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Diverse Inc Trust   -  DIVI   

Half-year Report

Released 14:37 12-Feb-2020

Half-year Report



The Directors present the Half-Yearly Financial Report of the Company for the period to 30 November 2019.


Over the six months to 30 November 2019, the Company’s NAV rose by 0.1% This compares with the FTSE All-Share Index that went up 3.6%, the FTSE SmallCap Index (excluding Investment Companies) that went down 1.3% and the FTSE AIM All-Share Index that went down 3.9% over the same period on a capital return basis.

Increased dividends A third interim dividend of 0.90p, a final dividend of 1.10p  and a special dividend of 0.16p in respect of the year ended 31 May 2019 were paid to shareholders during the half year. A first interim dividend of 0.85p for the current year was declared in October 2019 and will be paid to shareholders in February 2020. A second interim dividend of 0.90p, payable in May 2020, has also been declared.

Revenue reserves decreased to £16.8m The Company distributed £8.2m during the half-year period in dividends to shareholders, reducing revenue reserves by £0.7m. The revenue reserves are available to support dividend distributions to shareholders in future years, should incoming portfolio income prove less buoyant.

NAV total return to shareholders of 2.4% This includes the increase in NAV, plus the dividends paid during the half year and compares with an increase in the FTSE All-Share Index of 5.8% on a total return basis over the six months to 30 November 2019.

Share price total return to shareholders of 5.4% On average, the Company’s share price has traded at a 2.0% premium to the NAV over the life of the Company. During this six-month period, the share price has traded at a discount possibly due to anxiety about the political logjam and Brexit. Over the six months under review, the Company’s share price has risen faster than the NAV, as the discount narrowed.

Summary of Results

Half year to
30 November
Half year to   
30 November  
 Year ended   
31 May   
NAV per ordinary share 95.23p    94.64p  95.17p 
Ordinary share price (mid) 91.60p    93.40p  89.00p 
Discount to NAV1 3.81%   1.31% 6.48%
Revenue return per ordinary share 1.99p 1.89p  3.95p 
Ongoing charges1 1.11%2 1.17% 1.16%
Ordinary shares in issue 378,289,047 383,787,239 383,787,239

1 Alternative performance measure. Details provided in the Glossary below.

2 Estimated as at 30 November 2019. Ongoing charges are the Company’s annualised revenue and capitalised expenses (excluding finance costs and certain non-recurring items) expressed as a percentage of the average monthly net assets of the Company during the year.


This Half-Yearly Report covers the period to 30 November 2019, during which mainstream markets rose a little but many small cap share prices were depressed by Brexit uncertainties.


This led to a subdued performance for your Company, which saw its NAV rise by 2.4% and share price by 5.4% over the period on a total return basis.

The FTSE All-Share Index rose 5.8% over the period, whilst the FTSE SmallCap Index (excluding Investment Trusts) rose 0.5% and the FTSE AIM All-Share Index fell by 3.2% over the period on a total return basis, despite a pickup in takeover activity.

The Company’s portfolio continued to generate underlying dividend growth. Over the half  year, the revenue return per share was 1.99p, which compares with 1.89p per share in the equivalent six-month period last year.

The quarterly dividends paid by the Company continue to reflect this underlying growth, with  the first interim dividend up from 0.80p last year to 0.85p. The Board has also declared a second interim dividend of 0.90p, an increase from 0.85p last year, payable on 29 May 2020 to shareholders registered at the close of business on 27 March 2020.

Total return since the Company was listed in April 2011

The Company has been listed for eight and a half years. Despite the subdued returns over the three and a half years since the Brexit referendum, the NAV of the Company has still appreciated much in line with its underlying rate of dividend growth at 8.1% per annum since issue. In addition, the dividend yield was 4.0% in the first year after issue, hence the annualised total return has been around 11.1% per annum. This compares with a total return of 6.9% per annum for the FTSE All-Share Index, 9.4% from the FTSE SmallCap Index (excluding Investment Companies) and 1.3% for the FTSE AIM All-Share Index.

Share redemptions

The Company’s share price reflects the balance of buyers and sellers on the exchange. Hence, when there is an imbalance, its share price can diverge from the Company’s NAV. The Board's policy is to minimise this risk and so, in addition to powers to buy back shares, the Company offers an annual redemption facility.

The next Redemption Point for shareholders will be at the end of May 2020, for those who submit requests during April 2020.

Board succession

We recently announced the appointment to the Board of Michelle McGrade, who brings a wealth of experience and investment knowledge. Over the last three years, we have made four new appointments in order to refresh the Board that was in place at the Company’s launch nearly nine years ago. In order to complete an orderly succession, I will retire at the next AGM.


In October 2019, the Company entered into a £20m unsecured revolving loan facility agreement with The Royal Bank of Scotland, replacing the previous loan facility entered into in September 2016. The facility is available for one year (with an option to request extension for a further year) and provides the scope in certain circumstances to raise the level of borrowing to £45m. The facility was undrawn as at 30 November 2019.


The Company invests across a portfolio of both larger and smaller quoted companies with the principal objective of generating a sound and growing stream of dividend income. One of the great advantages of a multi cap approach is that it offers the Manager more opportunities to build a portfolio of holdings with greater scope for superior growth. Furthermore, there is greater scope to be risk sensitive, through diversification and minimising the need to hold stocks with significant levels of debt.

Given recent investor problems with certain open-ended funds investing in illiquid and unquoted companies, shareholders can be assured that the Company’s entire portfolio is invested in publicly listed and traded stocks that trade regularly. While some of the smaller capitalisation stocks might have less liquidity, the Board believes that they offer potential for greater returns and shareholders are protected by the closed-ended nature of our Company. The Board monitors such risks on a regular basis.

Environmental, Social and Governance (“ESG”)

Investing in quoted companies involves equating the potential upside, along with the potential risk of adverse outcomes. Part of this process involves evaluating how well management teams are able to minimise the risks associated with their governance, together with social and environmental issues that could cause reputational damage. It is anticipated that ESG data will have an increasing prominence in future financial and regulatory reporting. The Board will include a statement on how these issues are addressed in the Annual Report for the year ending 31 May 2020. In the meantime, it is worth noting that Premier Miton is a signatory to the United Nations Principles of Responsible Investment (“UN PRI”) which demonstrates the priority it places on these issues.


In spite of moderate global economic momentum, the Company remains well placed to generate attractive returns. Following the recent UK General Election, investors will likely deploy cash built up during the Brexit uncertainty. The UK stock market has lagged many other global markets and UK valuations are attractive. If this is accompanied by an appreciation of Sterling, then domestically-focused businesses can be expected to perform well. In time, capital is likely to waterfall down to mid caps and thence into small and micro caps, many of which have been overlooked by investors in general.

The UK stock market contrasts with others in that it has a vibrant wide-ranging universe of quoted small and micro caps. In a slow-growth world, it is the Company’s multi cap strategy that is particularly well placed to deliver premium returns.


Last November, Miton Group plc merged with Premier Asset Management Group plc. The Board has been kept informed of progress of the integration, has met the new chief executive and notes the expected commercial synergies, which we will follow closely. Most importantly, our investment team and their investment approach, which have delivered excellent long-term results since launch, will remain unchanged. Further details are included in the Manager’s report below.

Michael Wrobel
12 February 2020


Premier Miton

During November 2019, Premier and Miton merged to form Premier Miton Group plc, which remains an independent company with an emphasis on delivering premium investment returns.

Both Miton and Premier have a heritage of organically growing their fund management businesses from small beginnings, through client-centric fund strategies that have scope to deliver returns that are ahead of others. In the case of Premier, this was principally within funds including shares, bonds and property together, whereas in the case of Miton it was principally via equity portfolios in specific investment universes.

Some of the technology developed by Premier will be very helpful for Miton clients, and the reduction of overlapping costs will allow the combined group to accelerate investing in the business in order to address changing market trends ahead of others.

The day-to-day management of the Company’s portfolio continues to be carried out by Gervais Williams and Martin Turner, who have worked together on the Company since it first listed in April 2011.

Gervais Williams

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

Martin Turner

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

Which stocks helped or hindered the Company’s returns over the half year?

Between the end of May and the end of November 2019, the FTSE 250 stocks (the mid-sized stocks listed on the LSE) appreciated by 9.7%, well ahead of the FTSE All-Share Index that appreciated by 3.6%. In fact, the FTSE 100 Index only rose by 2.6%, and Brexit anxiety held back interest in small caps with the FTSE SmallCap Index (excluding Investment Companies) down 1.3% and the FTSE AIM All-Share Index down 3.9%. The Company’s NAV increased by 0.1% over the six-month period with the subdued returns related to a few FTSE 250 holdings, and relatively large weightings in small caps and AIM-listed stocks. The Company’s positioning traditionally has many small cap holdings because they have delivered greater dividend growth in the past, and also superior long-term returns.

In this half year, Eddie Stobart Logistics, a major trucking business, disappointed its shareholders with an announcement that it had been overstating its profits and needed to suspend its shares while the board considered how to address the debt burden. Ultimately, three investors offered additional capital at a low share price, but only one gained the support of its bankers. Eddie Stobart was revalued down to the new equity issue price during the period and is due to be relisted shortly.

Another portfolio detractor was Amigo, which offers guarantor loans. The company scaled back the number of loans it makes available in order to meet the tighter guideline from the FCA. In spite of its relatively strong balance sheet, the holding was sold from the portfolio as its share price declined, given its poorer dividend growth prospects. However, as two high-profile open-ended investment companies were liquidated later in the period, Amigo’s share price eventually fell to even lower levels, and the Company was able to re-purchase the holding at an unusually high dividend yield.

The strongest contributor to return was Charles Taylor, which rose 51% over the period on an agreed premium takeover. The strongest share price appreciation was Blackbird, a video software business that is now gathering sales and that we expect to generate substantial cash payback in time. Since it was such a small company at the start of the period, its share price was able to rise by 176%, and in our view, to still leave it with further potential upside in future. The portfolio also invested into three financial derivative dealers, which we believe are well placed to resume growth after some more onerous FCA regulations were introduced last year. CMC, IG Group and Plus500 have collectively all contributed to returns of the Company over the half-year period.

Many small and micro cap stocks over the last three and a half years have delivered relatively disappointing returns since the Brexit referendum. Therefore, the Company finished the half year with many of these standing at what appear to be undemanding valuations, as investors fretted over the scope for the Brexit anxiety to persist if there was a hung parliament after the General Election.

How has the Company performed since listing eight and a half years ago?

One the most substantial trends over the last eight and a half year period has been that inflationary pressures have generally remained modest, in spite of monetary expansion and additional Quantitative Easing. This has led to a major reduction in bond yields. The UK Government used to pay 3.4% per year for 10-year debt when the Company was issued, and at the end of November 2019, this cost was down to just 0.7%. Despite this stimulus, global growth has been somewhat modest over this period and, if anything, has slowed over recent years.

Over this period, it has been difficult for many mainstream UK-quoted companies to generate substantial growth. Furthermore, the price earnings ratio, a measure of the valuation of the UK stock market, has also not kept up with the general increase in others, such as the US. The mainstream UK-quoted companies have offset the economic headwinds by growing their dividends, albeit that this growth has been enhanced through a reduction of dividend cover. Therefore, the capital appreciation of the FTSE All-Share Index is only 28.9% since April 2011, whereas the aggregate value of the dividends collected over that period has been 37.9%. In contrast, whilst the return on the FTSE AIM All-Share Index has been boosted by some high-profile growth companies in recent years, overall it has only risen by 0.2% since April 2011 (this is not a misprint!), and when the dividends are included, the total return is only 10.9%. The FTSE Smallcap Index (excluding investment companies) has appreciated by 68.4% over this period, and when dividends are included, the total return is 116.4%.

The Company’s NAV has risen by 95.7% over the eight and a half year period, and when dividends are included, the total return rises to 155.7%. It is worth emphasising that the major part of the capital appreciation was achieved in the years prior to the UK referendum on the EU. Over the last three and a half years, the uncertainty about the nature of the UK’s exit from the EU has led to a degree of investor anxiety, and the share prices of UK smaller quoted companies in particular have not risen as well as the rest of the UK or other mainstream stock markets. As outlined in the Chairman's Statement, it is anticipated that, as the Brexit anxieties fall away, there is scope for UK-quoted stocks to benefit from a period of catch up.

What market trends can be expected when the UK transitions out of the EU?

Three stock market changes occurred after the result of the EU referendum was first announced in June 2016.

  1. The UK exchange rate fell abruptly. This boosted the value of profits generated overseas and increased the Sterling profits of multinational stocks. Hence the FTSE 100 Index actually ended up rising after the Brexit vote.
  2. The share prices of mainstream cyclical stocks such as banks, housebuilders and retailers fell sharply on the assumption that domestic growth prospects were going to be less buoyant.
  3. Small cap stocks were all lumped together with domestics and their share prices were marked down sharply, rather like the cyclicals. After a few months with many small caps reporting upbeat results, their share prices staged a recovery.

Following the General Election result, there is evidence that capital allocations to the UK stock market are now rising as the uncertainty of the Brexit transition falls away. Alongside, the recent UK stock market trends are also reversing.

  1. The UK exchange rate has already started to appreciate, and is a headwind for multinational stocks and the FTSE 100 Index specifically. The best performing sector of the stock market has been the FTSE 250 Index stocks for now.
  2. Specifically, much of these renewed capital flows have been directed towards mainstream cyclicals, such as banks, housebuilders and retailers. However, in spite of the greater confidence, we do not expect the growth of the UK to greatly outpace many others.
  3. In time, we expect the renewed capital inflows into the UK to flow down the market capitalisation bands from the FTSE 250 stocks into small, and then microcap, stocks  given that their valuations are so much lower. We expect many of the best performers to be small and micro caps where their results surprise on the upside.

Importantly, the UK is distinctive in its vibrant community of quoted small and micro caps, and there are few other markets where investors can participate in all the advantages these  stocks offer.

How does the Company add value when markets are particularly volatile?

Stock markets can suffer higher periods of volatility at times, which sometimes involve larger setbacks. The Company has two strategies specifically ready to enhance shareholders return through such a period when it occurs.

A FTSE 100 Put Option

For some years, the Company has invested in a Put option. This option means the Company can sell the FTSE 100 Index at a certain level (6,300 in our case) after the stock market has sold off. This works a bit like portfolio insurance, with the value of the FTSE 100 Put option rising as the FTSE 100 falls below 6,300.

Options come with a cost – a bit like an insurance premium. Specifically, the cost of the Put option will gradually decay over the insured period (to December 2020 in our case), irrespective of whether the markets suffer any fluctuations or not. It is therefore important to minimise the initial cash cost of a Put option, since its resale value generally falls over time (assuming markets are relatively flat) and ultimately becomes worthless if the FTSE 100 Index does not fall significantly below 6,300.

With this in mind, we tend to wait for buoyant periods in the market before purchasing Put options. In addition, we have been cautious about the scale of the Put options purchased. Therefore, the Put option only covers severe market setbacks (in our case when the FTSE 100 Index falls below 6,300) and only covers one quarter of the Company’s total assets. This means that the cost of the option is normally around 1.0% of the NAV per year on average, were the option to expire worthless at the end of its term.

The key advantage of having Put options in the portfolio is that their resale value would be expected to rise in relation to a market sell-off. The full level of that appreciation would be related to the duration of the remaining term of the option as well as the scale of the market setback. If the Put option were to be sold when markets were low, then the cash proceeds could be used to purchase additional equities for the portfolio at a time when their share prices were depressed. The added holdings in the portfolio would then enhance its recovery potential thereafter. Alongside this, the Company would benefit from the extra income from the new holdings added during this period.

In summary, the Put option strategy puts Diverse in a position where it has scope to take advantage of any major market setback, at a relatively modest running cost, if markets do not drop back significantly in the period prior to December 2020.

The Company’s Debt Facility

Generally, as outlined above, we believe the Company has plenty of scope to generate an attractive long-term return without relying on debt. Therefore, it generally does not use borrowing. However, the Company has an unused debt facility ready so it can purchase additional cheap shares and hold them were markets really well placed to recover after a severe setback.

Overall, the Company’s strategy necessarily involves taking stock market risk, which could involve a significant NAV drawdown in the future. At present, the drawdown risk is being offset in part by holding a FTSE 100 Put option since this would rise in value if the mainstream stock market fell sharply before December 2020. If the stock market were to bottom, the Company would have access to a pre-agreed debt facility and would be able to purchase extra holdings and participate in greater scale in the recovery. Together, we believe these strategies put the Company in a position to take some advantage of a significant stock market setback and subsequent recovery, which would enhance the returns of the Company’s NAV over such a period.

What are the prospects for the Company?

Since 2008, a key driver of global growth has been Chinese infrastructure investment. Our collective problem is that after a decade of Chinese infrastructure spend, many of their current projects do not generate enough cash to fund the repayment of their debt. Therefore, the Chinese have found it harder to borrow over recent years, and this has led to a marked slowdown in Chinese growth, and that of the world economy.

As larger companies rarely grow much faster than their host economies, the slowdown in world growth suggests that most mainstream companies will not grow much in future. It also implies stock market returns could turn out to be quite modest. Indeed, the fact that government debt is now standing on ultra-low interest rates also implies that returns on most asset classes are likely to be very modest in future.

Diverse was set up with these challenges in mind. The wide-ranging nature of the multi cap strategy means that the portfolio can pick more of the quoted companies that are able to sustain dividend growth even when the wider economy is not growing. During globalisation and the years of plentiful growth, this differential has not been particularly relevant. However, now that globalisation has evolved into nationalism and global growth has died away, small caps could be important. We would argue that this is the moment when all investors will become more interested in diversifying risk and including more companies with scope to buck the wider economic constraints.

Overall, during the long period of Brexit uncertainty, the valuation of the UK stock market has fallen behind others. Small and micro caps are even more overlooked than mainstream stocks, so we believe that they have potential for an even greater performance catch-up in future. In summary, this process of catch-up has already begun, and hence we are very upbeat about the Company’s prospects over both the short and the longer term.

Gervais Williams and Martin Turner
12 February 2020

as at 30 November 2019



Sector & main activity
% of net
1 Charles Taylor Industrials 8,942 2.5 3.4  
2 Randall & Quilter2 Financials 6,443 1.8 5.03 
3 Legal & General Financials 5,594 1.5 6.0  
4 Diversified Gas & Oil2 Oil & Gas 5,507 1.5 10.4  
5 Strix2 Industrials 5,396 1.5 4.0  
6 4lmprint Consumer Services 5,321 1.5 1.9  
7 Jadestone Energy2 Oil & Gas 5,159 1.4 -  
8 Lloyds Banking Financials 4,667 1.3 5.3  
9 CMC Markets Financials 4,628 1.3 2.4  
10 IG Financials 4,533 1.3 6.4  
Top 10 investments 56,190 15.6
11 Highlands Gold Mining2 Basic Materials 4,530 1.3 6.8  
12 Paypoint Industrials 4,301 1.3 6.5  
13 Kenmare Resources Basic Materials 4,281 1.2 0.9  
14 Sabre Insurance Financials 4,181 1.2 3.9  
15 Norcros Industrials 4,117 1.1 3.5  
16 Manolete Partners2 Financials 4,110 1.1 0.5  
17 Tesco Consumer Services 4,099 1.1 2.9  
18 Rank Consumer Services 4,089 1.1 3.1  
19 Hilton Food Consumer Goods 4,068 1.1 2.2  
20 Aviva Financials 4,033 1.1 7.5  
Top 20 investments 97,999 27.2
21 Royal Bank of Scotland Financials 4,027 1.1 7.7  
22 Centamin Basic Materials 3,989 1.1 4.9  
23 National Grid Utilities 3,987 1.1 5.4  
24 Hostelworld Consumer Services 3,986 1.1 8.5  
25 888 Consumer Services 3,949 1.1 4.3  
26 Morrison (WM) Supermarkets Consumer Services 3,882 1.1 4.4  
27 Smith (DS) Industrials 3,837 1.1 4.2 
28 Morses Club2 Financials 3,783 1.1 6.2 
29 Go-Ahead Consumer Services 3,767 1.1 4.7 
30 Lenergizer2 Industrials 3,744 1.0 6.0 
Top 30 investments 136,950 38.1
31 Lancashire Financials 3,738 1.0 1.6 
32 Admiral Financials 3,737 1.0 6.0 
33 Inspired Energy2 Industrials 3,715 1.0 4.0 
34 Stobart Industrials 3,658 1.0 2.7 
35 Savannah Petroleum2 Oil & Gas 3,608 1.0
36 Redde2 Financials 3,596 1.0 10.5 
37 Zotefoams Basic Materials 3,593 1.0 1.4 
38 Smurfit Kappa Industrials 3,578 1.0 3.1 
39 Mondi Basic Materials 3,563 1.0 4.2 
40 Photo-Me Inernational Consumer Goods 3,506 1.0 9.6 
Top 40 investments 173,242 48.1
Balance held in 93 equity investments 163,507 45.4
Total equity investments 336,749 93.5
600 Group 8% Convertible Loan Notes 14/02/20224 2,506 0.7
Intercede Group 8% Secured Convertible Loan Notes 29/12/20215 1,550 0.4
Hurricane Energy 7.5% Convertible SNR 24/07/2022 (USD) 1,388 0.4
Active Energy 8% Loan Notes 15/03/20225 1,334 0.4
Fixed interest investments 6,778 1.9
Total investments 343,527 95.4
Listed Put option
FTSE 100 – December 2020 6,300 Put 3,563 1.0
 Traded options 3,563 1.0
 Total investment portfolio 347,090 96.4
Other net current assets 13,143 3.6
Net assets 360,233 100.0

1 Source: Thomson Reuters. Based on historical yields and therefore not representative of future yield. Includes special dividends where known.

2 AIM/NEX listed.

3 By way of return of capital.

4 Bermuda Stock Exchange listed.

5 TISE listed.

as at 30 November 2019

Portfolio exposure by sector (%) - £341.7 million
Financials 36.2
Industrials 16.5
Consumer Services 12.7
Basic Materials 8.7
Oil & Gas 7.9
Consumer Goods 6.6
Technology 3.4
Utilities 2.3
Health Care 1.9
Cash and Fixed Interest 1.9
Other 1.0
Telecomms 0.9


Actual income by sector (%) - £8.3 million
Financials 36.0
Industrials 16.9
Consumer Services 13.2
Consumer Goods 11.0
Basic Materials 7.0
Oil & Gas 6.8
Cash and Fixed Interest 3.1
Telecomms 2.2
Technology 1.8
Utilities 1.4
Health Care 0.6


Portfolio by asset allocation (%) - £347.1 million
AIM/NEX Exchanges 33.3
FTSE 100 Index 21.7
FTSE 250 Index 17.2
FTSE SmallCap Index 16.4
Other 5.6
International Equities 2.0
FTSE Fledgling Index 1.9
Cash and Fixed Interest 1.9


Portfolio by spread of investment income (%) –
£8.3 million
FTSE 100 Index 30.3
AIM/NEX Exchanges 28.7
FTSE 250 Index 16.8
FTSE SmallCap Index 14.8
Other 4.3
Cash and Fixed Interest 3.1
FTSE Fledgling Index 2.0

Source: Thomson Reuters.

The LSE assigns all UK-quoted companies to an industrial sector and frequently to a stock market index. The LSE also assigns industrial sectors to many international quoted equities, and those that have not been classified by the LSE have been assigned as though they had. The portfolio as at 30 November 2019 is set out in some detail above, in line with that included in the Balance Sheet. The investment income in the table above comprises all of the income from the portfolio as included in the Income Statement for the six-month period. The AIM and NEX market are both UK exchanges specifically set up to meet the requirements of smaller listed companies.

The first two tables above determine the overall sector weightings of the Company’s capital at the end of the half year, and with regard to the income received by the Company over the six-month period. The second pair of tables determines the LSE stock market index within which portfolio companies sit, and the indices that derive the income received by the Company over the half year.

Investments for the Company’s portfolio are principally selected on their individual merits. As the portfolio evolves, the Manager continuously reviews the portfolio’s overall sector and index balance to ensure that it remains in line with the underlying conviction of the Manager. The Investment Policy is set out below, and details regarding risk diversification and other policies are set out each year in the Annual Report.


Interim Management Report

The important events that have occurred during the period under review, the key factors influencing the financial statements and the principal risks and uncertainties for the remaining six months of the financial year are set out in the Chairman’s Statement and the Manager’s Report above.

The principal risks facing the Group are substantially unchanged since the date of the Annual Report and Accounts for the year ended 31 May 2019 and continue to be as set out in that report on pages 21 to 23.

Risks faced by the Group include, but are not limited to, investment and strategy, smaller companies, sectoral diversification, dividends, share price volatility and liquidity/marketability risk, gearing, key man risk, engagement of third party service providers, market risk and credit and counterparty risk.

Responsibility Statement

The Directors confirm that to the best of their knowledge:

  1. DTR 4.2.7R of the Disclosure Guidance and Transparency Rules, being an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements; and a description of the principal risks and uncertainties for the remaining six months of the year; and
  2. DTR 4.2.8R of the Disclosure Guidance and Transparency Rules, being related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the Group during that period; and any changes in the related party transactions that could do so.

This Half-Yearly Financial Report was approved by the Board of Directors on 12 February 2020 and the above responsibility statement was signed on its behalf by Michael Wrobel, Chairman.

for the half year to 30 November 2019

Half year to
30 November 2019
Half year to
30 November 2018
Year ended
31 May 2019*


Revenue  return 
Capital  return 


Gains/(losses) on investments held at fair value through profit or loss 4,849  4,849  (39,284) (39,284) (33,171) (33,171)
(Losses)/gains on derivative contracts (2,750) (2,750) 1,357  1,357  (48) (48)
Foreign exchange losses (22) (22) (12) (12) (2,914) (2,914)
Income  2 8,389  8,389  8,239  8,239  17,100  17,100 
Management fee (386) (1,157) (1,543) (471) (1,413) (1,884) (900) (2,700) (3,600)
Other expenses (440) (440) (393) (393) (781) (781)
Return on ordinary activities before finance costs and taxation 7,563  920  8,483  7,375  (39,352) (31,977) 15,419  (38,833) (23,414)
Finance costs (13) (39) (52) (15) (45) (60) (30) (91) (121)
Return on ordinary activities before taxation 7,550  881  8,431  7,360  (39,397) (32,140) 15,144  (38,924) (23,535)
Taxation – irrecoverable withholding tax (22) (22) (103) (103) (245) (245)
Return on ordinary activities after taxation 7,528  881  8,409  7,257  (39,397) (32,140) 15,144  (38,924) (23,780)
pence  pence  pence  pence  pence  pence  pence  pence  pence 
Basic and diluted return:
Per ordinary share 3 1.99  0.23  2.22  1.89  (10.27) (8.38) 3.94  (10.14) (6.19)

* Extracted from audited financial statements.

The total column of this statement is the Income Statement of the Group prepared in accordance with IFRS, as adopted by the European Union. The supplementary revenue and capital columns are presented in accordance with the Statement of Recommended Practice issued by the Association of Investment Companies (“AIC SORP”).

All revenue and capital items in the above statement derive from continuing operations. No operations were acquired or discontinued during the year.

There is no other comprehensive income and therefore the return on ordinary activities after tax is also the total comprehensive income.

The accompanying notes are an integral part of these financial statements.








As at 1 June 2019* 434  192,562 45,775  108,999  17,470  365,240 
Total comprehensive income:
Net return for the period - 881  7,528  8,409 
Transactions with shareholders
recorded directly to equity:
Cancellation of shares 5 (6) - (5,239) (5,245)
Equity dividends paid 4 - (8,171) (8,171)
As at 30 November 2019 428  192,562 40,536  109,880  16,827  360,233 
As at 1 June 2018* 434  192,244 45,775  147,923  16,639  403,015 
Total comprehensive income:
Net return for the period -  (39,397) 7,257  (32,140)
Transactions with shareholders
recorded directly to equity:
New issue of shares 318 318 
Equity dividends paid 4 - (7,980) (7,980)
As at 30 November 2018 434  192,562 45,775  108,526  15,916  363,213 


As at 1 June 2018* 434  192,244 45,775  147,923  16,639  403,015 
Total comprehensive income:
Net return for the year - (38,924) 15,144  (23,780)
Transactions with shareholders recorded directly to equity:
Issue or ordinary shares 318 318 
Equity dividends paid 4 - (14,313) (14,313)
As at 31 May 2019* 434  192,562 45,775  108,999  17,470  365,240 

* Extracted from audited financial statements.

The accompanying notes are an integral part of these financial statements.

as at 30 November 2019

30 November 
30 November 
31 May 
Non-current assets:
Investments held at fair value
through profit or loss
343,527  342,586  326,248 
Current assets:
Derivative instruments 3,563  5,735  6,313 
Trade and other receivables 2,320  2,583  5,587 
Cash at bank and cash equivalents 11,423  15,355  27,495 
17,306  23,673  39,395 
Current liabilities:
Trade and other payables (600) (3,046) (403)
Net current assets 16,706  20,627  38,992 
Total net assets 360,233  363,213  365,240 
Capital and reserves:
Share capital – ordinary shares  5 378  384  384 
Share capital – management shares  5 50  50  50 
Share premium account 192,562  192,562  192,562 
Special reserve 40,536  45,775  45,775 
Capital reserve 109,880  108,526  108,999 
Revenue reserve 16,827  15,916  17,470 
Shareholders’ funds 360,233  363,213  365,240 
                    pence  pence  pence 
Net asset value per ordinary share 6 95.23  94.64  95.17

* Extracted from audited financial statements.

The accompanying notes are an integral part of these financial statements.


Half year to 
30 November 
Half year to 
30 November 
Year ended 
31 May 
Operating activities:
Net return before taxation 8,431  (32,037) (23,535)
(Gains)/losses on investments and derivatives held at fair value through profit or loss (2,099) 37,927  36,085 
Non-operating activities to financing activities 62  25  100 
Decrease/(increase) in trade and other receivables 3,267  (252) (3,256)
Increase/(decrease) in trade and other payables 197  (23) (2,666)
Withholding tax paid (22) (103) (245)
Net cash inflow from operating activities 9,836  5,537  6,483 
Investing activities:
Purchase of investments (63,554) (59,065) (99,709)
Sale of investments 51,124  59,862  122,957 
Purchase of derivative instruments (6,753)
Sale of derivative instruments 1,904 
Net cash (outflow)/inflow from financing activities (12,430) 797  18,399 
Financing activities:
Ordinary shares issued 318  318 
Ordinary shares cancelled (5,245)
RBS revolving credit facility non-utilisation fee paid (42) (25) (100)
RBS revolving credit facility arrangement fee paid (20)
Equity dividends paid (8,171) (7,980) (14,313)
Net cash outflow from financing (13,478) (7,687) (14,095)
(Decrease)/increase in cash and cash equivalents (16,072) (1,353) 10,787 
Reconciliation of net cash flow movements in funds:
Cash and cash equivalents at the start of the period 27,495  16,708  16,708 
Net cash (outflow)/inflow from cash and cash equivalents (16,072) (1,353) 10,787 
Cash at bank and cash equivalents at the end of the period 11,423  15,355  27,495 

* Extracted from audited financial statements.

The accompanying notes are an integral part of these financial statements.


1 General Information and Accounting Policies

The consolidated financial statements, which comprise the unaudited results of the Company and its wholly-owned subsidiary, DIT Income Services Limited (together referred to as the “Group”), for the period ended 30 November 2019 have been prepared in accordance with IAS 34 “Interim Financial Reporting”, as adopted by the European Union.

In the current period, the Company has applied a number of amendments to IFRS. These include annual improvements to IFRS, changes in standards, legislative and regulatory amendments, changes in disclosure and presentation requirements. The Company has applied, with associated amendments, for the first time: IFRS 16 Leases. IFRS 16 Leases sets out the principles for the recognition, measurement, presentation and disclosure of leases by lessors and lessees.

The adoption of this standard has not had any material impact on these financial statements, and, apart from the above, the accounting policies used by the Group followed in these half-yearly financial statements are consistent with the most recent Annual Report for the year ended 31 May 2019.

Going concern

The financial statements have been prepared on a going concern basis and on the basis that approval as an investment trust company will continue to be met. The Directors have made an assessment of the Company’s ability to continue as a going concern and are satisfied that the Company has adequate resources to continue in operational existence for the foreseeable future (being a period of at least 12 months from the date on which these financial statements were approved). Furthermore, the Directors are not aware of any material uncertainties that may cast significant doubt upon the Group’s ability to continue as a going concern, having taken into account the liquidity of the Group’s investment portfolio and the Group’s financial position in respect of its cash flows, debt and investment commitments.

Comparative information

The financial information contained in this Half-Yearly Report does not constitute statutory accounts as defined in the Companies Act 2006. The financial information for the half-year periods ended 30 November 2018 and 30 November 2019 has not been audited or reviewed by the Company’s Auditor. The comparative figures for the financial year ended 31 May 2019 have been extracted from the latest published Annual Report and Accounts, which have been reported on by the Company’s Auditor and delivered to the Registrar of Companies. The report of the Auditor was (i) unqualified, (ii) did not include a reference to any matters to which the Auditor 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.

2 Income

Half year to
30 November

Half year to 
30 November 

Year ended 
31 May 
Income from investments:
UK dividends 6,611 5,542  11,839 
UK REIT dividend income 115 188  396 
Unfranked dividend income 1,356 2,076  4,063 
UK fixed interest 262 356  648 
8,344 8,162  16,946 
Other income:
Bank deposit interest 12
Underwriting income - 40  100 
Exchange gains/(losses) 4 (2) (14)
Net dealing profit of subsidiary 29 36  56 
Other income - -
Total income 8,389  8,239  17,100 

3 Return per Ordinary Share

Returns per share are based on the weighted average number of shares in issue during the period. Normal and diluted return per share are the same as there are no dilutive elements on share capital.

Half year to
30 November 2019
Half year to
30 November 2018
Year ended
31 May 2019
£’000 pence £’000  pence  £’000  pence 
Revenue return 7,528 1.99 7,257  1.89  15,144  3.95 
Capital return 881 0.23 (39,397) (10.27) (38,924) (10.14)
Total return 8,409 2.22 (32,140) (8.38) (23,780) (6.19)
Weighted average number of ordinary shares 378,679,629 383,677,403  383,732,171

4 Dividends per Ordinary Share

Amounts recognised as distributions to equity holders in the period.

Half year to
30 November 2019
Half year to
30 November 2018
Year ended
31 May 2019
£’000 pence £’000 pence £’000 pence
In respect of the previous period:
Third interim dividend 3,405 0.90 3,259 0.85 3,260  0.85 
Final dividend 4,161 1.10 3,838 1.00 3,838  1.00 
Special dividend 605 0.16 883 0.23 883  0.23 
In respect of the period under review:
First interim dividend - - - - 3,070 0.8
Second interim dividend - - - - 3,262 0.85
8,171 2.16 7,980 2.08 14,313 3.73

The Board has declared a first interim dividend of 0.85p per ordinary share, payable on 28 February 2020 to shareholders registered at the close of business on 27 December 2019. The ex-dividend date was 24 December 2019. The Board has also declared a second interim dividend of 0.90p per ordinary share, payable on 29 May 2020 to shareholders registered at the close of business on 27 March 2020. The ex-dividend date will be 26 March 2020. In accordance with IFRS, these dividends have not been included as a liability in these financial statements.

5 Called-up Share Capital

The Company, which is a closed-ended investment company with an unlimited life, has a redemption facility through which shareholders are entitled to request the redemption of all or part of their holding of ordinary shares annually on 31 May each year. The Board may, at its absolute discretion, elect not to operate the annual redemption facility in whole or in part. In respect of the 31 May 2019 Redemption Point, the Company received redemption requests for 5,498,192 ordinary shares. All of these shares were redeemed at a calculated Redemption Price of 95.39p per share and cancelled by the Company with effect from 14 June 2019.

The issued share capital consisted of 378,289,047 ordinary shares and 50,000 management shares as at 30 November 2019.

6 Net Asset Value

Ordinary Shares

The NAV per ordinary share and the net assets attributable at the period end were as follows:

30 November 2019 30 November 2018 31 May 2019
per share
 Net assets
per share
Net assets
per share
Net assets
Basic and diluted 95.23 360,233 94.64 363,213 95.17 365,240

NAV per ordinary share is based on net assets at the period end and 378,289,047 ordinary shares, being the number of ordinary shares in issue at the period end (30 November 2018: 383,787,239 and 31 May 2019: 383,787,239 ordinary shares).

Management Shares

The NAV of £1 (30 November 2018: £1 and 31 May 2019: £1) per management share is based on net assets at the period end of £50,000 (30 November 2018: £50,000 and 31 May 2019: £50,000) and 50,000 (30 November 2018: 50,000 and 31 May 2019: 50,000) management shares. The shareholders have no right to any surplus or capital or assets of the Company.

7 Transaction Costs

During the period, expenses were incurred in acquiring or disposing of investments classified as fair value through profit or loss. These have been expensed through capital and are included within gains on investments in the Income Statement. The total costs were as follows:

Half year to
30 November 2019
Half year to
30 November 2018
Year ended
31 May 2019
Costs on acquisitions 241 203 352
Costs on disposals 33 73 119
274 276 471

These transaction costs are dealing commissions paid to stockbrokers and stamp duty, a government tax paid on transactions (which is zero when dealing on the AIM/NEX exchanges). A breakdown of these costs is set out below:

Half year to
30 November 2019

% of average
monthly net assets
Half year to
30 November 2018

% of average monthly net assets

Year ended
31 May 2019

% of average monthly net assets
Costs paid in dealing commissions 77 0.02 112 0.03 180 0.05
Costs of stamp duty 197 0.06 164 0.04 291 0.08
274 0.08 276 0.07 471 0.13

The average monthly net assets for the six months to 30 November 2019 was £354,034,000 (30 November 2018: £388,396,000 and 31 May 2019: £374,922,000).

8 Management Fee

The management fee is calculated at the rate of one-twelfth of 0.9% per calendar month on the average market capitalisation of the Company’s shares up to £300m and
one-twelfth of 0.8% per calendar month on the average market capitalisation between £300m and £500m, and 0.7% above £500m, payable monthly in arrears. In addition to the basic management fee, and for so long as a Redemption Pool is in existence, the Manager is entitled to receive from the Company a fee calculated at the rate of one-twelfth of 1.0% per calendar month of the NAV of the Redemption Pool on the last business day of the relevant calendar month.

At 30 November 2019, an amount of £500,000 was outstanding and due to Miton Trust Managers Limited in respect of management fees (30 November 2018: £294,000 and
31 May 2019: £292,000).

9 Valuation of Financial Instruments

The Company measures fair values using the following hierarchy that reflects the significance of the inputs used in making the measurements. Categorisation within the hierarchy has been determined on the basis of the lowest level input that is significant to the fair value measurement of the relevant assets as follows:

Level 1 – valued using quoted prices, unadjusted in active markets for identical assets or liabilities.

Level 2 – valued by reference to valuation techniques using observable inputs for the asset or liability other than quoted prices included in Level 1.

Level 3 – valued by reference to valuation techniques using inputs that are not based on observable market data for the asset or liability.

The tables below set out the fair value measurements of financial instruments as at the period end, by the level in the fair value hierarchy into which the fair value measurement is categorised.

Financial Assets

Financial assets at fair value through profit or loss
at 30 November 2019

Level 1

Level 2

Level 3

Equity investments 336,217 532 - 336,749
Derivative contracts 3,563 - - 3,563
Fixed interest bearing
1,388 5,390 - 6,778
341,168 5,922 - 347,090


Financial assets at fair value through profit or loss
at 30 November 2018

Level 1

Level 2

Level 3

Equity investments 331,912 1,650 - 333,562
Derivative contracts 5,735 - - 5,735
Fixed interest bearing securities 2,555 664 5,805 9,024
340,202 2,314 5,805 348,321


Financial assets at fair value through profit or loss at 31 May 2019 Level 1
Level 2
Level 3
Equity investments 318,940 - - 318,940
Derivative contracts 6,313 - - 6,313
Fixed interest bearing securities 1,769 5,539 - 7,308
327,022 5,539 - 332,561


The value of the subsidiary, DIT Income Services Limited, held at fair value is £1 (30 November 2018: £1 and 31 May 2019: £1) and is classified as a Level 3 investment.

The Company’s subsidiary completes trading transactions. The value of the investments held for trading in the subsidiary at 30 November 2019 are £nil (30 November 2018: £nil and 31 May 2019: £nil). The difference between the sale and purchase of assets is trading income recognised in the Income Statement.

Reconciliation of Level 3 Investments

The following table summarises the Company's Level 3 investments that were accounted for at fair value:

As at
30 November
Level 3
As at 
30 November 
Level 3 
As at 
31 May 
Level 3 
Opening fair value investments - 4,404  4,404 
Purchase at cost -
Sale proceeds - (27) (364)
Realised gains on sales - 16 
Transfer from Level 3 to Level 2 - (4,056) 
Transfer from Level 2 to Level 3 - 1,428 
Movement in unrealised holding gains -
Closing fair value of investments - 5,805 

10 Transactions with the Manager and Related Parties

The amounts paid and payable to the Manager pursuant to the management agreement are disclosed in note 8. Fees paid to the Directors in the half year to 30 November 2019 amounted to £90,000 (half year to 30 November 2018: £71,000; year ended 31 May 2019: £152,000).


Investment Objective

The Company’s investment objective is to provide shareholders with an attractive and growing level of dividends coupled with capital growth over the long term.

Investment Policy

The Company invests primarily in UK quoted or traded companies with a wide range of market capitalisations, but a long-term bias towards small and mid cap equities. The Company may also invest in large cap companies, including FTSE 100 constituents, where it is believed that this may increase shareholder value.

The Manager adopts a stock specific approach in managing the Company’s portfolio and therefore sector weightings are of secondary consideration. As a result of this approach, the Company’s portfolio does not track any benchmark index.

The Company may utilise derivative instruments including index-linked notes, contracts for differences, covered options and other equity-related derivative instruments for efficient portfolio management, gearing 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 below. The Company will not enter into uncovered short positions.

Risk Diversification

Portfolio risk is mitigated by investing in a diversified spread of investments. Investments in any one company shall not, at the time of acquisition, exceed 15% of the value of the Company’s investment portfolio. Typically it is expected that the Company will hold a portfolio of between 100 and 180 securities, predominantly most of which will represent no more than 1.5% of the value of the Company’s investment portfolio as at the time of acquisition.

The Company will not invest more than 10% of its gross assets, at the time of acquisition, in other listed closed-ended investment funds, whether managed by the Manager or not, except that this restriction shall not apply to investments in listed closed-ended investment funds which themselves have stated investment policies to invest no more than 15% of their gross assets in other listed closed-ended investment funds. In addition to this restriction, the Directors have further determined that no more than 15% of the Company’s gross assets will, at the time of acquisition, be invested in other listed closed-ended investment funds (including investment trusts) notwithstanding whether or not such funds have stated policies to invest no more than 15% of their gross assets in other listed closed-ended investment funds.

Unquoted Investments

The Company may invest in unquoted companies from time to time subject to prior Board approval. Investments in unquoted companies in aggregate will not exceed 5% of the value of the Company’s investment portfolio as at the time of investment.

Borrowing and Gearing Policy

The Board considers that long-term capital growth can be enhanced by the use of gearing which may be through bank borrowings and the use of derivative instruments such as contracts for differences. The Company may borrow (through bank facilities and derivative instruments) up to 15% of NAV (calculated at the time of borrowing).

The Board oversees the level of gearing in the Company, and reviews the position with the Manager on a regular basis.

In the event of a breach of the investment policy set out above and the investment and gearing restrictions set out therein, the Manager shall inform the Board upon becoming aware of the same and if the Board considers the breach to be material, notification will be made to the LSE.

No material change will be made to the investment policy without the approval of shareholders by ordinary resolution.



Capital Structure

The Company’s share capital consists of redeemable ordinary shares of 0.1p each (“ordinary shares”) with one vote per share and non-voting management shares of £1 each (“management shares”). From time to time, the Company may issue C ordinary shares of 1p each (“C shares”) with one vote per share.

As at 30 November 2019 and the date of this Report, there are 378,289,047 ordinary shares in issue, none of which are held in treasury, and 50,000 management shares.

Redemption of Ordinary Shares

The Company has a redemption facility through which shareholders are entitled to request the redemption of all or part of their holding of ordinary shares on 31 May each year. Redemption Request forms are available upon request from the Company’s Registrar.

Shareholders submitting valid requests for the redemption of ordinary shares will have their shares redeemed at the Redemption Price or the Company may arrange for such shares to be sold in the market at the NAV (including current period revenue) (the “Dealing Value”) prevailing at the end of May (subject to the Directors’ discretion). The Directors may elect, at their absolute discretion, to calculate the Redemption Price applying on any redemption point by reference to a separate Redemption Pool, when the Redemption Price will be calculated by reference to the amount generated upon the realisation of the Redemption Pool.

The Board may, at its absolute discretion, elect not to operate the annual redemption facility on any given Redemption Point, or to decline in whole or part any redemption request, although the Board does not generally expect to exercise this discretion, save in the interests of shareholders as a whole.

A redemption of ordinary shares may be subject to income tax and/or capital gains tax. In particular, private shareholders that sell their shares via the redemption mechanism could find they are subject to income tax on the gains made on the redeemed shares rather than the more usual capital gains tax on the sale of their shares in the market. However, individual circumstances do vary, so shareholders who are in any doubt about the redemption or the action that should be taken should consult their stockbroker, accountant, tax adviser or other independent financial adviser.

The relevant dates for the May 2020 Redemption Point are:

29 April 2020 Latest date for receipt of Redemption Requests and certificates for certificated shares
3.00pm on 29 April 2020 Latest date and time for receipt of Redemption Requests and TTE (transfer to escrow) instructions for uncertificated shares via CREST
5.00 pm on 29 May 2020 The Redemption Point
On or before 12 June 2020 Company to notify Redemption Price and dispatch redemption monies; or

If the redemption is to be funded by way of a Redemption Pool, Company to notify the number of shares being redeemed. Notification of Redemption Price and dispatch of redemption monies to take place as soon as practicable thereafter
On or before 26 June 2020 Balance certificates to be sent to shareholders

Further details of the redemption facility are set out in the Company’s Articles of Association or are available from the Company Secretary.

Historic Dividend Record

Period/year ended 31 May: 2012 
First interim dividend 0.30  0.30 0.30 0.40    0.65 0.70  0.75  0.80 0.85
Second interim dividend 0.50  0.50 0.50 0.50    0.65 0.70  0.80  0.85  0.90
Third interim dividend 0.46  0.46 0.50 0.50    0.75 0.80  0.85  0.90 
Fourth interim dividend 0.761 0.84 0.95 1.00    -
Final dividend - - 0.50    0.75 0.80  1.00  1.10 
Special  dividend - - -    -  0.403 0.233 0.163
2.02  2.10 2.25 2.902 2.80 3.40  3.63  3.81  1.75

1 The fourth interim dividend for the period ended 31 May 2012 was 0.93p but this included the benefit of the initial 13-month period. As shown above, on an annualised basis, the fourth interim dividend would have been 0.76p.

2 In order to allow shareholders to vote on the dividend, a final dividend was introduced in the year ended 31 May 2015, resulting in the payment of five dividends for that year. Since then, the Company has paid three interim dividends and a final dividend in respect of each year. There has been no interruption in the dividend payment timetable as a result of this change.

3 A special dividend was paid for the years ended 31 May 2017, 31 May 2018 and 31 May 2019, reflecting years when many special dividends were also paid by the companies in the portfolio.

Share Dealing

Shares can be traded through your usual stockbroker.

Share Prices

The Company’s ordinary shares are listed on the LSE.

Share Register Enquiries

The register for the ordinary shares is maintained by Link Asset Services. In the event of queries regarding your holding, please contact the Registrar on 0371 664 0300 or on +44 (0)371 664 0300 from outside the UK (calls are charged at the standard geographic rate and will vary by provider; calls outside the UK will be charged at the applicable international rate). Lines are open 9.00am to 5.30pm, Monday to Friday, excluding public holidays in England and Wales. You can also email

Changes of name and/or address must be notified in writing to the Registrar: Link Asset Services, Shareholder Services, The Registry, 34 Beckenham Road, Beckenham, Kent, BR3 4TU.

Electronic Communications from the Company

Shareholders now have the opportunity to be notified by email when the Company’s annual report, half-yearly report and other formal communications are available on the Company’s website, instead of receiving printed copies by post. This has environmental benefits in the reduction of paper, printing, energy and water usage, as well as reducing costs to the Company.

If you have not already elected to receive electronic communications from the Company and wish to do so, please contact the Registrar using the details shown below. Please have your investor code to hand.

Manager: Miton Trust Managers Limited

The Company’s Manager is Miton Trust Managers Limited. Miton Asset Management Limited has been appointed by Miton Trust Managers Limited as the Investment Manager. Both are wholly-owned subsidiaries of Premier Miton Group. Premier Miton Group is a leading multi-asset and equity fund management specialist listed on the AIM market for smaller and growing companies.

Premier Miton Group had pro-forma assets under management of £11.6 billion (as at 31 December 2019, unaudited).

Members of the fund management team invest in their own funds and are significant shareholders in the Premier Miton Group.

Investor updates in the form of monthly factsheets are available from the Company’s website,



The Association of Investment Companies.


The Alternative Investment Market is a sub-market of the London Stock Exchange. It allows smaller companies to float shares with a more flexible regulatory system than applicable to the main market.

Alternative Performance Measure (“APM”)

An APM is a numerical measure of the Company’s current, historical or future financial performance, financial position or cash flows, other than a financial measure defined or specified in the applicable financial framework.

The Company uses a number of APMs to provide information in order to assist the Board and the Investment Manager in monitoring the Company in order for them to meet the objectives of the Company, including the management of risk. These consist of, but are not limited to, key performance indicators set out in the various relevant parts of the Report.


If the share price of an investment trust is lower than the NAV per share, the shares are said to be trading at a discount. The size of the discount is calculated by subtracting the share price from the NAV per share and is usually expressed as a percentage of the NAV per share. If the share price is higher than the NAV per share, this situation is called a premium.

Discount Calculation 30 November
31 May
Closing NAV per share (p) 95.23 95.17 (a)
Closing share price (p) 91.60 89.00 (b)
(c=((b-a/a)x100) (%) (3.81) (6.48) (c)

The discount/premium and performance is calculated in accordance with guidelines issued by the AIC. The discount/ premium is calculated using the NAV per share inclusive of accrued income with debt at market value.

Dividend Yield

The annual dividend expressed as a percentage of the mid-market share price.

Financial Conduct Authority (“FCA”)

This regulator oversees the fund management industry, including the operation of the Company.


Gearing refers to the ratio of the Company’s total debt to its equity capital. The Company may borrow money to invest in additional investments for its portfolio. If the Company’s assets grow, the shareholders’ assets grow proportionately more because the debt remains the same, but if the value of the Company’s assets falls, the situation is reversed. Gearing can therefore enhance performance in rising markets but can adversely impact performance in falling markets.

Growth Stock

A stock where the earnings are expected to grow at an above-average rate, leading to a faster than average growing share price. Growth stocks do not usually pay a significant dividend.

International Financial Reporting Standards (“IFRS”)

Generally Accepted Accounting Principles (“GAAP”) are a common set of accounting principles, standards and procedures that companies follow when they compile their financial statements. GAAP is a combination of authoritative standards (set by policy boards) and the commonly accepted ways of recording and reporting accounting  information. This enables the financial results of companies to be determined on a common basis so they are able to be compared.

In the UK, company accounts must be prepared in accordance with applicable company law, this being the Companies Act 2006, which recognises GAAP. IFRS are standards issued by the International Accounting Standards Board (“IASB”), approved for implementation by the European Union to provide a common global language for business affairs so that company accounts are understandable and comparable across international boundaries. These were previously International Accounting Standards (“IAS”) maintained by the IASB. The Company adopted IFRS with the accounting policies of the Company set out in the financial statements.

Net Asset Value per Ordinary Share (“NAV”)

The NAV is shareholders’ funds expressed as an amount per individual share. Shareholders’ funds are the total value of all the Company’s assets, at their current market value, having deducted all liabilities and prior charges at their par value, or at their asset value as appropriate. The total NAV per share is calculated by dividing the NAV by the number of ordinary shares in issue excluding treasury shares.

NEX Exchange (“NEX”)

The NEX Exchange (previously known as ICAP Securities and Derivatives Exchange or ISDX) operates two primary market segments, the NEX Exchange Main Board and the NEX Exchange Growth Market. The latter is focused on smaller and medium-sized enterprises.

Ongoing Charges*

As recommended by the AIC in its guidance, ongoing charges are the Company’s annualised revenue and capital expenses (excluding finance costs and certain non-recurring items) expressed as a percentage of the average monthly net assets of the Company during the year.

Ongoing charges
30 November
31 May
Management fee 1,543  3,600 
Other administrative expenses 440  781 
Less one-time costs (45) (42)
Total management fee and other administrative expenses 1,938  4,339 
Total management fee and other administrative expenses (annualised) 3,921  4,339  (a)
Average net assets in the year 354,034  374,922  (b)
Ongoing charges (c=a/bx100) (%) 1.11  1.16 (c)

Put Option

Put options are most commonly used in the stock market to protect against the decline of the price of a stock below a specified price likened to purchasing a form of financial insurance. An owner of a Put option can collect a financial benefit after an adverse event, with the scale of the benefit proportionate to the setback in the market and the remaining term of the cover. The Company Put option will become more valuable should the market decline.

The International Stock Exchange (“TISE”)

The International Stock Exchange is a stock exchange headquartered in Guernsey, which provides a listing facility for international companies to raise capital from investors based around the world.

Total Assets

Total assets include investments, cash, current assets and all other assets. An asset is an economic resource, being anything tangible or intangible that can be owned or controlled to produce value and to produce positive economic value. Assets represent the value of ownership that can be converted into cash. The total assets less all liabilities will be equivalent to total shareholders’ funds.

Total Return – NAV and Share Price Returns*

Total return statistics enable the investor to make performance comparisons between investment trusts with different dividend policies. The total return measures the combined effect of any dividends paid, together with the rise or fall in the share price or NAV. This is calculated by the movement in the share price or NAV plus dividend income reinvested by the Company at the prevailing NAV.

NAV Total Return 30 November
31 May 
Closing NAV per share (p) 95.23 95.17 
Add back total dividends paid in the period/year (p) 2.16 3.73 
Adjusted closing NAV (p) 97.39 98.90  (a)
Opening NAV per share (p) 95.17 105.09  (b)
NAV total return unadjusted (c=((a-b)/b) x100) (%) 2.3 (5.9) (c)
NAV total return adjusted (%)* 2.4 (5.9)


Share Price Total Return 30 November
31 May 
Closing share price (p) 91.60 89.00 
Add back total dividends paid in the period/year (p) 2.16 3.73 
Adjusted closing share price (p) 93.76 92.73  (a)
Opening share price (p) 89.00 107.00  (b)
Share price total return unadjusted (c=((a-b)/b)x100) (%) 5.4 (13.3) (c)
Share price total return adjusted (%)* 5.4 (13.6)

*Based on NAV/share price movements and dividends being reinvested at the relevant cum dividend NAV/share price during the year. Where the dividend is invested and the NAV/share price falls, this will further reduce the return or, if it rises, any increase will be greater. The source is Morningstar who have calculated the return on an industry comparative basis.


The term volatility relates to how much and how quickly the share price or net asset value of an investment has tended to change in the past. Those with the greatest movement in their share prices are known as having high volatility, whereas those with a narrow range of change are known as having low volatility.

* Alternative performance measure


Announcement of half-yearly results February 2020
Payment of first interim dividend February 2020
Year end
Payment of second interim dividend
Redemption Point
May 2020
Announcement of annual results
Payment of third interim dividend
August 2020
Annual General Meeting October 2020
Half-year end
Payment of final dividend
November 2020


Directors (all non-executive)

Michael Wrobel (Chairman)
Andrew Bell
Paul Craig
Caroline Kemsley-Pein
Michelle McGrade
Calum Thomson

Secretary and Registered Office

Link Alternative Fund Administrators Limited
(trading as Link Asset Services)
Beaufort House
51 New North Road
Exeter EX4 4EP

Telephone: 01392 477500


Alternative Investment Fund Manager or Manager

Miton Trust Managers Limited
Paternoster House
65 St Paul’s Churchyard
London EC4M 8AB

Investment Manager

Miton Asset Management Limited
Paternoster House
65 St Paul’s Churchyard
London EC4M 8AB

Telephone: 020 3714 1525


Company website


Ernst & Young LLP
25 Churchill Place
Canary Wharf
London E14 5EY


Bank of New York Mellon
One Piccadilly Gardens
Manchester M1 1RN

Depositary and Custodian

Bank of New York Mellon (International) Limited 
One Canada Square
London E14 5AL

Registrar and Transfer Office

Link Asset Services
Shareholder Services Department
The Registry
34 Beckenham Road
Kent BR3 4TU

Telephone: 0371 664 0300
(+44 (0)371 664 0300 from outside the UK)
(calls are charged at the standard geographic rate and will vary by provider; calls from outside the UK will be charged at the applicable international rate).

Lines are open 9.00am to 5.30pm, Monday to Friday, excluding public holidays in England and Wales.




Stephenson Harwood LLP
1 Finsbury Circus
London EC2M 7SH


Cenkos Securities plc
6.7.8 Tokenhouse Yard
London EC2R 7AS

An investment company as defined under Section 833 of the Companies Act 2006.

Registered in England No. 7584303.

A member of the Association of Investment Companies.

The Half-Yearly Financial Report will be posted to shareholders shortly. The Report will also be available for download from the Company’s website:  or on request from the Company Secretary.

National Storage Mechanism

A copy of the Half-Yearly Report will be submitted to the National Storage Mechanism ("NSM") and will be available for inspection at the NSM, which is situated at:

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

LEI: 2138005QFXYHJM551U45


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Half-year Report - RNS