www.castelnaugroup.com
PO Box 255
Trafalgar Court
Les Banques
St. Peter Port
Guernsey
Channel Islands
GY1 3QL
Annual Report and Audited
Consolidated Financial Statements
For the year ended 31 December 2024
Strategic Report
Summary Information ............................................................................................................. 3
Chair’s Statement ...................................................................................................................... 5
Holdings ..........................................................................................................................................7
Portfolio Analysis .........................................................................................................................8
The Alternative Investment Fund Manager (“AIFM”)
and Investment Manager’s Report ..................................................................................... 9
Statement from the CIO of the Investment Manager .............................................. 14
Governance
Board Members ........................................................................................................................ 16
Directors’ Report ........................................................................................................................l8
Directors’ Remuneration Report ....................................................................................... 34
Statement of Directors’ Responsibilities ........................................................................ 35
Audit Committee Report .......................................................................................................37
Independent Auditor’s Report
................................................................... 40
Financial Statements
Consolidated Statement of Comprehensive Income ............................................. 46
Consolidated Statement of Financial Position ............................................................47
Consolidated Statement of Changes in Equity .......................................................... 48
Consolidated Statement of Cash Flows ....................................................................... 49
Notes to the Consolidated Financial Statements ..................................................... 50
Alternative Performance Measures (Unaudited)
...............77
Appendix (Unaudited)
........................................................................................78
Group Information
...................................................................................................79
Contents.
We strive to compound
shareholders’ capital at
high rates of return.
Castelnau Group Limited was formed by Phoenix Asset Management
Partners Limited in 2020. The listed structure provides the manager with
a permanent capital vehicle with which to make long-term investments
and acquisitions of all structures and sizes.
Castelnau Group
Strategic Report
Castelnau Group Ltd Annual Report 2024
1
Our Mission.
At Castelnau Group we strive to compound
shareholders’ capital at high rates of return.
The higher the better.
We aim to do this by collecting businesses which possess a
competitive advantage, at attractive prices.
Our structure helps us clear away short-term pressures that inhibit
value creation and nurture rational long-term capital allocation
frameworks in our holdings.
Strategic Report
The growth potential of
Castelnau’s businesses is
hugely exciting.
Castelnau Group Ltd Annual Report 2024
2
Castelnau Group Ltd Annual Report 2024
3
Strategic Report
Summary
Information
The Group
Castelnau Group Limited (the “Company”, “Castelnau”
or “CGL”) and its subsidiary (collectively, the “Group” or
“Castelnau Group”) is a Guernsey domiciled closed-
ended investment company which was incorporated
on 13 March 2020 under the Companies (Guernsey)
Law, 2008. The Company is classified as a registered
fund under the Protection of Investors (Bailiwick of
Guernsey) Law, 2020. Its registered office address is
PO Box 255, Les Banques, Trafalgar Court, St. Peter
Port, Guernsey GY1 3QL. The Company’s Ordinary
Shares were admitted to trading on the London Stock
Exchange on 18 October 2021.
This Annual Report and Audited Consolidated Financial
Statements (the “Financial Statements”) comprise the
financial statements of Castelnau Group Limited and
Castelnau Group Services Limited (incorporated on
14June 2022).
Investment Objective
The Group’s investment objective is to compound
Shareholders’ capital at a higher rate of return than the
FTSE All-Share Total Return Index over the long term.
Investment Policy
The Group will seek to achieve a high rate of
compound return over the long term by carefully
selecting investments using a thorough and objective
research process and paying a price which provides
a material margin of safety against permanent loss of
capital, but also a favourable range of outcomes.
The Group will follow a high conviction investment
strategy. The expertise and processes developed by
the Investment Manager can be applied to all parts of
the capital structure of a business, both private and
publicly quoted. These positions could be represented
by a minority stake, a control position combined with
operational involvement, full ownership of a company,
a joint venture, a loan or convertible instrument, a
short position or any other instrument which allows the
Group to access value.
The Group may select investments from all asset
classes, geographies and all parts of the capital
structure of a business. Both private and public
markets are within the scope of the Group’s
investment policy. The constraints on the Investment
Manager lie in the high standards, strict hurdles and
diligent processes used to select investments. These
constraints help to maximise returns by reducing
mistakes, enforcing a margin of safety and only
accepting investments with a favourable range of
outcomes.
The Group expects to hold a concentrated portfolio
of investments and the Group will not seek to reduce
concentration risk through diversification. The
opportunity set will dictate the number of holdings
and the weighting of investments in the Portfolio. The
investments with the best return profiles will receive the
largest weightings. The Group will therefore have no set
diversification policies.
The volatility of mark-to-market prices does not
affect the investment process. It is likely that volatility
in the market price of a listed investment will provide
attractive entry or exit points and so investors
should expect high volatility to sit alongside the high
long-term compounding rates that the Group is
aiming to achieve.
The constituents of local indices, the weightings of
investments in these indices and the volatility of the
indices relative to the Group will not affect investment
decisions. It is anticipated that agnosticism towards
local indices will help focus research efforts, decision
making and ultimately investment performance.
The Group may invest directly or through special
purpose vehicles if considered appropriate.
Shareholder Information
As at 31 December 2024, the number of Ordinary
Shares in issue was 322,829,422 (31 December 2023:
318,635,256). For further details, see note 12 to the
Financial Statements.
Castelnau Group Ltd Annual Report 2024
4
Strategic Report
Results and Performance
The results for the year are set out in the Consolidated
Statement of Comprehensive Income. Retained
earnings include realised and unrealised gains and
losses on the Group’s assets. Income and expenses
have been accrued in line with the accounting policies
during the year.
The Group’s profit before tax for the year amounted to
£81,946,637 (31 December 2023: loss of £7,772,322).
The benchmark is the FTSE All-Share Index (total
return). The Group’s performance for the year is shown
below:
Summary Information - continued
Year ended
31 December
2024
pence
Year ended
31 December
2023
pence
Change/
return
%
NAV per Ordinary Share* 98.3 72.6
35.4
Ordinary Share price 94.0 75.5 24.5
Benchmark return 9.5
Source: Bloomberg, Phoenix Asset Management Partners Limited.
The Ongoing Charges ratio was as follows:
Year ended
31 December
2024
%
Year ended
31 December
2023
%
Ongoing charges ratio* 0.53 0.59
* These are Alternative Performance Measures (“APMs”)
Alternative Performance Measures
(“AP Ms” )
The disclosures of performance above are considered
to represent the Group’s APMs. An APM is a financial
measure of historical or future financial performance,
financial position, or cash flows, other than a financial
measure defined or specified in the applicable
financial reporting framework. Definitions of these
APMs together with how these measures have been
calculated can be found on page 77.
Discount/Premium to NAV
The discount/premium of the Ordinary Share price to NAV
per Ordinary Share is closely monitored by the Board.
The Ordinary Share price closed at a 4.35% discount to
the NAV per Ordinary Share as at 31 December 2024
(31December 2023: premium of 4.02%).
Fees
The Investment Management Agreement (“IMA”) with
Phoenix Asset Management Partners Limited (“PAMP”)
creates significant Shareholder alignment, as PAMP does
not earn a management fee but earns a performance
fee only, which is paid in shares, and not in cash.
The Company’s performance is measured over
consecutive periods of not less than three years (each
a “Performance Period”) and the performance fee is
equal to one-third of the relative outperformance of
the NAV Total return to the FTSE All-Share Total Return
Index (“Benchmark”) for each Performance Period. The
first Performance Period ran from Initial Admission to
31December 2024. During the year, the IMA was revised
to reference the audited closing NAV rather than the
average NAV in the fee calculation and to include
a provision such that no performance fee is earned
until the NAV per Ordinary Share is above the original
NAV per Ordinary Share at Initial Public Offering (“IPO”)
(100p), adjusted for the performance of the Benchmark.
Further details on the revisions of the IMA with respect to
performance fees can be found in the Directors’ Report on
page 18. No performance fees have been earned to date.
Dividend
No dividend is being issued for the year (31 December
2023: £Nil).
Castelnau Group Ltd Annual Report 2024
5
Strategic Report
Chair’s
Statement
This report covers a twelve-month period from
1January 2024 to 31 December 2024.
During 2024, Castelnau Group has delivered a year
of strategic and financial progress, laying clear
groundwork from which to build. At Castelnau level,
we are pleased to have seen the NAV grow from
72.6pence at the start of the year to 98.3 pence – this
35% growth in NAV has been primarily driven by our
investment in Valderrama Limited (“Valderrama”)
which represented 83% of our GAV at year end. The
share price total return was 24.5% reflecting a relative
out performance of 15% compared to the FTSE All-Share
Index. In the context of a UK investment trust market
that has seen trusts trading at material discounts to
NAV, we were pleased during 2024 that the discount
was modest. During the year, we were also pleased
to issue some new shares to investors under our
blocklisting, as well as use Castelnau shares to
facilitate the acquisition of Farewill Limited (“Farewill”),
an important strategic acquisition for Dignity.
We have continued to focus on driving collaboration
between our portfolio businesses. We now have
regular events for our CEOs and CTOs, and welcomed
over 75colleagues to the annual portfolio event that
we host for our leadership teams – something we
hope to grow each year going forward. Seeing the
collaboration between Stanley Gibbons Baldwins’ retail
shop at the Strand and Hornby is a good example of
businesses working together organically.
A key focus is always our people and partnerships.
Wewere excited to be able to welcome new executive
talent at Dignity Plc (“Dignity”), Stanley Gibbons
Baldwins (“SGB”), Rawnet Limited (“Rawnet”) and
Hornby Plc (“Hornby”), and we also attracted talented
independent non-executives across the portfolio.
During the year, our relationship with key partners
such as SPWOne IV Limited (“SPWOne”) and Frasers
Group deepened, as can be seen by our collaboration
in strategic transactions at Dignity with SPWOne,
and events at Hornby and Iona Star LP (“Iona Star”)
demonstrating the strength of our relationship with
Frasers Group.
It is important we acknowledge that there have been
some headwinds in the portfolio companies during
the year. The wider wedding market was tough,
affecting Cambium International Ltd. (“Cambium”),
and changes to the digital advertising space led to
a strategic change of direction at Rawnet to focus
more on UX/strategy. In addition, the administration
at Stanley Gibbons Baldwin’s had a more profound
impact in H1 than we had hoped and has taken the
business time to navigate past, particularly with
customers. Nonetheless, we saw the impacted portfolio
companies demonstrate resilience and agility, leaving
them in a better position to carry into 2025.
Within our portfolio companies there was a significant
amount of progress, which will be later discussed.
At Dignity, we welcomed Zillah Byng-Thorne as
CEO, significantly reduced the outstanding debt
resulting in ratings upgrade in Dignity’s bonds during
December, executed the transformative acquisition of
Farewill, which has further established its leadership
in digital-led end-of-life services and Dignity saw
EBITDA grow by 13% to £43.9 million for the 2024
financial year. Hornby delivered an 8% year-on-year
increase in sales, secured an exclusive Ferrari license
for Pocher, with financial performance supported
by streamlined operations and improved logistics.
Cambium embraced artificial intelligence (“AI”) driven
innovations to enhance operational efficiencies and
customer experiences, and successfully re-platformed
its brands. SGB solidified its market position through
key hires, strategic partnerships, and plans for a digital
catalogue, while also achieving growth in its bullion
and auction businesses, earning recognition from
Royal Mail.
There was a focus on operational efficiency across
the Castelnau Group, where we looked to right-
size many of the businesses. This has seen the
portfolio companies starting to embrace operational
efficiencies of AI, and Ocula has helped facilitate this
initial adoption. We intend to remain extremely focused
on ensuring our businesses embrace technological
innovation, drive growth, and leave Castelnau Group
best positioned to drive shareholder returns in 2025
and beyond.
Castelnau Group Ltd Annual Report 2024
6
Strategic Report
Outlook 2025
As we look to the year ahead, our focus will include:
• Supporting the execution of the growth strategy at
Dignity;
• Accelerating revenue-generating activities across
portfolio companies;
• Leveraging technology and AI to enhance
operational efficiency;
• Deepening collaboration and knowledge-sharing
across businesses to drive innovation; and
• Ensuring our portfolio comprises of profitable, cash-
generating companies by the end of 2025.
Performance Review
For the twelve months ended 31 December 2024,
Castelnau Group reported a total number of
322,829,422 Ordinary Shares, representing a 1.3%
increase year-on-year. This increase was primarily
driven by the issuance of shares related to the block
listing facility (748,563 shares) and the acquisition of
additional shares in Cambium International Limited
(3,445,603 shares).
Key metrics include:
• NAV Total Return: +35.4%, outperforming the FTSE
All-Share Total Return Index (+9.5%) by +25.9%.
• Share Price Return: +24.5%, reflecting a +15%
outperformance versus the benchmark.
Portfolio Performance
• Valderrama (Dignity Plc): A cornerstone of
the portfolio, representing 82.5% of the GAV at
31December 2024, from 76.6% at 31 December
2023. The equity return stands at 48.1%, with a 45.5%
contribution to overall portfolio performance.
• Hornby: Though a smaller share of the portfolio
at 5.3% of GAV at 31 December 2024, Hornby has
delivered an equity return of 43.7%, adding 2.7% to
the total portfolio performance.
• Phoenix S.G. Limited (Stanley Gibbons Baldwins):
Accounting for just 0.2% of GAV at 31 December
2024, from 3.6% at 31 December 2023, had an equity
return of -90.7% and total contribution to overall
portfolio performance of -3.7%.
• Cambium: Accounting for 3.2% of GAV at
31December 2024, had an equity return of -38.5%,
a combined debt and equity return of -24.1% and a
total contribution to overall portfolio performance of
-3.0%.
• Silverwood Brands Plc: Representing 1.4% of GAV
at 31 December 2024, from 0.9% at 31 December
2023, had an equity return of -18.1% and a total
contribution to overall portfolio performance of
-0.4%.
• Ocula Technologies Holdings Ltd: Representing
1.4% of GAV at 31 December 2024, from 1.7% at
31December 2023, Ocula delivered an equity return
of -0.3%. While its total attribution to the portfolio
is neutral, the Group’s ownership position has
decreased from 50% to 42%.
• Rawnet: Representing 0.4% of GAV at 31 December
2024, from 2.1% at 31 December 2023, had an equity
return of -76.0% and total contribution to overall
portfolio performance of -2.2%.
Additional insights into investment performance are
detailed in the Alternative Investment Fund Manager
and Investment Manager’s Report.
Thank you for your continued trust and support. If you
would like to get in touch directly with me, as the Chair
of the Board; please email [email protected].
Joanne Peacegood
Chair
9 April 2025
Chair’s Statement - continued
Castelnau Group Ltd Annual Report 2024
7
Strategic Report
Company Sector Holdings Cost
Carrying
Amount
% of net
assets
31 Dec 2024
% of net
assets
31 Dec 2023
Valderrama Ltd (Dignity Plc) Specialised Consumer
Services - Equity
194,294,182 196,667,644 329,038,367 103.7% 96.0%
Hornby Plc* Leisure Products - Equity 92,406,448 39,061,617 21,253,483 6.7% 6.4%
Cambium International Ltd Specialised Consumer
Services - Equity
41,562 31,152,344 12,728,842 4.0% 5.3%
Cambium International Ltd Specialised Consumer
Services - Loan
9,700,000 9,700,000 9,700,000 3.1% 3.1%
Phoenix S.G. Ltd ("Strand
Collectibles Group”)
Speciality Retail - Loan 6,378,295 6,378,295 6,378,295 2.0% 1.1%
Ocula Technologies Holdings
Ltd (“Ocula”)
IT Services - Equity 1,084,421 1,450,363 5,660,000 1.8% 2.1%
Silverwood Brands Plc
(“Silverwood”)*
Specialised Consumer
Services - Equity
12,718,500 7,599,247 5,621,577 1.8% 1.1%
Dignity Plc Specialised Consumer
Services - Loan
2,000,000 2,000,000 2,000,000 0.6% N/A
Rawnet Ltd ("Rawnet") IT Services - Equity 284,173 2,750,000 1,487,000 0.5% 2.7%
Phoenix S.G. Ltd Speciality Retail - Equity 10,141 24,184,303 968,284 0.3% 4.5%
Rawnet Ltd IT Services - Loan 885,255 885,255 885,255 0.3% 0.4%
Silverwood Brands Plc* Specialised Consumer
Services - Loan
855,287 855,287 855,287 0.3% 1.9%
Iona Star LP IT Services - Equity 636 636,364 597,385 0.2% N/A
Showpiece Technologies Ltd
(“Showpiece”)
Internet Retail - Loan 2,950,000 2,950,000 401,500 0.1% 0.3%
Showpiece Technologies Ltd Internet Retail - Equity 8,000 8,000 – 0.0% 0.0%
Total holdings 397,575,275 125.4% 124.9%
Other net liabilities (80,332,323) (25.4%) (24.9%)
Net assets 317,242,952 100.0% 100.0%
* Listed as at 31 December 2024. Note that Silverwood Brands Plc’s shares were temporarily suspended for the first quarter of the year, and
recommenced trading in April 2024. Further discussion on the suspension is found in note 5 to the financial statements.
All companies are UK businesses.
Holdings as at
31 December 2024
Castelnau Group Ltd Annual Report 2024
8
Strategic Report
Portfolio Analysis as at
31 December 2024
Sector Percentage of Net Assets
Specialised Consumer Services - Equity 109.5%
Leisure Products - Equity 6.7%
Specialised Consumer Services - Loan 4.0%
IT Services - Equity 2.5%
Speciality Retail - Loan 2.0%
IT Services - Loan 0.3%
Speciality Retail - Equity 0.3%
Internet Retail - Loan 0.1%
Other net liabilities (25.4%)
Total 100.0%
Refer to note 5 for additional disclosure on the valuation of the holdings.
-40.0%
-20.0%
0.0%
20.0%
40.0%
60.0%
80.0%
100.0%
120.0%
109.5%
0.3%
0.3%
2.0%
2.5%
4.0%
6.7%
(25.4)%
0.1%
Other net liabilities
Internet Retail - Loan
IT Services - Equity
IT Services - Loan
Speciality Retail - Loan
Speciality Retail - Equity
Specialised Consumer Services - Loan
Leisure Products - Equity
Specialised Consumer Services - Equity
Castelnau Group Ltd Annual Report 2024
9
Strategic Report
Investment Philosophy and Strategic
Progress
Castelnau Group’s investment philosophy remains
steadfast: identifying and nurturing businesses with
untapped competitive advantages. In 2024, we
focused on strengthening our portfolio through key
management hires, strategic acquisitions, operational
enhancements, and innovative collaborations, ensuring
long-term growth and value creation.
Strategic initiatives in 2024 included:
• Acquisitions:
- Farewill by Dignity: The highly strategic deal,
enabling Dignity to move into legal services,
was structured as a share-for-share exchange,
resulting in most Farewill shareholders becoming
Castelnau shareholders. In return, Castelnau
acquired an additional 5.6 million shares in
Valderrama Limited, increasing its ownership
to66%.
- Corgi Model Club (“Corgi”) by Hornby: The
transaction was structured as a cash-neutral
deferred payment. This approach optimised cost
allocation, reduced immediate cash outflows,
and positioned Hornby to expect to achieve a
20% revenue uplift for Corgi in 2025 and 2026.
The integration of the Corgi management team
also enhanced operational efficiency across the
brand.
• Strengthening leadership teams:
- The Group’s leadership teams have been
significantly enhanced through several key
appointments: Zillah Byng-Thorne joined Dignity
as CEO, Victoria Lajer assumed the CEO role at
SGB, and Jenni Hughes-Ward was appointed CFO.
Additionally, Sam Love and Gyles Marshall are
now managing directors at Rawnet, and Penni
Teale has joined Hornby as COO.
- Across the portfolio, board composition has been
strengthened with strategic additions such as Ian
Griffiths at SGB, Richard Thompson at Cambium,
Nick Batram and Neil Sachdev at Hornby.
These appointments underscore our ongoing
commitment to strengthening leadership and
governance across the Group.
• Operational efficiencies and cost reductions:
- Guiding operational restructurings at Hornby,
Cambium, Dignity, and Rawnet to streamline
costs and enhance profitability.
- Facilitating cross-portfolio collaboration through
regular in-person executive management
forums, bringing together CEOs, CTOs, COOs,
CFOs, and HR leaders.
- Cambium re-platformed its brands and
embraced AI-driven innovations to enhance
operational efficiencies and customer
experience, while the Group remains focused on
adopting technology to drive future cost savings
and growth.
- Key initiatives at Phoenix S.G. Ltd included
improving internal systems, expanding core
auction categories like stamps and coins,
stabilising inventory, and exploring new ventures
such as bullion. The company built strategic
partnerships with Royal Mail and VeVe. A central
part of the long-term strategy is the development
of Chub, a collector’s platform aimed at
modernising stamp collecting and engaging a
new generation of collectors.
- Silverwood made a strategic acquisition in 2024,
acquiring Cosme Science Corporation, a leading
Japanese beauty product manufacturer, and
its subsidiary, Dr. Baeltz, a skincare brand. This
acquisition strengthens Silverwood’s portfolio
in the health and beauty sector, expanding
its presence in Japan and Asia. The deal will
enhance Silverwood’s position in the global
beauty market.
• Finance transactions:
- Ocula successfully raised £4 million in a Series A
funding round.
- Dignity repaid £82.6 million of debt to its
bondholders, primarily through using the
funds withdrawn from the trust surplus over
the summer. In addition, post year end, the
outstanding Phoenix loan was repaid using the
proceeds from a sale and leaseback transaction.
The Alternative Investment Fund
Manager (“AIFM”) and Investment
Manager’s Report
Castelnau Group Ltd Annual Report 2024
10
Strategic Report
Key Financial Metrics
(as of 31 December 2024):
• Net Assets: £317.2 million
• Market capitalisation: £303.5 million
Castelnau Group Track Record Performance
NAV return
%
Share price
total
return
**
%
All-Share
index
**
%
Relative
NAVto ASX
%
2024 35.4 24.5 9.5 25.9
2023 (3.3) 9.4 7.9 (11.2)
2022 (19.8) (34.6) 0.3 (20.2)
2021* (6.5) 5.5 2.5 (9.0)
Cumulative* (1.7) (6.0) 21.5 (23.2)
* From 18 October 2021
** Share price return with dividends reinvested; All-Share index returns with dividends reinvested. Past performance is not a reliable indicator of
future performance.
Source: Bloomberg, Phoenix Asset Management Partners Limited.
The table below reports the portfolio positions and returns between 31 December 2024 and 31 December 2023:
% of GAV* Ownership %
Equity
Return
Combined
Debit &
Equity
Return
Total
Attribution
2024 2023 2024 2023 2024 2024 2024
Dignity/Valderrama 82.5% 76.6% 65.4% 65.4% 48.1% 47.7% 45.5%
Hornby 5.3% 5.1% 54.9% 54.9% 43.7% 43.7% 2.7%
Cambium 3.2% 4.2% 90.3% 60.2% -38.5% -24.1% -3.0%
Silverwood 1.4% 0.9% 29.9% 1.8% -18.1% -13.9% -0.4%
Ocula 1.4% 1.7% 41.6% 50.3% -0.3% -0.3% 0.0%
Rawnet 0.4% 2.1% 100.0% 100.0% -76.0% -68.8% -2.2%
Phoenix S.G 0.2% 3.6% 64.1% 64.0% -90.7% -51.9% -3.7%
Iona Star 0.1% N/A 45.0% N/A N/A N/A N/A
*GAV represents the gross asset value in the Company.
Source: Phoenix Asset Management Partners Limited.
The Alternative Investment Fund Manager (“AIFM”) and Investment Manager’s Report - continued
Castelnau Group Ltd Annual Report 2024
11
Strategic Report
Performance
Valderrama (Dignity Plc)
Dignity has made significant progress across
leadership, operations, and financial performance.
Zillah Byng-Thorne joined as CEO in June. Other
key executive hires during the year include a
Funerals Managing Director, Chief Technology
Officer, Managing Director of Funeral Plans and a
Managing Director of Crematoria. Early in the year,
a number of unmanned funeral stores were initially
closed followed by underperforming stores, with 67
branches shuttered by Q2 and another 60 by August,
streamlining operations while improving performance
in retained branches.
Financially, Dignity generated £273.9 million in revenue
and £43.9 million in EBITDA for the financial year 2024
(EBITDA up 13.1% compared to the same period last
year), despite a 3.4% decline in the death rate.
Property disposals exceeded initial expectations,
generating £25 million in gross proceeds, and the
sale-and-leaseback of crematoria assets helped
repay £56.1 million in debt by January 2025. Trust
surplus withdrawals enabled the buyback of
£82.6million of Dignity bonds, further reducing debt
and annual service costs. Fitch upgraded Dignity’s
A and B notes in December, validating its financial
improvements.
In October, Dignity announced the acquisition of
Farewill, a leading provider of digital end-of-life
services, with completion in February 2025. This
strategic move broadened Dignity’s product offering
and audience while modernising its infrastructure.
With a stabilised balance sheet, Dignity is focused
on driving growth in cremations, funeral home
businesses, and funeral plans, alongside expanding
its crematoria estate and digitising funeral operations
in 2025.
Hornby
Hornby has focused on boosting sales, reducing costs
and simplifying the group. At the end of December,
the company delivered year-to-date sales growth
of 8%, with gross profits rising by 10% and margins
improving from 44% to 48%, supported by a 10%
increase in direct-to-consumer sales. Key operational
achievements included the successful completion
of a restructuring program, eliminating £1 million in
annualised central costs and projecting an additional
c.£500,000 in savings for 2025. The logistics tender
process led to the decision to relocate operations
from Kent to the Midlands, improving efficiency and
reducing costs.
Hornby also streamlined its portfolio with the sale
of LCD Enterprises, the loss-making subsidiary that
owned the Oxford Diecast brand, for £1.4 million. This
transaction reduced operational complexity and
contributed to debt reduction of c.£600,000 during Q4.
Strategic hires bolstered leadership, with Neil Sachdev
MBE joining as Chair and Penny Teale appointed COO.
The company also advanced its customer-focused
initiatives, launching new category ranges for Airfix,
securing an exclusive Ferrari license for Pocher, and
achieving retail wins, such as reintroducing Humbrol
products to Hobbycraft.
Hornby continued to invest in its brands, acquiring the
Corgi Model Club in a cash-neutral deal that brought
new leadership and expanded its product offering.
Notable successes included the launch of the original
Batmobile for Corgi, generating 4,000 pre-orders in its
first week.
Despite elevated inventory and debt levels,
Hornby demonstrated progress in addressing
these challenges and remains focused on driving
profitability through operational improvements,
cost efficiencies, and customer engagement. There
remains a lot to do, but we hope to continue to make
clear strategic progress across the Castelnau Group
in 2025.
Castelnau Group Ltd Annual Report 2024
12
Strategic Report
The Alternative Investment Fund Manager (“AIFM”) and Investment Manager’s Report - continued
On 13 March 2025, the Company announced its
support for Hornby’s proposed voluntary cancellation
of its AIM listing to enable grater strategic flexibility.
The decision reflects Hornby’s commitment to
structural changes, operation transformation, and
addressing the limited liquidity of its shares alongside
AIM compliance costs. Castelnau irrevocably
committed to voting in favour of the cancellation. To
accommodate Hornby’s shareholders who wish to
retain investment exposure through a listed vehicle,
Castelnau offered a share-for-share exchange
mechanism.
Cambium
Cambium focused on driving registrations and
improving operational efficiencies, in what was a
challenging wider wedding market, which drove the
valuation reduction of 34.5% during the year. Whilst
we saw an increasing proportion of cash gift lists,
registrations did increase by 7.1%, with total pledges
growing to £41.6 million, up 4.3% from financial
year 2023.
The business implemented a path-to-profitability
roadmap emphasising automation, AI, and cost
reduction, removing approximately £2 million in
run-rate costs. A re-platforming of Rock My Wedding
and an improved Wedding Present Company website
enhanced customer experiences. Little List continued
efforts to boost conversion rates, albeit post year
end the decision was made to materially reduce the
focus on this nascent business, until the core wedding
business reaches profitability. During the year,
Castelnau increased its ownership in Cambium from
60% to 90% through equity swap and debt conversion.
Ocula
Ocula successfully completed a £4 million Series
Afundraise to support growth for the next 24months.
Following the fundraise (in which Castelnau
participated), Castelnau’s ownership moved to 41%.
Jose Luis-Gomes invested in the round, and joined
the Ocula board; Jose leads Google Cloud’s North
American retail & consumer business sitting on
the board of Alphabet’s independent growth fund.
Ocula’s ARR grew to £1.5 million, with high-profile client
additions such as B&Q, Spinmaster, and Groupon. The
business expanded its footprint into North America,
establishing a US subsidiary to drive sales and client
acquisition.
Ocula Boost has started to gain traction in the
travel sector, showing promise as Ocula focuses
on deploying further enhancements to the offering.
Despite some customer churn over the summer,
learnings are being applied to minimise future losses,
positioning Ocula for continued ARR growth.
Silverwood
Silverwood navigated a complex year, including
unwinding its 19.8% stake in Lush through a capital
reduction and shareholder vote. The resolution
allowed shares to resume trading, and Castelnau
converted £4.4 million in unsecured loans into equity,
increasing its stake to 29.9%. The acquisition of Cosme
Science Corporation (“Cosme Science”), a Japanese
beauty manufacturer, marked a key milestone, with
integration progressing on plan. Brand- level focus
included a rebranding for Balmond’s and expansion
into new markets, while Cosme Science initiated
production of SteamCream. Silverwood remains
focused on driving growth across its portfolio,
including Nailberry, Sonotas, and Balmonds, with
investments in production capacity and channel
expansion.
Rawnet
2024 was a challenging year for Rawnet due to tough
market conditions in the digital marketing sector.
The business underwent a significant restructuring,
including cost-cutting measures, office relocation,
and leadership changes, with Sam Love and Gyles
Marshall assuming leadership roles. Despite these
challenges, Rawnet won some valuable accounts
and demonstrated growth in both new and account
management sales during the final quarter of the
year – albeit it remained loss making during the year.
The business is rebuilding its pipeline and remains
focused on achieving profitability in 2025.
The earnout liability, in accordance with the agreed
terms was settled in February 2024, with a total
payment of £2.5 million made to the founder and
selected employees.
Castelnau Group Ltd Annual Report 2024
13
Strategic Report
Phoenix S.G. Limited / Stanley Gibbons Baldwins
(“SGB”) (formerly Strand Collectibles Group)
SGB focused on stabilising operations, rebuilding
customer confidence, and driving strategic growth
following its administration process. Key leadership
changes included the appointment of Victoria Lajer
as interim CEO, Jenni Hughes-Ward as CFO, and Ian
Griffiths as an independent non-executive director.
A new Head of Stamps and a product owner for
the digital catalogue were also hired to strengthen
operations and drive innovation.
The auctions business achieved some notable
successes, including the Phillips Collection, which
generated over £2 million, and the Hays Morgan
Collection, expected to bring in £1.5 million over
12-18months. Additionally, SGB launched a new bullion
business, which continues to grow with relatively
strong margins and a convenient central London
location. The business also rebranded back to Stanley
Gibbons Baldwins to capitalise on the strength of
its legacy brands after the previous rebranding
failed to resonate with customers. The impact of
the administration had bigger implications than
anticipated, contributing to the negative portfolio
performance.
SGB delivered £8.9 million in sales for 2024, 4% ahead
of budget, and achieved an EBITDA performance
c.£400,000 above budget despite being loss-making
for the year. In December, SGB secured a Royal
Warrant and launched a limited-edition Penny Black
digital collectible in partnership with VeVe, selling
8,468 units within minutes.
The digital collectors tool gained momentum with
a dedicated product owner, and its first version is
expected to launch in 2025, enhancing customer
experience and modernising the business.
Operational improvements included transitioning
from a legacy ERP system to a flexible, cost-effective
alternative, with learnings that may benefit other
Castelnau portfolio companies. New leadership team
incentives were implemented to align management’s
interests with shareholder goals, positioning SGB for
future growth.
Iona Star
Iona Star launched its fund in late September,
securing up to £10 million in commitments from both
Castelnau and Frasers Group. Targeting early-stage
companies in AI and data convergence, the fund
made its first investment in AkashX, a Californian
data storage accelerator. With a proven team
delivering prior returns of over 3x invested capital,
Iona Star’s investments aim to benefit both the fund
and Castelnau’s broader portfolio. Fundraising efforts
are ongoing, with more updates expected in the next
quarterly report.
Phoenix Asset Management Partners remains
committed to driving operational excellence and
fostering sustainable long-term value creation across
the Castelnau Group portfolio. By leveraging deep
industry expertise, disciplined capital allocation, and
a hands-on approach to active ownership, we can
continuously seek to enhance the performance,
resilience, and strategic growth of our portfolio
companies.
Phoenix Asset Management Partners Ltd.
9 April 2025
Castelnau Group Ltd Annual Report 2024
14
Strategic Report
2024 Review
As Castelnau continues to evolve we are continually
learning. There are a number of ways in which we try
to help improve our businesses, one of which is with
leadership selection. One learning for me this year was
that most of the others follow from this one, they don’t
just sit alongside it. It has been a good year of progress
in that regard, in the parlance of Jim Collins of getting
good people on the bus, not least of which has been
Zillah Byng-Thorne taking over at Dignity.
Another learning is how we adapt the inspiration
and learnings of the likes of Danaher, Halma and
Constellation Software with the types of businesses
that we are interested in. We believe in the
decentralised model with a small centre that shares
best practice and learning, connects expertise, and
maximises the use of our network. The needs of our
leaders and businesses are different in the depths of
turnaround to when they are performing well. All of our
businesses require a culture that is customer centric to
truly thrive in the long term and we are not there yet in
all of them.
Culture is a really hard area in which to help. We
believe you can’t improve something you can’t
measure, and you can’t build continuous improvement
without measurement, so the Castelnau team spent a
lot of time evaluating what tools and methodologies
exist to do this and now have trials underway in two
of our businesses. We don’t seek to be the ones to
impose a culture or to be the ones improving it, we
think that is for the leadership of the business. We
aim to suggest tools that might help them to do that
and shared learnings that might be useful. We expect
unique cultures. Through a combination of experience,
necessity and then contemplation, I learned that
direct involvement in our businesses by me personally
was not the best use of my time and that I am less
effective than the capable people that I have access
to. Distance and perspective have been useful and, I
believe, will be more effective.
An area all of our businesses will be impacted by is
AI, as will all businesses. This is where Castelnau can
be very helpful. What is going on is seismic, we have
been working with Cambium, which is used to being
innovative and changing, on the art of the possible and
if we are right, then our unit cost economics are going
to be transformed dramatically and quickly. What we
learn in implementation is what is truly valuable to our
other businesses, it is easy to see how this can work in
theory but doing whilst operating in full flight is another
thing, especially as it involves the very people most
affected by it. I’ve been a student of business since I
was 12, that’s 45 years, and I’ve seen some massive
changes, like the internet or social media, but the
potential for AI to transform productivity in a business
in so many ways, is the greatest of them. If we are right
about Cambium, given that it is a free service, the
value should accrue to the shareholders.
Our businesses are on a path to being self-sustaining,
that’s a minimum requirement this year, but by the
end of the year we expect to be moving into the phase
where we are receiving capital at the centre which we
can deploy. We won’t be looking for turnarounds or
loss-making businesses. We have been building our
expertise and knowledge base where we think we can
acquire well and add value. When we reach that stage,
i.e. performing-businesses sending capital back that
is successfully redeployed and creating more future
value, then Castelnau will have started to become
what we envisaged at its creation.
Gary Channon
CIO, Phoenix Asset Management Partners Ltd.
9 April 2025
Statement from the CIO
of the Investment Manager
Strategic Report
Governance
We intend to
conduct ourselves
at all times with
integrity and
fairness.
Castelnau Group Ltd Annual Report 2024
15
Governance
Castelnau Group Ltd Annual Report 2024
16
Board Members
Biographical details of the Directors are as follows:
Joanne has over 25 years of experience in the financial services/asset
management sector. Joanne is a non-executive director with a portfolio
of clients including Financial Services and Operating Businesses. Joanne’s
portfolio includes Listed, Private Equity, Debt, Utilities, Renewables, Hedge,
Real Estate and Asset Managers. Prior to becoming a non-executive
director, Joanne worked for PwC in the Channel Islands, UK and Canada
and held leadership roles in Audit, Controls Assurance, Risk & Quality and
Innovation & Technology.
Joanne is an FCA with the ICAEW, graduating with an honours degree in
Accounting and holds the IOD Diploma. Joanne is the Chair of the Guernsey
International Business Association and the immediate past Chair of the
Guernsey Investment & Fund Association. Joanne resides in Guernsey.
Directorships in other public listed companies:
NextEnergy Solar Fund Limited, London
Volta Finance Limited, London & Euronext
Joanne Peacegood
(Independent Chair)
(aged 47)
Andrew is an experienced director and currently sits on several investment
manager and investment fund boards specialising in debt, venture,
renewables and buyouts. Andrew has over 20 years of experience in the
investment sector and the funds industry.
Andrew is currently the Managing Director of Aver Partners, having
previously been Managing Director at Ipes (Barings/Apex) and preceding
that, Managing Director at Capita (Sinclair Henderson/Link). He has
held senior management roles at Moscow Narodny (VTB Capital), DML
(Halliburton) and qualified whilst at Midland (HSBC/Montagu).
Andrew graduated from Cardiff University and Aix-Marseille Université. He is
a Chartered Management Accountant and is a Member of the Chartered
Institute for Securities and Investment (CISI). Andrew is currently Chair of
the British Venture Capital Association (BVCA) Channel Islands Working
Group and a member of the Association of Investment Companies’ (AIC)
Technical Committee. He is a previous Chair of the Guernsey Investment
Fund Association (GIFA), Council member of Guernsey International
Business Association (GIBA), member of the Association of Real Estate
Funds (AREF) Regulatory Committee and of Invest Europe’s (formally
European Venture Capital Association’s (EVCA)) Technical Group.
Directorships in other public listed companies:
ARCH SRF Listed Holdco Limited, International
Shore Capital Group Limited, Bermuda
Andrew Whittaker
(Independent Non-Executive
Director)
(aged 51)
Governance
Castelnau Group Ltd Annual Report 2024
17
Joanna has over 35 years’ experience working in the finance industry
in Guernsey. Joanna is a Director of Altum (Guernsey) Limited and was
previously Chief Executive Officer of Elysium Fund Management Limited
(“Elysium”) from its formation in 2006 to January 2025. The Altum Group
acquired Elysium in January 2025. Prior to that, Joanna was a Director and
the Company Secretary of Collins Stewart Fund Management Limited, and
was involved in corporate finance assignments and stock exchange listing
work in addition to fund administration and company secretarial duties.
Joanna has experience in the provision of best practice corporate governance
and company secretarial services to a diverse range of companies traded on
the AIM market of the London Stock Exchange, listed on the Main Market of the
London Stock Exchange, Euronext and The International Stock Exchange. Joanna
qualified as an Associate of ICSA: The Chartered Governance Institute UK &
Ireland in 1994 and was elected to Fellowship in May 2023.
Directorships in other public listed companies:
MAN AHL Diversified PCC Limited, International
Joanna Duquemin
Nicolle
(Independent Non-Executive
Director)
(aged 54)
David Stevenson is a columnist for the Financial Times, Citywire and Money
Week and author of a number of books on investment matters. He was
the founding director of Rocket Science Group and www.etfstream.com.
Currently, he is a director of Aurora Investment Trust Plc, Secured Income
Fund Plc, Gresham House Energy Storage Fund Plc, AltFi Limited and
Workspace Group Limited, and a strategy consultant to a number of asset
management firms and investment banks.
Directorships in other public listed companies:
Aurora Investment Trust plc, London
Gresham House Energy Storage Fund plc, London
Workspace Group plc, London
David Stevenson
(Non-Independent Non-Executive
Director)
(aged 58)
As a former investment banker at Morgan Stanley, Richard has over
15years of corporate finance experience. He has advised firms ranging
from the largest FTSE 100 companies to private businesses and played an
instrumental part in numerous high-profile M&A and ECM transactions.
Hepreviously worked at Peel Hunt and Barclays, having initially qualified
as a chartered accountant at KPMG. Richard currently acts as a non-
executive director on the board of Dignity Plc.
Richard Brown
(Non-Independent Non-Executive
Director)
(aged 40)
Governance
18
Castelnau Group Ltd Annual Report 2024
The Directors present their Annual Report and Audited
Consolidated Financial Statements for the year ended
31 December 2024.
Review of Performance Fee
Arrangements
As shareholders will be aware, the Investment Manager
does not charge a management fee to the Company
and is instead incentivised solely via a performance-
based fee arrangement. In summary, the performance
fee arrangement is measured over consecutive
periods of not less than three years with first period
commencing on the Company’s IPO on 18 October 2021
and ended on 31 December 2024. The performance fee
payable is one third of the outperformance of the Net
Asset Value total return after adjustment for inflows
and outflows, over the FTSE All-Share Total Return Index
(the “Benchmark”) with, subject to certain regulatory
considerations, the performance fee being satisfied
through the issuance of new Ordinary Shares.
The Directors consider that the performance fee,
measured over a three-year period and receivable
in shares, remains a significant point of alignment
between the Company, its shareholders and the
Investment Manager; however, during the year, the
performance fee arrangement was reviewed to ensure
this alignment is equitable to all parties. Pursuant to
the terms of the Investment Management Agreement
(“IMA”) prior to the review, the performance fee was
to be paid based on the outperformance over the
Benchmark, calculated by reference to the average
adjusted net assets of the Company over each
performance period. The averaging of the net asset
value over the performance period does not fully
take into account the outperformance that has been
delivered by the Investment Manager and principally
for this reason, it was proposed that a limited number
of adjustments would be made to the IMA, with the
Group entering into a revised agreement. This revised
agreement took effect from 31 May 2024, and the
revisions are summarised below:
• The fee will remain as one third of the
outperformance over the Benchmark, however, the
fee will be calculated by reference to the audited
closing net asset value (“Closing NAV”) rather than
the average net asset value, and will be compared
to the ‘Benchmark NAV’.
• The Closing NAV is the reported audited net
asset value of the Company at the period end,
excluding any accrued performance fees. Thiswill
be compared to the Benchmark NAV, which is
the Company’s opening audited NAV for the
performance period to which the Benchmark
return is applied. The Benchmark NAV will also be
adjusted for the impact of inflows and outflows to
the share capital of the Company, to ensure that
both the Closing NAV and Benchmark NAV reflect
performance adjusted for the impact of these events.
• In addition, the revised fee arrangement will
include a provision such that no performance fee
would be earned until the net asset value (“NAV”)
per Ordinary Share is above the original NAV per
Ordinary Share at IPO (100p), adjusted for the
performance of the Benchmark.
• The fee will continue to be paid in new Ordinary
Shares.
For avoidance of doubt, no performance fee for
the period to 31 December 2024 would currently
be payable under either the original or revised
performance fee calculation. In addition, no additional
changes to the IMA (other than in respect of the
performance fee) were made.
Castelnau Group Services Limited
Castelnau Group Services Limited (“CGSL”), the 100%
subsidiary of the Castelnau Group, retained the
services of an average of five staff during the year to
31 December 2024, all deployed to portfolio companies
or to PAMP. During the previous year, one member of
staff transitioned to a permanent role in a portfolio
company, as this was more suited to the role, however
this member of staff returned to CGSL in October 2024.
Dividend Policy
The Group has no stated dividend target. The Group’s
investment objective is one of capital growth and it
is anticipated that returns for Shareholders will derive
primarily from capital gains. The Group will target a Net
Asset Value total return of 10-15% above the return on
Directors’
Report
Governance
19
Castelnau Group Ltd Annual Report 2024
the FTSE All-Share Total Return Index per annum and
a minimum absolute Net Asset Value total return of
20%per annum.
Investors should note that the target returns stated
above are targets only and not a profit forecast. There
may be a number of factors that adversely affect the
Company’s ability to achieve the target returns and
there can be no assurance that the target will be met.
Borrowing Policy
There is no limit in the Articles on the level of gearing
which the Group can employ. Whilst the Group does
not currently expect to have long-term gearing as
part of its strategy, any such gearing utilised would be
expected to be below 50% of the Group’s gross asset
value (including undrawn capital commitments),
in each case measured at the time of investment.
The Board may, however, approve a higher level of
gearing from time to time, in circumstances where the
Investment Manager recommends it should do so on
an opportunistic basis.
Going Concern
The Directors believe that, having considered the
Group’s investment objective on page 3, financial
risk management, principal risks and in view of the
Group’s holdings in cash and cash equivalents, the
liquidity of investments and the income deriving from
those investments, the Group has adequate financial
resources and suitable management arrangements
in place to continue as a going concern for at least
twelve months from the date of approval of the
Financial Statements. The Directors are confident
that the Group has sufficient resources to meet its
obligations and sustain operations for the foreseeable
future.
Investment Manager
The Investment Management Agreement with PAMP
creates significant Shareholder alignment, as PAMP
does not earn a management fee, but earns a
performance fee only, which is paid in shares and not
in cash. The performance fee period is three years and
is equal to one-third of the relative outperformance of
the NAV total return over the FTSE All-Share Total Return
Index for each Performance Period.
The Board considers that the interests of Shareholders,
as a whole, are best served by the ongoing
appointment of the Investment Manager to achieve
the Company’s investment objectives.
Alternative Investment Fund Manager
(“AIFM”)
PAMP has been investing in UK listed equities for 25
years using a “value investing” approach to buy
high-quality businesses at attractive prices. PAMP
has delivered excellent long-term investment returns
since being set up by Gary Channon in 1998. PAMP
also manage the Aurora Investment Trust Plc and
the Huginn Fund. Shareholders can view the historic
track record of the Phoenix UK Fund here: https://www.
phoenixassetmanagement.com/investment-vehicles/
phoenix-uk-fund#past
PAMP’s investment process aims to identify great
businesses and management through intensive
primary research. PAMP is known for the depth of its
research which can often last many years before
making an investment. Once an investment is
made, the investment team maintains this intensive
approach to research by closely monitoring the
investments.
PAMP has an investment philosophy and approach
that is inspired and influenced by some of the great
investors such as Warren Buffett, Phil Fisher, Charlie
Munger and John Maynard Keynes. These philosophies
have been built into a “Phoenix approach”, which
PAMP has continuously refined using experience
of application and analysis and learning. This has
turned the philosophical approach into a proprietary
technical approach which has been applied to the
investments managed by PAMP and has helped to
deliver long-term outperformance.
This philosophy and approach are the bedrock for
the approach which Castelnau also takes. However,
this has been further developed in order to be more
applicable to entities which we control or are able to
give greater assistance to. More information about
this is included in our quarterly investor reports which
Governance
20
Castelnau Group Ltd Annual Report 2024
can be found here: https://www.castelnaugroup.com/
investor-relations/reports-factsheets
The Investment Management Agreement dated
23September 2021, and amended 31 May 2024,
between the Company and the Investment Manager,
pursuant to which the Investment Manager is
appointed to act as the Company’s Alternative
Investment Fund Manager for the purposes of the UK
AIFM Regime, and accordingly the Investment Manager
is responsible for providing portfolio management and
risk management services to the Company, subject to
the overall control and supervision of the Directors. The
Investment Manager, in its capacity as the Company’s
Alternative Investment Fund Manager, will also make
the relevant notifications for the marketing of the
Ordinary Shares in the United Kingdom and elsewhere
(if required).
Shareholders may be interested in reading the historic
track record of the Phoenix UK Fund since inception,
which is an Appendix at the back of the Annual Report
and Audited Consolidated Financial Statements.
Building on PAMP’s experience of investing in private
companies and companies where they have control
or influence, the Investment Manager has built a
“Castelnau Toolbox”, essentially a way of standardising
PAMP’s critical knowledge and techniques that can be
applied to a specific type of investee company, which
can be assessed and improved through application
over time.
Control of the Level of Ongoing
Charges
The Board monitors the Group’s operating costs
carefully. Based on the Group’s average net assets
for the year ended 31 December 2024, the Group’s
ongoing charges figure calculated in accordance
with the Association of Investment Companies (“AIC”)
methodology was 0.53% (2023: 0.59%). As the size of
the Group grows, the Board will manage expenses with
the intention of keeping costs down and reducing the
ongoing charge ratio accordingly.
Custodian and Depositary
Custody and Depositary services are provided by
Northern Trust (Guernsey) Limited (the “Depositary”).
The Depositary was appointed on 18 October 2021.
The terms of the Depositary agreement allow the
Depositary to receive professional fees for services
rendered. The Depositary agreement includes
custodian duties. For additional information, refer to
note 15 to the Financial Statements.
Directors
The Directors of the Group during the year and at the
date of this Report are set out on page 79.
Directors’ and Other Interests
The Directors of the Group held the following Ordinary Shares beneficially:
31 December
2024
Number of
Ordinary Shares
31 December
2024
% of issued
share capital
31 December
2023
Number of
Ordinary Shares
31 December
2023
% of issued
share capital
Joanne Peacegood* 31,344 0.01% 10,000 0.00%
Andrew Whittaker 40,000 0.01% 40,000 0.01%
Joanna Duquemin Nicolle 75,000 0.02% 75,000 0.02%
David Stevenson – – – –
Richard Brown* 21,344 0.01% – –
* Joanne Peacegood and Richard Brown each purchased 21,344 Ordinary Shares on 5 November 2024.
Directors’ Report - continued
Governance
21
Castelnau Group Ltd Annual Report 2024
Corporate Governance
The Board is committed to high standards of corporate
governance and has implemented a framework
for corporate governance which it considers to be
appropriate for an investment company in order
to comply with the principles of the UK Corporate
Governance Code (the “UK Code”). The Group is
also required to comply with the Code of Corporate
Governance (the “GFSC Code”) issued by the Guernsey
Financial Services Commission.
This Corporate Governance Statement, together with
the Going Concern Statement, Viability Statement
and the Statement of Directors’ Responsibilities set out
on pages 35 to 36, indicates how the Company has
complied with the principles of good governance of
the UK Code and its requirements on Internal Control.
The Group is a member of the AIC and by complying
with the AIC Code of Corporate Governance (the “AIC
Code”) is deemed to comply with both the UK Code
and the GFSC Code. The Board has considered the
principles and recommendations of the AIC Code and
considers that reporting against these will provide
better information to Shareholders. To ensure ongoing
compliance with these principles, the Board reviews a
report from the Corporate Secretary at each quarterly
meeting, identifying how the Group is in compliance
and identifying any changes that might be necessary.
The AIC Code is available on the AIC’s website, www.
theaic.co.uk. The UK Code is available in the Financial
Reporting Council’s website, www.frc.org.uk.
Since listing on the London Stock Exchange’s Main
Market on 18 October 2021, the Group has complied
with the recommendations of the AIC Code and thus
the relevant provisions of the UK Code, except as set
out below.
The UK Code includes provisions relating to:
• The role of the Chief Executive;
• Executive Directors’ remuneration;
• Annually assessing the need for an internal audit
function; and
• Senior Independent Director.
It is acknowledged in the UK Corporate Governance
Code that some of its provisions may not be relevant
to externally managed investment companies (such
as the Group). The Board does not consider that the
above provisions are relevant to the Group. The Group
will therefore not comply with these provisions.
Whilst the Group will seek to comply with the AIC Code
as far as practicable, it is likely that it will not be able
to comply with all of the AIC Code requirements. In
particular, in relation to the Director appointed by the
holder of the B Share, this Director will be appointed
by the Investment Manager and therefore will not
be entirely independent of the Investment Manager.
Further, such Director will not be subject to annual
re-election. In addition, the holder of the B Share has
the power to ensure that no Directors are removed or
appointed without its consent.
The Administrator maintains a system of internal
control on which it reports to the Board. The Board
has reviewed the need for an internal audit function
and has decided that the systems and procedures
employed by the Administrator provide the assurance
that a sound system of risk management and internal
control should. An internal audit function specific to the
Company is therefore considered unnecessary.
Role, Composition and Independence
of the Board
The Board is the Group’s governing body and has
overall responsibility for maximising the Group’s
success by directing and supervising the affairs of
the business and meeting the appropriate interests
of Shareholders and relevant stakeholders, while
enhancing the value of the Group and also ensuring
protection of investors. A summary of the Board’s
responsibilities is as follows:
• statutory obligations and public disclosure;
• strategic matters and financial reporting;
• risk assessment and management including
reporting compliance, governance, monitoring and
control; and
• other matters having a material effect on the
Group.
Governance
22
Castelnau Group Ltd Annual Report 2024
The Board’s responsibilities for the Annual Report and
Audited Consolidated Financial Statements are set
out in the Statement of Directors’ Responsibilities on
pages35 to 36. Biographies for all the Directors can be
found on pages 16 and 17.
The Board consists of five non-executive Directors all
of whom have diverse skill sets and experience. Three
of the five Directors are considered to be independent
of the Investment Manager and as prescribed by
the Listing Rules. The Board does not consider it
appropriate to appoint a Senior Independent Director
at this time because the majority of the Directors
are deemed to be independent of the Group. The
Board considers that it has the appropriate balance
of diverse skills and experience, independence and
knowledge of the Group and the wider sector, to
enable it to discharge its duties and responsibilities
effectively and that no individual or group of
individuals dominates decision making.
The Chair is responsible for leadership of the Board
and ensuring its effectiveness. The Chair is Joanne
Peacegood. The Chair of the Board must be, and is
considered to be, independent for the purposes of
Chapter 11 of the Listing Rules.
The Board needs to ensure that the Annual Report and
Audited Consolidated Financial Statements, taken as
a whole, is fair, balanced and understandable and
provides the information necessary for Shareholders
to assess the Group’s position and performance,
business model and strategy. In seeking to achieve
this, the Directors have set out the Group’s investment
objective and policy and have explained how the
Board and its delegated Committees operate and
how the Directors review the risk environment within
which the Group operates and sets appropriate risk
controls. Furthermore, throughout the Annual Report
and Audited Consolidated Financial Statements, the
Board has sought to provide further information to
enable Shareholders to have a fair, balanced and
understandable view.
The Board has contractually delegated responsibility
for the management of its investment portfolio, the
arrangement of custodial and depositary services
and the provision of administration, accounting,
registrar and company secretarial services including
the independent calculation of the Group’s NAV and
the production of the Annual Report and Audited
Consolidated Financial Statements which are
independently audited.
The Board is responsible for the appointment and
monitoring of all service providers to the Group.
The Directors are kept fully informed of investment
and financial controls and other matters by all service
providers that are relevant to the business of the Group
and should be brought to the attention of the Directors.
The Nominations Committee regularly reviews the
structure, size, composition (including the skills,
knowledge, experience and diversity) of the Board as a
whole and makes recommendations to the Board with
regard to any changes.
The Board has a breadth of experience relevant to the
Group and the Directors believe that any changes to
the Board’s composition can be managed without
undue disruption. With any new director appointment
to the Board, consideration will be given as to what
induction process is appropriate.
Directors’ Attendance at Meetings
The Board holds quarterly Board meetings to discuss
matters including portfolio performance, strategy,
dividend policy, structure, finance, corporate
governance, marketing, risk management, liquidity,
compliance, asset allocation and gearing, contracts
and Group performance. The quarterly Board meetings
are the principal source of regular information for the
Board enabling it to determine policy and to monitor
performance, compliance and controls but these
meetings are also supplemented by communication
and discussions throughout the year.
A representative from each of the Investment Manager,
AIFM, Administrator and Corporate Broker attends
each Board meeting either in person or by telephone
thus enabling the Board to fully discuss and review the
Group’s operation and performance. Each Director has
direct access to the Portfolio Manager and Company
Secretary and may, at the expense of the Group, seek
independent professional advice on any matter. Both
appointment and removal of these parties is to be
agreed by the Board as a whole.
Directors’ Report - continued
Governance
23
Castelnau Group Ltd Annual Report 2024
The Audit Committee meets five times a year, the
Management Engagement Committee (“MEC”) and
Remuneration and Nomination Committee meet at
least once a year. In addition, ad-hoc meetings of the
Board to review specific items between the regular
scheduled quarterly meetings can be arranged.
Between formal meetings, there is regular contact with
the Portfolio Manager, AIFM, Administrator, Custodian
and Depositary and the Corporate Broker.
Although some of the Directors hold other listed Board
positions, the Board is satisfied that they have sufficient
time to carry out their duties for the Group as evidenced
by their engagement and attendance at the Board and
Audit Committee meetings during the year.
At the Board meetings, the Directors review the
management of the Group’s assets and liabilities and
all other significant matters so as to ensure that the
Directors maintain overall control and supervision of
the Group’s affairs.
Appointment and Retirement of
Directors
Subject to the Companies Law and the Articles, the
Directors shall have power at any time, and from
time to time, without sanction of the Group in general
meeting but subject to receiving the written consent
of the holder of the B Share, to appoint any person to
be a Director, either to fill a casual vacancy or as an
additional Director. Any Director so appointed shall
hold office only until the next following annual general
meeting and shall then be eligible for re-appointment.
Subject to the Companies Law and the Articles, the
Group may by ordinary resolution appoint any person
as a Director; and remove any person from office as
a Director and there shall be no requirement for the
appointment or removal of two or more Directors to
be considered separately. A Director may resign from
office as a Director by giving notice in writing to that
effect to the Group. There is no age limit at which a
Director is required to retire. At each annual general
meeting of the Group, each Director, other than
the Director appointed by the holder of the B Share
pursuant to the Articles, shall retire from office and
each Director may offer themselves for election or
re-election by the Shareholders.
Board Performance and Training
On appointment to the Board, Directors will be offered
relevant training and induction. Training is an ongoing
matter as is discussion on the overall strategy of the
Group. The Board undertakes an annual internal Board
Performance Review. This exercise was completed in
March 2024 and April 2025. The Company Secretary
circulated questionnaires to each Director to complete
independent of each other, and anonymously.
Theircompleted forms were returned to the Company
Secretary, and their responses collated into a report
that was tabled at the Nomination Committee
meeting. The report findings were discussed at the
meeting. The results of the performance review were
satisfactory with no issues identified.
On appointment to the Board, each Director
considered the expected time needed to discharge
their responsibilities effectively. The Directors confirmed
that each had sufficient time to allocate and would
inform the Board of any subsequent changes. In
accordance with the AIC Code, if and when any
Director, including the Chair, has been in office (or
upon re-election would at the end of that term, be in
office) for more than nine years, the Board will consider
whether there is a risk that such Director might
reasonably be deemed to have lost independence
through such long service.
In respect of the Criminal Finances Act 2017 which has
introduced a new corporate criminal offence (“CCO”)
of failing to take reasonable steps to prevent the
facilitation of tax evasion, the Board confirms that they
are committed to zero tolerance towards the criminal
facilitation of tax evasion.
Board Diversity
When appointing new directors and reviewing the
Board composition, the Board considers, amongst
other factors, diversity, balance of skills, knowledge,
gender, social and ethnic background and experience.
The Board considers the Listing Rules requirement in
appointing new directors, however, does not consider
it appropriate to establish targets or quotas in this
regard.
Governance
24
Castelnau Group Ltd Annual Report 2024
As at 31 December 2024, the Board consisted of two
female and three male directors. Joanne Peacegood
is the Chair of the Board and the Remuneration
Committee, and Joanna Duquemin Nicolle is the
Chair of the Management Engagement Committee.
The Group has therefore met the targets set by the
Listing Rules UKLR 6.6.6R(9) and UKLR 16.3.29R(1) in
relation to board diversity for the percentage of its
board members who are female and also in a senior
position. The Group has not met the target to have at
least one director from a minority ethnic background,
but considers this satisfactory as the individual
Board members are performing within their role and
comprise a diverse skillset and knowledge. As the
Group was only listed in 2021, the board members
have not yet come up for succession, however,
when succession arises, the Board will consider the
requirements of the Listing Rules.
Board Committees and their Activities
Terms of Reference
All Terms of Reference of the Board’s Committees are
available from the Administrator upon request.
Management Engagement Committee
In accordance with the AIC Code, the Group has
established a Management Engagement Committee
which is chaired by Joanna Duquemin Nicolle and
includes Andrew Whittaker, Joanne Peacegood and
David Stevenson. The Management Engagement
Committee meets at least once a year or more often
if required. Its principal duties are to consider the
terms of appointment of the Investment Manager and
other service providers and it annually reviews those
appointments and the terms of engagement.
Audit Committee
The Group’s Audit Committee is chaired by Andrew
Whittaker and includes Joanna Duquemin Nicolle
and Joanne Peacegood. The Audit Committee meets
at least five times a year. The Board considers that
the members of the Audit Committee have the
requisite skills and sector experience to fulfil the
responsibilities of the Audit Committee. The Audit
Committee examines the effectiveness of the Group’s
control systems and amongst other items, reviews the
annual and interim reports and also requests certain
information from the Investment Manager and the
Administrator. It also reviews the scope, results, cost
effectiveness, independence and objectivity of the
external Auditor.
Further details on the Audit Committee can be found in
the Audit Committee Report on page 37.
Remuneration Committee
The Group’s Remuneration Committee consists of all
of the Directors and is chaired by Joanne Peacegood.
The Remuneration Committee meets at least once
a year or more often if required. The Remuneration
Committee’s main functions include:
(i) agreeing the policy for the remuneration of the
Directors and reviewing any proposed changes to
the policy;
(ii) reviewing and considering ad hoc payment to the
Directors in relation to duties undertaken over and
above normal business; and
(iii) appointing independent professional remuneration
advice.
Nomination Committee
The Group’s Nomination Committee consists of all of
the Directors and is chaired by Andrew Whittaker. The
Nomination Committee meets at least once a year or
more often if required. Its principal duties are to advise
the Board on succession planning bearing in mind the
balance of skills, knowledge and experience existing on
the Board and make recommendations to the Board
in this regard. The Nomination Committee advises
the Board on its balance of relevant skills, experience,
gender, race, ages and length of service of the
Directors serving on the Board. All appointments to the
Board are made in a formal and transparent manner.
Directors’ Report - continued
Governance
25
Castelnau Group Ltd Annual Report 2024
For each Director, the tables below set out the number
of Board and Committee meetings they were entitled
to attend during the year ended 31 December 2024
and the number of such meetings attended by each
Director.
Held Attended
Scheduled Board Meetings
Joanne Peacegood 4 4
Andrew Whittaker 4 4
Joanna Duquemin Nicolle 4 4
David Stevenson 4 4
Richard Brown 4 4
Management Engagement Committee Meetings
Joanne Peacegood 1 1
Andrew Whittaker 1 1
Joanna Duquemin Nicolle 1 1
David Stevenson 1 1
Audit Committee Meetings
Joanne Peacegood 5 5
Andrew Whittaker 5 4
Joanna Duquemin Nicolle 5 5
Remuneration Committee Meetings
Joanne Peacegood 1 1
Andrew Whittaker 1 1
Joanna Duquemin Nicolle 1 1
David Stevenson 1 1
Richard Brown 1 1
Nomination Committee Meetings
Joanne Peacegood 1 1
Andrew Whittaker 1 1
Joanna Duquemin Nicolle 1 1
David Stevenson 1 1
Richard Brown 1 1
Ad hoc Committee Meetings
Joanne Peacegood 9 7
Andrew Whittaker 9 9
Joanna Duquemin Nicolle 9 8
David Stevenson 8 6
Richard Brown 9 7
Governance
26
Castelnau Group Ltd Annual Report 2024
Strategy
The Group will follow a high conviction investment
strategy. The expertise and processes developed by
the Investment Manager can be applied to all parts of
the capital structure of a business, both private and
publicly quoted. These positions could be represented
by a minority stake, a control position combined with
operational involvement, full ownership of a company,
a joint venture, a loan or convertible instrument, a
short position or any other instrument which allows the
Group to access value.
Internal Controls
The Board is ultimately responsible for establishing
and maintaining the Group’s system of internal
financial and operating control and for maintaining
and reviewing its effectiveness. The Group’s risk matrix
continues to be the core element of the Group’s risk
management process in establishing the Group’s
system of internal financial and reporting control. The
risk matrix is prepared and maintained by the Board
which initially identifies the risks facing the Group
and then collectively assesses the likelihood of each
risk, the impact of those risks and the strength of
the controls operating over each risk. The system of
internal financial and operating control is designed to
manage rather than to eliminate the risk of failure to
achieve business objectives and by their nature can
only provide reasonable and not absolute assurance
against misstatement and loss.
These controls aim to ensure that assets of the
Group are safeguarded, proper accounting records
are maintained and the financial information for
publication is reliable. The Board confirms that there
is an ongoing process for identifying, evaluating and
managing the significant risks faced by the Group.
This process has been in place for the year under
review and up to the date of approval of this
Annual Report and Audited Consolidated Financial
Statements. It has been reviewed by the Board and is
in accordance with the AIC Code.
The AIC Code requires Directors to conduct at least
annually a review of the Group’s system of internal
financial and operating control, covering all controls,
including financial, operational, compliance and risk
management. The Board has evaluated the systems
of internal controls of the Group. In particular, it has
prepared a process for identifying and evaluating the
significant risks affecting the Group and the policies
by which these risks are managed. The Board also
considers whether the appointment of an internal
auditor is required and has determined that there is no
requirement for a direct internal audit function.
The Board has delegated the day-to-day
responsibilities for the management of the Group’s
investment portfolio, the provision of custodial and
depositary services and administration, accounting,
registrar and company secretarial functions including
the independent calculation of the Group’s NAV and
the production of the Annual Report and Audited
Consolidated Financial Statements which are
independently audited.
Formal contractual agreements have been put in
place between the Group and providers of these
services. Even though the Board has delegated
responsibility for these functions, it retains
accountability for these functions and is responsible
for the systems of internal control. At each quarterly
Board meeting, compliance reports are provided
by the Administrator, Company Secretary, Portfolio
Manager, AIFM and Depositary. The Board also receives
confirmation from the Administrator of its accreditation
under its controls report.
Procedure for Identifying Risks
The procedures in place to identify emerging or
principal risks are described below.
The Audit Committee regularly reviews the Group’s
risk matrix, focusing on ensuring that the appropriate
controls are in place to mitigate each risk. A system
has been established to identify emerging risks as
they occur as detailed below. The experience and
knowledge of the Audit Committee and Board is
invaluable to these discussions, as is advice received
from the Board’s service providers, specifically the
Investment Manager who is responsible for all portfolio
management services.
Directors’ Report - continued
Governance
27
Castelnau Group Ltd Annual Report 2024
The market and operational risks were discussed by
the Board, with updates on operational resilience
received from the Investment Manager, Administrator
and other key service providers.
The following is a description of the role each service
provider plays in the identification of emerging risks:
I. Investment Manager: the Investment Manager
advises the Board at each meeting on world
markets, stock market trends, information on stock
specific matters as well as regulatory, political and
economic changes likely to impact the Group’s
portfolio;
II. Distributor and Broker: provides advice periodically
specific to the Board on the Group’s share register,
sector, competitors and the investment company
market;
III. Company Secretary and Accounting Advisor: briefs
the Board on forthcoming legislation or regulatory
changes that might impact the Group; and
IV. AIC: the Group is a member of the AIC, which
provides regular technical updates as well as
drawing members’ attention to forthcoming
industry and regulatory issues.
Procedure for Oversight of Risks
Audit Committee: The risk matrix is kept under review.
This includes a review of the risk procedures and
controls in place at the key service providers to ensure
that emerging (as well as known) risks are adequately
identified and – so far as practicable – mitigated.
Experienced Non-Executive Directors on the
Committee, each bringing external knowledge of the
investment trust (and financial services generally)
marketplace, trends, threats etc. as well as macro/
strategic insight.
Principal Risks and Uncertainties
The principal risks faced by the Group, together with
the approach taken by the Board towards them, have
been summarised below.
Valuation of investments
Some of the Group’s investments will include securities
and other interests that are very thinly traded, for
which no market exists or which are restricted as
to their transferability under applicable laws and/
or the relevant investment documentation. Whilst
the valuations of the Group’s investments will be in
compliance with IFRS, some of the Group’s investments
will be difficult to value. Such valuations may be
conducted on an infrequent basis, are subject to
a range of uncertainties. The risks associated
with valuation of investments are managed by
the Investment Manager and reviewed by the
Board. TheBoard considered the valuation of the
investmentsheld by the Group as at 31 December
2024to be reasonable based on information
providedby the Investment Manager, underlying
portfolio companies, AIFM, Administrator, Custodian
and Depositary on their processes for the valuation
of these investments, which were validated by an
independent third party.
The Board reviewed the valuation policy and PAMP
has agreed the valuation process/techniques with the
Board around private asset investments. The Board is
satisfied with the approach and the valuation policy
and processes.
The Board receives the monthly NAV as well as
quarterly detailed updates on the portfolio which
include changes to the valuations. The Board is
updated when there is/or potential to be significant
changes in valuation. As part of the annual audit
process and the Board signing off on the annual
financial statements, the Board receives the valuation
packs and also the third-party (Kroll) reports. The
Board scrutinises the valuations/reports and ensures
they are satisfied prior to sign off.
The Board also asks questions regularly (including
during quarterly Board meetings, or ad hoc meetings)
to understand performance and the impact on
valuation and receives regular presentations from the
portfolio executives. The Board has access to detailed
valuation reports as and when requested.
Governance
28
Castelnau Group Ltd Annual Report 2024
Market risk
As a result of investments in publicly traded
portfoliocompanies with a total value of £21,253,483
(31 December 2023: £14,785,032), the Group will be
exposed to equity securities price risk. The market
value of the Group’s holdings in publicly traded
portfolio companies could be affected by a number
of factors, including, but not limited to: a change in
sentiment in the market regarding such companies;
the market’s appetite for specific business sectors;
and the financial or operational performance of
the publicly traded portfolio companies which may
be driven by, amongstother things, the cyclicality
of some of the sectors in which some or all of the
publicly traded portfolio companies operate. Equity
prices and returns from investing in equity markets are
sensitive to various factors, including but not limited to:
expectations of future dividends and profits; economic
growth; exchange rates; interest rates; and inflation.
The value of any investment in equity markets is
therefore volatile and it is possible, even when an
investment has been held for a long time, that an
investor may not get back the sum invested. Any
adverse effect on the value of any equities in which the
Group invests from time to time could have a material
adverse effect on the Group’s financial condition,
business, prospects and results of operations and,
consequently, the Net Asset Value and/or the market
price of the Ordinary Shares.
The Board receives updates on the Group’s investment
performance at quarterly Board meetings, or more
frequently as required, and challenges the Investment
Manager on investment performance, stock selection,
and portfolio composition.
Liquidity risk
Liquidity risk is defined as the risk that the Group will
encounter difficulty in meeting obligations associated
with financial liabilities. Investments made by the
Group may be illiquid and this may result in delays/
shortfall of expected cash flows to the Group.
Investments in private assets (including private
portfolio companies) are highly illiquid and have no
public market. There may not be a secondary market
for interests in private assets. Such illiquidity may affect
the Group’s ability to vary its portfolio or dispose of, or
liquidate part of, its portfolio, in a timely fashion (or at
all) and at satisfactory prices in response to changes
in economic or other conditions.
If the Group is required to dispose of or liquidate an
investment on unsatisfactory terms, it may realise less
than the value at which the investment was previously
recorded, which could result in a decrease in Net Asset
Value.
The performance of investments in private assets can
also be volatile because those assets may have limited
product lines, markets or financial reserves, or be more
susceptible to major economic setbacks or downturns.
Private assets may be exposed to a variety of business
risks including, but not limited to: competition from
larger, more established firms; advancement of
incumbent services and technologies; and the
resistance of the market towards new companies,
services or technologies.
The crystallisation of any of these risks or a
combination of these risks may have a material
adverse effect on the development and value of
a portfolio company and, consequently, on the
portfolio and the Group’s financial condition, results
of operations and prospects, with a consequential
adverse effect on the Net Asset Value and/or the
market price of the Ordinary Shares.
Furthermore, repeated failures by portfolio companies
to achieve success may adversely affect the
reputation of the Group or Investment Manager,
which may make it more challenging for the Group
and the Investment Manager to identify and exploit
new opportunities and for other portfolio companies
to raise additional capital, which may therefore have
a material adverse effect on the portfolio and the
Group’s financial condition, results of operations and
prospects, with a consequential adverse effect on
the Net Asset Value and/or the market price of the
Ordinary Shares.
The Board and Investment Manager review liquidity
needs (including operational costs, and loan
repayments), quarterly or more frequently as required,
relative to the value and liquidity of the Group’s assets
and the Group’s portfolio income. The majority of
Directors’ Report - continued
Governance
29
Castelnau Group Ltd Annual Report 2024
the expected liquidity requirements are known (for
example operational costs) while others are at the
discretion of the Group (for example, share buybacks).
The Board is satisfied that the Group’s unexpected
liquidity needs are not significant.
Credit risk
Counterparties such as financial institutions may not
meet their obligations regarding foreign currency and
cash balances. The Board ensures that counterparties
have an acceptable long and short-term credit rating.
Concentration risk
The Group expects to hold a concentrated portfolio
of investments and the Group will not seek to
reduce concentration risk through diversification.
Theopportunity set will dictate the number of holdings
and the weighting of investments in the portfolio. The
investments with the best return profiles will receive the
largest weightings. The Group will therefore have no set
diversification policies.
Other Risks and Uncertainties
Cyber risk
The Board ensures they have a sufficient
understanding of cyber risk to enable them to
manage any potential unauthorised access into
systems and identifying passwords or deleting data.
TheBoard discusses cyber risks at the quarterly board
meeting and also ensures they are continuing to keep
themselves up to date on the risks through attending
professional seminars on the topic, following good
password practices and vigilance to any suspicious
links or attachments. The Group is exposed to the
cyber risks of its third-party service providers. The Audit
Committee received the internal controls reports of
the relevant service providers where available, and
was able to satisfy itself that adequate controls and
procedures were in place to limit the impact to the
Group’s operations.
Operational risk
The Group is exposed to the operational risks of
its third-party service providers and considered
the risk and consequences in the event that these
systems failed during the year. The Investment
Manager, Registrar, Depositary, Administrator and
Company Secretary each have comprehensive
business continuity plans which facilitate continued
operation of the business in the event of a service
disruption or major disruption. The Audit Committee
received the internal controls reports of the relevant
service providers where available, and was able to
satisfy itself that adequate controls and procedures
were in place to limit the impact to the Group’s
operations, particularly with regard to a financial loss.
The performance of service providers is reviewed
annually via its Remuneration and Management
Engagement Committee. Each service provider’s
contract defines the duties and responsibilities of
each and has safeguards in place including provisions
for the termination of each agreement in the event
of a breach or under certain circumstances. Each
agreement also allows for the Board to terminate
subject to a stated notice period. At the meeting
of the Management Engagement Committee on
10December 2024, the Board undertook a thorough
review of each service provider and agreed that their
continued appointment remained appropriate and in
the Group’s long-term interest. The Board’s next review
will be at the next annual Management Engagement
Committee meeting.
Regulatory risk
Poor governance, compliance or administration,
including particularly the risk of loss of investment trust
status and the impact this may have on the Group
were considered by the Board. Having been provided
with assurance from each of the key service providers
during the year ended 31 December 2024, the Board
was satisfied that no such breach had occurred.
The Board’s next review will be at the next annual
Management Engagement Committee meeting.
Geopolitical risk
Russia’s ongoing invasion of Ukraine, the Israel-Hamas
conflict, and increasing tensions in the Middle East all
continue to be risks to the global economy. Escalation in
conflicts may result in an increase in sanctions globally
affecting commodity prices and supply chains, and
increasing compliance monitoring costs for businesses.
With changes in governments resulting from the
exceptional number of national elections that took
Governance
30
Castelnau Group Ltd Annual Report 2024
place in 2024 and more expected in 2025, the potential
increase in volatility of financial markets, altering
economic and investment landscapes, has started to
materialise. The Board and the Investment Manager are
cognisant of this risk and monitor it closely.
Environmental, Social and Governance (“ESG”)
matters
The Board recognises the importance of ESG factors
in the investment management industry and the
wider economy as a whole. It is the view of the Board
that direct environmental and social impact of the
Group is limited and that ESG considerations are most
applicable in respect of the asset allocation decisions
made for its portfolio.
The Group has appointed the Investment Manager
to advise it in relation to all aspects relevant to the
Investment Portfolio. The Investment Manager has a
formal ESG framework which incorporates ESG factors
into its investment process. The Board receives regular
updates from the Investment Manager on its ESG
processes and assesses their suitability for the Group.
ESG factors are assessed by the Investment Manager
for every transaction as part of their investment
process. Climate risks are incorporated in the ESG
analysis under environmental factors.
The Group has entered into contractual arrangements
with a network of third parties (the “Service Providers”)
who provide services to it. The Board, through the
Management Engagement Committee, undertakes
annual due diligence on, and ongoing monitoring
of, all such Service Providers including obtaining a
confirmation that each such Service Provider complies
with relevant laws regulations and good practice and
has ESG policies in place.
Viability Statement
The Directors, with recommendation from the Audit
Committee, have assessed the prospects of the Group
and relevant stresses i.e. additional funding requirements
to existing portfolio companies, loan repayments and
expenses, over a longer period than required by the
going concern provision. With recommendation from the
Audit Committee, the Board chose to conduct a review
for a period of five years to 31 December 2029 as it was
determined to be an appropriate timeframe given the
uncertainty of the investment world and the strategy
period. In selecting this period, the Board considered
the environment within which the Group operates and
the principal and emerging risks and their mitigations
associated with the Group. On a rolling basis, the
Directors evaluate the outcome of the investments and
the Group’s financial position as a whole.
The Group’s prospects are driven by its business
modeland strategy. The Group’s investment objective
is to compound Shareholders’ capital at a higher rate
of return than the FTSE All-Share Total Return Index
overthe long term. The Group will target a Net Asset
Value total return of 10-15% above the return on the
FTSE All-Share Total Return Index per annum and a
minimum absolute Net Asset Value total return of
20%per annum.
In support of this statement, the Audit Committee
recommended to the Directors to take into account all
of the principal and emerging risks facing the Group
as summarised on pages 27 to 29, the nature of the
Group’s business including cash reserves and other
liquid investments held by the Group, the potential of
its portfolio of investments to generate future income
and capital proceeds, and the ability of the Directors
to minimise the level of cash outflows, if necessary.
Themost relevant potential impacts of the identified
principal risks and uncertainties on viability were
determined to be:
(i) investments are in line with the investment
objective and investment policy as set out in the
Group’s prospectus; and
(ii) the Group has the ability to meet running costs and
standing expenses.
Each quarter, the Directors, through the Audit
Committee, review threats to the Group’s viability
utilising the risk matrix, which it updates as required
due to recent developments and/or changes in the
global market. The Board relies on periodic reports
provided by the Alternative Investment Fund Manager
and Investment Manager, and Administrator regarding
risks faced by the Group. When required, experts are
utilised to gather relevant and necessary information,
regarding tax, legal, and other factors.
Directors’ Report - continued
Governance
31
Castelnau Group Ltd Annual Report 2024
The Alternative Investment Fund Manager and
Investment Manager considers the future cash
requirements of the Group before funding portfolio
companies. Furthermore, the Board receives regular
updates from the Alternative Investment Fund
Manager and Investment Manager on the Group’s
cash position, which allows the Board to maintain
their fiduciary responsibility to the Shareholders and,
ifrequired, limit funding for existing commitments.
Based on the aforementioned procedures and
the existing internal controls of the Group, and the
Alternative Investment Fund Manager and Investment
Manager, the Board, with recommendation from
the Audit Committee, has concluded that there is
areasonable expectation that the Group will remain
viable over the five-year period to 31 December 2029.
Report under Section 172 of the
Companies Act 2006
Although the Group is domiciled in Guernsey, in
accordance with the guidance set out in the AIC Code,
the Directors have included below how the matters
set out in Section 172 of the UK Companies Act 2006
have been considered in their board discussions and
decision making.
Further information as to how the Board has had regard to the Section 172 factors:
Section 172 factor Key examples Location
Consequences of decisions in the long term Investment Objectives and Policy Summary Information
Future Prospects Directors’ Report
Dividend Policy Directors’ Report
Viability Statement Directors’ Report
Fostering business relationships with suppliers,
customers and other stakeholders
Shareholder Engagement; Key Service
Providers
Directors’ Report
Impact of operations on the community and the
environment
Environmental, Social and Governance Directors’ Report
Maintaining high standard of business conduct Corporate Governance Directors’ Report
Directors’ duty to promote the success of the
Group
The Board seeks to understand the views of the Group’s
Shareholders and its other key stakeholders as well as how
their interests and the matters set out in Section 172 of the
Companies Act 2006 in the UK (“Companies Act”) have
been considered. As part of the Board and stakeholder
evaluation processes that are undertaken annually, the
Board reviews its engagement mechanisms to ensure
they remain effective. In fulfilling their duties, the Directors
carefully consider the likely consequences of their actions
over the long term and on other key stakeholders.
(i) the Group’s investment objective and policy;
(ii) the main trends and factors likely to affect the
future development, performance and position of
the Group’s business;
(iii) the Group’s key performance indicators;
(iv) the Group’s peers;
(v) the Group’s overall strategy; and
(vi) the Group’s core values which are integrity,
accountability, transparency and commitment.
Identifying stakeholders
The Board has identified its key stakeholders which
include Shareholders, Investee Companies, Investment
Manager, Financial Advisers, the Company Secretary,
Administrator, Registrar, Lawyers, Custodian and
Depositary, amongst others. The Board is aware of the
need to foster the Group’s relationships with its key
stakeholders through its stakeholder management
activities. The Board provides oversight and challenge
to the Investment Manager to ensure that the Group
meets its requirements to create and preserve
Shareholder value.
Governance
32
Castelnau Group Ltd Annual Report 2024
Shareholder engagement
The Board welcomes Shareholders’ views and
places great importance on communication with
its Shareholders. Shareholders wishing to meet
with the Chair and other Board members should
contact the Group’s Administrator by emailing
On 18 September 2024, Shareholders had the
opportunity to vote on the resolutions as specified
in the Notice of AGM. The Notice of the AGM and the
results were released to the London Stock Exchange
inthe form of an announcement.
Key service providers
The Board delegates responsibility for its day to day
operations to a number of key service providers.
Theactivities delegated, service levels and other
related reports to the activities of each service provider
(such as their own approach to such matters as
cyber risk and assessment of climate change risk
to operations) are closely monitored, where and as
appropriate by the Board and they are required to
report to the Board at set intervals.
Monitoring of key decisions and the outcome of
those decisions
The Board meets at least quarterly and at such other
times as deemed appropriate. During these meetings,
the Board considers reports from the Investment
Manager on the Group’s portfolio, its investment activity
and sector diversity. In addition, the Investment Manager
provides an overview of engagement with the investee
companies as well as potential investee companies.
The Board debates the Group’s portfolio and notable
acquisitions or disposals at each of its meetings and
challenges stock selection where deemed appropriate.
In between meetings, the Investment Manager and
Board maintain contact through which they consider
investment ideas, further fundraising initiatives and
market outlook and strategies to consider adjusting
the Group’s portfolio in line with the Group’s investment
policy. During the year, the Board discussed the merits
and structure of the Group, with the Investment Manager
and advisers and considered the long-term interests of
the Group’s Shareholders during those discussions.
In addition, the Board receives reports from the
Financial Adviser on the Group’s Shareholder base
including any changes; its Secretary on latest
governance issues, legal or market announcements;
and its Administrator on the Group’s management
accounts. Furthermore, the Board receives reports
from the Group’s Broker on the performance of the
Group’s peers and ad hoc reports from its other key
stakeholders as deemed appropriate.
On an annual basis, the Board will undertake a review
of its stakeholders which include a review of their
control report and policies, such as whistleblowing,
anti-bribery, anti-money laundering and corruption,
cyber security, data protection policies and each
entity’s business continuity arrangements to ensure
they are in place and are adequate.
Stewardship code
The Board and the Investment Manager support and
have a strong commitment to the UK Stewardship
Code, the latest version of which was issued by FRC
took effect from 1 January 2020 and endorsed by
the AIC which sets out the principles of effective
stewardship by institutional investors.
Modern slavery disclosure
Due to the nature of the Group’s business, being a
company that does not offer goods or services to
consumers, the Board considers that it is not within
the scope of modern slavery. The Board considers the
Group’s supply chains, dealing predominately with
professional advisers and service providers in the
financial service industry, to be low risk in this matter.
Anti-bribery and corruption
It is the Group’s policy to conduct all of its business
in an honest and ethical manner. The Group takes a
zero-tolerance approach to bribery and corruption
and is committed to acting professionally, fairly
and with integrity in all its business dealings and
relationships wherever it operates. The Group’s policy
and the procedures that implement it are designed
to support that commitment. The Board has made
enquiries of its third-party service providers to ensure
their procedures and policies are in place. Refer to
above for more information.
Directors’ Report - continued
Governance
33
Castelnau Group Ltd Annual Report 2024
Tax evasion
The Group maintains a zero-tolerance policy towards
the provision of illegal services, including the facilitation
of tax evasion. The Group has received assurances
from the Group’s main contractors and suppliers that
they maintain a zero-tolerance policy towards the
provision of illegal services, including the facilitation of
tax evasion.
Significant Shareholdings
Shareholders with holdings of more than 5.0% of the Ordinary Shares of the Group at 31 March 2025 were as
follows:
Number of
Ordinary Shares
% of issued
share capital
State Street Nominees Limited OM01 122,425,672 36.83%
Nortrust Nominees Limited 104,457,878 31.42%
Goldman Sachs Securities (Nominees) Limited 26,704,079 8.03%
Those invested directly or indirectly in 5.0% or more
of the issued share capital of the Group will have the
same voting rights as other holders of the Ordinary
Shares.
Annual General Meeting (AGM)
The Group’s AGM will be held at 1.00pm on
17September 2025 at the offices of Northern Trust
International Fund Administration Services (Guernsey)
Limited, Trafalgar Court, Les Banques, St Peter Port,
Guernsey, Channel Islands, GY1 3QL.
Should a Shareholder have a question that they would
like to raise at the AGM, the Board requests that they
ask the question in advance of the AGM by sending it
by email to [email protected]. All questions
raised, together with the relevant answer, will be placed
on the Group’s website at www.castelnaugroup.com.
Independent Auditor
A resolution for the reappointment of Grant Thornton
Limited (“Grant Thornton”) as auditor to the Group will
be proposed at the annual general meeting. Grant
Thornton have indicated their willingness to continue in
office.
Signed on behalf of the Board of Directors on 9 April
2025 by:
Joanne Peacegood Joanna Duquemin Nicolle
Director Director
Governance
Castelnau Group Ltd Annual Report 2024
34
Directors’ Remuneration
Report
The Group is not required to present a Directors’
Remuneration Report, and this report does not purport
to meet all of the requirements of a typical listed UK
company’s Directors’ Remuneration Report, but has
been provided as the Directors believe that it is a
useful addition to this Annual Report and Financial
Statements.
The aggregate amount of Directors’ fees should
not exceed £250,000 per annum to allow for the
appointment of additional director(s), to allow for an
overlap in appointments, thereby assisting with Board
succession planning.
Remuneration Policy
The Group's policy in regard to Directors' remuneration
is to ensure that the Group maintains a competitive fee
structure in order to recruit, retain and motivate non-
executive Directors of excellent quality in the overall
interests of Shareholders.
It is the responsibility of the Remuneration Committee
to consider the Directors' remuneration. However,
the Nomination Committee will review any
proposed changes. The Board ultimately receives
the recommendations and approves the Directors’
remuneration.
No element of the Directors' remuneration is
performance related, nor does any Director have any
entitlement to pensions, share options or any long-
term incentive plans from the Group.
Directors are remunerated in the form of fees, payable
quarterly in advance, to the Directors personally. No
Directors have been paid additional remuneration
by the Group outside their normal Directors’ fees and
expenses.
Joanne Peacegood is entitled to an annual fee of
£40,000. Andrew Whittaker is entitled to an annual
fee of £35,000. Joanna Duquemin Nicolle and David
Stevenson are entitled to an annual fee of £30,000.
Richard Brown waived the right to receive a Director
fee. The Directors received the following remuneration
in the form of Directors’ fees relating to the years
ended 31 December 2024 and 31 December 2023:
31 December 2024
GBP
31 December 2023
GBP
Joanne Peacegood 40,000 40,000
Andrew Whittaker 35,000 35,000
David Stevenson 30,000 30,000
Joanna Duquemin Nicolle 30,000 30,000
Richard Brown – –
135,000 135,000
Appropriate Directors' and Officers’ liability insurance
cover is maintained by the Group on behalf of the
Directors.
Each Director’s appointment letter provides that, upon
the termination of his/her appointment that he/she must
resign in writing and all records remain the property of the
Group. The Directors’ appointments can be terminated in
accordance with the Articles and without compensation.
A Director may resign from office as a Director by giving
notice in writing to that effect to the Group. There is
no age limit at which a Director is required to retire.
Notwithstanding the foregoing, all Directors have agreed
to stand for re-election annually and are re-elected by
the Shareholders at the AGM.
The amounts charged to the Group for Directors as
shown in note 7 to the Financial Statements are for
services as non-executive Directors. No Director has
a service contract with the Group, nor are any such
contracts proposed.
Signed on behalf of the Board of Directors on 9 April
2025 by:
Joanne Peacegood Joanna Duquemin Nicolle
Director Director
Governance
Castelnau Group Ltd Annual Report 2024
35
Statement of Directors’
Responsibilities
The Directors are responsible for preparing the
Financial Statements in accordance with applicable
Guernsey law and regulations.
The Companies (Guernsey) Law, 2008 requires the
directors to prepare financial statements for each
financial year. Under that law, they have elected to
prepare the financial statements in accordance with
IFRS Accounting Standards (“IFRS”) as issued by the
International Accounting Standards Board ("IASB") and
applicable law.
The financial statements are required by law to give
a true and fair view of the state of affairs of the Group
and of the profit or loss of the Group for that period.
In preparing these financial statements, the Directors
are required to:
• select suitable accounting policies and then apply
them consistently;
• make judgements and estimates that are
reasonable and prudent;
• state whether applicable accounting standards
have been followed, subject to any material
departures disclosed and explained in the financial
statements; and
• prepare the financial statements on the going
concern basis unless it is inappropriate to presume
that the Group will continue in business.
The Directors confirm that they have complied
with these requirements in preparing the financial
statements.
The Directors are responsible for keeping proper
accounting records which disclose with reasonable
accuracy at any time the financial position of
the Group and to enable them to ensure that the
financial statements have been properly prepared
in accordance with The Companies (Guernsey)
Law, 2008. They have the general responsibility for
taking such steps as are reasonably open to them to
safeguard the assets of the Group and to prevent and
detect fraud and other irregularities.
So far as each Director is aware, there is no relevant
audit information of which the Group’s auditor is
unaware, and each Director has taken all the steps
that he or she ought to have taken as a Director in
order to make himself or herself aware of any relevant
audit information and to establish that the Group’s
auditor is aware of that information.
The Directors are responsible for the oversight of
the maintenance and integrity of the corporate and
financial information in relation to the Group website;
the work carried out by the auditor does not involve
consideration of these matters and, accordingly, the
auditor accepts no responsibility for any changes that
may have occurred to the financial statements since
they were initially presented on the website.
Legislation in Guernsey governing the preparation and
dissemination of financial statements may differ from
legislation in other jurisdictions.
The Directors are responsible for ensuring that the
Annual Report and Financial Statements include
information requirements by the Disclosure Guidance
and Transparency Rules ("DTR") of the Financial
Conduct Authority ("FCA") with regard to corporate
governance, require the Group to disclose how it has
applied the principles, and complied with the provision
of the corporate governance code applicable to the
Group.
The Directors confirm that to the best of their
knowledge:
(a) The financial statements have been prepared in
accordance with IFRS and give a true and fair view
of the assets, liabilities, financial position and profit
or loss of the Group as at and for the year ended 31
December 2024.
Governance
Castelnau Group Ltd Annual Report 2024
36
(b) The Annual Report includes information detailed
in the Chair’s Statement, Investment Manager’s
Report, Directors’ Report, Statement of Directors’
Responsibilities, Directors’ Remuneration Report and
Audit Committee Report and provides a fair review
of the information required by:
(i) DTR 4.1.8 and DTR 4.1.9 of the Disclosure Guidance
and Transparency Rules, being a fair review of
the Group business and a description of the
principal risks and uncertainties facing the
Group; and
(ii) DTR 4.1.11 of the Disclosure Guidance and
Transparency Rules, being an indication of
important events that have occurred since the
end of the financial year and the likely future
development of the Group.
In the opinion of the Board, the financial
statements taken as a whole, are fair, balanced
and understandable and provide the information
necessary to assess the Group’s position and
performance, business model and strategy.
By order of the Board,
Joanne Peacegood
Director
9 April 2025
Joanna Duquemin Nicolle
Director
Statement of Directors' Responsibilities - continued
Governance
Castelnau Group Ltd Annual Report 2024
37
On the following pages, we present the Audit
Committee Report, setting out the responsibilities of
the Audit Committee and its key activities for the year
ended 31 December 2024.
The Audit Committee has reviewed the
appropriateness of the Group’s system of risk
management and internal financial and operating
controls, the robustness and integrity of the Group’s
financial reporting, along with the external audit
process. The Audit Committee has devoted time in
ensuring that controls and processes have been
properly established, documented and implemented.
During the course of the year, the information that the
Audit Committee has received has been timely and
clear and has enabled the Committee to discharge its
duties effectively.
Role and Responsibilities
The primary function of the Audit Committee is to
assist the Board in fulfilling its oversight responsibilities.
This includes reviewing the financial reports and other
financial information and any significant financial
judgement contained therein before publication.
In addition, the Audit Committee reviews the systems
of internal and operating controls on a continuing
basis that the Administrator, Portfolio Manager, AIFM,
and Custodian and Depositary and the Board have
established with respect to finance, accounting, risk
management, compliance, fraud and audit. The Audit
Committee also reviews the accounting and financial
reporting processes, along with reviewing the roles,
independence and effectiveness of the external
auditor.
The ultimate responsibility for reviewing and approving
the annual and interim financial statements remain
with the Board.
The Audit Committee's full terms of reference can be
obtained by contacting the Group's Administrator.
Risk Management and Internal Control
The Board, as a whole, considers the nature and extent
of the Group’s risk management framework and the
risk profile that is acceptable in order to achieve the
Group’s strategic objectives. As a result, it is considered
that the Board has fulfilled its obligations under the AIC
Code.
The Audit Committee continues to be responsible
for reviewing the adequacy and effectiveness of
the Group’s ongoing risk management systems and
processes. Its system of internal controls, along with its
design and operating effectiveness, is subject to review
by the Audit Committee through reports received
from the Portfolio Manager, AIFM and Custodian and
Depositary, along with those from the Administrator
and external auditor.
The Audit Committee has prepared a risk matrix,
which considers the controls applied by the Board, the
Investment Manager and key service providers.
The Audit Committee considers, at least once a year,
whether there is a need for an internal audit function.
Currently, the Audit Committee does not consider there
to be a need for an internal audit function, given that
all outsourced functions are with parties who have
their own internal controls and procedures.
Fraud, Bribery and Corruption
The Board has relied on the overarching requirement
placed on the Service Providers under the relevant
agreements to comply with applicable law,
including anti-bribery laws. A review of the Service
Providers’ policies will take place at the Management
Engagement Committee Meetings. The Board receives
confirmation from all service providers that there has
been no fraud, bribery or corruption.
Financial Reporting and Significant
Financial Issues
The Audit Committee assesses whether suitable
accounting policies have been adopted and whether
the Portfolio Manager has made appropriate estimates
and judgements. The Audit Committee reviews
accounting papers prepared by the Portfolio Manager
and Administrator which provides details on the main
financial reporting judgements.
The Audit Committee also reviews reports by the
external auditors which highlight any issues with
Audit Committee
Report
Governance
Castelnau Group Ltd Annual Report 2024
38
respect to the work undertaken on the audit. The Audit
Committee is satisfied that the judgements made
by the Investment Manager and Administrator are
reasonable, and that appropriate disclosures have
been included in the financial statements.
The significant issues considered during the year
by the Audit Committee in relation to the financial
statements and how they were addressed are detailed
below:
Valuation of investments
Some of the Group’s investments will include securities
and other interests that are very thinly traded, for
which no market exists or which are restricted as
to their transferability under applicable laws and/
or the relevant investment documentation. Whilst
the valuations of the Group’s investments will be in
compliance with IFRS, some of the Group’s investments
will be difficult to value. Such valuations may be
conducted on an infrequent basis, are subject to a
range of uncertainties and will involve the Investment
Manager and/or the Audit Committee exercising
judgement. The Board reviewed the valuation policy
and PAMP went through the valuation process/
techniques with the Board around private asset
investments. The Board satisfactorily benchmarked
this valuation methodology with a third party. There
has been no change to the valuation policy and
the process remains the same which has also been
confirmed with the Board. The Board is satisfied with
the approach and the valuation policy and processes.
Revenue
Proceeds from any disposal of the Group’s interests in
portfolio companies through liquidity events, including
sales of equity following IPOs and trade sales, may vary
substantially from year to year. In addition, earnings
produced by portfolio companies are typically
reinvested for the purpose of growth, and payments
of dividends by assets are often subject to milestones
which may not be achieved. This means the return
received by the Group from these sources may vary
substantially from year to year. Notwithstanding that
the Group does not expect to receive much in the way
of returns from dividends, these variations in overall
returns may have a material adverse effect on the
portfolio and on the Group’s financial condition, results
of operations and prospects, with a consequential
adverse effect on the Net Asset Value and/or the
market price of the Ordinary Shares.
External Auditor
The Audit Committee has responsibility for making
a recommendation on the appointment, re-
appointment and removal of the external auditor.
Grant Thornton was appointed as the first auditor of
the Group following a competitive tender process.
During the year, the Audit Committee received and
reviewed audit plans and reports from the external
auditor. It is standard practice for the external auditor
to meet privately with the Audit Committee without the
Investment Manager and other service providers being
present at each Audit Committee meeting.
To assess the effectiveness of the external audit
process, the auditor was asked to articulate the
steps that they have taken to ensure objectivity and
independence, including where the auditor provides
non-audit services. The Audit Committee monitors the
auditor’s performance, behaviour and effectiveness
during the exercise of their duties, which informs the
decision to recommend reappointment on an annual
basis.
The Group does not utilise the external auditor for
internal audit purposes, secondments, tax compliance,
private letter rulings, accounting advice or valuation
advice. The Group's auditor performed the audit of
the Group's annual financial statements, prepared
in accordance with IFRS as issued by the IASB, in
accordance with International Standards on Auditing
(ISAs).
The audit engagement leader responsible for the audit,
Mr Cyril Swale, will rotate off CGL in 2025 after having
served five years.
Audit Committee Report - continued
Governance
Castelnau Group Ltd Annual Report 2024
39
The remuneration paid to Grant Thornton and to other Grant Thornton member firms for audit and non-audit
services in respect of the years ended 31 December 2024 and 31 December 2023 is shown below:
31 December 2024
GBP
31 December 2023
GBP
Audit
Annual audit of the Group 76,200 62,000
Non-audit
Desktop review of Unaudited Interim Financial Statements 7,000 4,950
Agreed upon procedures in relation to review of the prospectus – 31,150
7,000 36,100
For any questions on the activities of the Audit Committee not addressed in the foregoing, a member of the Audit
Committee remains available to attend each AGM to respond to such questions.
The Audit Committee Report was approved by the Audit Committee on 8 April 2025 and signed on behalf by:
Andrew Whittaker
Chair, Audit Committee
Castelnau Group Ltd Annual Report 2024
40
Independent Auditor’s Report to the
Members of Castelnau Group Limited
Opinion
We have audited the consolidated financial statements of Castelnau Group Limited (the “Company”) and its
subsidiary (collectively, the “Group”) for the year ended 31 December 2024 which comprise the Consolidated
Statement of Comprehensive Income, the Consolidated Statement of Financial Position, the Consolidated
Statement of Changes in Equity, the Consolidated Statement of Cash Flows, and Notes to the Consolidated
Financial Statements, including material accounting policy information.
In our opinion, the accompanying consolidated financial statements:
• give a true and fair view of the financial position of the Group as at 31 December 2024, and of consolidated
financial performance and its consolidated cash flows for the year then ended;
• are in accordance with IFRS Accounting Standards (IFRS) as issued by the International Standards Board (IASB);
and
• comply with the Companies (Guernsey) Law, 2008.
Basis for opinion
We conducted our audit in accordance with the International Standards on Auditing (ISAs) and applicable law.
Our responsibilities under those standards are further described in the ‘Auditor’s Responsibilities for the Audit of the
Consolidated Financial Statements’ section of our report. We are independent of the Group in accordance with
the ethical requirements that are relevant to our audit of the consolidated financial statements in Guernsey, as
required by the Crown Dependencies’ Audit Rules and Guidance. We have fulfilled our other ethical responsibilities
in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit
of the consolidated financial statements of the current period. These matters were addressed in the context of
our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a
separate opinion on these matters.
Castelnau Group Ltd Annual Report 2024
41
The key audit matter How the matter was addressed in our audit
Valuation of unquoted investments
(2024: £356.1m, and 2023: £258.3m)
We identified the valuation of unquoted investments as one of
the most significant assessed risks of material misstatement
due to fraud and error, with these being measured using
significant estimates and judgments, and inputs that are
not based on observable market data (using models
incorporating discounted cash flow flows and discount rates)
which are subject to estimation uncertainty and the possibility
of management override of controls, giving rise to a higher risk
of misstatement and requiring significant audit attention.
The fair value of unquoted investments may be misstated due
to the application of inappropriate methodologies, inputs to
the valuations, and/or judgemental factors.
Refer to the Audit Committee Report (pages 37-39);
Accounting policies on pages 52-55, and Note 5, ‘Investments
in unconsolidated subsidiaries’, to the consolidated financial
statements.
Our audit procedures consisted of:
In responding to the key audit matter, we performed the
following audit procedures:
• We updated our understanding of management’s
processes, policies and methodologies, and controls
concerning the valuation of the unquoted investments and
confirm our understanding by performing walkthrough
tests of design and implementation of relevant controls.
• We obtained and inspected the valuation models
prepared by the Investment Manager and management’s
valuation expert, as well as the supporting data, to assess
whether the data used is appropriate and relevant.
• We assessed whether the valuation of unquoted
investments’ accounting policy aligns with the IFRS 13
Fair Value Measurement requirements and consistently
applied, and if the valuation models are performed
accordingly.
• We assessed management's external valuation expert's
independence, competence, and objectivity.
• We obtained the valuations prepared by management
and the valuation report prepared by management’s
valuation expert and challenged the valuation conducted
by them through the following:
• We held discussions with the Investment Manager and
management’s valuation expert to obtain information
and update our understanding of how they valued
the unquoted investments and inspected supporting
documents we obtained and corroborated the
information provided.
• We assessed whether the valuation models used by
management to estimate the fair values of the unquoted
investments is consistent with methods usually used by
market participants for similar types of instruments.
• We assessed the key assumptions considered within the
management’s valuation expert’s report and ensured
that these assumptions were reasonable and consistent
with the requirements of IFRS 13 ‘Fair Value Measurement’.
• We agreed key inputs/data used in the calculation
of the fair value, such as discount rates, growth
rates, forecasts, etc., through inspecting supporting
documents and discussions with management.
• We determined if the fair value estimates are within the
range of values determined by the audit team.
• We engaged Grant Thornton Luxembourg’s valuation team
and performed the following testing for the investment in
Valderrama (only), which includes the following;
• Reviewed the valuation methodology used to estimate
the fair value of the financial instrument;
Castelnau Group Ltd Annual Report 2024
42
The key audit matter How the matter was addressed in our audit
• Used their knowledge of the market to assess and
corroborate management’s market-related judgments
and valuation inputs (i.e. discount rates, EBITDA
multiples and comparable data) by reference to
comparable transactions and independently compiled
databases/indices; and
• Reviewed key assumptions in the valuation model
to ensure that these assumptions used in the
valuation are reasonable and that the fair value of the
investment has been appropriately calculated.
• Reviewed any the significant differences noted
between the Kroll and PAMP reports and assessed the
impact on the valuation.
• We conducted a review and evaluation of the valuation
review performed by Grant Thornton Luxembourg valuation
team.
• We performed back-testing to evaluate the
reasonableness of the discount rates applied in the
models and the actual performance of the investee
entities compared to the projections used in the
discounted cash flow models, including comparing the
prior year valuation estimates with the actual results of the
investments.
• We evaluated whether fair value disclosure in the
consolidated financial statements is appropriate,
complete and in accordance with IFRS 13 ‘Fair Value
Measurement’.
Our results:
We have not identified any material matters to report to
those charged with governance in relation to the fair value
measurement of unquoted investments.
Other information
The directors are responsible for the other information. The other information comprises the information included
in the annual report and audited consolidated financial statements but does not include the consolidated
financial statements and our auditor’s report thereon.
Our opinion on the consolidated financial statements does not cover the other information and we do not express
any form of assurance conclusion thereon.
In connection with our audit of the consolidated financial statements, our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent with the
consolidated financial statements or our knowledge obtained in the audit or otherwise appears to be materially
misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
Independent Auditor’s Report to the Members of Castelnau Group Limited – continued
Castelnau Group Ltd Annual Report 2024
43
Responsibilities of the directors for the consolidated financial statements
As explained more fully in the statement of directors' responsibilities set out on pages 35 to 36, the directors
are responsible for the preparation of the consolidated financial statements that give a true and fair view in
accordance with IFRS by the IASB, and for such internal control as the directors determine is necessary to enable
the preparation of consolidated financial statements that are free from material misstatement, whether due to
fraud or error.
In preparing the consolidated financial statements, the directors are responsible for assessing the Group’s ability
to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or
have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the consolidated financial statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a
whole are free from material misstatement, whether due to fraud or error and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit
conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can
arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably
be expected to influence the economic decisions of users taken on the basis of these consolidated financial
statements.
As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional
scepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is
sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement
resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery,
intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the
Group’s internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates
and related disclosures made by the Directors.
• Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based
on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may
cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material
uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the
consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions
are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or
conditions may cause the Group to cease to continue as a going concern.
• Evaluate the overall presentation, structure, and content of the consolidated financial statements, including
the disclosures, and whether the consolidated financial statements represent the underlying transactions and
events in a manner that achieves fair presentation.
Castelnau Group Ltd Annual Report 2024
44
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business
activities within the Group to express an opinion on the consolidated financial statements. We are responsible for
the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.
We communicate with the directors regarding, among other matters, the planned scope and timing of the audit and
significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical requirements regarding
independence, and to communicate with them all relationships and other matters that may reasonably be thought
to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards applied.
From the matters communicated with the directors, we determine those matters that were of most significance in
the audit of the consolidated financial statements of the current period and are therefore the key audit matters.
We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the
matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in
our report because the adverse consequences of doing so would reasonably be expected to outweigh the public
interest benefits of such communication.
The engagement partner on the audit resulting in this independent auditor’s report is Cyril Swale.
Use of our report
This report is made solely to the Company’s members, as a body, in accordance with section 262 of the
Companies (Guernsey) Law, 2008. Our audit work has been undertaken so that we might state to the Company’s
members those matters we are required to state to them in an auditor’s report and for no other purpose. To the
fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and
the Company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters in relation to which the Companies (Guernsey) Law,
2008 requires us to report to you if, in our opinion:
• proper accounting records have not been kept by the Company; or
• the consolidated financial statements are not in agreement with the accounting records; or
• we have not obtained all the information and explanations, which to the best of our knowledge and belief, are
necessary for the purposes of our audit.
Cyril Swale
For and on behalf of Grant Thornton Limited
Chartered Accountants
St Peter Port
Guernsey
Date: 9 April 2025
Independent Auditor’s Report to the Members of Castelnau Group Limited – continued
Financial Statements
Castelnau Group Ltd Annual Report 2024
45
Financial
Statements
Castelnau Group Ltd Annual Report 2024
45
Financial Statements
Castelnau Group Ltd Annual Report 2024
46
Consolidated Statement of
Comprehensive Income
For the year ended 31 December 2024
| 31 December | 31 December | ||
| 2024 | 2023 | ||
| Notes | GBP | GBP | |
Income | 6 | ||
Expenses | 7 | ( | ( |
( | ( | ||
Finance costs | 16 | ( | ( |
Write-off of financial assets at amortised cost | 5 | ( | |
Movement in expected credit loss provision | 5 | ( | |
Net gains on foreign currency | |||
Net gains on financial assets at fair value through profit or loss | 5 | ||
Profit/(loss) before tax | ( | ||
Tax expense | 8 | ( | |
Total comprehensive income/(loss) for the year | ( | ||
Pence | Pence | ||
Earnings/(loss) per Ordinary Share – Basic and diluted | 13 | ( |
All items in the above statement derive from continuing operations. All revenue is attributable to the equity holders
of the Group.
The accompanying notes on pages 50 to 76 form an integral part of these Consolidated Financial Statements.
Financial Statements
Castelnau Group Ltd Annual Report 2024
47
Consolidated Statement of
Financial Position
As at 31 December 2024
| 31 December | 31 December | ||
| 2024 | 2023 | ||
| Notes | GBP | GBP | |
| NON-CURRENT ASSETS | |||
Investments - equity | 5 | ||
Investments - loans | 5 | ||
Interest receivable - loans | |||
Office equipment | |||
| CURRENT ASSETS | |||
Investments - loans | 5 | ||
Trade and other receivables | 9 | ||
Cash and cash equivalents | |||
TOTAL ASSETS | |||
| CURRENT LIABILITIES | |||
Earn-out liability | 10 | ||
Loans payable | 16 | ||
Finance costs payable | 16 | ||
Other payables | 11 | ||
TOTAL LIABILITIES | |||
NET ASSETS | |||
| EQUITY | |||
Share capital | 12 | ||
Retained earnings/(deficit) | ( | ||
TOTAL EQUITY | |||
Number of Ordinary Shares in issue | 12 | ||
NAV per Ordinary Share (pence) | 14 |
The accompanying notes on pages 50 to 76 form an integral part of these Consolidated Financial Statements.
Financial Statements
Castelnau Group Ltd Annual Report 2024
48
Consolidated Statement of
Changes in Equity
For the year ended 31 December 2024
| Retained | ||||
| (Deficit)/ | ||||
| Share Capital | Earnings | Total | ||
| Note | GBP | GBP | GBP | |
Opening equity | ( | |||
Profit for the year | ||||
Issue of Ordinary Shares | ||||
Closing equity | 12 |
For the year ended 31 December 2023
| Share Capital | Retained Deficit | Total | ||
| Note | GBP | GBP | GBP | |
Opening equity | ( | |||
Loss for the year | ( | ( | ||
Issue of Ordinary Shares | ||||
Closing equity | 12 | ( |
The accompanying notes on pages 50 to 76 form an integral part of these Consolidated Financial Statements.
Financial Statements
Castelnau Group Ltd Annual Report 2024
49
Consolidated Statement of
Cash Flows
For the year ended 31 December 2024
| 31 December | 31 December | ||
| 2024 | 2023 | ||
| Notes | GBP | GBP | |
| Operating activities | |||
Total comprehensive income/(loss) for the year | ( | ||
Movement in expected credit loss provision | 5 | ( | |
Write-off of financial assets at amortised cost | 5 | ||
Net gains on financial assets at fair value through profit or loss | ( | ( | |
Net gains on foreign currency | ( | ||
Finance costs | 16 | ||
Depreciation of office equipment | |||
(Increase)/decrease in trade and other receivables | 9 | ( | |
(Decrease)/increase in provisions | 10 | ( | |
Increase in payables | 11 | ||
Increase in interest receivable - loans | ( | ||
Capitalised interest income | ( | ||
Net cash used in operating activities | ( | ( | |
| Investing activities | |||
Purchases of equity and bonds | ( | ( | |
Loans issued | ( | ( | |
Cash received from repayment of loans | |||
Purchase of office equipment | ( | ||
Net cash used in investing activities | ( | ( | |
| Financing activities | |||
Issue of Ordinary Shares | |||
Finance costs paid | 16 | ( | |
Proceeds from loans received | |||
Repayment of loans received | 16 | ( | |
Net cash flow from financing activities | |||
Increase/(decrease) in cash and cash equivalents | ( | ||
Cash and cash equivalents at beginning of year | |||
Exchange gain on cash and cash equivalents | |||
Cash and cash equivalents at end of year |
The accompanying notes on pages 50 to 76 form an integral part of these Consolidated Financial Statements.
Financial Statements
Castelnau Group Ltd Annual Report 2024
50
1. General information
was incorporated in Guernsey on 13 March 2020 under the Companies (Guernsey) Law, 2008. The Company is
classified as a registered fund under the Protection of Investors (Bailiwick of Guernsey) Law 2020. Its registered
office address is PO Box 255, Les Banques, Trafalgar Court, St. Peter Port, Guernsey GY1 3QL . The Company’s
Ordinary Shares were admitted to trading on the London Stock Exchange on 18 October 2021.
The Annual Report and Audited Consolidated Financial Statements (the “Consolidated Financial Statements” or
the “Financial Statements”) comprise the financial statements of Castelnau Group Limited and Castelnau Group
Services Limited (the “Subsidiary”) (incorporated on 14 June 2022), together referred to as the “Group”.
Details of the Directors, Investment Manager and Advisers can be found on page 79.
The Financial Statements of the Group are presented for the year ended 31 December 2024 and were authorised
for issue by the Board on 9 April 2025.
2. Accounting policies
Notes to the Consolidated Financial
Statements
For the year ended 31 December 2024
Financial Statements
Castelnau Group Ltd Annual Report 2024
51
IAS 1 | Presentation of Financial Statements (amendments regarding the classification of | 1 January 2024 |
| liabilities and the disclosure of accounting policies) | ||
| IAS 7; | Supplier Finance Arrangements (amendments to IAS 7 and IFRS 7) | 1 January 2024 |
| IFRS 7 | ||
| IFRS S1; | IFRS Sustainability Disclosure Standards (IFRS S1 and IFRS S2) | 1 January 2024 |
| IFRS S2 |
IAS 21 | Lack of Exchangeability (amendments to IAS 21) | 1 January 2025 |
| IFRS 9; | Classification and Measurement of Financial Instruments (amendments to IFRS 9 | 1 January 2026 |
| IFRS 7 | and IFRS 7) | |
IFRS 19 | Subsidiaries without Public Accountability: Disclosures | 1 January 2027 |
IFRS 18 | Presentation and Disclosure in the Financial Statements | 1 January 2027 |
e. Basis of consolidation
Financial Statements
Castelnau Group Ltd Annual Report 2024
52
Name of Subsidiary | Date of acquisition | Domicile | Ownership |
Castelnau Group Services Limited “CGSL” | 14 June 2022 | United Kingdom | 100% |
3. Material accounting policies
Notes to the Consolidated Financial Statements – continued
Financial Statements
Castelnau Group Ltd Annual Report 2024
53
Financial Statements
Castelnau Group Ltd Annual Report 2024
54
Notes to the Consolidated Financial Statements – continued
Financial Statements
Castelnau Group Ltd Annual Report 2024
55
Financial Statements
Castelnau Group Ltd Annual Report 2024
56
4. Judgements, estimations or assumptions
The Directors have reviewed matters requiring judgements, estimations or assumptions. The preparation of the
Financial Statements requires management to make judgements, estimations or assumptions that affect the
amounts reported for assets and liabilities as at the year-end date and the amounts reported for revenue and
expenses during the year. However, the nature of the estimation means that actual outcomes could differ from
those estimates.
Judgements
4.2 Assessment as investment entity
Entities that meet the definition of an investment entity within IFRS 10 are required to measure their subsidiaries at
fair value through profit or loss rather than consolidate them. The criteria which define an investment entity are as
follows:
(i) An entity that obtains funds from one or more investors for the purpose of providing those investors with
investment services;
(ii) An entity that commits to its investors that its business purpose is to invest solely for returns from capital
appreciation, investment income or both; and
(iii) An entity that measures and evaluates the performance of substantially all of its investments on a fair
value basis.
The Group has several investors that have access to investment management services and opportunities. In
addition, some of the investors are not related parties of the Group or members of the Group.
The Group’s objective to provide a “high rate of compound return” is consistent with that of an investment entity.
The Group has clearly defined exit strategies for each of its investment classes, these strategies are again
consistent with an investment entity.
The Group uses a variety of methods or valuation techniques and makes assumptions based on market
conditions existing at each Consolidated Statement of Financial Position date to value financial assets at fair value
through profit or loss that are not traded in active markets. The valuation techniques have been prepared with the
Notes to the Consolidated Financial Statements – continued
Financial Statements
Castelnau Group Ltd Annual Report 2024
57
goal that fair value measurements derived when using these valuation techniques are compliant with IFRS. The
Board has satisfactorily benchmarked this methodology with an independent third party.
The Directors, upon considering the above criteria, have concluded that the Group meets the definition of an
investment entity. Therefore, the Group has classified its investments at fair value through profit or loss in the
Consolidated Statement of Financial Position with the exception of CGSL. An investment entity is still required to
consolidate a subsidiary where that subsidiary largely provides services that relate to the investment entity’s
activities. The subsidiary is discussed in note 2(e).
| FVTPL | Amortised cost | ||
| Equity | Loans | Total | |
| GBP | GBP | GBP | |
| INVESTMENTS | |||
Opening portfolio cost | 291,883,601 | 18,738,255 | 310,621,856 |
Purchases at cost | 14,359,233 | 13,967,582 | 28,326,815 |
Proceeds on maturity/principal repayment | – | (9,400,000) | (9,400,000) |
Realised losses on maturity/write-off | (2,750,001) | (537,000)* | (3,287,001) |
Cost | 303,492,833 | 22,768,837 | 326,261,670 |
Unrealised gains on investments | 134,026,852 | – | 134,026,852 |
Unrealised losses on investments | (60,164,747) | (2,548,500)* | (62,713,247) |
Fair value/carrying amount | 377,354,938 | 20,220,337 | 397,575,275 |
Realised losses on maturity/write-off | (2,750,001) | (537,000)* | (3,287,001) |
Movement in unrealised gains on investments | 103,646,231 | – | 103,646,231 |
Movement in unrealised losses on investments | (11,035,431) | 570,478* | (10,464,953) |
Net gains on financial assets | 89,860,799 | 33,478 | 89,894,277 |
Financial Statements
Castelnau Group Ltd Annual Report 2024
58
| FVTPL | Amortised cost | ||
| Equity | Loans | Total | |
| GBP | GBP | GBP | |
| INVESTMENTS | |||
Opening portfolio cost | 163,111,446 | 12,960,632 | 176,072,078 |
Purchases at cost | 199,447,865 | 10,486,000 | 209,933,865 |
Proceeds on maturity/principal repayment | (56,986,319) | (1,708,377) | (58,694,696) |
Realised losses on sale/maturity/write-off | (13,689,391) | (3,000,000) | (16,689,391) |
Cost | 291,883,601 | 18,738,255 | 310,621,856 |
Unrealised gains on investments | 30,380,621 | – | 30,380,621 |
Unrealised losses on investments | (49,129,316) | (3,118,978)* | (52,248,294) |
Fair value/carrying amount | 273,134,906 | 15,619,277 | 288,754,183 |
Realised losses on sale/maturity/write-off | (13,689,391) | (3,000,000) | (16,689,391) |
Movement in unrealised gains on investments | 24,467,275 | – | 24,467,275 |
Movement in unrealised losses on investments | (2,789,263) | (118,978)* | (2,908,241) |
Net gains/(losses) on financial assets | 7,988,621 | (3,118,978) | 4,869,643 |
Name of investee company | Date of acquisition | Domicile | Ownership |
Rawnet Limited | 12 February 2021 | United Kingdom | 100.0% |
Showpiece Technologies Limited | 12 November 2021 | United Kingdom | 80.0% |
Hornby Plc | 14 October 2021 | United Kingdom | 54.9% |
Ocula Technologies Holdings Limited | 22 January 2021 | United Kingdom | 41.6% |
Silverwood Brands Plc | 13 October 2022 | United Kingdom | 29.9% |
Iona Star LP | 25 September 2024 | United Kingdom | 45.0% |
Phoenix SG Limited | 14 October 2021 | Cayman Islands | 64.1% |
Cambium International Limited | 14 October 2021 | Cayman Islands | 90.3% |
Valderrama Limited | 14 April 2023 | Channel Islands | 65.4% |
Notes to the Consolidated Financial Statements – continued
Financial Statements
Castelnau Group Ltd Annual Report 2024
59
| 31 December | 31 December | |
| 2024 | 2023 | |
| GBP | GBP | |
| Classification | ||
Level 1 | 21,253,483 | 14,785,032 |
Level 2 | – | – |
Level 3 | 356,101,455 | 258,349,874 |
Total investments held at ‘FVTPL’ | 377,354,938 | 273,134,906 |
Financial Statements
Castelnau Group Ltd Annual Report 2024
60
| 31 December | 31 December | |
| 2024 | 2023 | |
| GBP | GBP | |
| Level 3 investments | ||
Opening balance | 258,349,874 | 51,198,247 |
Purchases of financial assets | 14,359,233 | 197,837,646 |
Net realised losses for the year | – | (3) |
Net unrealised gains for the year | 83,392,348 | 6,845,993 |
Transfers from Level 2 to Level 3 | – | 2,467,991 |
Closing balance | 356,101,455 | 258,349,874 |
Notes to the Consolidated Financial Statements – continued
Financial Statements
Castelnau Group Ltd Annual Report 2024
61
Financial Statements
Castelnau Group Ltd Annual Report 2024
62
| Significant | |||
| unobservable | Estimate of the | Sensitivity of fair value to changes in | |
| Description | input | input | unobservable inputs |
Discount rate | 9.5% | An increase to 10%/(decrease to 9%) | |
| would (decrease)/increase fair value | |||
| by (-13%)/+15% | |||
Terminal growth rate | 2.4% | An increase to 2.9%/(decrease to 1.9%) | |
| would increase/(decrease) fair value | |||
| Investment in Valderrama | by +9%/(-7%) | ||
Trust real returns | 3.5% | An increase to 4%/(decrease to 3%) | |
| would increase/(decrease) fair value | |||
| by +5%/(-6%) | |||
Group EBIT margin* | various | An increase of 1%/(decrease of 1%) | |
| (11.7% to 22.3%) | would increase/(decrease) fair value | ||
| by +7%/(-7%) | |||
Discount rate | 17% | An increase to 18%/(decrease to 16%) | |
| would (decrease)/increase fair value | |||
| Investment in Phoenix S.G. | by (-35%)/+38% | ||
Magenta | £4,675,000 | An increase of 10%/(decrease of 10%) | |
| would increase/(decrease) fair value | |||
| by +31%/(-31%) | |||
| Revenue run-rate (£/month | 12,000 | An increase of 5%/(decrease of 5%) | |
| per billable head) | would increase/(decrease) fair value | ||
| Investment in Rawnet | to £2.1 million/(£0.8 million) | ||
Profit multiple | 5x | An increase to 6x/(decrease to 4x) | |
| would increase/(decrease) fair value | |||
| to £1.9 million/(£1.0 million) | |||
Discount rate | 15% | An increase to 16%/(decrease to 14%) | |
| would (decrease)/increase fair value | |||
| Investment in Silverwood | by (-15.38%)/+18.33% | ||
Terminal growth rate | 2% | An increase to 2.5%/(decrease to 1.5%) | |
| would increase/(decrease) fair value | |||
| by +3.39%/(-2.94%) | |||
Discount rate | 15% | An increase to 16%/(decrease to 14%) | |
| would (decrease)/increase fair value | |||
| by (-7%)/+7.9% | |||
Revenue growth rate | 5% | An increase to 6%/(decrease to 4%) | |
| Investment in Cambium | would increase/(decrease) fair value | ||
| by +22%/(-20%) | |||
Gross profit margin | 42.2% | An increase to 43.2%/(decrease to | |
| 41.2%) would increase/(decrease) fair | |||
| value by +11%/(-11%) |
Notes to the Consolidated Financial Statements – continued
Financial Statements
Castelnau Group Ltd Annual Report 2024
63
| Significant | |||
| unobservable | Estimate of the | Sensitivity of fair value to changes in | |
| Description | input | input | unobservable inputs |
Discount rate | 15% | An increase to 16%/(decrease to 14%) | |
| would (decrease)/increase fair value by | |||
| (-10%)/+10% | |||
Inflation | 2% | An increase to 3%/(decrease to 1%) | |
| would increase/(decrease) fair value | |||
| by +25%/(-27%) | |||
Funeral plan excess return | 2.5% | An increase to 3.5%/(decrease to 1.5%) | |
| Investment in Valderrama | would increase/(decrease) fair value | ||
| by +16%/(-20%) | |||
Terminal growth rate | 2% | An increase to 3%/(decrease to 1%) | |
| would increase/(decrease) fair value | |||
| by +4%/(-4%) | |||
Annual operating profit | n/a | An increase of 5%/(decrease of -5%) | |
| would increase/(decrease) fair value | |||
| by +8%/(-9%) | |||
Discount rate | 15% | An increase to 16%/(decrease to 14%) | |
| would (decrease)/increase fair value by | |||
| (-7%)/+9% | |||
Terminal growth rate | 2% | An increase to 3%/(decrease to 1%) | |
| Investment in Phoenix S.G. | would increase/(decrease) fair value | ||
| by +3%/(-3%) | |||
Annual operating profit | n/a | An increase of 5%/(decrease of -5%) | |
| would increase/(decrease) fair value | |||
| by +5%/(-5%) | |||
Discount rate | 15% | An increase to 18%/(decrease to 12%) | |
| would (decrease)/increase fair value by | |||
| Investment in Rawnet | (-16%)/+19% | ||
| FY22-27 Compound sales | 9% | An increase to 13%/(decrease to 8%) | |
| Growth rate | would increase/(decrease) fair value | ||
| by +100%/(-65%) | |||
Discount rate | 15% | An increase to 16%/(decrease to 14%) | |
| would (decrease)/increase fair value | |||
| by (-9%)/+10% | |||
Revenue growth rate | 12% | An increase to 14%/(decrease to 10%) | |
| Investment in Cambium | would increase/(decrease) fair value | ||
| by +9%/(-8%) | |||
Group product margin | 45% | An increase to 46%/(decrease to 44%) | |
| would increase/(decrease) fair value | |||
| by +4%/(-4%) |
Financial Statements
Castelnau Group Ltd Annual Report 2024
64
6. Segment reporting
The Group had two reportable segments which are Castelnau Group Limited (an investment company with an
objective to compound Shareholders’ capital at a higher rate of return than the FTSE All-Share Total Return Index
over the long term) and Castelnau Group Services Limited (a company that provides marketing and branding
services). In identifying these operating segments, management follows the objectives of Castelnau Group Limited
and Castelnau Group Services Limited.
The accounting policy for the reportable segments are consistent with the Group’s accounting policy described in
note 3.
Segment information for the financial year is as follows:
| Castelnau | |||
| Castelnau | Services | Total | |
| Group | Group | 31 December | |
| Limited | Limited | 2024 | |
| GBP | GBP | GBP | |
| Income | |||
Consultancy services | – | 1,112,507 | 1,112,507 |
Interest income | 1,139,285 | – | 1,139,285 |
Other income | 1,102 | – | 1,102 |
Segment income | 1,140,387 | 1,112,507 | 2,252,894 |
Gross wages | – | (1,060,030) | (1,060,030) |
Other expenses | (1,462,730) | (181,920) | (1,644,650) |
(1,462,730) | (1,241,950) | (2,704,680) | |
Finance costs | (7,495,854) | – | (7,495,854) |
Net gains on financial assets | 89,894,277 | – | 89,894,277 |
Segment profit/(loss) before tax | 82,076,080 | (129,443) | 81,946,637 |
Taxation | – | – | – |
Segment comprehensive income/(loss) | 82,076,080 | (129,443) | 81,946,637 |
Segment assets | 398,821,511 | 54,808 | 398,876,319 |
Segment liabilities | (81,519,387) | (113,980) | (81,633,367) |
Segment net assets/(liabilities) | 317,302,124 | (59,172) | 317,242,952 |
Notes to the Consolidated Financial Statements – continued
Financial Statements
Castelnau Group Ltd Annual Report 2024
65
Segment information for the year ended 31 December 2023 is as follows:
| Castelnau | |||
| Castelnau | Services | Total | |
| Group | Group | 31 December | |
| Limited | Limited* | 2023 | |
| GBP | GBP | GBP | |
| Income | |||
Consultancy services | – | 1,122,884 | 1,122,884 |
Interest income | 864,209 | – | 864,209 |
Other income | – | 5,000 | 5,000 |
Segment income | 864,209 | 1,127,884 | 1,992,093 |
Gross wages | – | (592,014) | (592,014) |
Other expenses | (2,812,421) | (519,654) | (3,332,075) |
(2,812,421) | (1,111,668) | (3,924,089) | |
Finance costs | (10,710,140) | – | (10,710,140) |
Net gains on foreign currency | 171 | – | 171 |
Net gains on financial assets | 4,869,643 | – | 4,869,643 |
Segment (loss)/profit before tax | (7,788,538) | 16,216 | (7,772,322) |
Taxation | – | (3,081) | (3,081) |
Segment comprehensive (loss)/income | (7,788,538) | 13,135 | (7,775,403) |
Segment assets | 289,686,339 | 257,466 | 289,943,805 |
Segment liabilities | (58,506,735) | (185,283) | (58,692,018) |
Segment net assets | 231,179,604 | 72,183 | 231,251,787 |
* The financial information has been presented to align to the final financial position of the Subsidiary as at 31 December 2023. The changes do not
have a material impact on the financial statements.
Financial Statements
Castelnau Group Ltd Annual Report 2024
66
| 31 December | 31 December | |
| 2024 | 2023 | |
| GBP | GBP | |
Administration fees | 136,582 | 107,231 |
Audit fees | 91,611 | 72,198 |
Change in fair value of earn-out liability | (57,765) | 175,478 |
Depositary fee | 58,595 | 49,475 |
Depreciation of office equipment | 805 | 598 |
Directors' fee | 135,000 | 135,000 |
Employee benefits* | 1,060,030 | 592,014 |
| Investment transaction charges | – | 11 |
Legal and professional fees** | 797,760 | 2,490,902 |
Operating expenses | 172,470 | 135,114 |
Sundry costs | 261,361 | 128,288 |
Trustee fee | 48,231 | 37,780 |
2,704,680 | 3,924,089 |
| 31 December | 31 December | |
| 2024 | 2023 | |
| GBP | GBP | |
| *Included in expenses | ||
Wages and salaries | 928,485 | 515,694 |
Employers’ national insurance contributions | 117,686 | 61,682 |
Pension costs | 16,313 | 12,412 |
Employee healthcare | 2,255 | 2,226 |
HMRC employers’ allowance | (4,709) | – |
1,060,030 | 592,014 |
Notes to the Consolidated Financial Statements – continued
Financial Statements
Castelnau Group Ltd Annual Report 2024
67
| 31 December | 31 December | ||
| 2024 | 2023 | ||
| GBP | GBP | ||
(Loss)/profit before tax | (129,443) | 16,216 | |
Tax chargeable | Tax rate 19% | – | 3,081 |
Deferred tax | – | – | |
Tax expense | – | 3,081 |
| 31 December | 31 December | |
| 2024 | 2023 | |
| GBP | GBP | |
Prepayments | 48,336 | 44,486 |
Income receivable | 798,809 | 11,770 |
Trade receivables | 18,859 | 204,977 |
866,004 | 261,233 |
10. Earn-out liability
| 31 December | 31 December | |
| 2024 | 2023 | |
| GBP | GBP | |
Earn-out liability - Current | – | 2,522,126 |
– | 2,522,126 |
The earn-out liability at 31 December 2023 was calculated as the fair value of the liability related to the potential
future payment of the Rawnet earn-out. The total earn-out payment was to be crystallised over three different
periods, with a maximum payment of £903,311 at each crystallisation date. Payments for all three years were due
to be made within 5 days of 12 February 2024. The amount of the earn-out was conditional on the growth and
performance of certain Rawnet clients (other Castelnau portfolio companies). It was considered likely that the
earn-out would be paid in full based on expectations as of the valuation date. While full payment of the first and
second tranches was effectively guaranteed, there was some uncertainty with regards to the final tranche.
In February 2024, an earn-out payment of £2,464,361 was made in accordance with the terms of the Sale and
Purchase Agreement dated 19 August 2020.
Financial Statements
Castelnau Group Ltd Annual Report 2024
68
| 31 December | 31 December | |
| 2024 | 2023 | |
| GBP | GBP | |
Other accrued expenses | 339,196 | 149,546 |
Trade payables | 16,786 | 134,788 |
Social security and other taxes | 43,057 | 30,655 |
399,039 | 314,989 |
| 31 December | 31 December | |
| 2024 | 2023 | |
| GBP | GBP | |
Share capital at the beginning of the year | 285,111,250 | 184,116,760 |
Issue of Ordinary Shares | 4,044,528 | 100,994,490 |
Allotted, called up and fully paid Ordinary Shares* | 289,155,778 | 285,111,250 |
Class B Share held by the Investment Manager** | 1 | 1 |
Total Share capital at the end of the year | 289,155,779 | 285,111,251 |
| 31 December | 31 December | |
| 2024 | 2023 | |
| Number of | Number of | |
| Ordinary shares | Ordinary shares | |
Ordinary Shares at the beginning of the year | 318,635,256 | 183,996,058 |
Issue of Ordinary Shares | 4,194,166 | 134,639,198 |
Total Ordinary Shares in issue at the end of the year* | 322,829,422 | 318,635,256 |
Class B Share held by the Investment Manager** | 1 | 1 |
Notes to the Consolidated Financial Statements – continued
Financial Statements
Castelnau Group Ltd Annual Report 2024
69
13. Earnings/(loss) per Ordinary Share
Earnings/(loss) per Ordinary Share is based on the profit of £81,946,637 (31 December 2023: loss of £7,775,403)
attributable to the weighted average of 320,236,116 (31 December 2023: 274,368,675) Ordinary Shares in issue
during the year.
There is no difference between the weighted average diluted and undiluted number of Ordinary Shares. There is
no difference between basic and diluted earnings/(loss) per share as there are no diluted instruments.
14. Net assets per Ordinary Share
The figure for net assets per Ordinary Share is based on £317,242,952 (2023: £231,251,787) divided by 322,829,422
voting Ordinary Shares in issue at 31 December 2024 (2023: 318,635,256).
15. Material agreements
Details of the management, administration and secretarial contracts can be found in the Directors’ Report on
page 18. There were no transactions with Directors other than disclosed in note 16. As at 31 December 2024, there
were no fees payable to PAMP (31 December 2023: £Nil).
a) Investment Manager and Alternative Investment Fund Manager (“AIFM”)
The Investment Manager will not receive a management fee in respect of its portfolio management services
to the Group. The Investment Manager will become entitled to a performance fee subject to meeting certain
performance thresholds.
The Performance Fee is equal to one third of the outperformance of the Net Asset Value total return (on an
undiluted basis and excluding any accrual or payment of the Performance Fee) after adjustment for inflows and
outflows (such inflows and outflows including, for the avoidance of doubt, tender payments and buybacks), with
dividends reinvested, over the FTSE All-Share Total Return Index (“Benchmark”), for each Performance Period (or,
where no performance fee is payable in respect of a financial year, in the period since a Performance Fee was last
payable). The Net Asset Value total return is based on the weighted number and Net Asset Value of the Ordinary
Shares in issue over the relevant Performance Period.
During the year, the Group entered into a revised agreement with the Investment Manager, with the revisions
summarised below:
• The fee remains as one third of the outperformance over the Benchmark, however, the fee will be calculated
by reference to the closing net asset value (“Closing NAV”) rather than the average net asset value, and will be
compared to the ‘Benchmark NAV’.
• The Closing NAV is the reported net asset value of the Company at the period end, excluding any accrued
performance fees. This will be compared to the Benchmark NAV, which is the Company’s opening NAV for the
performance period to which the Benchmark return is applied. The Benchmark NAV will also be adjusted for the
impact of inflows and outflows to the share capital of the Company, to ensure that both the Closing NAV and
Benchmark NAV reflect performance adjusted for the impact of these events.
Financial Statements
Castelnau Group Ltd Annual Report 2024
70
• In addition, the revised fee arrangement includes a provision such that no performance fee would be earned
until the net asset value (“NAV”) per Ordinary Share is above the original NAV per Ordinary Share at IPO (100p),
adjusted for the performance of the Benchmark.
• The fee will continue to be paid in new Ordinary Shares.
For the avoidance of doubt, no performance fee for the period to 31 December 2024 would currently be payable
under either the original or proposed revisions to the performance fee calculation. In addition, no additional
changes to the IMA (other than in respect of the performance fee) were made.
During the year, performance fees of £Nil (31 December 2023: £Nil) were charged to the Group, of which £Nil
(31 December 2023: £Nil) remained payable at the end of the year.
b) Administrator and Secretary
Northern Trust International Fund Administration Services (Guernsey) Limited (the “Administrator”) is entitled to:
(i) an administration fee of 0.05% of the Net Asset Value of the Group up to £200 million, 0.03% of the NAV of the
Group between £200 million and £400 million, and 0.02% of the NAV of the Group over £400 million (subject to
a minimum administration fee of £60,000); (ii) a financial reporting fee of £10,000; (iii) a company secretarial
services fee of £10,000; and (iv) an additional fee of £2,000 while the Administrator acts as the Group’s nominated
firm (as described in the FCA Handbook), in each case per annum (exclusive of VAT). In addition, the Administrator
is entitled to certain other fees for ad hoc services rendered from time to time. During the year, administration and
secretarial fees of £124,582 (31 December 2023: £107,231) were charged to the Group by the Administrator, of which
£97,198 (31 December 2023: £52,550) remained payable at the end of the year.
c) Depositary
Northern Trust (Guernsey) Limited (the “Depositary”) is entitled to: (i) a custody fee of 0.02% of the NAV of the
Group (subject to a minimum of £20,000); and (ii) a depositary services fee of 0.02% of the NAV of the Group up to
£200 million, falling to 0.01% of the NAV of the Group over £200 million (subject to a minimum depositary services
fee of £20,000), in each case per annum (exclusive of VAT). In addition, the Depositary is entitled to certain other
fees for ad hoc services rendered from time to time. During the year, depositary fees of £58,595 (31 December
2023: £49,475) were charged to the Group, of which £8,684 (31 December 2023: £13,650) remained payable at the
end of the year.
d) Registrar
The Group utilises the services of MUFG Corporate Markets (Guernsey) Limited (formerly Link Market Services
(Guernsey) Limited) as Registrar in relation to the transfer and settlement of Ordinary Shares. Under the terms of
the Registrar Agreement, the Registrar is entitled to a fee calculated on the basis of the number of Shareholders
and the number of transfers processed (exclusive of VAT). In addition, the Registrar is entitled to certain other
fees for ad hoc services rendered from time to time. During the year, registrar fees of £47,380 (31 December 2023:
£32,208) were charged to the Group, of which £13,318 was prepaid as at 31 December 2024 (31 December 2023:
£3,145 was prepaid).
Notes to the Consolidated Financial Statements – continued
Financial Statements
Castelnau Group Ltd Annual Report 2024
71
| 31 December | 31 December | |
| 2024 | 2023 | |
| GBP | GBP | |
Joanne Peacegood | 40,000 | 40,000 |
Andrew Whittaker | 35,000 | 35,000 |
Joanna Duquemin Nicolle | 30,000 | 30,000 |
David Stevenson | 30,000 | 30,000 |
Richard Brown | – | – |
135,000 | 135,000 |
| 31 December | 31 December | |
| 2024 | 2023 | |
| Number of | Number of | |
| Ordinary Shares | Ordinary Shares | |
Joanne Peacegood* | 31,344 | 10,000 |
Andrew Whittaker | 40,000 | 40,000 |
Joanna Duquemin Nicolle | 75,000 | 75,000 |
David Stevenson | – | – |
Richard Brown* | 21,344 | – |
Financial Statements
Castelnau Group Ltd Annual Report 2024
72
| 31 December | 31 December | |
| 2024 | 2023 | |
| GBP | GBP | |
Loans payable at the beginning of the year | 47,676,429 | – |
Loans received | 17,883,571 | 89,217,968 |
Repayment of loans received | – | (41,541,539) |
Loans payable at the end of the year | 65,560,000 | 47,676,429 |
Finance costs payable at the beginning of the year | 8,178,474 | – |
Finance costs charged | 7,495,854 | 10,710,140 |
Repayment of finance costs | – | (2,531,666) |
Finance costs payable at the end of the year | 15,674,328 | 8,178,474 |
Notes to the Consolidated Financial Statements – continued
Financial Statements
Castelnau Group Ltd Annual Report 2024
73
Financial Statements
Castelnau Group Ltd Annual Report 2024
74
| 1-12 | More than 12 | ||
| months | months | Total | |
| As at 31 December 2024 | |||
Loans payable | 65,560,000 | – | 65,560,000 |
Finance costs payable | 15,674,328 | – | 15,674,328 |
Other payables | 399,039 | – | 399,039 |
81,633,367 | – | 81,633,367 |
| 1-12 | More than 12 | ||
| months | months | Total | |
| As at 31 December 2023 | |||
Earn-out liability | 2,522,126 | – | 2,522,126 |
Loans payable | 47,676,429 | – | 47,676,429 |
Finance costs payable | 8,178,474 | – | 8,178,474 |
Other payables | 314,989 | – | 314,989 |
58,692,018 | – | 58,692,018 |
Notes to the Consolidated Financial Statements – continued
Financial Statements
Castelnau Group Ltd Annual Report 2024
75
Financial Statements
Castelnau Group Ltd Annual Report 2024
76
18. Post year end events
These financial statements were approved for issuance by the Board on 9 April 2025. Subsequent events have
been evaluated to this date.
On 3 February 2025, the Group issued 9,622,167 Ordinary Shares in relation to the acquisition of Farewill Limited by
Dignity Ventures Limited. The acquisition was financed through a share-for-share exchange, which resulted in the
Group acquiring an additional 5.6 million shares in Valderrama Limited, increasing its ownership of Valderrama’s
issued share capital from 65% to 66%. Following this, the Group’s issued share capital was 332,451,589 Ordinary
Shares with one voting right per share, and 1 Class B Share held by the Investment Manager with no voting rights.
On 13 March 2025, a portfolio company, Hornby Plc, announced its intention to seek shareholder approval for the
voluntary cancellation of admission of its ordinary shares to the AIM market of the London Stock Exchange. Should
shareholders resolve to approve, the cancellation is expected to become effective on 10 April 2025. Following this,
the Group announced its intention to support Hornby’s proposed cancellation by offering Hornby shareholders
a share-for-share exchange facility which will allow them to choose to exchange their ordinary shares in Hornby
for new ordinary shares in Castelnau. New ordinary shares in Castelnau will be issued at a price of £1.01, being the
latest published net asset value per share of the Company. The maximum number of Hornby shares that could be
accepted by Castelnau under the exchange facility is 34,851,808, which if fully exchanged, will result in an increase
in the Group’s interest in Hornby from 54.9% to 75.6%.
There are no other subsequent events which require adjustment or disclosure in these financial statements.
Notes to the Consolidated Financial Statements – continued
Castelnau Group Ltd Annual Report 2024
77
Alternative Performance Measures
(Unaudited)
In accordance with ESMA Guidelines on Alternative Performance Measures (“APMs”), the Board has considered
what APMs are included in the Annual Report and Audited Consolidated Financial Statements which require
further clarification. APMs are defined as a financial measure of historical or future financial performance, financial
position or cash flows, other than a financial measure defined or specified in the applicable financial reporting
framework. The APMs included in the annual report are unaudited and outside the scope of IFRS.
Ongoing Charges
The ongoing charges represent the Group’s operating expenses, excluding finance costs, expressed as a
percentage of the average of the monthly net assets during the year. The Board continues to be conscious of
expenses and works hard to maintain a sensible balance between good quality service and cost.
Year ended
31 December
2024
GBP
Year ended
31 December
2023
GBP
Average NAV for the year (A) 286,084,027 195,994,634
Operating expenses (annualised) (B) 1,520,495 1,159,512
Ongoing charges (B/A) 0.53% 0.59%
NAV Total Return
NAV total return is the percentage increase or decrease in NAV, inclusive of dividends paid and reinvested, in the
reporting year. It is calculated by adding the increase or decrease in NAV per share with the dividend per share
when paid and reinvested back into the NAV, and dividing it by the NAV per share at the start of the year.
Year ended
31 December
2024
pence
Year ended
31 December
2023
pence
Opening NAV per share (A) 72.6 75.0
Closing NAV per share 98.3 72.6
Increase/(decrease) in NAV per share (B) 25.7 (2.4)
NAV total return (B/A) 35.4% (3.2%)
NAV per Ordinary Share
NAV per Ordinary Share is calculated by dividing the total Net Asset Value of £317,242,952 (31 December 2023:
£231,251,787) by the number of Ordinary Shares at the end of the year of 322,829,422 Ordinary Shares (31 December
2023: 318,635,256). This produces a NAV per Ordinary Share of 98.3p (2023: 72.6p), which was an increase of 35.4%
(2023: decrease of 3.2%).
Discount/Premium to NAV
If the share price of an investment company is lower than the NAV per Ordinary Share, the shares are said to be
trading at a discount. The size of the discount is calculated by subtracting the share price at year end of 94.0p
(31 December 2023: 75.5p) from the NAV per Ordinary Share at year end of 98.3p (31 December 2023: 72.6p) and is
usually expressed as a percentage of the NAV per Ordinary Share of 4.4% (31 December 2023: premium of 4.0%).
Ifthe share price is higher than the NAV per Ordinary Share, the shares are said to be trading at a premium.
Castelnau Group Ltd Annual Report 2024
78
Appendix (Unaudited)
Phoenix UK Fund Performance Table
The FTSE All-Share index used is with dividends reinvested.
Year
Investment Return
(Gross) NAV Return (Net) FTSE All-Share Index Share Price £
May 1998-2007 210.0% 150.0% 56.0% 2,498.40
2008 -39.5% -40.2% -29.9% 1,494.31
2009 62.8% 59.7% 30.2% 2,386.48
2010 1.1% 0.0% 14.7% 2,386.37
2011 3.0% 1.9% -3.2% 2,430.75
2012 48.3% 42.2% 12.5% 3,456.27
2013 40.5% 31.3% 20.9% 4,539.47
2014 1.9% 0.1% 1.2% 4,544.25
2015 20.1% 14.7% 0.9% 5,211.13
2016 9.1% 7.6% 16.8% 5,605.58
2017 21.5% 16.3% 13.1% 6,518.69
2018 -13.6% -14.7% -9.5% 5,558.97
2019 30.3% 27.7% 19.1% 7,098.36
2020 -3.9% -4.9% -9.7% 6,748.66
2021 23.4% 18.7% 18.3% 8,011.17
2022 -16.7% -17.4% 0.2% 6,619.32
2023 34.0% 32.8% 7.7% 8,791.99
2024 1.5% 0.7% 9.4% 8,851.34
Cumulative 1528.1% 785.1% 292.7%
Annualised Returns 11.0% 8.5% 5.3%
Castelnau Group Ltd Annual Report 2024
79
Group Information
Directors – Parent (all non-executive)
Joanne Peacegood (Chair)
Andrew Whittaker
Joanna Duquemin Nicolle
David Stevenson
Richard Brown
Registrar
MUFG Corporate Markets (Guernsey) Limited
(formerly Link Market Services (Guernsey) Limited)
Mont Crevelt House
Bulwer Avenue
St. Sampson
Guernsey
GY2 4LH
Registered Office
PO Box 255
Trafalgar Court
Les Banques
St. Peter Port
Guernsey
Channel Islands
GY1 3QL
Financial Adviser and Broker
Panmure Liberum Limited
25 Ropemaker Street
London
EC2Y 9LY
AIFM and Investment Manager
Phoenix Asset Management Partners Limited
64-66 Glentham Road
London
SW13 9JJ
Solicitors to the Group as to English law
Gowling WLG (UK) LLP
4 More Riverside
London
SE1 2AU
Administrator and Company Secretary
Northern Trust International Fund
Administration Services (Guernsey) Limited
PO Box 255
Trafalgar Court
Les Banques
St. Peter Port
Guernsey
Channel Islands
GY1 3QL
Solicitors to the Group as to Guernsey law
Carey Olsen (Guernsey) LLP
PO Box 96
Carey House
Les Banques
St. Peter Port
Guernsey
Channel Islands
GY1 4BZ
Custodian and Depositary
Northern Trust (Guernsey) Limited
PO Box 71
Trafalgar Court
Les Banques
St. Peter Port
Guernsey
Channel Islands
GY1 3DA
Independent Auditor
Grant Thornton Limited
St. James Place
St. James Street
St. Peter Port
Guernsey
GY1 2NZ
Strategic Report
Summary Information ............................................................................................................. 3
Chair’s Statement ...................................................................................................................... 5
Holdings ..........................................................................................................................................7
Portfolio Analysis .........................................................................................................................8
The Alternative Investment Fund Manager (“AIFM”)
and Investment Manager’s Report ..................................................................................... 9
Statement from the CIO of the Investment Manager .............................................. 14
Governance
Board Members ........................................................................................................................ 16
Directors’ Report ........................................................................................................................l8
Directors’ Remuneration Report ....................................................................................... 34
Statement of Directors’ Responsibilities ........................................................................ 35
Audit Committee Report .......................................................................................................37
Independent Auditor’s Report
................................................................... 40
Financial Statements
Consolidated Statement of Comprehensive Income ............................................. 46
Consolidated Statement of Financial Position ............................................................47
Consolidated Statement of Changes in Equity .......................................................... 48
Consolidated Statement of Cash Flows ....................................................................... 49
Notes to the Consolidated Financial Statements ..................................................... 50
Alternative Performance Measures (Unaudited)
...............77
Appendix (Unaudited)
........................................................................................78
Group Information
...................................................................................................79
Contents.
We strive to compound
shareholders’ capital at
high rates of return.
Castelnau Group Limited was formed by Phoenix Asset Management
Partners Limited in 2020. The listed structure provides the manager with
a permanent capital vehicle with which to make long-term investments
and acquisitions of all structures and sizes.
Castelnau Group
www.castelnaugroup.com
PO Box 255
Trafalgar Court
Les Banques
St. Peter Port
Guernsey
Channel Islands
GY1 3QL
Annual Report and Audited
Consolidated Financial Statements
For the year ended 31 December 2024