

At 30 September 2021, the Company had a nominal issued share capital of £5,300,589, comprising 53,005,887 ordinary shares of 10p each, carrying one vote each. All of the shares of the Company are listed on the London Stock Exchange, which is a regulated market. The Company holds no shares in Treasury.

The Company deploys gearing through long-term debt being a £20.7m 7.25% debenture stock 2025, of which £25m was issued in 2000 with £4.3m being re-purchased in 2004.

The limits on the ability to borrow are described in the investment policy on page 23 of the Annual Report. The Board is responsible for managing the overall gearing of the Company.

Details of gearing levels are contained in the Year's Summary on page 2 of the Annual Report, and in note 22 to the Accounts.

There are: no restrictions on voting rights; no restrictions concerning the transfer of securities in the Company; no special rights with regard to control attached to securities; no agreements between holders of securities regarding their transfer known to the Company; and no agreements which the Company is party to that might change or fall away on a change of control or trigger any compensatory payments for Directors, following a takeover bid.

Notice period for general meetings

The Board believes that it is in the best interests of shareholders of the Company to have the ability to call meetings on 14 clear days' notice should a matter require urgency. The Board will therefore, as last year, propose a resolution at the AGM to approve the reduction in the minimum notice period from 21 clear days to 14 clear days for all general meetings other than annual general meetings. The Directors do not intend to use the authority unless immediate action is required.

Future Developments

The Chairman's Statement on page 5 of the Annual Report and the Chief Executive's Report on page 19 of the Annual Report provide details concerning relevant future developments of the Company in the forthcoming year.

Employee, Social, Environmental, Ethical and Human Rights policy

The Company, as an investment company, has limited direct impact upon the environment. In carrying out its activities and relationships with its employees, suppliers and the community, the Company aims to conduct itself responsibly, ethically and fairly.

The Company falls outside the scope of the Modern Slavery Act 2015 as it does not meet the turnover requirements under that act. The Company outsources significant parts of its operations to reputable professional companies, including fund management to MAM. MAM complies with all the relevant laws and regulations and also takes account of social, environmental, ethical and human rights factors, where appropriate.

Carbon Reporting

In accordance with the Companies Act 2006 (Strategic Report and Directors' Reports) Regulations 2013, and the Companies (Directors' Report) and Limited Liability Partnership (Energy and Carbon Report) Regulations 2018, the Company is required to report on its carbon dioxide emissions and quantity of energy consumed. In accordance with the regulations, the Company has determined that its organisational boundary, to which entities the regulations apply, is consistent with its accounts.

The Company operates in the financial services sector, and in common with many organisations employs outsourcing such that most of its activities are performed by other outside organisations which do not give rise to any reportable matters by the Company.

However, the Company, as a self-managed investment company, does undertake activities at its sub-leased premises. In accordance with the provision of the centrally provided building services (including heating, light, cooling etc) to all lessees in the building by the landlord, and by the superior lessee, it is considered that the Company does not have emissions responsibility in respect of these services, which rather rest with the landlord or superior lessee. The Company does however have responsibility for various other emissions in the usage of electricity by its office equipment in the course of undertaking its duties but it is not able to determine their amounts as compared to those provided by the landlord or superior lessee.

Additionally, the Company has many investments in companies around the world, either directly or through the MAM Funds; however, the Company does not have the ability to control the activities of these investee companies and as such has no responsibility for their emissions. Therefore, the Board believes that the Company has no reportable matters for the year ended 30 September 2021 (2020: nil).

Donations

The Company made no political or charitable donations during the year (2020: nil) to organisations either within or outside of the UK.

Gender Diversity

The Board is aware of the recommendations made in the Hampton-Alexander and Parker Review in respect of gender and ethnic diversity in the boardroom. The Company does not have a formal policy on diversity, but details on how diversity is taken into account when making new appointments to the Board is included in the section on the Nomination Committee on page 39 of the Annual Report. At the year end, 83.3% of the directors of the Board were male and 16.6% were female. The composition of the Company's employees is 66.6% male and 33.3% female.

Material Contracts

• Majedie Asset Management Limited

The Board has appointed MAM as its fund manager, the terms of which are defined under an Investment Agreement dated 13 January 2014. The agreement divides the Company's investment assets into a combination of a segregated portfolio and the MAM in-house funds, with the Board having the ability, subject to certain capacity constraints in respect of the MAM funds, for the determination of the asset allocation of its investment assets, both initially and on an on-going basis.

The Investment Agreement provides that the segregated portfolio is to be managed on the same basis as the MAM UK Equity Fund, with other investments being made into the various MAM Funds, as decided by the Board as part of their asset allocation requirements. Further details on the allocation of the investments managed by MAM are included in the Chief Executive's Report on pages 6 and 7 of the Annual Report.

The fees payable under the Investment Agreement are detailed below:

Portfolio/Fund*	Management Feeˆ	Performance Feeˆ
UKES	0.48% p.a.	Nil
Tortoise Fund	1.00% p.a.	20%†
Global Equity Fund	0-0.65% p.a.**	Nil
International Equity Fund	0.25% p.a	Nil

* The fees are calculated under the terms of the Investment Agreement or the relevant fund prospectus, and apply from 1 January 2021. The fees charged to the UKES are charged directly to the Company's Statement of Comprehensive Income. All other fund fees are charged within the relevant fund.

† The performance fee entitlement only occurs once the hurdle has been exceeded (being the Sterling Overnight Index Average or "SONIA") and is calculated on a high water mark basis.

** The management fee range reflects the investments made into different share classes.

The Investment Agreement entitles either party to terminate the arrangement with six months' notice.

· The Bank of New York Mellon (International) Limited

The Board appointed BNY Mellon Trust & Depositary (UK) Limited to provide depositary services as required by the UK AIFMD and certain other associated services under the terms of a depositary agreement dated 19 June 2014. This agreement was novated to The Bank of New York Mellon (International) Limited (BNYMIL) with effect from 1 March 2018. The services provided by BNYMIL as Depositary for the Company include:

●	general oversight responsibilities over the issue and cancellation of the Company's share capital, the carrying out of net asset value calculations, the application of income, and the ex-post review of investment transactions;
●	monitoring of the Company's cash flows and ensuring that all cash is booked in appropriate accounts in the name of the Company or BNYMIL acting on behalf of the Company; and
●	safekeeping of the assets held within the Company's investment portfolio, including those classed as financial instruments for the purpose of the UK AIFMD, and ensuring the Company's financial instruments are held in segregated accounts so that they can be clearly identified as belonging to the Company and maintaining records sufficient for verification of the Company's ownership rights in relation to assets other than financial instruments.

BNYMIL or any BNY Mellon affiliates may have an interest, relationship or arrangement that is in conflict with or otherwise material in relation to services it provides to the Investment Manager and the Company. Should a conflict of interest arise, BNYMIL shall manage conflicts of interest fairly and transparently. As a regulated business, the Depositary is required to prevent, manage and, where required, disclose information regarding any actual or potential conflict of interest incidents to relevant clients. The Depositary is required to and does maintain and operate effective organisational and administrative arrangements with a view to taking all reasonable steps designed to prevent conflicts of interest from adversely affecting the interests of its clients. The terms of the depositary agreement provide that, where certain assets of the Company are invested in a country whose laws require certain financial instruments to be held in custody by a local entity and no such entity is able to satisfy the requirements under the UK AIFMD in relation to use of delegates by depositaries, BNYMIL may still delegate its functions to such a local entity and be fully discharged of all liability for loss of financial instruments of the Company by such local entity.

The Depositary receives an annual fee for its services based on a sliding scale on the total gross portfolio assets of the Company, payable monthly in arrears. The depositary agreement in place with BNYMIL continues unless and until terminated: without cause upon the Company and BNYMIL giving not less than 90 days' notice and upon BNYMIL giving notice expiring not less than 18 months after the date of the agreement, in each case such notice to be effective only if a new Depositary has been appointed.

· Link Market Services Limited (Link)

Company Secretarial services are provided by Link, under the Company Secretarial Services Agreement dated 25 April 2016. The agreement mandates that Link Company Matters Limited will act as Link's nominated corporate secretary. The agreement also provides for fees to be paid quarterly, to be based on a fixed annual amount and be subject to annual RPI increases with either party to give notice to terminate the agreement with 12 months' notice.

Listing Rule Disclosure

The Company confirms that there are no items which require disclosure under Listing Rule 9.8.4R in respect of the year ended 30 September 2021.

UK AIFMD

The UK AIFMD requires certain financial and non-financial disclosures in respect of Annual Reports.

These disclosures are met by the Company in its Annual Report. In addition, certain specific disclosures are required which are:

· Remuneration

Total remuneration details for the Directors (who are considered to be code staff under the Directive) are shown in the Report on Directors' Remuneration. Remuneration details for staff are included in note 7 to the accounts. There was no variable remuneration due during the year.

· Leverage

The UK AIFMD requires the Company to disclose its actual leverage (calculated under the Gross & Commitment methods) and also to set a limit in respect of leverage it can use. The Company has set a limit of 1.5 times (1 being no leverage) and as at 30 September 2021 had leverage of 1.12 times under the Gross method and 1.14 times under the Commitment method. Note 22 to the accounts provides further details.

· Investor Pre-investment information

The UK AIFMD requires that potential investors are provided with certain information. The Company provides this information on its website at www.majedieinvestments.com. This has been updated in the year reflecting various small changes, all of which are described in this Annual Report.

Disclosure of Information to Auditors

As far as each of the Directors are aware:

· there is no relevant audit information of which the Company's Auditors are unaware; and

· they have taken all steps that they ought to have taken as Directors in order to make themselves aware of any relevant audit information and to establish that the Company's Auditors are aware of that information.

This confirmation is given and should be interpreted in accordance with the provisions of Section 418 of the Companies Act 2006.

Auditors

Ernst & Young LLP were re-appointed as Auditors on 20 January 2021. Ernst & Young LLP have indicated their willingness to continue in office and a resolution will be proposed at the AGM to re-appoint them as Auditors.

Viability

The Board has assessed the prospects of the Company over the five year period to September 2026. The Board believes that five years is appropriate given the long-term nature of the Company's objective and the risks arising from investing in equity markets.

In undertaking their assessment of the viability of the Company, the Board has first considered the Company's prospects utilising the following factors:

●	the Company's business model and investment strategy;
●	how the Company is positioned against each of the Company's emerging and principal risks and uncertainties;
●	the nature and liquidity of the Company's investments;
●	global equity market conditions with particular reference to the COVID-19 pandemic;
●	the level of its long-term liabilities.

The assessment process provided the following matters which are considered relevant, being:

●	the Board carried out a robust assessment of the principal and emerging risks and uncertainties (see pages 25 and 26 of the Annual Report) that are facing the Company over the review period. The current investment climate is uncertain. In particular, the longer-term impacts of the COVID-19 pandemic are unknown. Also, other political impacts are additional factors. However, the Company, as a closed ended investment company with a long-term focus and objective is well positioned to ride out any short-term volatility. Investment risk and volatility are high but are well below stress testing levels (the Chief Executive's Report on page 19 of the Annual Report provides more details on the investment outlook). Lastly, the Company continues to have no need to make use of any of the governmental pandemic economic assistance packages that had been made available;
●	the £20.8m of borrowings, (being leverage of 1.12 times (Gross method) and 1.14 times (Commitment method)), are considered acceptable and are well below the 1.5 times limit. The Board keeps gearing levels under review and can increase cash levels as required;
●	the investment portfolio, excluding the MAM investment, remains highly liquid (which comprise 84.9% of total assets at 30 September 2021). The Board receives many detailed reports on positioning and approach from MAM and geographic and sector positioning is kept under constant review (the Chief Executive's Report on page 7 of the Annual Report provides further details on the investment portfolio);
●	the investment in MAM (being £25.2m comprising 14.5% of total assets as at 30 September 2021) is illiquid. The announcement by Liontrust re MAM on 7 December 2021 will result in the sale of the MAM investment. The sale of MAM will result in a drop in income for the Company but it has very significant revenue reserves available and has the ability to utilise its capital reserves as required;
●	the Company's systems and operational performance, and that of its service providers, have been resilient under the on-going challenges posed by COVID-19 with service levels having been maintained.

As part of the assessment the Board remains very conscious of the impact of COVID-19, both short and long-term, on the Company as noted previously and how this uncertainty might affect the Company's future prospects. However, the Board considers that the Company's investment strategy is appropriate and looking forward from the period under review, a global equity investment with a good dividend yield should be considered attractive. As such, the Board has concluded that there is a reasonable expectation that the Company will be able to continue in operation and meet its liabilities as they fall due over the five year period to September 2026.

Going Concern

In assessing the Company's ability to continue as a going concern, the Board considered the nature of its investment portfolio, its investment objective and policy (see page 22 and 23 of the Annual Report), its risk management systems, its financial income and expenditure projections, and its financial and operational structure.

As part of this assessment the Board took into consideration the continuing uncertainties generated by the COVID-19 pandemic on the Company's ability to generate income, sell its assets as or if required to meet liabilities, and ability to operate under any restrictions imposed by the pandemic. The Board stress tested a downside scenario showing income from investments falling by, on average, 50% and investment values by 45% which would still leave the Company with adequate financial resources to be in a going concern position.

It should also be noted that the Company continues to have had no need to make use of any of the governmental pandemic economic support packages made available.

he sale of MAM to Liontrust as announced on 7 December 2021 is expected to complete by June 2022 and will

not have any material impact on the going concern position of the Company.

As such the Board is of the view that the Company will be able to meet its obligations to 13 December 2022, being twelve months from the date of the approval of the financial statements, and therefore continues to adopt the going concern basis in preparing the financial statements.

By Order of the Board

Link Company Matters Limited

Company Secretary

13 December 2021

 

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The Directors are responsible for preparing the Annual Report and the Company financial statements in accordance with applicable United Kingdom law. Under that Law, the Directors are required to prepare the financial statements in accordance with international accounting standards in conformity with the requirements of the Companies Act 2006. Under Company Law the Directors must not approve the Company financial statements unless they are satisfied that they present fairly the financial position, financial performance and cash flows of the Company for that period. In preparing the Company financial statements the Directors are required to:

●	select suitable accounting policies in accordance with IAS 8: Accounting Policies, Changes in Accounting Estimates and Errors and then apply them consistently;
●	present information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable information;
●	provide additional disclosures when compliance with the specific requirements in international accounting standards in conformity with the requirements of the Companies Act 2006 are insufficient to enable users to understand the impact of particular transactions, other events and conditions on the Company's financial position and financial performance;
●	state that the Company has complied with international accounting standards, subject to any material departures disclosed and explained in the financial statements;
●	make judgements and estimates that are reasonable and prudent; and
●	state that the Annual Report, taken as a whole, is fair, balanced and understandable and provides sufficient information to allow shareholders to assess the Company's performance.

The Directors are responsible for keeping adequate 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 enable them to ensure that the Company financial statements comply with the Companies Act 2006. 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.

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

The Directors of the Company, whose names are shown on in the full annual report and accounts, each confirm to the best of their knowledge that:

●	the financial statements, which have been prepared in accordance with International Accounting Standards in conformity with the Companies Act 2006, give a true and fair view of the assets, liabilities, financial position and loss of the Company;
●	the Annual 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 risks and uncertainties that it faces; and
●	they consider that the Annual Report, taken as a whole, is fair, balanced and understandable and provides the information necessary for shareholders to assess the Company's performance, business model and strategy.

By order of the Board

R David Henderson

Chairman

13 December 2021

REPORT OF THE DEPOSITARY

Report of the Depositary to the shareholders of Majedie Investments PLC

Depositary's responsibilities

The Depositary is responsible for the safekeeping of all custodial assets of the Company, for verifying and maintaining a record of all other assets of the Company and for the collection of income that arises from those assets.

It is the duty of the Depositary to take reasonable care to ensure that the Company is managed in accordance with the UK Alternative Investment Fund Managers Directive (UK AIFMD), the FUND Sourcebook and the Company's Instrument of Incorporation, in relation to the calculation of the net asset value per share and the application of income of the Company. The Depositary also has a duty to monitor the Company's compliance with investment restrictions and leverage limits set in its offering documents.

Report of the Depositary to the shareholders of Majedie Investments PLC for the year ended 30 September 2021

Having carried out such procedures as we consider necessary to discharge our responsibilities as Depositary of the Company, it is our opinion, based on the information available to us and the explanations provided, that in all material respects the Company, acting through the AIFM has been managed in accordance with UK AIFMD, the FUND sourcebook, the Instrument of Incorporation of the Company in relation to the calculation of the net asset value per share, the application of income of the Company; and with investment restrictions and leverage limits set in its offering documents.

For and on behalf of

The Bank of New York Mellon (International) Limited

One Canada Square

London E14 5AL

NON-STATUTORY ACCOUNTS

The financial information set out below does not constitute the Company's statutory accounts for the years ended 30 September 2021 and 30 September 2020 but is derived from those accounts. Statutory accounts for 2020 have been delivered to the Registrar of Companies, and those for 2021 will be delivered in due course. The Auditors have reported on those accounts; their report was (i) unqualified, (ii) did not include a reference to any matters to which the Auditors drew attention by way of emphasis without qualifying their report and (iii) did not contain a statement under Section 498 (2) or (3) of the Companies Act 2006. The text of the Auditors' report can be found in the Company's full Annual Report and Accounts at www.majedieinvestments.com.

STATEMENT OF COMPREHENSIVE INCOME

for the year ended 30 September 2021

	2021			2020
	Notes	Revenue return £000	Capital return £000	Total £000	Revenue return £000	Capital return £000	Total £000
Investments
Gains/(losses) on investments at fair value through profit or loss	13		23,839	23,839		(20,385)	(20,385)
Net Investment Result			23,839	23,839		(20,385)	(20,385)
Income
Income from investments	3	6,078		6,078	5,958		5,958
Other income	3	70		70	76		76
Total income		6,148		6,148	6,034		76
Expenses
Management fees		(76)	(228)	(304)	(68)	(203)	(271)
Administration expenses		(681)	(573)	(1,254)	(742)	(704)	(1,446)
Return/(loss) before finance costs and taxation		5,391	23,038	28,429	5,224	(21,292)	(16,068)
Finance costs	8	(387)	(1,145)	(1,532)	(381)	(1,143)	(1,524)
Net return/(loss) before taxation		5,004	21,893	26,897	4,843	(22,435)	(17,592)
Taxation	9	(15)		(15)	(10)		(10)
Net return/(loss) after taxation for the year		4,989	21,893	26,882	4,833	(22,435)	(17,602)
Return/(loss) per Ordinary Share		pence	pence	pence	pence	pence	pence
Basic	11	9.4	41.3	50.7	9.1	(42.3)	(33.2)

The total column of this statement is the Statement of Comprehensive Income of the Company. There is no other comprehensive income for the year and hence the net return/(loss) after taxation for the year is also total comprehensive income. All amounts relate to continuing operations.

STATEMENT OF CHANGES IN EQUITY

for the year ended 30 September 2021

	Notes	Share capital £000	Share premium £000	Capital redemption reserve £000	Capital reserve £000	Revenue reserve £000	Total £000
Year ended 30 September 2021
As at 1 October 2020		5,301	3,054	99	97,518	25,361	131,333
Share buybacks for cancellation	17	(1)		1	(18)		(18)
Net return for the year					21,893	4,989	26,882
Dividends declared and paid in year	10					(6,044)	(6,044)
As at 30 September 2021		5,300	3,054	100	119,393	24,306	152,153
Year ended 30 September 2020
As at 1 October 2019		5,305	3,054	95	120,046	26,574	155,074
Share buybacks for cancellation	17	(4)		(4)	(93)		(93)
Net (loss)/return for the year					(22,435)	4,833	(17,602)
Dividends declared and paid in year	10					(6,046)	(6,046)
As at 30 September 2020		5,301	3,054	99	97,518	25,361	131,333

 

BALANCE SHEET

as at 30 September 2021

	Notes	2021 £000	2020 £000
Non-current assets
Property and equipment	12	244	309
Investments at fair value through profit or loss	13	170,550	145,471
		170,794	145,780
Current assets
Trade and other receivables	14	400	269
Cash and cash equivalents	15	3,162	7,525
		3,562	7,794
Total assets		174,356	153,574
Current liabilities
Trade and other payables	16	(1,405)	(1,421)
Total assets less current liabilities		172,951	152,153
Non-current liabilities
Debenture and lease liability	16/19	(20,798)	(20,820)
Total liabilities		(22,203)	(22,241)
Net assets		152,153	131,333
Represented by:
Ordinary share capital	17	5,300	5,301
Share premium account		3,054	3,054
Capital redemption reserve		100	99
Capital reserve		119,393	97,518
Revenue reserve		24,306	25,361
Equity Shareholders' Funds		152,153	131,333
Net asset value per share	18	pence	pence
Basic		287.1	247.7

Approved by the Board of Majedie Investments PLC (Company no 109305) and authorised for issue on 13 December 2021.

R David Henderson

Chairman

 

CASH FLOW STATEMENT

for the year ended 30 September 2021

	Notes	2021 £000	2020 £000
Net cash flow from operating activities
Net return/(loss) before taxation*		26,897	(17,592)
Adjustments for:
(Gains)/losses on investments	13	(23,839)	20,385
Accumulation dividends	3	(326)	(253)
Depreciation	12	66	17
Foreign exchange losses/(gains)		2	(2)
Purchases of investments		(47,536)	(41,824)
Sales of investments		46,496	49,500
		1,760	10,231
Finance costs		1,532	1,524
Operating cashflows before movements in working capital		3,292	11,755
Increase/(decrease) in trade and other payables		42	(21)
(Increase)/decrease in trade and other receivables		(106)	42
Net cash inflow from operating activities before tax		3,228	11,776
Tax recovered on overseas dividend income		19	11
Tax on overseas dividend income		(24)	(17)
Net cash inflow from operating activities		3,223	11,770
Investing activities
Purchase of tangible assets		(1)	(1)
Initial direct costs incurred for the right-of-use asset		(15)	(2)
Net cash outflow from investing activities		(16)	(3)
Financing activities
Interest paid on debentures	19	(1,501)	(1,501)
Interest paid on lease liability	19	(6)
Dividends paid	10	(6,044)	(6,046)
Lease liability principal repayments	19	(19)
Share buybacks for cancellation	17		(93)
Net cash outflow from financing activities		(7,570)	(7,570)
(Decrease)/increase in cash and cash equivalents for the year		(4,363)	4,127
Cash and cash equivalents at start of year		7,525	3,398
Cash and cash equivalents at end of year		3,162	7,525

* Includes dividends received in the year of £5,652,000 (2020: £5,748,000) and interest received of £Nil (2020: £Nil

NOTES TO THE ACCOUNTS

General Information

Majedie Investments PLC is a company incorporated and domiciled in England under the Companies Act 2006. The Company is registered as a public limited company and is an investment company as defined by Section 833 of the Companies Act 2006. The address of the registered office is given on page 104 of the Annual Report. The nature of the Company's operations and its principal activities are set out in the Business Review section of the Strategic Report on pages 22 to 28 of the Annual Report.

1 Significant Accounting Judgements, Estimates and Assumptions

The preparation of financial statements in accordance with International Accounting Standards in conformity with the requirements of the Companies Act 2006 requires management to exercise its judgement in the process of applying the Company's accounting policies. It also requires the use of certain significant estimates and assumptions.

In the course of preparing the financial statements, no critical judgements have been made in the process of applying the Company's accounting policies, apart from those involving estimates, which are shown separately below, that have had a significant effect on the amounts recognised in the financial statements.

The following are the areas where critical estimates and assumptions have been used:

· Unquoted Investments

Unquoted investments are valued at management's best estimate of fair value in accordance with International Accounting Standards having regard to International Private Equity and Venture Capital Valuation guidelines as recommended by the British Venture Capital Association. The principles which the Company applies are set out on pages 69 to 71of the Annual Report. The inputs into the valuation methodologies adopted include historical data such as earnings or cash flow as well as more subjective data such as earnings forecasts, discount rates and earnings multiples. As a result of this, the determination of fair value requires management judgement. At the year end, unquoted investments (including the investment in MAM but excluding the MAM funds) represent 14.6% (2020: 20.4%) of Equity Shareholders' Funds.

1 Significant Accounting Policies

The principal accounting policies adopted are set out as follows:

The accounts on pages 61 to 94 of the Annual Report comprise the audited results of the Company for the year ended 30 September 2021 and are presented in pounds Sterling rounded to the nearest thousand, as this is the functional currency in which the Company transactions are undertaken.

Going Concern

The Directors have considered the ongoing impact from the COVID-19 pandemic and remain of the view that this will have a limited financial impact on the Company's resources and continuing existence. As part of the assessment of going concern the Directors took into account the uncertain economic outlook associated with the pandemic which included the level of cash and cash equivalents and readily realisable securities which could meet short-term commitments, the ability of the Company to meet its liabilities and on-going expenses from investments, revenue forecasts for the forthcoming year, the ability of the Company and its service providers to continue to meet service levels and lastly performing stress testing (see page 36 of the Annual Report). After completing the assessment the Directors have a reasonable expectation that the Company will be able to meet its obligations to 13 December 2022, being twelve months from the date of approval of the financial statements and therefore the financial statements have been prepared on a going concern basis.

Presentation of Statement of Comprehensive Income

In order to reflect the activities of an investment company and in accordance with guidance issued by the AIC, supplementary information which analyses the Statement of Comprehensive Income between items of a revenue or capital nature has been presented alongside the Statement of Comprehensive Income. Additionally, the net revenue is the measure that the Directors believe to be appropriate in assessing the Company's compliance with certain requirements as set out in section 1158 of the Corporation Tax Act 2010.

Basis of Accounting

The accounts of the Company have been prepared in accordance with International Accounting Standards in conformity with the requirements of the Companies Act 2006.

Where presentational guidance set out in the SORP regarding the financial statements of investment companies and venture capital companies issued by the AIC in October 2019 is not inconsistent with the requirements of international accounting standards, the Directors have sought to prepare the financial statements on a basis compliant with the recommendations of the SORP.

Standards Issued But Not Yet Effective

At the date of authorisation of these financial statements, the following relevant Standards and Interpretations have not been applied in these financial statements since there were in issue but not yet effective and/or adopted:

International Accounting Standards and Interpretations (IAS/IFRS/IFRICs)	Effective Date
Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16	1 January 2021
COVID-19 Related rent concessions amendment to IFRS 16	1 April 2021
Amendments to the conceptual framework for financial reporting	1 January 2022
Amendments to IAS 1 and IAS 8	1 January 2023

The Directors do not anticipate that the adoption of these standards will have a material impact on the Company.

New Standards, Interpretations and Amendments adopted by the Company

The Company applied in the financial year ended 30 September 2021, for the first time, certain standards which are effective for annual periods beginning on or after 1 January 2020. These were amendments to IFRS 9, IAS 39, IFRS 7, IAS 1, IAS 8 and the conceptual framework for financial reporting. None of these amendments has had an impact on the Company's financial position or performance.

Foreign Currencies

Transactions during the period, including purchases and sales of securities, income and expenses, are translated at the rate of exchange prevailing on the date of the transaction.

Monetary assets and liabilities denominated in foreign currencies are retranslated at the functional currency rate of exchange ruling at the balance sheet date. Non-monetary items that are measured in terms of historical cost in a foreign currency are translated at using the exchange rates as at the dates of initial transactions. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when fair value was determined.

Foreign currency transaction gains and losses on financial instruments classified as FVPL are included in profit or loss in the Statement of Comprehensive Income as part of the "Losses on investments at fair value through profit or loss"

Income

Dividend income is recognised on the date when the Company's right to receive the payment is established. Dividend revenue is presented gross of any non-recoverable withholding taxes, which are separately disclosed in the Statement of Comprehensive Income. Where the Company has elected to receive scrip dividends in the form of additional shares rather than cash, the amount of the cash dividend foregone is recognised as income. Special dividends are recognised as capital or revenue in accordance with the underlying nature of the transaction.

Interest income is recognised on an accrual basis.

Expenses

All expenses or fees are recognised on an accruals basis. This includes any pension payments made to the Company's defined contribution personal pension plan. In accordance with the SORP concerning the classification of expense items between capital and revenue, all items are presented as revenue except for as follows:

●	Expenses incurred which are incidental to the acquisition or disposal of an investment are treated as capital costs and separately identified and disclosed (see note 13);
●	Expenses are split and presented separately partly as capital items where a connection with the maintenance or enhancement of the value of the investments held can be demonstrated, and accordingly the investment management fees and certain administrative expenses have been allocated 75% to capital, in order to reflect the Board's expected long-term view of the nature of the investment returns to the Company;
●	The investment management performance fee, which is based on capital out-performance is charged wholly to capital.

Finance Costs

(a)  Debentures

Interest expense is recognised for all interest bearing financial instruments using the effective interest rate method.

In accordance with the SORP, finance costs in respect of financing investments or financing activities aimed at maintaining or enhancing the value of investments are allocated 75% to capital. Any premiums paid on the early repurchase of debenture stock are charged wholly to capital.

(b)  Lease liabilities

Interest expense on lease liabilities is recognised in accordance with IFRS 16.

In accordance with the SORP, finance costs in respect of financing investments or financing activities aimed at maintaining or enhancing the value of investments are allocated 75% to capital. As such property lease liability finance costs are charged wholly to revenue.

Taxation

The tax charge represents the sum of the tax currently payable and deferred tax.

The tax currently payable is based on taxable profit for the year. Taxable profit differs from profit reported in the Statement of Comprehensive Income because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The Company's liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the balance sheet date.

In accordance with the SORP, the allocation method used to calculate tax relief on expenses presented against capital returns in the Statement of Comprehensive Income is the marginal basis. Under this basis, if taxable income is capable of being offset entirely by expenses presented in the revenue return column of the Statement of Comprehensive Income, then no tax relief is transferred to the capital return column.

Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet method. Deferred tax liabilities are recognised for all temporary taxable differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised.

No provision is made for tax on capital gains as the Company operates as an approved investment trust for tax purposes.

Property and Equipment

Property and equipment are stated at initial cost less accumulated depreciation and any recognised impairment loss. Leasehold right-of-use assets are accounted for in accordance with IFRS 16. Depreciation for other tangible assets is calculated using the straight line method and at rates of 25% to 33% per annum.

Leases

The Company applies IFRS 16 and the policies applied under that standard are as follows:

(a) Right-of-use assets

The Company recognises right-of-use assets at the commencement date of the lease (i.e. the date the underlying asset is available for use). Right-of-use assets are measured at cost and the cost includes the amount of lease liabilities recognised, initial direct costs incurred, and lease payments made at or before the commencement date less any lease incentives received. Unless the Company is reasonably certain to obtain ownership of the leased asset at the end of the lease term, the recognised right-of-use assets are depreciated on a straight line basis over the shorter of its estimated useful life and the lease term. Right-of-use assets are subject to impairment.

(b) Lease liabilities

At the commencement date of the lease, the Company recognises lease liabilities measured at the present value of lease payments to be made over the lease term. The lease payments can include fixed payments, less any lease incentives receivable, variable lease payments linked to an index or rate and payments or penalties for terminating a lease - only if reasonably certain to exercise the termination option.

In calculating the present value of lease payments, the Company uses the incremental borrowing rate at the lease commencement date if the interest rate implicit in the lease is not readily determinable. After the commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for the lease payments made. In addition, the carrying amount of lease liabilities is remeasured if there is a modification, a change in the lease term, a change in the in-substance fixed lease payments or a change in the assessment to purchase the underlying asset.

(c)  Short-term leases and leases of low-value assets

As and if applicable, the Company would apply the short-term lease recognition exemption to any short term leases (being leases that have a lease term of 12 months or less without a purchase option) and the low-value recognition exemption to leases that are considered of low value (being below £5,000). Lease payments on any such leases would be recognised as an expense on a straight-line basis over the lease term.

Financial Instruments

The Company applies IFRS 9 Financial Instruments and the policies applied under that standard are as follows:

(a) Classification

In accordance with IFRS 9, the Company classifies its financial assets and liabilities at initial recognition into the categories of financial assets and liabilities as shown below:

Financial Assets

The Company classifies its financial assets as subsequently measured at amortised cost or measured at fair value through profit or loss, on the basis of both:

· the Company's business model, as an investment trust, for managing the financial assets;

· the contractual cash flow characteristics of the financial asset.

Financial assets measured at amortised cost

A debt instrument is measured at amortised cost if it is held within a business model whose objective is to hold financial assets in order to collect contractual cash flows and its contractual terms give rise, on specified dates, to cash flows that are solely payments of principal and interest on the principal amount outstanding. The Company includes in this category short term non-financing receivables including accrued income and trade and other receivables.

Financial assets measured at fair value through profit or loss (FVPL)

A financial asset is measured at FVPL if:

a)  its contractual terms do not give rise to cash flows on specified dates that are solely payments of principal and interest on the principal amount outstanding; or

b)  it is not held within a business model whose objective is either to collect contractual cash flows, or to both collect contractual cash flows and sell; or

c)  at initial recognition, it is irrevocably designated as measured at FVPL when doing so eliminates or significantly reduces a measurement or recognition inconsistency that would otherwise arise from measuring assets or liabilities or recognising the gains or losses on them on different bases.

The Company includes in this category its equity investments.

Financial liabilities

Financial liabilities measured at amortised cost

This category includes all financial liabilities. The Company includes in this category debentures and other short term payables.

(b) Recognition

The Company recognises a financial asset or liability when it becomes a party to the contractual provisions of the instrument. In respect of purchases or sales of financial instruments that require delivery of assets within a time frame generally established by regulation or convention in a market place are recognised on a trade date basis.

(c) Initial Measurement

Financial assets and liabilities at FVPL are recorded in the Statement of Financial Position at fair value. All transaction costs for such instruments are recognised in profit or loss in "(Losses)/gains on investments at fair value through profit and loss" in the Statement of Comprehensive Income. Financial liabilities held at amortised cost are initially recognised at cost, being the fair value of the consideration received less issue costs where applicable.

(d) Subsequent measurement

After initial measurement the Company measures financial instruments which are classified as at FVPL, at fair value. Subsequent changes in the fair value of those financial instruments are recorded in "Gains/(losses) on investments at fair value through profit and loss" in the Statement of Comprehensive Income. Any dividends or interest earned on these instruments are recorded separately under "Income" in the Statement of Comprehensive Income"

Financial liabilities are measured at amortised cost using the effective interest method. Gains and losses are recognised in profit or loss when the liabilities are derecognised, as well as through the amortisation process.

The effective interest rate method is a method of calculating the amortised cost of a financial asset or liability and of allocating and recognising the interest income or expense in profit or loss over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments or receipts through the expected life of the financial asset or liability to the gross carrying amount of financial asset or to the amortised cost of the financial liability.

(e)Derecognition

A financial asset (or where applicable, a part of a financial asset or a part of a group of similar financial assets) is derecognised where the rights to receive cash flows from the asset have expired. Or the Company has transferred its rights to receive cash flows from the asset, and the Company has transferred substantially all of the risks and rewards of the asset or has transferred control of the asset.

A financial liability is derecognised by the Company when the obligation under the liability is discharged, cancelled or expired.

(f) Impairment

The Company holds only trade receivables with no financing component and which have maturities of less than 12 months at amortised cost. Therefore the Company has chosen to apply an approach similar to the simplified approach for expected credit losses under IFRS 9 to all its trade receivables. The Company does not track changes in credit risk, but instead recognises a loss allowance, if any, based on the lifetime expected credit losses at each balance sheet date.

(g) Fair value measurement

The Company measures its investments in financial instruments, such as equity instruments, at fair value at each balance sheet date.

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the balance sheet date. The fair value for financial instruments traded in active markets at the balance sheet date is based on their quoted price (bid price for long positions), without any deduction for transaction costs. The fair value for financial instruments that are either unit trusts or open ended investment companies are based on their closing price, the bid price or the single price as appropriate, as released by the relevant fund administrator.

Fair values for unquoted investments, or investments for which the market is inactive, are established by using various valuation techniques in accordance with the International Private Equity and Venture Capital Valuation (IPEV) guidelines. These may include recent arm's length market transactions, the current fair value of another instrument which has substantially the same earnings multiples, discounted cash flow analysis and option pricing models. Where there is a valuation technique commonly used by market participants to price the instrument and that technique has been demonstrated to provide reliable estimates of prices obtained in actual market transactions, that technique is utilised.

The Company identifies transfers between levels in the hierarchy by re-assessing the categorisation (based on the lowest level input that is significant to the fair value measurement as a whole), and deems transfers to have occurred at the beginning of each reporting period.

Changes in the fair value of investments and gains on the sale of investments are recognised as they arise in the Statement of Comprehensive Income.

Cash and Cash Equivalents

Cash and cash equivalents comprise cash on hand and short-term deposits in banks that are readily convertible to known amounts of cash and that are subject to an insignificant risk of changes in value.

Share Capital

Upon the issuance of Ordinary 10p shares, the consideration received is included in equity. Transaction costs incurred by the Company in issuing its own equity instruments are accounted for as a deduction from equity. Any excess consideration over the nominal value of any Ordinary 10p shares issued, before transaction costs, is credited to the Share Premium Account.

Own equity instruments that are repurchased for cancellation are deducted from Equity Shareholders Funds and accounted for at amounts equal to the consideration paid, including any directly attributable incremental costs. In accordance with the Company's Articles, the total cost of any such transactions will be deducted from the Capital Reserve.

Capital Reserve

The Capital Reserve includes gains and losses on the sale of financial instruments, and investment holding gains or losses, as reported in the Statement of Comprehensive Income. Additionally any finance costs and expenses charged to capital in accordance with the Company's policy, and as detailed above, the cost of any shares repurchased for cancellation, are debited against the Capital Reserve.

Revenue Reserve

The net revenue for the year is included in the Revenue Reserve along with dividends to shareholders, when approved.

Dividends payable to Shareholders

Dividends are at the discretion of the Company. A dividend to the Company's shareholders is accounted for as a deduction from the Revenue Reserve. An interim dividend is recognised as a liability in the period in which it is irrevocably declared by the Board of Directors. A final dividend is recognised as a liability in the period in which it is approved by the Company's shareholders in a Annual General Meeting.

2 Business Segments

For management purposes the Company is organised into one principal activity, being investing activities, as detailed below:

Investing activities

The Company's investment objective is to maximise total shareholder return whilst increasing dividends by more than the rate of inflation over the long term. The Company operates as an investment company and its portfolio contains investments in companies listed in a number of countries. Geographical information about the portfolio is provided on page 17 of the Annual Report and exposure to different currencies is disclosed in note 22 on pages 87 of the Annual Report.

3 Income

	2021 £000		2020 £000
Income from investments†
Dividend income*	5,647		5,631
Accumulation dividend income	326		253
Overseas dividend income	105		74
		6,078		5,958
Other income
Interest income	70		76
Sundry income		70		76
Total income		6,148		6,034
Income from investments
Listed UK	1,408		1,167
Listed overseas	105		74
Unlisted - MAM funds	538		690
Unlisted	4,027		4,027
		6,078		5,958

† Special dividends received during the year and not recognised in income but rather as a return of capital were £489,000 (2020: Nil).

* Includes MAM Ordinary income of £4,027,000 (2020: £4,027,000) and Property Income Distribution (PID) dividend income of £Nil (2020: £13,000).

4 Management Fees

	2021			2020
Fund management	Revenue return £000	Capital return £000	Total £000	Revenue return £000	Capital return £000	Total £000
	76	228	304	68	203	271
	76	228	304	68	203	271

The fund management fees are payable to MAM in accordance with the Investment Agreement and the material terms are disclosed in the Directors' Report on page 33 of the Annual Report. The fund management fees charged and shown are only in respect on the investment in the MAM UKES Segregated Portfolio. Fund management fees in respect of the investments made in the other MAM funds are charged directly in the relevant fund and included in the relevant fund's published net asset value price and hence form part of that investment's valuation in the Company's accounts. At 30 September 2021, an amount of £81,000 was outstanding for payment of fund management fees due to MAM on the UKES Segregated Portfolio (2020: £65,000).

5 Administrative Expenses

	2021 £000		2020 £000
Staff costs - note 7	468		464
Other staff costs and directors' fees	224		243
Advisers' costs	228		305
Information costs	117		117
Establishment costs	39		41
Operating lease rentals - premises			59
Depreciation on tangible assets	66		17
Auditor's remuneration (see below)	51		41
Other expenses	61		159
		1,254		1,446

A charge of £573,000 (2020: £704,000) to capital and an equivalent credit to revenue has been made in the Company has been made to recognise the accounting policy of 75% of direct investment administration expenses to capital.

Total fees charged by the Auditor for the year, all of which were charged to revenue, comprised:

	2021 £000		2020 £000
Audit services - statutory audit	49		40
Other audit related services	2		1
		51		41

Other audit related services relate to a review of the Company's debenture covenant.

6 Directors' Emoluments

	2021 £000		2020 £000
Fees	189		167
Salary	192		191
Other benefits	9		10
		390		368

The Report on Directors' Remuneration on pages 46 to 49 of the Annual Report explains the Company's policy on remuneration for Directors for the year. It also provides further details of Directors' remuneration.

7 Staff Costs including CEO

	2021 £000		2020 £000
Salaries and other payments	387		383
Social security costs	50		50
Pension contributions	31		31
		468		464

	2021 Number	2020 Number
Average number of employees:
Management and office staff	3	3

8 Finance Costs

	2021			2020
	Revenue return £000	Capital return £000	Total £000	Revenue return £000	Capital return £000	Total £000
Interest on 7.25% 2025 debenture stock	375	1,126	1,501	375	1,126	1,501
Amortisation of debenture stock issue expenses	6	19	25	6	17	23
Lease liability interest expense	6		6
	387	1,145	1,532	381	1,143	1,524

Further details of the debenture stock in issue are provided in note 16 and note 22, and the lease liability in note 20.

9 Taxation

	2021 £000	2020 £000
Tax on overseas dividends	15	10

Reconciliation of tax charge:

The current taxation rate for the year is lower (2020: lower) than the standard rate of corporation tax in the UK of 19.0% (2020: 19.0%). The differences are explained below:

	2021 £000		2020 £000
Net return/(loss) before taxation		26,897		(17,592)
Taxation at UK Corporation Tax rate of 19.0% (2020: 19.0%)	5,110		(3,342)
Effects of:
- UK dividends which are not taxable	(1,128)		(1,129)
- foreign dividends which are not taxable	(38)		(15)
- (gains)/losses on investments which are not taxable	(4,338)		3,873
- expenses which are not deductible for tax purposes	88		87
- excess expenses for the current year	306		526
- overseas taxation which is not recoverable	15		10
Actual current tax charge		15		10

After claiming relief against accrued income taxable on receipt, the Company has unrelieved excess expenses of £97,190,000 (2020: £93,627,000). It is not yet certain that the Company will generate sufficient taxable income in the future to utilise these expenses are therefore no deferred tax asset has been recognised.

The allocation of expenses to capital does not result in any tax effect. Due to the Company's status as an approved investment trust, and the intention to continue meeting the required conditions in the foreseeable future, the Company has not provided for deferred tax on any capital gains and losses arising on the revaluation or disposal of its investments.

10 Dividends

The following table summarises the amounts recognised as distributions to equity shareholders in the period:

	2021 £000		2020 £000
2019 Final dividend of 7.0p paid on 28 January 2020			3,713
2020 Interim dividend of 4.4p paid on 19 June 2020			2,333
2020 Final dividend of 7.0p paid on 26 January 2021	3,711
2021 Interim dividend of 4.4p paid on 18 June 2021	2,333
		6,044		6,046

	2021 £000		2020 £000
Proposed final dividend for the year ended 30 September 2021 of 7.0p (2020: final dividend of 7.0p) per ordinary share	3,710		3,711
		3,710		3,711

The proposed final dividend has not been included as a liability in these accounts in accordance with IAS 10: Events after the Reporting Period.

Set out below is the total dividend to be paid in respect of the financial year. This is the basis on which the requirements of Section 1158 of the Corporation Tax Act 2010 are considered:

	2021 £000		2020 £000
Interim dividend for the year ended 30 September 2021 of 4.40p (2020: 4.40p) per ordinary share.)	2,333		2,333
Final dividend for the year ended 30 September 2021 of 7.0p (2020: 7.0p) per ordinary share.	3,710		3,711
		6,043		6,044

Distributable reserves of the Company comprise the Capital and Revenue Reserves.

Dividends have been made solely from the Revenue Reserve.

11 Return per Ordinary Share

Basic return per ordinary share is based on 53,013,842 ordinary shares, being the weighted average number of shares in issue (2020: Basic return based on 53,027,870 ordinary shares). Basic returns per ordinary share are based on the net return after taxation attributable to equity shareholders.

	2021 £000		2020 £000
Basic revenue returns are based on net revenue after taxation of:	4,989		4,833
Basic capital returns are based on net capital return/(loss) of:	21,893		(22,435)
Basic total returns are based on a return/(loss) of:		26,882		(17,602)

12 Property and Equipment

	Right-of-use asset £000		Leasehold Improve-ments £000		Office Equipment £000		Total £000
Cost: At 1 October 2020 Additions Disposals	304		28		251 1		583 1
At 30 September 2021		304		28		252		584
Depreciation: At 1 October 2020 Charge for year Disposals	1 61		28		245 5		274 66
At 30 September 2021		62		28		250		340
Net book value: At 30 September 2021		242				2		244
At 30 September 2020		303				6		309

The Right-of Use Asset is in respect of a leasehold interest in office premises. Further details concerning leases are contained in note 20 on page 85 of the Annual Report.

	Right-of-use asset £000		Leasehold Improve-ments £000		Office Equipment £000		Total £000
Cost: At 1 October 2019 Additions Disposals	304		28		250 1		278 305
At 30 September 2020		304		28		251		583
Depreciation: At 1 October 2019 Charge for year Disposals	1		21 7		236 9		257 17
At 30 September 2020		1		28		245		274
Net book value: At 30 September 2020	303					6		309
At 30 September 2019				7		14		21

13 Investments at Fair Value Through Profit or Loss

	2021				2020
	Listed £000	Unlisted (MAM Funds) £000	Unlisted £000	Total £000	Listed £000	Unlisted (MAM Funds) £000	Unlisted £000	Total £000
Opening book cost	42,756	64,004	2,331	109,091	48,714	68,092	2,331	119,137
Opening investment holding (losses)/gains	(4,109)	11,778	28,711	36,380	(325)	15,547	38,555	53,777
Opening fair value	38,647	75,782	31,042	145,471	48,389	83,639	40,886	172,914
Opening fair value
Purchases at cost	32,771	15,003		47,774	27,869	14,496		42,365
Sales proceeds received	(21,896)	24,638)		(46,534)	(28,601)	(20,822)		49,423)
Gains/(losses) on investments	11,041	18,639	(5,841)	23,839	(9,010)	(1,531)	(9,844)	(20,385)
Closing fair value	60,563	84,786	25,201	170,550	38,647	75,782	31,042	145,471
Closing book cost	53,473	61,365	2,331	117,169	42,756	64,004	2,331	109,091
Closing investment holding gains/(losses)	7,090	23,421	22,870	53,381	(4,109)	11,778	28,711	36,380
Closing fair value	60,563	84,786	25,201	170,550	38,647	75,782	31,042	145,471

The Company received £46,534,000 (2020: £49,423,000) from investments sold in the year. The book cost of these investments when they were purchased was £39,696,000 (2020: £52,411,000). These investments have been revalued over time and until they were sold any unrealised gains/losses were included in the fair value of the investments.

Unlisted investments include an amount of £40,000 in a company (2020: £37,000 in a company) and £25,161,000 (2020: £31,005,000) for the Company's investment in MAM as detailed on page 82 of the Annual Report. Also, further details concerning the investments in the MAM Funds are shown on page 81 of the Annual Report.

During the year the Company incurred transaction costs amounting to £157,000 (2020: £145,000), of which £147,000 (2020: £125,000) related to the purchase of investments and £10,000 (2020: £20,000) related to the sales of investments. These amounts are included in "Losses on investments at fair value through profit or loss", as disclosed in the Statement of Comprehensive Income.

The composition of the investment return is analysed below:

	2021 £000		2020 £000
Net gains/(losses) on sales of equity investments	6,838		(2,988)
Increase/(decrease) in holding gains on equity investments	17,001		(17,397)
Gains/(losses) on investments		23,839		(20,385)

Fair value hierarchy disclosures

The Company is required to classify fair value measurements using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The fair value hierarchy consists of the following three levels:

· Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities.

An active market is a market in which transactions for the asset or liability occur with sufficient frequency and volume on an ongoing basis such that quoted prices reflect prices at which an orderly transaction would take place between market participants at the measurement date. Quoted prices provided by external pricing services, brokers and vendors are included in Level 1, if they reflect actual and regularly occurring market transactions on an arm's length basis.

· Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices).

Level 2 inputs include the following:

· quoted prices for similar (i.e. not identical) assets in active markets.

· inputs other than quoted prices that are observable for the asset (e.g. interest rates and yield curves observable at commonly quoted intervals).

· inputs that are derived principally from, or corroborated by, observable market data by correlation or other means (market corroborated inputs).

· Level 3 - Inputs for the asset or liability that are not based on observable market data (unobservable inputs).

The level in the fair value hierarchy within which an asset or liability is categorised is determined on the basis of the lowest level input that is significant to the fair value measurement of the asset. For this purpose, the significance of an input is assessed against the fair value measurement of an asset or liability in its entirety. If a fair value measurement uses observable inputs that require significant adjustment based on unobservable inputs, that measurement is a Level 3 measurement. Assessing the significance of a particular input to the fair value measurement requires judgement, considering factors specific to the asset or liability.

The determination of what constitutes 'observable' requires significant judgement by the Company. The Company considers observable data to be investments actively traded in organised financial markets, fair value is generally determined by reference to stock exchange quoted market bid prices at the close of business on the balance sheet date, without adjustment for transaction costs necessary to realise the asset.

The table below sets out fair value measurements of financial assets in accordance with the IFRS fair value hierarchy system:

	2021				2020
	Level 1 £000	Level 2 £000	Level 3 £000	Total £000	Level 1 £000	Level 2 £000	Level 3 £000	Total £000
Financial assets held at fair value through profit or loss - equities and managed funds:
Listed equity securities	60,563			60,563	38,647			38,647
Unlisted equity securities (MAM Funds)		84,786		84,786		75,782		75,782
Unlisted equity securities			25,201	25,201			31,042	31,042
	60,563	84,786	25,201	170,550	38,647	75,782	31,042	145,471

Investments whose values are based on quoted market prices in active markets, and therefore are classified within Level 1, include active listed equities. The Company does not normally adjust the quoted price for these instruments (although it may invoke its fair value pricing policy in times of market disruption - this was not the case for 30 September 2021 or 2020).

Financial instruments that trade in markets that are not considered to be active but are valued based on quoted market prices, dealer quotations or alternative pricing sources supported by observable inputs are classified within Level 2. As Level 2 investments include positions that are not traded in active markets and/or are subject to transfer restrictions, valuations may be adjusted to reflect liquidity and/or non-transferability, which are generally based on available market information. During the year there were no transfers (2020: Nil) between Level 1 and Level 2.

Investments classified within Level 3 have significant unobservable inputs. As observable prices are not available for these securities, the Company has used valuation techniques to derive the fair value. In respect of unquoted instruments, or where the market for a financial instrument is not active, fair value is established by using recognised valuation methodologies, in accordance with IPEV Valuation Guidelines. New investments are initially held at cost, for a limited period, then at the price of the most recent investment in the investee. This is in accordance with IPEV Guidelines as the cost of recent investments will generally provide a good indication of fair value. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

The following table presents the movement in Level 3 instruments for the year:

	2021		2020
	Total £000	Equity investments £000	Total £000	Equity investments £000
Opening balance	31,042	31,042	40,886	40,886
Total losses for the year included in the Statement of Comprehensive Income	(5,841)	(5,841)	(9,844)	(9,844)
	25,201	25,201	31,042	31,042

Investments in Investment Funds

The Company has a number of investments in investment funds managed by MAM. Details of those investments are:

	30 September 2021		30 September 2020
	Investment Value £000	Proportion Held %	Investment Value £000	Proportion Held %
MAM Tortoise Fund	21,848	5.4	16,066	4.6
MAM Income Fund			9,394	6.6
MAM Global Equity Fund	44,217	72.6	27,403	68.1
MAM International Equity Fund	13,593	61.0	11,484	64.5
MAM US Equity Fund			8,490	4.4
MAM UK Smaller Companies Fund*	5,128	4.0	2,945	1.5
	84,786		75,782

* The MAM UK Smaller Companies Fund forms part of the MAM UK Equity Segregated Portfolio.

The fees charged on these investments are disclosed in the material contracts section of the Directors' Report on page 33 of the Annual Report

In addition, the total value of all investments managed by MAM at 30 September 2021 was £146.8 million (2020: £115.3 million). Further details on the investments in the MAM funds are contained in the Chief Executive's Report on pages 16 to 19 of the Annual Report.

Substantial Share Interests

The Company's investments in the MAM Global Equity Fund and the MAM International Equity Fund, with a cost of £28.1 million and £10.0 million respectively, are each a substantial interest in those funds at 30 September 2021 (2020: MAM Global Equity Fund and MAM International Equity Fund of £16.5 million and £10 million). As the Company meets the definition of a investment entity under IFRS 10, these holdings are not treated as a subsidiary or associate, rather each is accounted for as an investment held at fair value through profit or loss, in accordance with IAS 28 and IFRS 9.

Majedie Asset Management (MAM)

MAM is a UK based asset management firm providing investment management and advisory services across a range of UK and global equity strategies. The carrying value of the investment in MAM is included in the Balance Sheet as part of investments held at fair value through profit or loss.

	2021 £000	2021 £000
Cost of investment	540	540
Holding gains	24,621	30,465
Fair value of investment at balance sheet date	25,161	31,005

Under the valuation approach used the carrying value is usually assessed and approved quarterly by the Board following the relevant recommendation by the Audit Committee. The valuation basis annualises the most recent quarterly earnings of MAM, applies a median of a peer group price earnings multiple with an unlisted liquidity discount of 20% (although this can be adjusted depending on market conditions). Performance fee earnings multiples are further discounted by 50%. Surplus net assets are then added, having deducted 200% of regulatory capital. A 5% increase/decrease (with all other variables held constant) in:

· management fee revenue results in a 4.2% increase/decrease in the carrying value of MAM;

· performance fee revenue results in a 0.7% increase/decrease in the carrying value of MAM;

· net assets results in a 1.8% increase/decrease in the carrying value of MAM;

· the PE multiples or the liquidity discount results in a 3.6% decrease or a 4.1% increase in the carrying value of MAM.

In accordance with the revised shareholders' agreement, the Company may sell a certain number of shares to the MAM Employee Benefit Trust at the relevant prescribed price (as calculated in accordance with the revised shareholders' agreement). The Company sold no shares during the year (2020: nil).

As at 30 September 2021, the Company holds 57,523 ordinary 0.1p shares representing a 17.6% shareholding in MAM (2020: 57,523 ordinary 0.1p shares representing a 17.2% shareholding).

14 Trade and Other Receivables

	2021 £000	2020 £000
Sales for future settlement	160	122
Prepayments	53	46
Dividends receivable	129	30
Taxation recoverable	58	71
	400	269

The Directors' consider that the carrying amounts of trade and other receivables approximates to their fair value.

15 Cash and Cash Equivalents

	2021 £000	2020 £000
Deposits at banks	2,377	6,756
Other cash balances*	785	769
	3,162	7,525

* Other cash balances represent unclaimed dividends by shareholders. Such cash is held in a separate account by the Company's registrar and is not used by the Company for day-to-day operations.

16 Trade and Other Payables

Amounts falling due within one year:

	2021 £000	2020 £000
Purchases for future settlement	282	370
Accrued expenses	255	245
Other creditors	803	769
Current portion of lease liability	65	37
	1,405	1,421

The Directors' consider that the carrying amounts of trade and other payables approximates to their fair value.

Amounts falling due after more than one year:

	2021 £000	2020 £000
£20.7m (2020: £20.7m) 7.25% 2025 debenture stock	20,595	20,570
Lease liability	203	250
	20,798	20,820

Debenture stock(s) are secured by a floating charge over the Company's assets. Expenses associated with the issue of the debenture stocks were deducted from the gross proceeds at issue and are being amortised over the life of the debentures. Further details on interest and the amortisation of the issue expenses are provided in note 8 on page 75 of the Annual Report.

Further details on the lease liability are contained in note 20 on page 85 of the Annual Report.

17 Ordinary Share Capital

	Number	2021 £000	Number	2020 £000
As at 1 October	53,013,887	5,301	53,055,483	5,305
Ordinary 10p shares bought back for cancellation	(8,000)	(1)	(41,596)	(4)
As at 30 September	53,005,887	5,300	53,013,887	5,301

All shares are allotted fully paid up, and are of one class only. During the year 8,000 Ordinary 10p shares were bought back for cancellation at a total cost of £18,000. In accordance with the Company's articles this was debited against the Capital Reserve. There are no Ordinary 10p shares in Treasury.

Ordinary shares carry one vote each on a poll. The Companies Act 2006 abolished the requirement for the Company to have authorised share capital. The Company adopted new Articles of Association on 20 January 2010 which, inter alia, reflected the new legislation. Accordingly the Company has no authorised share capital.

The directors will still be limited as to the number of shares they can allot at any one time as the Companies Act 2006 requires that directors seek authority from the shareholders for the allotment of new shares.

18 Net Asset Value

The net asset value per share has been calculated based on Equity Shareholders' Funds of £152,153,000 (2020: £131,333,000), and on 53,005,887 (2020: 53,013,887) ordinary shares, being the number of shares in issue at the year end.

19 Reconciliation of changes in liabilities arising from financing activities

			Non-cash charges
Long term borrowings	As at 30 September 2020 £000	Cash Flows £000	Other £000	Effective interest rate accrual £000	At 30 September 2021 £000
£20.7m 7.25% 2025 debenture stock	20,570			25	20,595
Lease liability	250	(25)	(28)	6	203
Interest payable on debenture stock		(1,501)		1,501
Total liabilities from financing activities	20,820	(1,526)	(28)	1,532	20,798

				Non-cash charges
Long term borrowings	As at 30 September 2019 £000	Cash Flows £000	New Lease £000	Other £000	Effective interest rate accrual £000	At 30 September 2020 £000
£20.7m 7.25% 2025 debenture stock	20,547				23	20,570
Lease liability			287	(37)		250
Interest payable on debenture stock		(1,501)			1,501
Total liabilities from financing activities	20, 547	(1,501)	287	(37)	1,524	20,820

The Other column includes the effect of the reclassification of the current portion of the lease liability. Further details on the lease liability on contained in note 20.

20 Leases

The Company as a lessee

This is in respect of its premises which by way of a sub-lease arrangement with a superior lessee, which commenced in September 2020 for a term of five years.

Set out below are the carrying amounts of lease liabilities and the movements during the period:

At 1 October	2021 £000	2020 £000
Additions	287	287
Payments made under the lease	(25)
Accretion of interest	6
	268	287
At 30 September
Disclosed as:
Current	65	37
Non-current	203	250

The following are the amounts recognised in profit or loss under its IFRS 16 lease:

	2021 £000	2020 £000
Depreciation expense of right of use assets	61	1
Interest expense on lease liabilities	6
Total amount recognised in profit or loss	67	1

The Company has had no expenses relating to short-term leases, variable lease payments or leases of low-value assets.

The Company's total cash outflows for its IFRS 16 lease in the year ended 30 September 2021 were £25,000 (2020: £Nil). Future cash outflows of a fixed amount under the IFRS 16 lease are as follows:

Expiry date	2021 £000	2020 £000
Within one year Between one and two years Between two and three years Between three and four years Between four and five years	70 70 70 70	35 70 70 70 70
	280	315

21 Financial Commitments

At 30 September 2021, the Company had no financial commitments which had not been accrued for (2020: none).

22 Financial Instruments and Risk Profile

As an investment company, the Company invests in securities for the long term in order to achieve its investment objective as stated on page 1 of the Annual Report. Accordingly the Company is a long term investor and it is the Board's policy that no trading in investments or other financial instruments be undertaken. COVID-19 continues to provide uncertainty and its impact on the Company is mainly in terms of market risk and operational risk (see Business Review on page 25 of the Annual Report).

Management of Market Risk

Management of market risk is fundamental to the Company's investment objective and the investment portfolio is regularly monitored to ensure an appropriate balance of risk and reward.

Exposure to any one entity is monitored by the Board and MAM (the Fund Manager). The Board has complied with the investment policy requirement not to invest more than 15% of the total value of the Company's gross assets, save that the Company can invest up to 25% of its gross assets in any single fund managed by MAM where the Board believes that the investment policy of such funds is consistent with the Company's objective of spreading investment risk.

MAM as Fund Manager, can utilise derivative instruments for efficient portfolio management and investment purposes as it sees fit. There have been no derivatives used in the MAM UKES in the period (2020: None). Certain MAM funds do use derivatives to meet their investment objectives.

The Company's financial instruments comprise its investment portfolio (see note 13), cash balances, debtors and creditors that arise directly from its operations such as sales and purchases for future settlement, accrued income, lease liability under IFRS 16 and the debenture loan used to partially finance its operations.

In the pursuit of its investment objective, the Company is exposed to various risks which could cause short term variation in its net assets and which could result in both or either a reduction in its net assets or a reduction in the revenue profits available for distribution by way of dividend. The main risk exposures for the Company from its financial instruments are market risk (including currency risk, interest rate risk and other price risk), liquidity risk, concentration risk and credit risk. COVID-19 continues to provide uncertainty into global equity markets however as a closed ended investment company with a long-term objective this increased short term volatility can be managed and is within stress testing limits. MAM continue to monitor their fund portfolios and positioning in light of the pandemic and have made adjustments as and if required.

The Board does set the overall investment strategy and allocation. It has in place various controls and limits and receives various reports in order to monitor the Company's exposure to these risks. The risk management policies identified in this note have not changed materially from the previous accounting period.

Market Risk

The principal risk in the management of the investment portfolio is market risk - i.e. the risk that values and future cashflows will fluctuate due to changes in market prices. Market risk is comprised of:

· foreign currency risk; and

· interest rate risk; and

· other price risk i.e. movements in the value of investment portfolio holdings caused by factors other than interest rates or currency movements.

These risks are taken into account when setting investment policy or allocation and when making investment decisions.

Foreign Currency Risk

Exposure to foreign currency risk arises primarily and directly through investments in securities listed on overseas equity markets. A proportion of the net assets of the Company are denominated in currencies other than Sterling, with the effect that the balance sheet and total return can be materially affected by currency movements. The Company's exposure to foreign currencies through its investments in overseas securities as at 30 September 2021 was £4,945,000 (2020: £5,394,000).

The Company's investments in the MAM funds are in sterling denominated share classes. These share classes themselves are not hedged within the relevant MAM fund. The Company also has sterling denominated investments which may pay dividends in foreign currencies. Additionally the investment portfolio is subject to indirect foreign currency risk impacts by having investments in investee companies that whilst listed in the UK have global operations and as such are subject to currency impacts on their assets and revenues. It is not possible to accurately quantify these exposures and impacts.

MAM, as Fund Manager, monitors the Company's exposure to foreign currencies and the Board receives regular reports on exposures. The Company does not hedge any foreign currency exposures back to Sterling.

The currency risk of the non-sterling monetary financial assets and liabilities at the reporting date was:

	2021		2020
Currency exposure	Overseas Investments £000	Total Currency Exposure £000	Overseas Investments £000	Total Currency Exposure £000
US dollar	2,031	2,031	2,783	2,783
Swiss Franc	606	606	1,314	1,314
Euro	1,832	1,832	997	997
Yen			1	1
Other non-Sterling	476	476	299	299
	4,945	4,945	5,394	5,394

Sensitivity Analysis

If Sterling had strengthened by 5% relative to all currencies on the reporting date, with all other variables held constant, the income and net assets would have decreased by the amounts shown in the table below. The analysis was preformed on the same basis for 2020. The revenue impact is an estimated annualised figure based on the relevant foreign currency denominated balances at the reporting date.

Income Statement	2021 £000	2020 £000
Capital Return	(247)	(270)
Net Assets	(247)	(270)

A 5% weakening of Sterling against the same currencies would have resulted in an equal and opposite effect on the above amounts, on the basis that all other variables remain constant.

Interest Rate Risk

The Company's direct interest rate risk exposure affects the interest received on cash balances and the fair value of its debenture. Indirect exposure to interest rate risk arises through the effect of interest rate changes on the valuation of the investment portfolio. All of the financial assets held by the Company are equity shares, which pay dividends, not interest. The Company may, from time to time, hold investments which pay interest.

The Board sets limits for cash balances and receive regular reports on the cash balances of the Company. The Company's fixed rate debenture introduces gearing to the Company which is monitored within limits and is also reported to the Board regularly. Cash balances can also be used to manage the level of gearing to within the range as set by the Board. The Board sets the overall investment strategy and allocation and also have various limits on the investment portfolio which aim to spread the portfolio investments to reduce the impact of interest rate risk on investee company valuations. Regular reports are received by the Board in respect of the Company's investment portfolio and the relevant limits.

The interest rate risk profile of the financial assets and liabilities at the reporting date was:

	2021 £000	2020 £000
Floating rate financial assets: UK Sterling Financial assets not carrying interest	3,162 170,950	7,525 145,740
	174,112	153,265
Fixed rate financial liabilities: UK Sterling Financial liabilities not carrying interest	(20,863) (1,340)	(20,857) (1,384)
	(22,203)	(22,241)

Floating rate financial assets usually comprise cash on deposit with banks which is repayable on demand and receives a rate of interest based, in part, on the UK base rates in force over the period. The Company does not normally hold non-Sterling cash as all foreign currency receivables or payables are converted back into Sterling at the settlement date of the relevant transaction. The fixed rate financial liabilities comprise lease liability under IFRS 16 (see note 20) which total £268,000 and accrue interest at a rate of 2.25% and the Company's debenture, totalling £20.7 million in total on a nominal basis. It pays a rate of interest of 7.25% per annum and will mature in March 2025 (2020: Debenture totalling £20.7 million nominal, maturing in March 2025, with an interest rate of 7.25% per annum. Lease liability under IFRS 16 of £287,000 with an effective interest rate of 2.25%).

Sensitivity Analysis

Based on closing cash balances held as on deposit with banks, a notional 0.5% decrease in the UK base interest rates would have no effect on net assets and the net revenue return before tax of the Company, due to the extremely low rates at the moment.

A 0.5% increase in interest rates would result in a larger impact, as is shown in the table below.

Income statement	2021 £000	2020 £000
Revenue return	12	34
Net assets	12	34

Other Price Risk

Exposure to market price risk is significant and comprises mainly movements in the market prices and hence value of the Company's listed equity security investments and its investments in the unlisted MAM Funds, (although the funds themselves are unlisted they are primarily invested in listed equity securities), which are both disclosed in note 13 on pages 79 to 82 of the Annual Report. The Company also has unlisted investments which are indirectly impacted by movements in listed equity prices and related variables. The Board sets the overall investment strategy and allocation which aims to achieve a spread of investments across sectors and regions in order to reduce risk.

The Board receives reports on the investment portfolio, performance and volatility on a regular basis in order to ensure that the investment portfolio is in accordance with the investment policy.

MAM's policy as Fund Manager is to manage risk through a combination of monitoring the exposure to individual securities, industry and geographic sectors, whilst maintaining a constant awareness in real time of the portfolio exposures in accordance with the investment strategy. Any derivative positions are marked to market and exposure to counterparties is also monitored on a daily basis by MAM. At the year end the Company itself did not hold any derivatives (2020: None).

As mentioned earlier, MAM may, and do, use derivative instruments including index-linked notes, contracts for difference, covered options and other equity-related derivative instruments for efficient portfolio management and investment purposes. As also noted previously this may occur in the MAM funds and there have been no derivatives used in the MAM UKES. The Board has regular presentations from MAM on their investment strategy and approach.

The following table details the exposure to market price risk on the listed and unlisted equity investments:

Non-current investments held at fair value through profit or loss	2021 £000	2020 £000
Listed equity investments	60,563	38,647
Unlisted equity investments (MAM Funds)	84,786	75,782
Unlisted equity investments	25,201	31,042
	170,550	145,471

Sensitivity Analysis

If share prices on listed equity security investments and the unlisted equity investments (MAM Funds) had decreased by 10% at the reporting date with all other variables remaining constant, the net return before tax and the net assets would have decreased by the amounts shown below. Details of the sensitivity analysis in respect of the investment in MAM is shown in note 13.

Income statement	2021 £000	2020 £000
Capital return	14,535	11,443
Net assets	14,535	11,443

A 10% increase in listed equity security share prices would have resulted in a proportionately equal and opposite effect on the above amounts on the basis that all other variables remain constant.

Credit Risk

Credit risk is the risk of other parties failing to discharge an obligation causing the Company financial loss. The Company's exposure to credit risk is managed by the following:

· The Company's investments are held on its behalf by the Company's Depositary, who delegates safekeeping to the Custodian, the Bank of New York Mellon SA/NV, London branch, which if it became bankrupt or insolvent could cause the Company's rights with respect to securities held to be delayed. However under the UK AIFMD, the Depositary provides certain indemnities in respect of the Company's investments. The Company receives regular internal control reports from the Custodian which are reported to and reviewed by the Audit Committee.

· Investment transactions are undertaken by MAM with a number of approved brokers in the ordinary course of business on a contractual delivery versus payment basis. MAM has procedures in place whereby all new brokers are subject to credit checks and approval by them prior to any business being undertaken. MAM utilises the services of a large range of approved brokers thereby mitigating credit risk by diversification.

· Company cash is held at banks that are considered to be reputable and of high quality. Cash balances above a certain threshold are spread across a range of banks to reduce concentration risk.

Credit Risk Exposure

The table below sets out the financial assets exposed to credit risk as at the reporting date:

	2021 £000	2020 £000
Cash on deposit and at banks Sales for future settlement Interest, dividends and other receivables	3,162 160 182	7,525 122 147
	3,504	7,794
Minimum exposure during the year	3,272	3,153
Maximum exposure during the year	21,863	19,943

All amounts included in the analysis above are based on their carrying values.

None of the financial assets were past due at the current or prior reporting date.

Liquidity Risk

Liquidity risk is the risk that the Company will encounter difficulties in meeting its obligations as they fall due.

Liquidity risk is monitored, although it is recognised that the majority of the Company's assets are invested in quoted equities and other quoted securities that are readily realisable (MAM fund investments are highly liquid). The Board has various limits in respect to how much of the Company's assets can be invested in any one company. The unlisted investments in the portfolio are subject to liquidity risk, but such investments (excluding MAM) are in realisation mode and represent a very small part of the portfolio. Nonetheless limits remain for any such investments and liquidity risk would always be considered when making investment decisions in such securities. The Company is subject to concentration risk due to its investment in MAM, at 14.5% (2020: 20.4%) of the Company's total assets. This investment is closely monitored by the Board who receive regular financial and operational reports, and it is believed that the current concentration risk here is mitigated somewhat by the diversification undertaken within the MAM business itself.

The Company maintains an appropriate level of non-investment related cash balances in order to finance its operations. The Company regularly monitors such cash balances to ensure all known or forecasted liabilities can be met. The Board receives regular reports on the level of the Company's cash balances. The Company does not have any overdraft or other undrawn borrowing facilities to provide liquidity.

A maturity analysis of financial liabilities showing remaining contractual maturities is detailed below:

			2021
Undiscounted cash flows	Due within 1 year £000	Due between 1 and 2 years £000	Due between 2 and 3 years £000	Due 3 years and beyond £000	Total £000
7.25% 2025 debenture stock				20,700	20,700
Interest on debenture stock	1,501	1,501	1,501	750	5,253
Payments due in respect of the lease liability	70	70	70	70	28
Trade payables and other liabilities*	1,340				1,340
	2,911	1,571	1,571	21,520	27,573

			2020
Undiscounted cash flows	Due within 1 year £000	Due between 1 and 2 years £000	Due between 2 and 3 years £000	Due 3 years and beyond £000	Total £000
7.25% 2025 debenture stock				20,700	20,700
Interest on debenture stock	1,501	1,501	1,501	750	6,754
Payments due in respect of the lease liability	35	70	70	140	31
Trade payables and other liabilities*	1,384				1,384
	2,920	1,571	1,571	23,091	29,153

* Excludes the current portion of the lease liability.

Categories of financial assets and liabilities

The following table analyses the carrying amounts of the financial assets and liabilities by categories as defined in IFRS 9:

Financial Assets	2021 £000		2020 £000
Financial assets at fair value through profit or loss	170,550		145,471
Equity securities		170,550 3,562		145,471 7,794
Other financial assets*		174,112		153,265
Financial liabilities	22,203		22,241
Financial liabilities measured at amortised cost**		22,203		22,241

* Other financial assets include cash and cash equivalents, sales for future settlement, dividend and interest receivable and other receivables.

** Financial liabilities measured at amortised cost include; debenture stock in issue, lease liability, purchases for future settlement, investment management fees, other payables and accrued expenses.

The investment portfolio has been valued in accordance with the accounting policy in note 1 to the accounts, i.e. at fair value. The lease liability carrying value is considered to be its fair value. The debenture stock is classified as level 3 under the fair value hierarchy. The fair value of the debenture stock is calculated using a standard bond pricing method, using a redemption yield of a similar UK Gilt stock with a appropriate margin being applied.

	Book Value 2021 £000		Book Value 2020 £000		Fair Value 2021 £000		Fair Value 2020 £000
£20.7m (2020: £20.7m) 7.25%	20,595		20,570		23,617		24,939
2025 debenture stock		20,595		20,570		23,617		24,939

Capital Management Policies and Procedures

The Company's capital management objectives are:

· to ensure that it is able to continue as a going concern; and

· to maximise the revenue and capital returns to its shareholders through a mix of equity capital and debt. The Board set a range for the Company's net debt (comprised as debentures less cash) at any one time which is maintained by management of the Company's cash balances.

	2021 £000		2020 £000
Net Debt
Adjusted cash and cash equivalents*	(2,092)		(6,410)
Debentures	20,595		20,570
Lease liability	268		280
Sub total		18,771		14,440
Equity
Equity share capital	5,300		5,301
Retained earnings and other reserves	146,853		126,032
Equity Shareholders Funds		152,153		131,333
Gearing
Net debt as a percentage of Equity Shareholders' Funds		12.3%		11.0%

* ·Adjusted cash and cash equivalents comprise cash plus current assets less current liabilities (excluding the current portion of the lease liability).

Maximum potential gearing represents the highest gearing percentage on the assumption that the Company had no net current assets. As at 30 September 2021 this was 13.7% (2020: 15.9%).

The Board monitors and reviews the broad structure of the Company's capital on an ongoing basis. The review includes:

· the level of gearing, taking into account MAM's views on capital markets; and

· the level of the Company's free float of shares as the Barlow family owns approximately •% of the share capital of the Company; and

· the extent to which revenue in excess of that required to be distributed should be retained.

These objectives, policies and processes for managing capital are unchanged from the prior period.

The Company is also subject to various externally imposed capital requirements which are that:

· the debenture are not to exceed, in aggregate, 66 2/3% of the adjusted share capital and reserves in accordance with the relevant Trust Deed; and

· the Company has to comply with statutory requirements relating to dividend distributions; and

· the UK AIFMD imposes a requirement for all AIFs to have in place a limit on the amount of leverage that they may hold. It is then the responsibility of the relevant AIFM to ensure that this limit is not exceeded, which in this case is the Company (as a self-managed AIF).

Leverage is similar to gearing (as calculated in accordance with AIC guidelines previously), but the UK AIFMD mandates a certain calculation methodology which must be applied. Leverage as calculated under the UK AIFMD methodology for the Company is:

Gross Method	2021 £000	2020 £000
Investments held at fair value through profit or loss	170,550	145,471
Total investments at exposure value as defined under the UK AIFMD	170,550	145,471
Shareholders' funds	152,153	131,333
Leverage (times)	1.12	1.11
Commitment Method	2021 £000	2020 £000
Investments held at fair value through profit or loss Cash and cash equivalents	170,550 3,162	145,471 7,525
Total investments at exposure value as defined under the UK AIFMD	173,712	152,996
Shareholders' funds	152,153	131,333
Leverage (times)	1.14	1.16

The leverage figures calculated above represent leverage as calculated under the gross and commitment methods as defined under the UK AIFMD (a figure of 1 represents no leverage or gearing). The two methods differ in their treatment of amounts outstanding under derivative contracts with the same counterparty, which are not applicable to the Company, and of the treatment of cash balances. In both methods the Company has included the debenture by including the value of investments purchased by those borrowings, rather than their balance sheet value. The Company's leverage limit under the UK AIFMD is 1.5 times, which equates to a borrowing level of 50% (the Company has not exceeded this limit at any time during the year or the prior year).

These requirements are unchanged from the prior year and the Company has complied with them.

23 Related Party Transactions

Majedie Asset Management (MAM)

MAM is the Fund Manager to the Company, under the terms of an Investment Agreement which provides for MAM to manage the Company's investment assets on both a segregated portfolio basis and also by investments into various MAM funds. Details of the Investment Agreement are contained in the material contracts section of the Directors' report on pages 33 and 34 of the Annual Report, As Fund Manager, MAM is entitled to receive fund management fees. In respect of the Segregated Portfolio investment these are charged directly to the Company and are shown as an expense in its accounts. Any fees due in respect of investments made into any MAM funds are charged in the fund's accounts and are therefore included as part of the investment value of the relevant holdings. Details concerning the Company's investments managed by MAM are shown in the Chief Executive's Report on page 6 to 19 of the Annual Report.

MAM is also entitled to receive performance fees on the Company's investment in the MAM Tortoise Fund. There are no performance fees due currently.

In addition to the above, the Company retains an investment in MAM itself. Mr JWM Barlow is a non-executive director of MAM but receives no remuneration for this role. MAM is accounted for as an investment in the Company's accounts and is valued at fair value through profit or loss. Details concerning the Company's investment in MAM are included in the Chief Executive's Report on page 6 and on note 13 on page 82 of the Annual Report.

The table below discloses the transactions and balances for the related party:

Transactions during the period:	2021 £000	2020 £000
Dividend income received from MAM	4,027	4,027
Management fee income due to MAM (Segregated Portfolio only)	304	271
Balances outstanding at the end of the period:
Between the Company and MAM (Segregated Portfolio investment management fees) Value of the Company's investment in MAM	81 25,161	65 31,005

Remuneration

The remuneration of the Directors, who are the key management personnel of the Company, is set out below in aggregate for each of the categories specified in IAS 24: Related Party disclosures. There are no amounts outstanding at 30 September 2021 for Directors fees or salary (2020: Nil). Further information about the remuneration of individual Directors is provided in the audited section of the Report on Directors' Remuneration on page 47 of the Annual Report.

Short term employee benefits

2021 £000	2020 £000
390	368
390	368

24 Post Balance Sheet Date Events

On 7 December 2021, an announcement from Liontrust Asset Management PLC was made that it had entered into an agreement to acquire the Company's Fund Manager, Majedie Asset Management Limited in a transaction that was due to complete in June 2022. The Company has a 17.6% shareholding in MAM.

In accordance with IAS 10, this transaction is not an adjusting event and hence the financial statements have been completed with the value of MAM as at 30 September 2021 as calculated under the existing methodology.

The consideration for MAM shareholders is made up of shares in Liontrust and cash. On completion the Company is expected to be paid £7.7m in the form of dividends and special dividends. At the share price of Liontrust on 7 December 2021, the value of the share consideration is £14.7m. There is further deferred consideration of cash and shares of up to £5.6m which may potentially be due three years after completion that is dependent on future investment performance and growth in assets under management.

Registered Office	Registrars
1 King's Arms Yard	Computershare Investor Services PLC
London EC2R 7AF	The Pavilions
Telephone: [phone]	Bridgwater Road
E-mail: [e-mail]	Bristol BS99 6ZZ
Registered Number: 109305 England	Telephone: [phone]
Company Secretary	Shareholders should notify all changes of name and address in writing to the Registrars. Shareholders may check details of their holdings, historical dividends, graphs and other data by accessing www.investorcentre.co.uk.
Link Company Matters Limited
6th Floor
65 Gresham Street
London EC2V 7NQ
	Shareholders wishing to receive communications from the Registrars by email (including notification of the publication of the annual and interim reports) should register on-line at www.investorcentre.co.uk/ecomms.  Shareholders will need their shareholder number, shown on their share certificate and dividend vouchers, in order to access both of the above services.
Fund Manager
Majedie Asset Management Limited
10 Old Bailey
London EC4M 7NG
Telephone: [phone]
Email: [e-mail]
Depositary	Auditors
The Bank of New York Mellon (International) Limited	Ernst & Young LLP 25 Churchill Place
1 Canada Square	Canary Wharf
London E14 5AL	London E14 5EY
The Depositary acts as global custodian and may delegate safekeeping to one or more global sub-custodians. The Depositary has delegated safekeeping of the assets of the Company to the Bank of New York Mellon SA/NV and The Bank of New York Mellon.	Stockbrokers J.P. Morgan Cazenove 25 Bank Street London E14 5JP
AIFM Majedie Investments PLC Solicitor	ISIN
	Ordinary: GB0005555221
	Debenture 7.25% 31/03/2025: GB0006733058
Dickson Minto W.S.	Ticker
16 Charlotte Square	Ordinary: MAJE
Edinburgh EH2 4DF	Debenture 7.25% 31/03/2025: BD22
Website	Sedol
www.majedieinvestments.com	Ordinary: 0555522
	Debenture 7.25% 31/03/2025: 0673305

Annual General Meeting

The Company's Annual General Meeting will be held on Wednesday 22 January 2020 at City of London Club, 19 Old Broad Street, London EC2N 1DS.

National Storage Mechanism

A copy of the Annual Report and Accounts will be submitted shortly to the National Storage Mechanism ("NSM") and will be available for inspection at the NSM, which is situated at: https://data.fca.org.uk/#/nsm/nationalstoragemechanism.

A copy of the Annual Report and Accounts, which includes the Notice of Annual General Meeting will be delivered to shareholders shortly and can also be found at www.majedieinvestments.com.

ENQUIRIES

If you have any enquiries regarding this announcement, please contact Mr William Barlow on 020 7382 8185.

END

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

LEI: 2138007QEY9DYONC2723

 

END

 

 

FR TIBITMTIBMLB