EPE
Special
Opportunities
Report & Accounts
January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
01
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Annual Review 03
Introduction to EPE Special Opportunities 09
Investment Strategy and Portfolio Review 19
Governance Report 29
Financial Statements 39
Contents
02
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
ESO Portfolio Asset:
The Rayware Group
03
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Annual
Review
04
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
The macro-economic environment has continued to be complex throughout the year ended
31January 2024, creating headwinds for the Company and its portfolio. Economic uncertainty
has underpinned an adverse environment for new investments or disposals within the portfolio
at acceptable pricing. As a result, the Board and Investment Advisor have prioritised positioning
the portfolio to navigate turbulent market conditions, focussing on operating improvements and
liquidity alongside progressing longer term growth strategies which will allow the Company to
capitalise as the trading environment begins to stabilise. The Board and Investment Advisor are
encouraged by early signs of stabilisation in key indicators and are cautiously optimistic of further
improvement over the coming period.
The Net Asset Value (“NAV”) per share* of the Company
as at 31 January 2024 was 324 pence, representing a
decrease of 1 per cent. on the NAV per share* of 328 pence
as at 31 January 2023. The share price of the Company
as at 31 January 2024 was 165 pence, representing a
decrease of 3 per cent. on the share price of 170 pence
as at 31 January 2023. The share price of the Company
represents a discount* of 49% to the NAV per share* of
the Company as at 31 January 2024. The Company seeks
to manage the discount to NAV via capital management,
including ordinary share buyback programs, as well
as achieving further diversication of the investment
portfolio and scale in the Company.
The Company has prudently managed its positioning
of the portfolio, whilst maintaining momentum within
overarching strategic initiatives to drive growth;
• Luceco plc (“Luceco”) released its results for the year
ended 31 December 2023 announcing sales of £209
million and an operating prot of £24million, ahead of
expectations.
• The Rayware Group (“Rayware”) trading was impacted
by customer destocking, supply chain, consumer
condence and inationary pressures. A new Head of
US Sales and Marketing was appointed in June 2023
and Head of Export in February 2024.
• Whittard of Chelsea (“Whittard”) delivered its highest
revenue under EPIC ownership, with notable gains
in its UK retail channel. A new CMO and CFO were
appointed in January 2024.
• David Phillips has grown sales year-on-year, driven
by notable gains across the build-to-rent and project-
based divisions.
• Pharmacy2U (“P2U”) delivered sustained growth in its
core NHS online prescription division. The acquisition
of LloydsDirect promises to materially increase the
scale of the platform.
• Denzel’s has grown sales year-on-year and built a
strong foundation to support its future growth plans. In
January 2024, the business appointed an experienced
Chairman to the board.
• EPIC Acquisition Corp (“EAC”) announced that it will
return all residual capital to third parties and wind up.
ESO’s holding in EAC was realised at par after the
year end, while the value realised from EAC Sponsor
will be determined following the completion of
theliquidation.
The Company successfully completed the following
investments and realisations in the period;
• In the year ended 31 January 2024, the Company,
through its subsidiary ESO Investments 1 Limited,
invested £3.35 million in Rayware, reducing the
business’ senior debt, and has provided a contingent
guarantee to Rayware’s third party lenders with a
balance of £1.75m outstanding as at 31 January 2024,
following a £0.75 million drawdown in the period.
• In July 2023, the Company completed the realisation
of its holdings in Atlantic Credit Opportunities Fund
and in August 2023 completed the realisation of its
holdings in Prelude Structured Alternatives Master
Fund LP, both realised at carrying value.
Chairman’s Statement
05
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
The performance of the investment portfolio is a key driver
of the Net Asset Value performance of the Company.
The Company had cash balances of £15.3 million*
1
as
at 31 January 2024. Maintaining liquidity has existed as
a core focus for the Board, whilst the macroeconomic
environment remains turbulent. In July 2023, the
Company exercised its right to extend the maturity of
its £4.0 million unsecured loan notes to 23 July 2024.
In July 2023, the Company also repurchased 7.5 million
zero dividend preference (“ZDP”) shares for a total
consideration of £7.9 million. Following this buyback, the
Company has 12.5 million ZDP shares remaining in issue,
maturing in December 2026. The Company has no other
third-party debt outstanding.
The Board would like to thank Mr Wilson, who retired
in September 2023, for his long period of service and
express their gratitude for his dedication and support
throughout his appointment to the Company over the last
20 years. The Board would like to note its appreciation
of the Investment Advisor and the portfolio management
teams for their eorts through a complicated period.
The Board will monitor the progress of the portfolio
over the coming months and looks forward to updating
shareholders at the half year.
Clive Spears
Chairman
27 March 2024
* See Alternative Performance Measures on page 86 to 87 of this Report and Accounts.
1
Company liquidity is stated inclusive of cash held in subsidiaries in which the Company is the sole investor.
06
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Investment Advisor’s Report
The macroeconomic backdrop remained volatile, presenting challenges for both the Company
and its portfolio. A complex global economic landscape has generated a market environment
inconducive to new investments or divestments. As a result, the Board and Investment Advisor
have remained focused on providing support to the portfolio and their management teams,
ensuring they are well-positioned from a strategic, operational and liquidity standpoint. The
Company has taken action to de-risk its capital structure and improved liquidity by electing
to extend the maturity of its £4.0 million unsecured loan notes to July 2024. This supported
the repurchase of 7.5 million of its ZDP shares, decreasing the redemption amount payable at
maturity in December 2026.
The NAV per share* of the Company as at 31 January 2024
was 324 pence, representing a decrease of 1 per cent. on
the NAV per share* of 328 pence as at 31 January 2023.
The share price of the Company as at 31 January 2024
was 165 pence, representing a decrease of 3 per cent. on
the share price of 170 pence as at 31 January 2023.
The Company maintains satisfactory liquidity during the
ongoing period of market uncertainty. The Company
had cash balances of £15.3 million*
1
as at 31 January
2024, which are available to support the portfolio,
meet committed obligations and deploy into attractive
investment opportunities. Net third party debt* in the
underlying portfolio stands at 1.4x EBITDA* in aggregate.
The Company’s unquoted private investments portfolio is
valued at a weighted average enterprise value to EBITDA
multiple* of 7.2x for mature assets (excluding assets
investing for growth). The valuation has been derived by
reference to quoted comparables, after the application of
a liquidity discount to adjust for the portfolio’s scale and
unquoted nature. The Investment Advisor notes that the
fair market value of the portfolio remains exposed to a
volatile macro environment and equity market valuations.
In July 2023, the Company completed the repurchase of
7.5 million of its ZDP shares in the market (or 38 per cent.
of the Company’s issued ZDP share capital) at a weighted
average share price of 105 pence for a total consideration
of £7.9 million.
Luceco released its results for the year ended 31
December 2023 in March 2024. The business announced
trading ahead of market expectations, with sales of £209
million and Q4 trading 9.5 per cent. ahead of the prior
year. The business generated operating prot of £24
million, ahead of expectations. The business achieved
strong cash generation driven by higher operating prot
and improved working capital eciency which supported
further deleveraging, with net debt* of 0.6x LTM EBITDA*
as at 31 December 2023. Anexcellent achievement and
well below Luceco’s target range of 1.0-2.0x net debt* to
EBITDA*.
Rayware experienced challenging trading conditions
throughout the period. Financial performance was
impacted by customer destocking, acute supply chain
costs, depressed consumer condence and well
publicised inationary cost pressures. Rayware’s capital
structure has therefore remained under pressure due to
depressed EBITDA*, interest exposure and mezzanine
nance raised at acquisition. ESO invested £3.35 million in
the period to reduce external debt and has a contingent
guarantee of £1.75 million outstanding. More positively,
in support of the international growth strategy, a new
Head of US Sales and Marketing was appointed in June
2023 and a new Head of Export was appointed in
February2024.
Whittard of Chelsea delivered a strong performance
in the period led by growth in its UK retail channel, due
to strengthening domestic and tourist footfall, further
enhanced by a new pop-up store in London Paddington
station over the Christmas period. Whittard has continued
to progress its international strategy, with the business
entering a strategic partnership with Rayware to develop
its overseas presence and with its South Korean franchise
partner opening a new store in Samsung Town in April
2023. The business made two senior appointments in
January 2024, including a new Chief Financial Ocer and
Chief Marketing Ocer.
David Phillips has continued to develop its built-to-rent
and project-based divisions, delivering year-on-year
sales growth. Protability has improved from better
product sourcing, pricing and a focus on recurring sales
channels. Eciency has been further enhanced through
prudent actions taken to reduce the cost base.
07
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Pharmacy2U demonstrated an increased rate of organic
growth in its core NHS online prescription division in the
period. In October 2023, P2U announced the acquisition
of LloydsDirect, the UK’s second largest online pharmacy,
from McKesson UK. In March 2024, the UK Competition and
Markets Authority provided clearance for the transaction.
Denzel’s has focussed on developing its team and
infrastructure in the period to support its ambitious
growth plans, whilst at the same time achieving strong
year-on-year sales growth. The business relaunched
its website and has seen a signicant increase in online
marketing and transactional activity to support its early
successes in oine retail channels. In January 2024,
the business appointed an experienced Chairman to
theboard.
In January 2024, EPIC Acquisition Corp announced that
it will return all residual capital to third parties and wind
up. A perfect storm of Ukraine, global divestment from
China, economic ux from energy prices, subsequent
ination and inevitable stock market volatility made 2022
and 2023 dicult years with regards to a high conviction,
high risk, capital markets product. Over the 24 month
investment period, the EAC team reviewed over
250opportunities, engaged actively with 12 targets and
held over 100 investor meetings. Interesting transaction
opportunities arose but could not be completed given the
lack of appetite for public market transactions during the
period. A disappointing end to an interesting investment
product and opportunity for ESO. ESO’s holding in EAC
was realised at par after the year end, while the value
realised from EAC Sponsor will be determined following
the completion of the liquidation.
The Investment Advisor continues to monitor the
Company’s credit fund investments. European Capital
Private Debt Fund has completed its investment period
and is distributing capital to the Company. In July 2023,
the Company completed the realisation of its holdings in
Atlantic Credit Opportunities Fund and in August 2023
completed the realisation of its holdings in Prelude
Structured Alternatives Master Fund LP, both realised at
carrying value.
The Investment Advisor would like to convey its thanks
to all of the management teams across the portfolio for
their continued commitment during a dicult period, and
to the Board and the Company’s shareholders for their
counsel and support.
EPIC Investment Partners LLP
Investment Advisor to the Company
27 March 2024
As at 31 January 2024
NAVper share* 324 pence
Share price 165 pence
Portfolio returns* 3.1x MM / 22% IRR
Mature unquoted asset valuation
2
* 7.2x EV / EBITDA
Portfolio leverage* 1.4x Net Third Party Debt / EBITDA
* See Alternative Performance Measures on page 86 to 87 of this Report and Accounts.
1
Company liquidity is stated inclusive of cash held in subsidiaries in which the Company is the sole investor.
2
EV / EBITDA multiple excludes Pharmacy2U and Denzel’s as the assets are in a growth stage, prior to mature protability.
08
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Introduction to
EPE Special Opportunities
09
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
ESO portfolio asset:
David Phillips
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities Limited (“ESO” or the “Company”) is a
private equity investment company established in 2003.
The Company’s ordinary shares trade on the AIM market of the
London Stock Exchange and the Growth Market of the Aquis
Stock Exchange. The Company’s zero dividend preference
shares trade on the main market of the London Stock Exchange
(standardlisted). The Company’s unsecured loan notes trade on
the Aquis Stock Exchange.
The Company’s primary objective is to provide long-term return
on equity for its shareholders by investing in small and medium
sized companies in the UK.
The Company targets growth and buy-out opportunities,
specialsituations and distressed transactions, deploying capital
where it believes the potential for shareholder value creation to
be compelling.
The Investment Advisor to the Company is EPIC Investment
Partners LLP (“EPIC”).
10
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE
Special
Opportunities
11
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Investment highlights:*
3.1x
Portfolio
1
current
money multiple
22%
Portfolio
1
current IRR
7%
10 year annualised
share price return
Recent developments:
June 2021 ESO realises £15.0 million from the sale of shares in Luceco plc and retains
22.1 per cent holding.
July 2021 ESO acquires Rayware Group, a family of iconic British-heritage kitchenware brands.
December 2021 ESO invests €10.0 million in EPIC Acquisition Corp, a special purpose acquisition company,
and its sponsor.
December 2021 ESO raises £20.0 million via the issuance of zero dividend preference shares.
July 2022 ESO extends the maturity of £4.0 million of unsecured loan notes to July 2023, with an
option to further extend the maturity to July 2024.
October 2022 ESO invests £2.0 million in Denzel’s, a fast growing, healthy and sustainable premium dog
snacks brand.
July 2023 ESO extends the maturity of £4.0 million of unsecured loan notes to July 2024.
July 2023 ESO retires 7.5 million zero dividend preference shares.
July 2023 ESO completes the realisation of its holdings in Atlantic Credit Opportunities Fund.
August 2023 ESO completes the realisation of its holdings in Prelude Structured Alternatives Master
Fund LP.
January 2024 EPIC Acquisition Corp announced it will return all residual capital to third parties and wind up.
* See Alternative Performance Measures on page 86 to 87 of this Report and Accounts.
1
Portfolio returns are prepared on the basis of the aggregate total returns for current ESO portfolio companies, excluding fund
investments, as at 31 January 2024.
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
12
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPIC Investment Partners LLP (“EPIC” or the “Investment
Advisor”) was founded in June 2001 and is an independent
investment manager wholly owned by its partners.
Since inception, EPIC has made 37 investments into small
and medium sized companies in the UK and was appointed
Investment Advisor to the Company in September 2003.
EPIC manages the Company’s investments in accordance
with guidelines determined by the Board and the Company’s
constitutional framework. The governance structure is subject
to annual review by the Board.
In addition to private equity, EPIC has complementary business
lines, including Advisory, Markets and Administration.
13
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Market-leading
track record
37 investments across a broad range of sectors and
situations. EPIC has returned 2.3x money multiple and
15 per cent. IRR on its investments to 31 January 2024.*
Highly aligned and
stable team
Committed and stable partnership, with average tenure
in excess of 10 years. The EPIC team is the largest
investor in ESO.
Extensive industry
network
Longstanding relationships in the UK market provide
EPIC with access to c.300 deals per annum. EPIC
leverages its network of operating partners to drive
portfolio valuecreation.
Listed market
experience
EPIC has a successful track record of advising listed
vehicles spanning more than 20 years. In addition to ESO,
EPIC has advised EPIC plc, EPIC Brand Investmentsplc,
Luceco plc and EPIC Acquisition Corp.
Complementary
business lines
The cross-disciplinary expertise of EPIC’s Advisory,
Markets and Administration divisions allows EPIC to
access o-market investment opportunities and deploy
specialist knowledge.
* See Alternative Performance Measures on page 86 to 87 of this Report and Accounts.
14
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Large market of companies
A greater universe of potential transactions allows EPIC to be more selective,
applying a higher investment threshold and greater pricing discipline.
Low competition for transactions
Diminished investor engagement and buy-side competition in the lower
mid-market is a structural driver for attractive valuations and leads to a higher
likelihood of successful completions.
Funding gap
The diculty experienced by lower mid-market companies in accessing bank or
alternative nancing solutions often drives stakeholders to seek equity funding in
order to achieve the company’s growth or liquidity objectives.
Shareholders seeking liquidity
The lower mid-market is characterised by owner managers. Many of these owners
seek funding partners to achieve their personal growth and liquidity objectives.
Growth and operational improvements
Strong potential to create value either via top line growth, operational improvements
or through acquisitions. Private equity investors bring critical development capital
and leverage cross-sector expertise to produce transformational change.
ese factors create an attractive investment universe, with favourable
entry pricing and the potential for meaningful future value creation.
Why lower mid-market private equity?
15
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Market-leading
returns
The Company has continued to deliver market leading
returns with an annualised share price return of 7 per
cent. over the last 10 years. Current portfolio returns are
3.1x MM and 22 per cent. IRR to 31 January 2024.*
Access to high
quality portfolio
The Company oers investors access to a conservatively
valued, high growth portfolio. Mature unquoted assets
(excluding assets investing for growth) are valued at
7.2x EBITDA. The combined sales of the portfolio have
grown at a CAGR of 8 per cent. over the last 3 years.*
Established
deal pipeline
EPIC consistently targets proprietary deal opportunities.
Deals are also sourced from a network of industry
contacts including operating partners and corporate
nance advisors. EPIC reviews c.300 deals per annum
in the UK lower mid-market.
Long term
capital vehicle
The Company’s quoted structure allows investments to
develop over the long term, beneting from the ability
to implement transformational initiatives and compound
returns over periods in excess of standard private equity
hold periods (typically 3-5 years).
Manager
alignment
EPIC is a focussed and independent manager with
substantial investment in the Company. The EPIC
team is the largest investor in ESO, creating signicant
alignment with investors and a focus on long-term
sustainable shareholder returns.
Why EPE Special Opportunities?
* See Alternative Performance Measures on page 86 to 87 of this Report and Accounts.
16
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Clive Spears (Non-executive Chairman)
Clive Spears retired from the Royal Bank of Scotland
International Limited in December 2003 as Deputy
Director of Jersey after 32 years of service. His
main activities prior to retirement included Product
Development, Corporate Finance, Trust and Oshore
Company Services and he was Head of Joint Venture
Fund Administration with Rawlinson & Hunter. Mr Spears
is an Associate of the Chartered Institute for Securities &
Investments. He has accumulated a well spread portfolio
of directorships centring on private equity, infrastructure
and corporate debt. His current appointments include
Chairman of Nordic Capital Limited and directorships of
a series of ICG plc sponsored funds and funds managed
by Kreos Fund Management. He is a resident of Jersey.
Heather Bestwick (Non-executive Director)
Heather Bestwick has been a nancial services
professional for over 25 years, onshore in the City of
London and oshore in the Cayman Islands and Jersey.
She qualied as an English solicitor, specialising in ship
nance, with City rm Norton Rose, and worked in their
London and Greek oces for 8 years. Ms. Bestwick
subsequently practised and became a partner with
global oshore rm Walkers in the Cayman Islands,
and Managing Partner of the Jersey oce. Ms Bestwick
sits on the boards of the Deutsche Bank company
which managed the dbX fund platform and Rathbones
Investment Management International Limited. She is a
resident of Jersey.
Michael Gray (Non-executive Director)
Michael Gray was at The Royal Bank of Scotland for
over 30 years, latterly as Managing Director (Corporate)
of RBS International, before retiring in 2015. During his
32years at the rm Michael covered a broad spectrum
of nancial services including corporate and commercial
banking, funds, trusts and real estate. Mr Gray currently
holds a number of non-executive positions across
private equity, infrastructure and fund management.
Michael’s appointments currently include non-executive
directorships of Triton Investment Management (a
Swedish private equity group), GCP Infrastructure
Investments (a FTSE 250 listed company), J-Star Jersey
Company Limited (a Japanese private equity group),
Foresight 4 VCT plc (a listed venture capital fund), JTC plc
(a FTSE 250 listed trust and corporate services company)
and TEAM plc (a listed wealth management company).
He is a resident of Jersey.
David Pirouet (Non-executive Director)
David Pirouet retired from PricewaterhouseCoopers
Channel Islands LLP in 2009 after being an Audit
and Assurance Partner for over 20 years. During his
29 years at the rm Mr Pirouet specialised in the
nancial services sector, in particular in the alternative
investment management area and also led the business’s
Hedge Fund and business recovery practices for over
four years. Mr Pirouet currently holds a number of
non-executive positions across private equity,
infrastructure and corporate debt. Mr Pirouet was
previously a non-executive Director and Chair of the Audit
and Risk committee for GCP Infrastructure Investments
(FTSE 250 listed company) until he retired in February
2021. He is a resident of Jersey.
Biographies of the Directors
17
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Giles Brand
Giles Brand is a Partner and the founder of EPIC. He
is currently Non-executive Chairman of Whittard of
Chelsea and Luceco plc. Before joining EPIC, Giles was
a founding Director of EPIC Investment Partners, a fund
management business which at sale had US$5bn under
management. Prior to this, Giles worked in Mergers and
Acquisitions at Baring Brothers in Paris and London. Giles
read History at Bristol University.
James Henderson
James Henderson is a Managing Director of EPIC. He
previously worked in the Investment Banking division of
Deutsche Bank before joining EPIC. Whilst at Deutsche
Bank he worked on a number of M&A transactions and
IPOs in the energy, property, retail and gaming sectors, as
well as providing corporate broking advice to mandated
clients. At EPIC, James manages the investments in
Pharmacy2U, Denzel’s and EPIC Acquisition Corp. James
read Modern History at Oxford University and Medicine at
Nottingham University.
Ian Williams
Ian Williams is a Managing Director of EPIC. He was
previously a Partner at Lyceum Capital Partners LLP,
responsible for deal origination and engagement, with
a primary focus on the business services and software
sectors, as well as nancial services, education and health
sectors. Prior to Lyceum, Ian was a Director at Arbuthnot
Securities, involved in IPOs, secondary fund raisings
and M&A, focused on the support services, healthcare,
transport & IT sectors. Ian started his career at Hambros
Bank in the M&A team. Ian read Politics and Economics at
the University of Bristol.
Hiren Patel
Hiren Patel is a Partner of EPIC. He has worked in the
investment management industry for the past twenty
years. Before joining EPIC, Hiren was Finance Director
of EPIC Investment Partners. Prior to this, Hiren was
employed at Groupama Asset Management where he
was the Group Financial Controller.
Alex Leslie
Alex Leslie is a Managing Director of EPIC. He previously
worked in Healthcare Investment Banking at Piper Jaray
before joining EPIC. Whilst at Piper Jaray he worked on
a number of M&A transactions and equity fundraisings
within the Biotechnology, Specialty Pharmaceutical and
Medical Technology sectors. At EPIC, Alex manages
the investments in Luceco plc, Rayware and European
Capital Private Debt Fund. He previously managed
the Company’s investments in Process Components,
BigHead Industries, David Phillips, Prelude, Atlantic Credit
Opportunities Fund and Driver Require. Alex read Human
Biological and Social Sciences at the University of Oxford
and obtained an MPhil in Management from the Judge
Business School at the University of Cambridge.
Biographies of the Investment Advisor
18
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
19
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Investment Strategy and
Portfolio Review
ESO portfolio asset:
Whittard of Chelsea
20
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
e Company aims to generate long-term returns on equity for its
shareholders by investing in a portfolio of private equity assets.
Deal
Sourcing
Given its attractive fundamentals, the Investment
Advisor believes there is a strong case to invest in the
UK lower mid-market.
Proprietary deal sourcing is complemented by active
engagement within the wider corporate advisory
community to communicate the Company’s clearly
dened investment strategy.
Active
Management
The portfolio is likely to be concentrated, numbering
between two and ten assets at any one time,
which allows EPIC to allocate the resource to form
genuinely engaged and supportive partnerships with
management teams.
This active approach facilitates the delivery of truly
transformational initiatives in underlying investments
during the period of ownership.
Investment
Criteria
The Company aims to invest in businesses exhibiting
inter alia the following characteristics:
• Attractive entry pricing
• High quality management teams with established
track records
• Defensible competitive position
• Opportunity for strong revenue growth, either by
market expansion or increased market share
• Opportunity for strong cash generation
Investment Strategy
21
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Size
The Company seeks to invest up to £30 million per
transaction. For investments larger than £30 million, the
Company may seek co-investment from third parties.
Sector
The Company will consider most sectors, but has
particular expertise in consumer, retail, nancial services,
manufacturing and the wider services sector (including
education, healthcare and social housing).
Control
The Company aims to take controlling equity positions,
but may also consider minority stakes where the
investment case is compelling and shareholder
protections are robust.
Deal Type
The Company targets growth, buyout, special situations
and private investment in public equities (“PIPE”)
investments. Given EPIC’s listed market experience,
the Company may also partner with outstanding
management teams on the listing and management
of special purpose acquisition vehicles. The Company
may occasionally invest in third-party funds.
Geography
The Company primarily seeks to invest in UK focused
assets as well as those with signicant overseas
operations; for example, Luceco plc within the
currentportfolio.
Investment Criteria
22
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
The portfolio as at 31 January 2024 consists of two listed assets, ve private
equity assets and two private fund investments.
Luceco plc
Supplier of wiring accessories and LED lighting
Rayware
Wholesaler of six heritage British homeware brands
Whittard of Chelsea
Speciality tea, coee and hot chocolate brand
David Phillips
Furniture provider to the UK property sector
Pharmacy2U
Leading online pharmacy in the UK
Denzel’s
Premium dog snacks brand
Other Investments
European Capital Private Debt Fund
EAC Sponsor Limited
EPIC Acquisition Corp
Sector Diversication Instrument Diversication
n
Engineering,
Manufacturing
and Distibution
(35%)
n
Healthcare
(2%)
n
Consumer and
Retail
(49%)
n
Credit Funds
(0%)
n
Bank Deposits
(13%)
n
Equity
(61%)
n
Shareholder
Loans
(26%)
n
Credit Funds
(0%)
n
Bank Deposits
(13%)
Portfolio
23
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Leading supplier of LED lighting and electrical accessories
Key facts
Location: UK / China
Sector: Wiring Accessories
& LED
Type of deal: Buyout
Equity holding: 22%
Financial year: December
Latest sales: £209m (2023)
Description
Luceco plc is a manufacturer and distributor of electrical accessories and LED
lighting products to the UK and, increasingly, international markets. The business
is headquartered in the UK and has a Chinese manufacturing facility and several
international sales ofces.
Background
Luceco plc is a manufacturer of wiring accessories, predominantly switches
and sockets, under the British General and Masterplug brands. Luceco also
supplies to the LED lighting market under the Luceco and Kingsher brands. In
2007, the business established a Chinese manufacturing facility which has been
subsequently expanded twice. The facility has provided Luceco plc with supply
chain exibility and margin efciencies. In October 2016, Luceco plc was admitted
to trading on the Main Market of the London Stock Exchange.
Recent developments
Luceco released its results for the year ended 31 December 2023 in March 2024.
The business announced trading ahead of market expectations, with sales of
£209 million and Q4 trading 9.5 per cent. ahead of the prior year. The business
generated operating prot of £24 million, ahead of expectations. The business
achieved strong cash generation driven by higher operating prot and improved
working capital eciency which supported further deleveraging, with net debt of
0.6x LTM EBITDA as at 31 December 2023. An excellent achievement and well
below Luceco’s target range of 1.0-2.0x net debt to EBITDA.
24
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Wholesaler of six heritage British homeware brands
Key facts
Location: Liverpool
Sector: Consumer
Type of deal: Buyout
Equity holding: 73%
Financial year: December
Latest sales: £31m (2023)
Description
The Rayware Group (“Rayware”) is a wholesaler of six heritage British homeware
brands, including the iconic Kilner and Mason Cash marques, as well as Viners,
Typhoon, Ravenhead and Price & Kensington. The business develops and
distributes a wide product range including jars, mixing bowls, cutlery, glassware
and tableware.
Background
The business was established in 1975 and has grown through acquisitions, building
a portfolio of heritage British homeware brands. In July 2021, ESO acquired a
majority interest in Rayware.
Recent developments
Rayware experienced challenging trading conditions throughout the period.
Financial performance was impacted by customer destocking, acute supply
chain costs, depressed consumer condence and well publicised inationary cost
pressures. Rayware’s capital structure has therefore remained under pressure
due to depressed EBITDA, interest exposure and mezzanine nance raised at
acquisition. ESO invested £3.35 million in the period to reduce external debt and
has a contingent guarantee of £1.75 million outstanding. More positively, in support
of the international growth strategy, a new Head of US Sales and Marketing was
appointed in June 2023 and a new Head of Export was appointed in February2024.
Outlook
Rayware remains focussed on investing behind key growth channels, prioritising
initiatives such as international expansion and omnichannel growth. The Investment
Advisor is condent the company will benet as the challenging environment,
including high freight costs, weak FX rates and subdued consumer demand,
begins to normalise. Over the long term, there is the opportunity for Rayware to
strengthen its position in the branded homeware market through targeted M&A.
25
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Speciality tea, coee and hot chocolate brand
Key facts
Location: Oxfordshire
Sector: Consumer
Type of deal: Turnaround
Equity holding: 85%
Financial year: December
Latest sales: £46m (2023)
Description
Whittard of Chelsea (“Whittard”) is a British heritage brand supplying a range
of premium tea, coee and hot chocolate to a global consumer market. The
business operates an established omni-channel platform spanning retail (UK store
estate), e-commerce (UK site with global distribution), China (Tmall e-commerce
platform), wholesale and franchise.
Background
Founded by Walter Whittard in 1886, Whittard has accumulated over 135 years of
specialist expertise, establishing strong brand recognition and a loyal customer
base. Since the acquisition in 2008, EPIC and management have led the
successful turnaround of Whittard by restructuring its operations, developing a
scalable omni-channel platform and investing in the brand to establish a premium
positioning appropriate to the brand’s heritage.
Recent developments
Whittard of Chelsea delivered a strong performance in the period led by growth
in its UK retail channel, due to strengthening domestic and tourist footfall, further
enhanced by a new pop-up store in London Paddington station over the Christmas
period. Whittard has continued to progress its international strategy, with the
business entering a strategic partnership with Rayware to develop its overseas
presence and with its South Korean franchise partner opening a new store in
Samsung Town in April 2023. The business made two senior appointments in
January 2024, including a new Chief Financial Ocer and Chief Marketing Ocer.
Outlook
Whittard’s strong brand and omni-channel platform is well positioned to take
advantage of international growth opportunities, supported by strategic market
openings, digital excellence and increased selling points. The business is expected
to continue to benet from the return of domestic and international shoppers to UK
high-streets and sustained appetite for premium, British brands.
26
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Leading furniture provider to the UK property sector
Key facts
Location: Nationwide
Sector: Property Services
Type of deal: Turnaround / Growth
Equity holding: 34%
Financial year: March
Latest sales: £43m (2023)
Description
David Phillips provides furniture and furnishing services to the UK property sector,
supplying owners, managers, agents and developers in the residential, build-to-
rent, student accommodation and social housing sectors.
Background
The business was established in 1999 as a London-focused furniture supplier
and has since expanded through acquisitions, increasing its geographic reach
and product oering to become a market leader.
Recent developments
David Phillips has continued to develop its built-to-rent and project-based
divisions, delivering year-on-year sales growth. Protability has improved
from better product sourcing, pricing and a focus on recurring sales channels.
Eciency has been further enhanced through prudent actions taken to reduce
the cost base.
Outlook
Sustained structural improvements, achieved during the successful turnaround
and amid the COVID-19 pandemic, continue to bolster the business, positioning it
for enhanced growth. The emphasis remains on optimising operational eciency
and supporting the channel strategy. Over the long term, signicant growth
opportunities have been identied.
27
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
The UK’s leading online pharmacy
Key facts
Location: West Yorkshire
Sector: Healthcare
Type of deal: Growth
Equity holding: 2%
Financial year: March
Latest sales: £173m (2023)
Description
Pharmacy2U is focussed on delivering repeat NHS prescriptions to patients
in the community. Repeat prescriptions comprise c.80 per cent. of the c.£10
billion NHS community prescription market. Pharmacy2U benets from highly
attractive customer dynamics, with low churn rates following patient acquisition
and signicant lifetime value. Pharmacy2U operates from facilities in Leeds and
Leicestershire which employ automated dispensing systems and have substantial
capacity to support growth.
Background
Pharmacy2U created the concept of online pharmacy and, in conjunction with
the NHS, helped to develop the Electronic Prescription Service technology. The
technology allows for prescriptions to be electronically signed by doctors and
medicines to be delivered direct to the home.
Recent developments
Pharmacy2U demonstrated an increased rate of organic growth in its core NHS
online prescription division in the period.
In October 2023, P2U announced the acquisition of LloydsDirect, the UK’s second
largest online pharmacy, from McKesson UK. In March 2024, the UK Competition
and Markets Authority provided clearance for the transaction.
Outlook
Pharmacy2U remains xed on consolidating its position as the UK’s leading online
pharmacy, supported by the integration of the LloydsDirect acquisition.
28
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Healthy and sustainable premium dog snacks brand
Key facts
Location: London
Sector: Consumer
Type of deal: Growth
Equity holding: 18%
Financial year: January
Latest sales: £3m (2024)
Description
Founded in 2018, Denzel’s is a healthy and sustainable premium dog snacks
brand. Denzel’s products are made in the UK and Ireland using entirely natural
ingredients and 100% plastic-free eco-friendly packaging.
Denzel’s operates an omni-channel distribution strategy, underpinned by listings
in some of the UK’s leading retailers. Denzel’s e-commerce channel includes
its own website and subscription oering as well as listings on marketplaces. In
addition, Denzel’s products are available in a range of hospitality locations, notably
dog-friendly pubs and hotels across the UK. Denzel’s products are currently
stocked in over two thousand locations in the UK.
Background
In October 2022, ESO completed a £2.0 million investment in Denzel’s as lead
investor within a £3.0 million growth capital raise.
Recent developments
Denzel’s has focussed on developing its team and infrastructure in the period
to support its ambitious growth plans, whilst at the same time achieving strong
year-on-year sales growth. The business relaunched its website and has seen a
signicant increase in online marketing and transactional activity to support its
early successes in oine retail channels. In January 2024, the business appointed
an experienced Chairman to the board.
Outlook
Denzel’s is focused on enhancing the digital brand, aiming to establish a
comprehensive omnichannel strategy while expanding listings with grocers and
major retailers. The team are actively making improvements to the product range
and operational platform to facilitate the next stage of growth.
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
29
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Governance
Report
ESO Portfolio Asset:
Luceco
30
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Audit and Risk Committee Report
The Audit and Risk Committee is chaired by David
Pirouet and comprises all other Directors. Mr Pirouet
was appointed as Chairman of the Committee on
28June2019.
The Audit and Risk Committee’s main duties are:
• To review and monitor the integrity of the interim
and annual nancial statements, interim statements,
announcements and matters relating to accounting
policy, laws and regulations of the Company;
• To evaluate the risks to the quality and eectiveness
of the nancial reporting process;
• To review the eectiveness and robustness of the
internal control systems and the risk management
policies and procedures of the Company;
• To review the valuation of portfolio investments;
• To review corporate governance compliance,
including the Company’s compliance with the
QCA Corporate Governance Code and Disclosure
Guidance and Transparency Rules (“DTR”) reporting
requirements;
• To review the nature and scope of the work to be
performed by the Auditors, and their independence
and objectivity; and
• To make recommendations to the Board as to the
appointment and remuneration of the external
auditors.
The Audit and Risk Committee has a calendar which sets
out its work programme for the year to ensure it covers all
areas within its remit appropriately. It met four times during
the period under review to carry out its responsibilities
and senior representatives of the Investment Advisor
attended the meetings as required by the Audit and Risk
Committee. In between meetings, the Audit and Risk
Committee chairman maintains ongoing dialogue with
the Investment Advisor and the lead audit partner via
regular calls and physical meetings.
During the past year the Audit and Risk Committee carried
out an ongoing review of its own eectiveness. These
concluded that the Audit and Risk Committee is satisfactorily
fullling its terms of reference and is operating eectively.
In addition, the Audit and Risk Committee undertook
a review of the Company’s corporate governance and
compliance with the QCA Corporate Governance Code
and DTR reporting requirements.
Signicant accounting matters
The primary risk considered by the Audit and Risk
Committee during the period under review in relation to
the nancial statements of the Company is the valuation
of unquoted investments.
The Company’s accounting policy for valuing investments
is set out in notes 3i and 12. The Audit and Risk Committee
examined and challenged the valuations prepared by
the Investment Advisor, taking into account the latest
available information on the Company’s investments and
the Investment Advisor’s knowledge of the underlying
portfolio companies through their ongoing monitoring.
The Audit and Risk Committee satised itself that the
valuation of investments had been carried out consistently
with prior accounting periods, or that any change in
valuation basis was appropriate, and was conducted in
accordance with published industry guidelines.
The Auditors explained the results of their review of the
procedures undertaken by the Investment Advisor in
preparation of valuation recommendations for the Audit
and Risk Committee. On the basis of their audit work, no
material adjustments were identied by the Auditor.
External audit
The Audit and Risk Committee reviewed the audit plan and
fees presented by the auditors, PricewaterhouseCoopers
CI LLP (“PwC”), and considered their report on the
nancial statements. The fee for the audit of the annual
report and nancial statements of the Company (and
subsidiaries) for the year ended 31 January 2024 is
£81,200 (2023:£61,350).
The Audit and Risk Committee reviews the scope
and nature of all proposed non-audit services before
engagement, with a view to ensuring that none of these
services have the potential to impair or appear to impair
the independence of their audit role. The Audit and
Risk Committee receives an annual assurance from the
auditors that their independence is not compromised by
the provision of such services, if applicable. During the
period under review, the auditors provided non-audit
services to the Company in relation to the Interim Review
representing total fees of £26,350 (2023: £17,000).
31
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
On 22 April 2022, PwC were appointed as auditors to the
Company from the 31 July 2023 Interim review and the
31 January 2023 audit. The Audit and Risk Committee
regularly considers the need to put the audit out to
tender, the auditors’ fees and independence, alongside
matters raised during eachaudit.
PwC, being eligible, have expressed their willingness to
continue in oce for the current nancial year.
Other service providers
The Board will review the performance and services
oered by Langham Hall, as fund administrator and EPIC
Administration as fund sub-administrator on an ongoing
basis. EPIC Administration completed its last triennial
agreed upon procedures review during the year ended
31 January 2021. The agreed upon procedures review for
2024 is currently ongoing.
Risk management and internal control
The Company does not have an internal audit function.
The Audit and Risk Committee believes this is appropriate
as all of the Company’s operational functions are
delegated to third party service providers who have their
own internal control and risk monitoring arrangements. A
report on these arrangements is prepared by each third
party service provider and submitted to the Audit and
Risk Committee which it reviews on behalf of the Board
to support the Directors’ responsibility for overall internal
control. The Company does not have a whistleblowing
policy and procedure in place. The Company delegates
this function to the Investment Advisor who is regulated
by the FCA and has such policies in place. The Audit and
Risk Committee has been informed by the Investment
Advisor that these policies meet the industry standard
and no whistleblowing took place during the year.
David Pirouet
Chairman of the Audit and Risk Committee
27 March 2024
32
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Corporate Governance Statement
The Board of EPE Special Opportunities is pleased to
update shareholders of the Company’s compliance
with the 2018 Quoted Companies Alliance Corporate
Governance Code (the “QCA Code”).
The Company is committed to the highest standards of
corporate governance, ethical practices and regulatory
compliance. The Board believe that these standards
are vital to generate long-term, sustainable value for
the Company’s shareholders. In particular the Board is
concerned that the Company is governed in a manner to
allow ecient and eective decision making, with robust
risk management procedures.
As an investment vehicle, the Company is reliant upon
its service providers for many of its operations. The
Board maintains ongoing and rigorous review of these
providers. Specically the Board reviews the governance
and compliance of these entities to ensure they meet the
high standards of the Company.
The Board is dedicated to upholding these high standards
and will look to strengthen the Company’s governance
on an ongoing basis.
The Company’s compliance with the QCA Code is
included in this report and on the Company’s website
(www.epespecialopportunities.com). The Board deems
the QCA Code sucient and any additional listing rules
and DTR disclosures are covered in this Corporate
Governance report. The Company will provide annual
updates on changes to compliance with the QCA Code.
The Quoted Companies Alliance has announced that a
revised version of the QCA Code will apply to accounting
periods commencing on or after 1 April 2024. The
Company will update its corporate governance disclosures
to reect the revised code in the Report and Accounts
released in the relevant future accountingperiod.
The FCA also progresses on changing the UK Listing Rules.
The key changes include creating a single segment for
listed equity securities, replacing the current premium and
standard distinctions and placing additional obligations on
standard listed issuers, including related party transactions
as well as bringing them within scope of the UK Governance
Code. The Board will monitor and make an assessment of
how these changes impact the Company.
The Board has reviewed the analysis below and conrms
in its view that the Company has complied with the
applicable requirements of the 2018 QCA Code.
Clive Spears
Chairman
27 March 2024
e 2018 QCA Code
QCA Code Application Explanation of the Company’s Compliance
1. Establish a strategy and business model which promote long-term value for shareholders
The board must be able to express a shared view of the
company’s purpose, business model and strategy.
It should go beyond the simple description of products
and corporate structures and set out how the company
intends to deliver shareholder value in the medium to
long-term.
It should demonstrate that the delivery of long-term
growth is underpinned by a clear set of values aimed
at protecting the company from unnecessary risk and
securing its long term future.
The annual and interim reports detail the Company’s investment
strategy, historic performance, current portfolio and future outlook.
These reports discuss challenges faced by the Company and the
portfolio and how these are mitigated.
Further the Company provides updates to shareholders on
signicant changes in the Company’s or the portfolio’s position or
prospects through ad hoc announcements, as required.
2. Seek to understand and meet shareholder needs and expectations
Directors must develop a good understanding of the
needs and expectations of all elements of the company’s
shareholder base.
The Board must manage shareholders’ expectations
and should seek to understand the motivations behind
shareholder voting decisions.
The Board seeks to develop a strong and ongoing understanding
with the Company’s shareholders.
The Board is available to respond to or address any queries
or concerns raised by shareholders. Such concerns should be
raised via the Company’s Investment Advisor or the Company’s
administrator, as appropriate.
33
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
QCA Code Application Explanation of the Company’s Compliance
2. Seek to understand and meet shareholder needs and expectations (continued)
Throughout the year the Company’s Investment Advisor and
Nominated Advisor (“Nomad”) meet with key shareholders to keep
them informed of the Company’s progress. Both these advisors
report to the Board on these interactions regularly.
The Company holds general meetings of its shareholders on an
annual basis, where the annual report is presented to shareholders
for their approval. The Board attends these meetings and is
available to respond to or address any queries or concerns raised
by attendees.
3. Take into account wider stakeholder and social responsibilities and their implications for long-term success
Long-term success relies upon good relations with
a range of dierent stakeholder groups both internal
(workforce) and external (suppliers, customers,
regulators and others).
The board needs to identify the company’s stakeholders
and understand their needs, interests and expectations.
Where matters that relate to the company’s impact on
society, the communities within which it operates or the
environment have the potential to aect the company’s
ability to deliver shareholder value over the medium to
long-term, then those matters must be integrated into
the company’s strategy and business model.
Feedback is an essential part of all control mechanisms.
Systems need to be in place to solicit, consider and act
on feedback from all stakeholder groups.
The Company seeks to invest capital in a responsible manner,
generating benet to shareholders, its portfolio companies and
the wider economy.
The Company, primarily through its Investment Advisor,
engages in ongoing communication with all its stakeholders,
in particular its shareholders. The Board seeks to ensure that
the portfolio companies, in which the Company has an interest,
act in a responsible manner with consideration to their various
stakeholders.
The Company’s Investment Advisor, in its capacity as manager
of these portfolio assets, provides feedback to the Board on their
performance and interaction with the wider community.
The Board gives consideration to steps which might be taken to
enhance the impact the Company’s investments might have on
the wider economy, within the Company’s strategic objectives. The
Board makes specic enquiry of the Investment Advisor where
relevant to the activities of these portfolio assets.
4. Embed eective risk management, considering both opportunities and threats, throughout the organisation
The board needs to ensure that the company’s risk
management framework identies and addresses all
relevant risks in order to execute and deliver strategy;
companies need to consider their extended business,
including the company’s supply chain, from key
suppliers to end-customer.
Setting strategy includes determining the extent of
exposure to the identied risks that the company is
able to bear and willing to take (risk tolerance and risk
appetite).
The Board maintains a robust risk management framework, which
is reviewed and challenged on an ongoing basis.
The Board has established an Audit and Risk Committee to advise
the Board on the Company’s risk management approach and
overall risk prole. The Audit and Risk Committee meets at least
twice a year and undertakes periodic business risk assessments.
The key risks categories for the Company are portfolio performance
and operational performance.
In relation to the risks associated with the portfolio’s performance,
the Company’s Investment Advisor manages the portfolio.
The performance and capabilities of the Investment Advisor are
reviewed on an ongoing basis and in particular, via an annual
site visit by the Board to the Investment Advisor most recently
completed on 23 February 2024. Further, the Board receives
updates on the portfolio on a quarterly basis (and on an ad hoc
basis, as required) and challenges the Investment Advisor, as
appropriate. The portfolio is relatively concentrated with a target
size of 2-10 assets.
34
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Corporate Governance Statement
(continued)
QCA Code Application Explanation of the Company’s Compliance
4. Embed eective risk management, considering both opportunities and threats, throughout the organisation (continued)
In relation to risks associated with the Company’s operational
performance, the Company has no direct employees or
operations, and has instead delegated its operations to certain
service providers, in particular the Company’s Investment Advisor,
Nomad, Administrator and Financial Administrator. The Company
reviews the performance of these key suppliers on an annual basis
with site visits and in-person meetings with all key advisors.
In relation to the nancial reporting process :
• The Company receives independent agreed upon procedures
compliance reports on a three year cycle (and when procedures
are signicantly amended) from the Financial Administrator.
• The Audit and Risk Committee monitors the reporting process
and reviews and submits recommendations to the Board, where
necessary, challenging the integrity of nancial statements.
• The Audit and Risk Committee reviews the assessments of
going concern, longer-term prospects and viability.
• The Audit and Risk Committee considers proposed changes to
accounting policy.
The Subsidiary investment holding vehicles have their own Boards
and governance structure in place. The Subsidiary Boards’ review
and approve the direct investments. The Subsidiary investment
holding vehicles are not consolidated in the group’s nancial
statements in accordance with IFRS 10. The internal control and
risk management systems in relation to the nancial reporting
process for the subsidiaries are in line with the controls followed
by the Company.
The Company also controls an employee benet trust (“EBT”)
established to operate the jointly owned share plan and share
based payment scheme for the Company’s Directors and certain
employees of the Investment Advisor. The EBT subsidiary’s
nancial statements are consolidated in the nancial statements
as presented in this Report and Accounts. The EBT subsidiary has
its own Trustees and they act independently to the Company. The
nancial reporting process and controls of the EBT subsidiary are
in line with the Company The Board considers the EBT subsidiary
as an insignicant component to the consolidated nancial
statements..
The Audit and Risk Committee ensures that all service providers
remain compliant with relevant regulation and remain suitable to
provide their contracted services.
35
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
QCA Code Application Explanation of the Company’s Compliance
5.
Maintain the board as a well-functioning, balanced team led by the chair
The board members have a collective responsibility and
legal obligation to promote the interests of the company,
and are collectively responsible for dening corporate
governance arrangements. Ultimate responsibility for
the quality of, and approach to, corporate governance
lies with the chair of the board.
The board (and any committees) should be provided with
high quality information in a timely manner to facilitate
proper assessment of the matters requiring a decision or
insight.
The board should have an appropriate balance between
executive and non-executive directors and should have
at least two independent non-executive directors.
Independence is a board judgement.
The board should be supported by committees (e.g.
audit, remuneration, nomination) that have the necessary
skills and knowledge to discharge their duties and
responsibilities eectively.
Directors must commit the time necessary to full their
roles.
All members of the Board are considered to be of independent
thought and are non-executive directors. In particular, the Board
feel that they are suciently independent of the Investment Advisor
and that they suciently challenge the advice received from the
Investment Advisor.
Some Board members have long periods of service. The Board
believe that the experience and familiarity with the Company is
to the benet of the Company, its portfolio, its shareholders and
objectives. The investment period of portfolio assets matches
the long period of service held by certain Board members,
providing deep knowledge of the Company’s investment portfolio.
Board members voluntarily retire by rotation for re-election by
shareholders, on 4-year cycles.
The Board has established the following committees to advise on
the Board’s responsibilities:
• Audit and Risk Committee
All directors are members of this committee.
The Board does not feel that that the establishment of either a
Remuneration Committee or a Nomination Committee would be
appropriate for an investment company of the Company’s current
size.
The Board meets at least four times a year to review the Company’s
performance and operations. All directors attended the majority of the
routine meetings convened in the last twelve months.
The Board may convene additional meetings, as required to address
investment opportunities and other matters arising. Where directors
are not able to attend (often given the short notice), directors typically
communicate their input on the subject matter under discussion to the
rest of the Board ahead of time such that it may be incorporated in the
Board meeting’s deliberations.
The Audit and Risk Committee meets at least twice a year.
The Chairman of the Audit and Risk Committee meets with the
Company’s auditors at least three times a year.
The time commitment required of directors varies dependent upon
the activity level of the Company. It is anticipated that 8-12 days
per annum are required of directors for the attendance of routine
meetings of the Board. In addition it is anticipated that 4-10 days
per annum are required for the participation in other matters
arising.
6. Ensure that between them the directors have the necessary up-to-date experience, skills and capabilities
The board must have an appropriate balance of sector,
nancial and public markets skills and experience, as
well as an appropriate balance of personal qualities and
capabilities.
The board should understand and challenge its own
diversity, including gender balance, as part of its
composition.
The board should not be dominated by one person
or a group of people. Strong personal bonds can be
important but can also divide a board.
The experience and skills of the directors are detailed in their
biographies included on the website and in the annual and interim
reports.
The Board reviews the experience and skills of the Board, as a
collective, on an annual basis, along with the ecacy of the
Board’s operations. Any deciencies identied by these exercises
are mitigated, where possible, by development of individual
directors or recruitment of directors, when necessary.
36
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
QCA Code Application Explanation of the Company’s Compliance
6.
Ensure that between them the directors have the necessary up-to-date experience, skills and capabilities (continued)
Each director is responsible for the maintenance of their skills. All
directors hold other complementary directorships and are active
participants in the investment management community.
By way of example, certain Jersey-based directors are required,
given their directorships and under local regulations, to complete
a certain amount of Continuing Professional Development (“CPD”)
each year.
The Board receives investment advice from its Investment Advisor
on an ongoing basis. The Board receives compliance advice from
the Nomad on an ongoing basis. The Board seeks legal advice
where appropriate and for all signicant corporate actions and
legal agreements.
The Company’s secretary and Administrator provide compliance
advice, as relevant.
The Company’s advisors are detailed on the Company’s website
and in the annual and interim reports.
Michael Gray is the senior independent director of the Company.
7. Evaluate board performance based on clear and relevant objectives, seeking continuous improvement
The board should regularly review the eectiveness of
its performance as a unit, as well as that of its committees
and the individual directors.
The board performance review may be carried out
internally or, ideally, externally facilitated from time
to time. The review should identify development or
mentoring needs of individual directors or the wider
senior management team.
It is healthy for membership of the board to be periodically
refreshed. Succession planning is a vital task for boards.
No member of the board should become indispensable.
The Board reviews the experience and skills of the Board, as a
collective, on an annual basis, along with the ecacy of the
Board’s operations. Any deciencies identied by these exercises
are mitigated, where possible, by development of individual
directors or recruitment of directors, when necessary.
This review is conducted by an anonymised questionnaire
completed by directors, with results collated by the Company’s
Administrator. The matrix of skills and experience against which
the Board reviews itself is broad and reects the Company’s
strategy and long-term objectives.
The directors collectively review the succession plan for the Board
on an annual basis, with recruitment of directors, when necessary,
aligned to the skill reviews performed by the Board.
8. Promote a corporate culture that is based on ethical values and behaviours
The board should embody and promote a corporate
culture that is based on sound ethical values and
behaviours and use it as an asset and a source of
competitive advantage.
The policy set by the board should be visible in the
actions and decisions of the chief executive and the
rest of the management team. Corporate values should
guide the objectives and strategy of the company.
The culture should be visible in every aspect of the
business, including recruitment, nominations, training
and engagement. The performance and reward system
should endorse the desired ethical behaviours across all
levels of the company.
The corporate culture should be recognisable
throughout the disclosures in the annual report, website
and any other statements issued by the company.
The Company seeks to invest capital in a responsible and
ethical manner, generating benet to shareholders, its portfolio
companies and the wider economy.
The Company, as a vehicle for holding investments, has no
employees and limited capacity to eect changes in culture in
companies it is aliated with. That said, the Board is keen that the
portfolio companies, in which the Company has an interest, act
in an ethical manner with consideration to the wider community.
The Board ensures that all portfolio companies have policies in
place to comply with applicable governance laws and regulations,
such as anti-bribery and modern day slavery. The Board has a zero
tolerance approach to breaches of these laws and regulations.
The Board promotes ethical behaviour throughout the portfolio,
through directions to the Company’s Investment Advisors in
relation to the ethical management of the portfolio.
No diversity policy has been applied by the Company as it qualies
as a medium company in accordance with DTR 7.2.8 B and DTR
1B.1.7R.
Corporate Governance Statement
(continued)
37
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
QCA Code Application Explanation of the Company’s Compliance
9. Maintain governance structures and processes that are t for purpose and support good decision-making by the board
The company should maintain governance structures
and processes in line with its corporate culture and
appropriate to its:
• size and complexity; and
• capacity, appetite and tolerance for risk.
The governance structures should evolve over time in
parallel with its objectives, strategy and business model
to reect the development of the company.
The roles and responsibilities of the directors are detailed in the
Governance Report in the annual and interim reports.
A summary of the role and responsibilities of the chairman of the
Board is included on the Company’s website.
All signicant matters related to the operation of the Company are
reserved to the Board, in particular given the Company does not
have an executive function.
The committee of the Board has been established to advise the
Board on certain matters.
A summary of the terms of reference of the Board and the
committee of the Board is included on the Company’s website.
The Company has engaged certain suppliers to provide services
to the Company. These suppliers are engaged by and report to
the Board.
10. Communicate how the company is governed and is performing by maintaining a dialogue with shareholders and
other relevant stakeholders
A healthy dialogue should exist between the board and
all of its stakeholders, including shareholders, to enable
all interested parties to come to informed decisions
about the company.
In particular, appropriate communication and reporting
structures should exist between the board and all
constituent parts of its shareholder base. This will assist:
• the communication of shareholders’ views to the
board; and
• the shareholders’ understanding of the unique
circumstances and constraints faced by the company.
It should be clear where these communication practices
are described (annual report or website).
The annual report includes the following details:
• The work of the Board during the period of review – please see
the Chairman’s Statement; and
• The work of the Audit and Risk Committee – please see the
Governance Report.
The annual and interim reports do not include a remuneration
report as the Board does not consider such a report appropriate,
given the Company does not have executive directors and the
remuneration of the non-executive directors is detailed elsewhere
in the reports.
The directors of the Company participate in a share-based
remuneration scheme. Participation in this scheme requires the
purchase by directors of shares in the Company. The Board feel
that this scheme is appropriate as equity participation in the
Company is important for fostering alignment with shareholders.
The scheme has caps on director participation and has been
approved by a general meeting of shareholders.
The outcomes of all votes of shareholders are disclosed
shortly afterwards via announcement to the market. These
announcements are retained on the Company’s website.
Historic interim and annual reports are contained on the
Company’s website (last ve years).
38
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
39
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Financial
Statements
ESO Portfolio Asset:
Denzel’s
40
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
41
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Contents
Report of the Directors 42
Statement of Directors’ Responsibilities 46
Independent Auditors’
Report 48
Consolidated
Statement of Comprehensive Income 54
Consolidated
Statement of Assets and Liabilities 55
Consolidated
Statement of Changes in Equity 56
Consolidated
Statement of Cash Flows 57
Notes to the Consolidated
Financial Statements 58
Alternative Performance Measures 86
Unaudited schedule of shareholders holding over 3% of issued shares 88
Company Information 89
42
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Report of the Directors
Principal activity and incorporation
under the Laws with registered number 108834C on 25 July 2003. On 23 July 2012, the Company re-registered
under the Isle of Man Companies Act 2006, with registration number 008597V. On 11 September 2018, the Company
re-registered under the Bermuda Companies Act 1981, with registration number 53954. The Company’s ordinary
shares are quoted on AIM, a market operated by the London Stock Exchange, and the Growth Market of the Aquis
Stock Exchange (formerly the NEX Exchange). The Company’s Unsecured Loan Notes (“ULN”) are quoted on the
Aquis Stock Exchange.
The Company’s Zero Dividend Preference Shares (“ZDP”) are admitted to trade on the main market of the London Stock
Exchange (standard listed). It was identied that the 31 January 2023 accounts did not fully include certain disclosures
and requirements necessitated by the main market listing of the ZDP shares. Detailed review has been performed by
management to consider obligations and reporting requirements in accordance with the Listing Rules and DTR for the
standard listed segment (shares) on the London Stock Exchange. The format of the annual report has been updated to
include the required disclosures.
The principal activity of the Company and its subsidiaries holding vehicles (together the “Subsidiaries”) is to provide long-
term return on equity for its shareholders by investing between £2m and £30m in small and medium sized companies.
The Company targets growth capital and buy-out opportunities, special situations and distressed transactions, deploying
capital where it believes the potential for shareholder value creation to be compelling. The Company has the flexibility
to invest in public as well as private companies and is also able to invest in Special Purpose Acquisition Companies
(“SPACs”) and third party funds. The Company will consider most industry sectors including business services, consumer
and retail, financial services and the industrials sector. The portfolio is likely to be concentrated, numbering between
two and ten assets at any one time, which allows the Company to allocate the necessary resource to form genuinely
engaged and supportive partnerships with management teams. This active approach facilitates the delivery of truly
transformational initiatives in underlying investments during the Company’s period of ownership.
The Subsidiary investment holding vehicles are not consolidated in the group’s nancial statements in accordance with
IFRS10. The Company also controls an employee benet trust (“EBT”) established to operate the jointly owned share plan
and share based payment scheme for the Company’s Directors and certain employees of the Investment Advisor. The
nancial statements presented in this Report and Accounts are the consolidated nancial statements of the Company and
the EBT subsidiary. The Company and the EBT subsidiary are collectively referred to as the “Group” hereinafter.
Registered oce
The Company’s registered oce is:
Clarendon House, 2 Church Street, Hamilton HM11, Bermuda
Place of business
Prior to 15 May 2023, the Company operated out of and was controlled from:
Liberation House, Castle Street, St Helier, Jersey JE1 2LH.
On 15 May 2023, the Company’s place of business was amended to:
Gaspe House, 66-72 Esplanade, St Helier, Jersey, Channel Islands, JE1 2LH.
Results of the nancial year
Results for the year are set out in the Consolidated Statement of Comprehensive Income on page 54 and in the
Consolidated Statement of Changes in Equity on page 56.
Dividends
The Board does not recommend a dividend in relation to the current year (2023: nil) (see note 10 for further details).
43
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Corporate governance principles
Please refer to the Corporate Governance Statement of this Report & Accounts. The Directors, place a high degree
of importance on ensuring that the Company maintains high standards of Corporate Governance and have therefore
adopted the Quoted Companies Alliance 2018 Corporate Governance Code (the“QCACode”).
The Board holds at least four meetings annually and has established an Audit and Risk Committee. The Investment
Committee was agreed to be disbanded by the Board, given that the Subsidiary investment holding vehicles have their
own Boards and governance structure in place. The Subsidiary investment holding vehicles’ Boards review and approve
the direct investments, and as such a separate Investment Committee at the Company level is not required. The Board
does not intend to establish remuneration and nomination committees given the current composition of the Board and
the nature of the Company’s operations. The Board reviews annually the remuneration of the Directors and agrees on
the level of Directors’ fees.
Composition of the Board
The Board currently comprises four non-executive directors, all of whom are independent. Clive Spears is Chairman of
the Board, David Pirouet is Chairman of the Audit and Risk Committee.
Nicholas Wilson stepped down from the Board on 30 September 2023.
Audit and Risk Committee
The Audit and Risk Committee comprises David Pirouet (Chairman of the Committee) and all other Directors. The Audit
and Risk Committee provides a forum through which the Company’s external auditors report to the Board.
The Audit and Risk Committee meets twice a year, at a minimum, and is responsible for considering the appointment
and fee of the external auditors and for agreeing the scope of the audit and reviewing its ndings. It is responsible for
monitoring compliance with accounting and legal requirements, ensuring that an eective system of internal controls
is maintained and for reviewing the annual and interim nancial statements of the Company before their submission for
approval by the Board. The Audit and Risk Committee has adopted and complied with the extended terms of reference
implemented on the Company’s readmission to AIM in August 2010, as reviewed by the Board from time to time.
The Board is satised that the Audit and Risk Committee contains members with sucient recent and relevant
nancialexperience.
Principal risks and uncertainties
The Group has a robust approach to risk management that involves ongoing risk assessments, communication with our
Board of Directors and Investment Advisor, and the development and implementation of a risk management framework
along with reports, policies and procedures. We continue to monitor relevant emerging risks and consider the market
and macro impacts on our key risks.
Risk Description Mitigation
Performance Risk In the event the Company’s investment
portfolio underperforms the market, the
Company may underperform vs. the
market and peer benchmarks.
The Board independently reviews any investment
recommendation made by the Investment Advisor
in light of the investment objectives of the Company
and the expectations of shareholders.
The Investment Advisor maintains board
representation on all majority owned portfolio
investments and maintains ongoing discussions
with management and other key stakeholders in
investments to ensure that there are controls in
place to ensure the success of the investment.
44
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Report of the Directors
(continued)
Risk Description Mitigation
Portfolio
Concentration Risk
The Company’s investment policy is
to hold a concentrated portfolio of
2-10 assets. In a concentrated portfolio,
if the valuation of any asset decreases
it may have a material impact on the
Company’s NAV.
The Directors and Investment Advisor keep the
portfolio under review and focus closely on those
holdings which represent the largest proportion of
total value.
Liquidity
Management
Liquidity risk is the risk that the Company
will encounter diculty in meeting the
obligations associated with its nancial
liabilities that are settled by delivering
cash or another nancial asset.
The Board and Investment Advisor closely
monitors cash ow forecasts in conjunction with
liability maturity. Liquidity forecasts are carefully
considered before capital deployment decisions
are made.
Credit Risk Credit risk is the risk that an issuer or
counterparty will be unable or unwilling
to meet a commitment that it has entered
into with the Company. The Company,
through its interests in subsidiaries, has
advanced loans to a number of private
companies which exposes the Company
to credit risk. The loans are advanced to
unquoted private companies, which have
no credit risk rating.
Loan investments are entered into as part of
the investment strategy of the Company and its
subsidiaries, and credit risk is managed by taking
security where available (typically a oating
charge) and the Investment Advisor taking an
active role in the management of the borrowing
companies. In addition to the repayment of loans
advanced, the Company and subsidiaries will often
arrange additional preference share structures
and take signicant equity stakes so as to create
shareholder value. It is the performance of the
combination of all securities including third party
debt that determines the Company’s view of
eachinvestment.
Operational Risk The Company outsources investment
advisory and administrative functions to
service providers. Inadequate or failed
internal processes could lead to operational
performance risk and regulatory risk.
The primary responsibility for the development and
implementation of controls over operational risk
rests with the Board of Directors. This responsibility
is supported by the development of overall
standards for the management of operational risk,
which encompasses the controls and processes
at the service providers and the establishment
of service levels with the service providers. The
Directors’ assessment of the adequacy of the
controls and processes in place at the service
providers with respect to operational risk is
carried out via regular discussions with the service
providers as well as site visits to their oces. The
Company also undertakes periodic third-party
reviews of service providers’ activities.
45
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Signicant holdings
Signicant shareholdings are analysed on page 88. The Directors are not aware of any other holdings greater than 3per
cent. of issued shares.
Directors
The Directors of the Company holding oce during the nancial year and to date are:
Mr. C.L. Spears (Chairman)
Mr. N.V. Wilson (resigned on 30 September 2023)
Ms. H. Bestwick
Mr. D.R. Pirouet
Mr. M.M Gray
Related Party Transactions
Details in respect of the Group’s related party transactions during the period are included in note 22 to the nancial
statements.
Sta and Secretary
At 31 January 2024 the Group employed no sta (2023: none).
Independent Auditors
The current year is the second year in which PricewaterhouseCoopers CI LLP are undertaking the audit for the Group.
PricewaterhouseCoopers CI LLP have indicated willingness to continue in oce.
On behalf of the Board
Heather Bestwick
Director
27 March 2024
46
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
The Directors are responsible for preparing the Annual Report and the nancial statements in accordance with
applicable law and regulations.
The Directors are required to prepare nancial statements for each nancial year. The Group is required to prepare the
nancial statement in accordance with IFRS Accounting Standards as issued by the International Accounting Standards
Board (hereinafter “IFRS Accounting Standards”) and applicable legal and regulatory requirements of Bermuda
Companies Act 1981.
The Directors must not approve the nancial statements unless they are satised that they give a true and fair view of
the state of aairs of the Group and of its prot or loss for that period. In preparing the Group’s nancial statements, the
Directors are required to:
• select suitable accounting policies and then apply them consistently;
• make judgements and estimates that are reasonable, relevant and reliable;
• state whether they have been prepared in accordance with IFRS Accounting Standards; and
• assess the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern
and use the going concern basis of accounting unless they either intend to liquidate the Group or to cease operations,
or have no realistic alternative but to do so.
The Directors conrm that they have complied with the above requirements in preparing the nancial statements.
The Directors are responsible for keeping adequate accounting records that are sucient to show and explain the
Group’s transactions and disclose with reasonable accuracy at any time the nancial position of the Group and enable
them to ensure that its nancial statements comply with the Bermuda Companies Act 1981. They are responsible for
such internal control as they determine is necessary to enable the preparation of nancial statements that are free
from material misstatement, whether due to fraud or error, and have 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 otherirregularities.
The maintenance and integrity of the Company’s website is the responsibility of the Directors; the work carried out by
the auditors does not involve consideration of these matters and, accordingly, the auditors accept no responsibility for
any changes that might have occurred to the annual nancial statements since they were initially presented on the
website. Legislation in Bermuda governing the preparation and dissemination of nancial statements may dier from
legislation in other jurisdictions.
Each of the Directors conrm that, to the best of their knowledge:
• The nancial statements, prepared in accordance with IFRS Accounting Standards, give a true and fair view of
the assets, liabilities, nancial position and prot or loss of the Company and the undertakings included in the
consolidation taken as a whole; and
• the Investment Advisor’s report includes a fair review of the development and performance of the business and
the position of the Company and the undertakings included in the consolidation taken as a whole, together with a
description of the principal risks and uncertainties that they face.
Statement of Directors’ Responsibilities
in respect of the Annual Report and the Financial Statements
47
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
In the case of each Director in oce at the date the Directors’ report is approved:
• so far as the Director is aware, there is no relevant audit information of which the Group’s auditors are unaware; and
• they have taken all the steps that they ought to have taken as a Director in order to make themselves aware of any
relevant audit information and to establish that the Group’s auditors are aware of that information.
This annual report was approved by the Board and the above Director’s Responsibility Statement was signed on behalf
of the Board by:
Heather Bestwick
Director
27 March 2024
48
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Report on the audit of the nancial statements
Our opinion
In our opinion, EPE Special Opportunities Limited’s group nancial statements:
• ● give a true and fair view of the state of the group’s aairs as at 31 January 2024 and of its prot and cash ows for
the year then ended;
• ● have been properly prepared in accordance with IFRS Accounting Standards as issued by the International
Accounting Standards Board (IASB); and
• ● have been prepared in accordance with the requirements of the Companies Act 1981 (Bermuda).
We have audited the group nancial statements, included within the Report and Accounts (the “Annual Report”), which
comprise: the Consolidated Statement of Assets and Liabilities as at 31 January 2024; the Consolidated Statement of
Comprehensive Income, Consolidated Statement of Changes in Equity and Consolidated Statement of Cash ows for
the year then ended; and the notes to the group nancial statements, comprising material accounting policy information
and other explanatory information.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs (UK)”) and applicable law.
Our responsibilities under ISAs (UK) are further described in the Auditors’ responsibilities for the audit of the nancial
statements section of our report. We believe that the audit evidence we have obtained is sucient and appropriate to
provide a basis for our opinion.
Independence
We remained independent of the group in accordance with the ethical requirements that are relevant to our audit of
the nancial statements in the UK, which includes the FRC’s Ethical Standard and we have fullled our other ethical
responsibilities in accordance with these requirements.
Our audit approach
Overview
Audit scope
• ● EPE Special Opportunities Limited (the “Company”) is registered in Bermuda but operates from Jersey. We
conducted our audit work in Jersey. The Company’s subsidiaries comprise subsidiary investments measured at
fair value through prot or loss which are not consolidated in accordance with IFRS 10, and an employee benet
trust which is consolidated in the group’s nancial statements. The group is composed of the Company and its
consolidated subsidiary.
• ● We tailored the scope of our audit taking into account the type of investments held by the group, the accounting
processes and controls, and the industry in which the group operates.
• ● We have audited the nancial statements of the group prepared by its nancial administrator who is based in
London.
Key audit matters
• ● Valuation of the underlying Level 3 investments recognised as part of the Investments at fair value through prot
or loss.
Materiality
• ● Overall materiality: £2,179,000 (2023: £1,948,000) based on 2.25% (2023: 2%) of net assets.
• ● Performance materiality: £1,634,000 (2023: £974,000).
Independent Auditors’ Report
to the Members of EPE Special Opportunities Limited
49
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
e scope of our audit
As part of designing our audit, we determined materiality and assessed the risks of material misstatement in the
nancialstatements.
Key audit matters
Key audit matters are those matters that, in the auditors’ professional judgement, were of most signicance in the audit
of the nancial statements of the current period and include the most signicant assessed risks of material misstatement
(whether or not due to fraud) identied by the auditors, including those which had the greatest eect on: the overall
audit strategy; the allocation of resources in the audit; and directing the eorts of the engagement team. These matters,
and any comments we make on the results of our procedures thereon, were addressed in the context of our audit of
the nancial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on
these matters.
This is not a complete list of all risks identied by our audit.
The key audit matter below is consistent with last year.
Key audit matter How our audit addressed the key audit matter
Valuation of the underlying Level 3 investments recognised
as part of the Investments at fair value through prot or loss.
The Company’s Investments at fair value through prot or
loss include underlying Level 3 investments amounting to
£59,461,949 as at 31 January 2024 (2023: £50,568,639). These
underlying investments are held through the Company’s
subsidiaries. Details of these investments including the
valuation techniques used in determining the fair value are
disclosed in Note 12 to the nancial statements.
The Company’s underlying investment in a listed special
purpose acquisition company (“SPAC”) is classied as Level
3 together with the unquoted investments in private equity
(“Direct PE investments”).
The valuation of these underlying Level 3 investments, where
material, has been assessed as a key audit matter due to the
signicant judgement required and assumptions applied in
determining the fair value as at 31 January 2024.
We evaluated the investment valuation accounting
policy for compliance with IFRS Accounting
Standards as issued by the International Accounting
Standards Board (IASB) and the International Private
Equity and Venture Capital Valuation Guidelines.
We also tested that the investment valuations were
accounted for in accordance with the stated policy.
We obtained an understanding and performed
an evaluation of the Investment Advisor’s
processes, key controls and methodology applied
in determining the fair value of the investment
portfolio, along with the subsequent consideration
and approval by the Directors. We tested the
classication, approach and valuation basis of the
underlying Level 3 investments held through the
Company’s subsidiaries.
Level 3 investments comprise of the following:
Investment in Direct PE investments – We
evaluated the appropriateness of the valuation
methodology for each investment. This included:
• testing the nancial metrics applied using
independently obtained latest nancial
information from portfolio companies;
• assessing the suitability of selected peers;
checking the valuation multiples used to third
party sources; and
• challenging the reasonableness of the signicant
unobservable inputs into the valuation models.
50
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Independent Auditors’ Report
to the Members of EPE Special Opportunities Limited (continued)
Key audit matter How our audit addressed the key audit matter
Investment in the SPAC – the fair value for this
asset is calculated with reference to the liquidation
value of the investments. We tested the basis of
the liquidation value to underlying agreements and
conrmed the recoverable amount held in escrow
for the SPAC to bank statements.
We considered the quality of information obtained
through our conrmation process, as well as the
date of the latest available information used to
support these valuations at year end. This included
a review of the latest audited nancial statements
of the underlying investment companies or funds
and an assessment of the appropriateness of the
conrming parties supplying us with the requested
valuation support.
Based on the audit work detailed above, we have
not identied anything material to report to those
charged with corporate governance.
How we tailored the audit scope
We tailored the scope of our audit to ensure that we performed enough work to be able to give an opinion on the
nancial statements as a whole, taking into account the structure of the group, the accounting processes and controls,
and the industry in which it operates.
The group’s portfolio investments are held by its three controlled subsidiary investments: ESO Investment 1 Limited;
ESO Investments 2 Limited and ESO Alternative Investments. These entities are not consolidated in the group’s nancial
statements in accordance with IFRS 10. The Company also controls the EPIC Private Equity Employee Benet Trust,
an employee benet trust established to operate the jointly owned share plan and share based payment scheme
for the Company’s directors and certain employees of the Investment Advisor. The employee benet trust’s nancial
statements are consolidated in the group’s nancial statements.
The accounting processes and nance function of the Company and its subsidiaries are managed centrally by
EPIC Administration Limited, nancial administrator. Each portfolio company held through a subsidiary investment is
responsible for its own accounting processes and controls. Financial information is shared to the relevant subsidiary
which forms the basis of estimating the fair value of the subsidiary investments by the Investment Advisor.
We consider the consolidated subsidiary to be an insignicant component and based on our professional judgement
have tailored our audit scope to account for the group’s consolidated nancial statements as a single component to
which we have applied the group materiality.
e impact of climate risk on our audit
As part of our audit we made enquiries of management to understand the extent of the potential impact of climate risk
on the group’s nancial statements, and we remained alert when performing our audit procedures for any indicators of
the impact of climate risk. Our procedures did not identify any material impact as a result of climate risk on the group’s
nancial statements.
51
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Materiality
The scope of our audit was inuenced by our application of materiality. We set certain quantitative thresholds for
materiality. These, together with qualitative considerations, helped us to determine the scope of our audit and the
nature, timing and extent of our audit procedures on the individual nancial statement line items and disclosures and
in evaluating the eect of misstatements, both individually and in aggregate on the nancial statements as a whole.
Based on our professional judgement, we determined materiality for the nancial statements as a whole as follows:
Overall group materiality £2,179,000 (2023: £1,948,000).
How we determined it 2.25% (2023: 2%) of net assets
Rationale for benchmark applied We believe that net assets is the most appropriate benchmark because
this is the key metric of interest to investors. It is also a generally
accepted measure used for companies in this industry.
We use performance materiality to reduce to an appropriately low level the probability that the aggregate of
uncorrected and undetected misstatements exceeds overall materiality. Specically, we use performance materiality in
determining the scope of our audit and the nature and extent of our testing of account balances, classes of transactions
and disclosures, for example in determining sample sizes. Our performance materiality was 75% (2023: 50%) of overall
materiality, amounting to £1,634,000 (2023: £974,000) for the group nancial statements.
In determining the performance materiality, we considered a number of factors – the history of misstatements, risk
assessment and aggregation risk and the eectiveness of controls – and concluded that an amount at the upper end
of our normal range was appropriate.
We agreed with the Audit and Risk Committee that we would report to them misstatements identied during our audit
above £108,000 (2023: £97,000) as well as misstatements below that amount that, in our view, warranted reporting for
qualitative reasons.
Conclusions relating to going concern
Our evaluation of the directors’ assessment of the group’s ability to continue to adopt the going concern basis of
accounting included:
• ● Evaluating risks and factors that could impact the going concern basis of accounting, including both internal risks
(i.e., business model and strategy execution) and external risks (i.e., macroeconomic conditions);
• ● Understanding and evaluating the group’s nancial forecasts and stress testing of the key assumptions used;
• ● Assessing the level of available nancial resources against the group’s nancing facilities and commitments and
performing sensitivity analysis;
• ● Reviewing and evaluating the adequacy of the disclosures made in the nancial statements in relation to going
concern.
Based on the work we have performed, we have not identied any material uncertainties relating to events or conditions
that, individually or collectively, may cast signicant doubt on the group’s ability to continue as a going concern for a
period of at least twelve months from when the nancial statements are authorised for issue.
In auditing the nancial statements, we have concluded that the directors’ use of the going concern basis of accounting
in the preparation of the nancial statements is appropriate.
However, because not all future events or conditions can be predicted, this conclusion is not a guarantee as to the
group’s ability to continue as a going concern.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant
sections of this report.
52
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Independent Auditors’ Report
to the Members of EPE Special Opportunities Limited (continued)
Reporting on other information
The other information comprises all of the information in the Annual Report other than the nancial statements and our
auditors’ report thereon. The directors are responsible for the other information. Our opinion on the nancial statements
does not cover the other information and, accordingly, we do not express an audit opinion or, except to the extent
otherwise explicitly stated in this report, any form of assurance thereon.
In connection with our audit of the nancial statements, our responsibility is to read the other information and, in doing
so, consider whether the other information is materially inconsistent with the nancial statements or our knowledge
obtained in the audit, or otherwise appears to be materially misstated. If we identify an apparent material inconsistency
or material misstatement, we are required to perform procedures to conclude whether there is a material misstatement
of the nancial statements or a material misstatement of the other information. 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 based on these responsibilities.
Responsibilities for the nancial statements and the audit
Responsibilities of the directors for the nancial statements
As explained more fully in the Statement of Directors’ Responsibilities, the directors are responsible for the preparation
of the nancial statements in accordance with the applicable framework and for being satised that they give a true
and fair view. The directors are also responsible for such internal control as they determine is necessary to enable the
preparation of nancial statements that are free from material misstatement, whether due to fraud or error.
In preparing the nancial 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 nancial statements
Our objectives are to obtain reasonable assurance about whether the nancial statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue an auditors’ 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 (UK) 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 inuence the economic
decisions of users taken on the basis of these nancial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line
with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
Based on our understanding of the group and industry, we identied that the principal risks of non-compliance with
laws and regulations related to, but were not limited to, the Companies Act 1981 (Bermuda) and the Listing Rules, and
we considered the extent to which non-compliance might have a material eect on the nancial statements. We also
considered those laws and regulations that have a direct impact on the nancial statements such as the Companies Act
1981 (Bermuda). We evaluated management’s incentives and opportunities for fraudulent manipulation of the nancial
statements (including the risk of override of controls), and determined that the principal risks were related to the posting
of inappropriate journal entries and the potential for management bias in accounting estimates and key judgements
impacting the nancial statements, specically the valuation of investments held at fair value through prot or loss. Audit
procedures performed by the engagement team included:
• ● Enquiries with the directors, the investment advisor and the regulated third party administrators to any actual or
suspected instances of fraud or non-compliance with laws and regulations;
• ● Understanding and assessing the impact of known and suspected instances of non-compliance with laws and
regulations that could rise to a material misstatement in the group nancial statements, including, but not limited to,
the Companies Act 1981 (Bermuda) and the Listing Rules;
• ● Inspecting and testing signicant transactions or nancial statement disclosures determined in accordance with the
terms of the relevant agreements, such as any fees paid to the investment advisor and related entities;
53
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
• ● Inspecting legal fee expenditure for any indication of undisclosed litigation or non-compliance with laws and regulations;
• ● Evaluating assumptions and judgements made in relation to signicant accounting estimates, particularly the
determination of fair value of the investments;
• ● Performing audit procedures to incorporate unpredictability around the nature, timing or extent of our testing; and
• ● Identifying and testing journal entries considered to be of higher fraud risk, and the evaluation of the business
rationale for any signicant or unusual transactions identied as being outside the normal course of business.
There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances
of non-compliance with laws and regulations that are not closely related to events and transactions reected in the
nancial statements. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not
detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional
misrepresentations, or through collusion.
Our audit testing might include testing complete populations of certain transactions and balances, possibly using data
auditing techniques. However, it typically involves selecting a limited number of items for testing, rather than testing
complete populations. We will often seek to target particular items for testing based on their size or risk characteristics.
In other cases, we will use audit sampling to enable us to draw a conclusion about the population from which the
sample is selected.
A further description of our responsibilities for the audit of the nancial statements is located on the FRC’s website at:
www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditors’ report.
Use of this report
This report, including the opinions, has been prepared for and only for the Company’s members as a body in accordance
with Section 90 of the Companies Act 1981 (Bermuda) and for no other purpose. We do not, in giving these opinions,
accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose
hands it may come save where expressly agreed by our prior consent in writing.
Other required reporting
Report of the Directors
In our opinion, based on the work undertaken in the course of the audit, the information given in the Report of the
Directors for the year ended 31 January 2024 is consistent with the consolidated nancial statements and has been
prepared in accordance with applicable legal and regulatory requirements.
In light of the knowledge and understanding obtained in the course of the audit, we did not identify any material
misstatement in the Report of the Directors.
Other matter
In due course, as required by the Financial Conduct Authority Disclosure Guidance and Transparency Rule 4.1.14R,
these nancial statements will form part of the ESEF-prepared annual nancial report led on the National Storage
Mechanism of the Financial Conduct Authority in accordance with the ESEF Regulatory Technical Standard (‘ESEF RTS’).
This auditors’ report provides no assurance over whether the annual nancial report will be prepared using the single
electronic format specied in the ESEF RTS.
Michael Byrne
For and on behalf of PricewaterhouseCoopers CI LLP
Chartered Accountants
Jersey, Channel Islands
27 March 2024
54
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Consolidated Statement of Comprehensive Income
For the year ended 31 January 2024
Note
31January
2024
Total
£
31January
2023
Total
£
Income
4 Interest income 366,660 79,899
11 Net fair value movement on investments* 3,384,604 (39,438,551 )
Total income / (loss) 3,751,264 (39,358,652 )
Expenses
5 Investment advisor’s fees (1,832,745 ) (1,755,442 )
6 Directors’ fees (162,474 ) (172,000 )
7 Share based payment expense (339,593 ) (555,225 )
8 Other expenses (635,675 ) (557,416 )
Total expense (2,970,487 ) (3,040,083 )
Prot / (loss) before nance costs and tax 780,777 (42,398,735 )
Finance charges
15 Interest on unsecured loan note instruments (309,049 ) (309,382 )
15 Zero dividend preference shares nance charge (868,190 ) (1,128,093 )
Loss for the year before taxation (396,462 ) (43,836,210 )
9 Taxation – –
Loss for the year (396,462 ) (43,836,210 )
Other comprehensive income – –
Total comprehensive loss (396,462 ) (43,836,210 )
17 Basic loss per ordinary share (pence) (1.39 ) (147.95 )
17 Diluted loss per ordinary share (pence) (1.33 ) (141.77 )
* The net fair value movements on investments is allocated to the capital reserve and all other income and
expenses are allocated to the revenue reserve in the Consolidated Statement of Changes in Equity. All items
derive from continuing activities.
The accompanying notes form an integral part of these financial statements.
55
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Consolidated Statement of Assets and Liabilities
At 31 January 2024
Note
31January
2024
£
31January
2023
£
Non-current assets
11 Investments at fair value through prot or loss 95,459,612 100,412,977
Current assets
11 Investments at fair value through prot or loss 5,262,427 –
13 Cash and cash equivalents 14,462,495 22,226,008
Trade and other receivables and prepayments 73,646 87,899
Current liabilities
14 Trade and other payables (676,284 ) (596,790 )
15 Unsecured loan note instruments (3,987,729 ) (3,987,729 )
(4,664,013 ) (4,584,519 )
Net current assets 15,134,555 17,729,388
Non-current liabilities
15 Zero dividend preference shares (13,714,191 ) (20,721,001 )
(13,714,191 ) (20,721,001 )
Net assets 96,879,976 97,421,364
Equity
16 Share capital 1,730,828 1,730,828
16 Share premium 13,619,627 13,619,627
24 Capital reserve 100,523,993 97,139,389
24 Revenue reserve and other equity (18,994,472 ) (15,068,480 )
Total equity 96,879,976 97,421,364
18 Net asset value per share (pence) 324.26 328.41
The financial statements were approved by the Board of Directors on 27 March 2024 and signed on its behalf by:
Clive Spears David Pirouet
Director Director
The accompanying notes form an integral part of these nancial statements.
56
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Consolidated Statement of Changes in Equity
For the year ended 31 January 2024
Year ended 31January 2024
Note
Share
capital
£
Share
premium
£
Capital
reserve
£
Revenue
reserve and
other equity
£
Total
£
Balance at 1 February 2023 1,730,828 13,619,627 97,139,389 (15,068,480 ) 97,421,364
Total comprehensive loss for the year – – 3,384,604 (3,781,066 ) (396,462 )
Contributions by and distributions
toowners
7 Share-based payment charge – – – 339,593 339,593
Share ownership scheme participation – – – 41,401 41,401
16 Share acquisition for JOSP scheme – – – (525,920 ) (525,920 )
Total transactions with owners – – – (144,926 ) (144,926 )
Balance at 31 January 2024 1,730,828 13,619,627 100,523,993 (18,994,472 ) 96,879,976
Year ended 31January 2023
Note
Share
capital
£
Share
premium
£
Capital
reserve
£
Revenue
reserve and
other equity
£
Total
£
Balance at 1 February 2022 1,730,828 13,619,627 136,577,940 (8,303,418 ) 143,624,977
Total comprehensive loss for the year – – (39,438,551 ) (4,397,659 ) (43,836,210 )
Contributions by and distributions
toowners
7 Share-based payment charge – – – 555,225 555,225
Share ownership scheme participation – – – 149,568 149,568
16 Purchase of shares – – – (2,587,375 ) (2,587,375 )
16 Share acquisition for JOSP scheme – – – (484,821 ) (484,821 )
Total transactions with owners – – – (2,367,403 ) (2,367,403 )
Balance at 31 January 2023 1,730,828 13,619,627 97,139,389 (15,068,480 ) 97,421,364
The accompanying notes form an integral part of these nancial statements.
57
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Consolidated Statement of Cash Flows
For the year ended 31 January 2024
Note
31January
2024
£
31January
2023
£
Operating activities
Interest income received 366,660 79,899
Expenses paid (2,535,853 ) (2,853,467 )
11 Purchase of investments (3,350,000 ) (3,174,948 )
11 Proceeds from investments 6,425,542 3,848,880
19 Net cash generated from / (used in) operating activities 906,349 (2,099,636 )
Financing activities
15 Unsecured loan note interest paid (309,049 ) (299,080 )
Purchase of shares (525,920 ) (3,072,196 )
15 Buyback of zero dividend preference shares (7,875,000 ) –
Share ownership scheme participation 41,401 149,568
Net cash used in nancing activities (8,668,568 ) (3,221,708 )
Decrease in cash and cash equivalents (7,762,219 ) (5,321,344 )
Eect of exchange rate uctuations on cash and cash equivalents (1,294 ) 2,310
Cash and cash equivalents at start of year 22,226,008 27,545,042
13 Cash and cash equivalents at end of year 14,462,495 22,226,008
Reconciliation of net debt
Cash and cash equivalents
On
31 January
2023
£
Cash
ows
£
Other
non-cash
charge
£
On
31 January
2024
£
Cash at bank 22,226,008 (7,762,219) (1,294) 14,462,495
Unsecured loan note instruments (3,987,729) 309,049 (309,049) (3,987,729)
Zero dividend preference shares (20,721,001) 7,875,000 (868,190) (13,714,191)
Net debt (2,482,722) 421,830 (1,178,533) (3,239,425)
The accompanying notes form an integral part of these nancial statements.
58
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
1 General information
On 25 July 2003, the Company was incorporated with limited liability in the Isle of Man. On 23 July 2012, the
Company then re-registered in the Isle of Man in order to bring the Company within the Isle of Man Companies
Act 2006, with registration number 008597V. On 11 September 2018, the Company re-registered under the
Bermuda Companies Act 1981, with registration number 53954. The Company moved its operations to Jersey with
immediate effect on 17 May 2017 and has subsequently operated from Jersey only.
The Company’s ordinary shares are quoted on AIM, a market operated by the London Stock Exchange, and
the Growth Market of the Aquis Stock Exchange (formerly the NEX Exchange). The Company’s zero dividend
preference shares are admitted to trade on the main market of the London Stock Exchange (standard listed).
The Company’s unsecured loan notes are quoted on the Aquis Stock Exchange.
The Company’s portfolio investments are held in two majority owned subsidiary entities, ESO Investments 1
Limited and ESO Investments 2 Limited and one wholly owned subsidiary entity, ESO Alternative Investments LP
(together the “Subsidiaries”). ESO Investments 1 Limited and ESO Investments 2 Limited operate out of Jersey and
ESO Alternative Investments LP operates out of the United Kingdom.
Direct interests in the individual portfolio investments are held by the following Subsidiaries;
| • | ESO Investment 1 Limited: Rayware, Whittard, David Phillips and Denzel’s |
| • | ESO Investments 2 Limited: Luceco and Pharmacy2U |
| • | ESO Alternative Investments LP: European Capital Private Debt Fund LP, Atlantic Credit Opportunities DAC, |
| EPIC Acquisition Corp and EAC Sponsor Limited |
The above Subsidiaries are subsidiary holding vehicles and are not consolidated in accordance with IFRS 10 as
detailed in Notes 3a and 3b.
The Company also controls the EPIC Private Equity Employee Benefit Trust (referred herein as the “EBT
subsidiary”), an employee benefit trust, which financial position and results are consolidated in these financial
statements (refer to Notes 3a and 7 for details). These financial statements are consolidated financial statements
of the Company and the EBT subsidiary. The Company and the EBT subsidiary are collectively referred to as the
“Group” hereinafter.
The Group’s primary objective is to provide long-term return on equity for its shareholders by investing between
£2m and £30m in small and medium sized companies.
The Group targets growth capital and buy-out opportunities, special situations and distressed transactions,
deploying capital where it believes the potential for shareholder value creation to be compelling. ESO has the
flexibility to invest in public as well as private companies and is also able to invest in Special Purpose Acquisition
Companies (“SPACs”) and third party funds.
ESO will consider most industry sectors including business services, consumer and retail, financial services and
the industrials sector.
The portfolio is likely to be concentrated, numbering between two and ten assets at any one time, which allows
the Group to allocate the necessary resource to form genuinely engaged and supportive partnerships with
management teams. This active approach facilitates the delivery of truly transformational initiatives in underlying
investments during the Group’s period of ownership.
The Group has no employees.
Notes to the Consolidated Financial Statements
For the year ended 31 January 2024
59
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
1 General information (continued)
The following significant changes occurred during the year ended 31 January 2024:
| • | In July 2023, the Company completed the realisation of its holdings in Atlantic Credit Opportunities Fund and |
| in August 2023 completed the realisation of its holdings in Prelude Structured Alternatives Master Fund LP, | |
| with both realised at carrying value. | |
| • | In January 2024, EPIC Acquisition Corp. announced that it will return all residual capital to third parties and |
| wind up. The valuation methodology for EPIC Acquisition Corp. and EAC Sponsor Limited was amended to a | |
| liquidation valuation, implying a reduction in the aggregate value of the holdings. As a result, the designation of | |
| the level of fair value hierarchy of EPIC Acquisition Corp was amended to Level 3 from Level 2 as at 31 January | |
| 2023 (see note 12). | |
| • | In July 2023, the Company completed the buyback of 7.5 million zero dividend preference shares (“ZDP”). |
| Following this buyback, the Company has 12.5 million ZDP shares remaining in issue, maturing in December | |
| 2026 for a value of £7,875,000 (see note 15). | |
| • | The movement in the value of investments and fair value movement are deemed as significant changes |
| during the period (see note 12). |
2 Basis of preparation
a. Statement of compliance
The financial statements have been prepared in accordance with IFRS Accounting Standards as issued by the
International Accounting Standards Board (“IFRS Accounting Standards”) and applicable legal and regulatory
requirements of Bermuda Companies Act 1981. The following accounting policies have been adopted and applied
consistently. The financial statements comply with IFRS Accounting Standards as issued by the International
Accounting Standards Board (IASB).
b. Basis of measurement
The financial statements have been prepared on the historical cost convention except for financial instruments at
fair value through profit or loss which are measured at fair value (note 12). The following are amendments that the
Group has decided not to adopt early:
| • | Standards and amendments to existing standards effective 1 January 2023 |
| There are no standards, amendments to standards or interpretations that are effective for annual periods | |
| beginning on 1 January 2023 that have a material effect on the financial statements of the Group. | |
| • | New standards, amendments and interpretations effective after 1 January 2023 and have not been |
| early adopted | |
| A number of new standards, amendments to standards and interpretations are effective for annual periods | |
| beginning after 1 January 2023, and have not been early adopted in preparing these financial statements. | |
| None of these are expected to have a material effect on the financial statements of the Group. |
60
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Notes to the Consolidated Financial Statements
For the year ended 31 January 2024 (continued)
2 Basis of preparation (continued)
c. Functional and presentation currency
These financial statements are presented in Sterling, which is the Group’s functional and presentation currency. All
financial information presented in Sterling has been rounded to the nearest pound.
‘Functional currency’ is the currency of the primary economic environment in which the Group operates.
The expenses (including investment advisory and administration fees) and investments are denominated and
paid in Sterling. Accordingly, management has determined that the functional currency of the Group is Sterling.
A foreign currency transaction is recorded initially at the rate of exchange at the date of the transaction. Assets
and liabilities are translated from foreign currency to the functional currency at the closing rate at the end of the
reporting period. The resulting gains or losses are included in the Consolidated Statement of Comprehensive
Income.
d. Use of estimates and judgements
The preparation of financial statements in conformity with IFRS Accounting Standard requires the Directors and
the Investment Advisor to make judgements, estimates and assumptions that affect the application of policies and
the reported amounts of assets and liabilities, income and expense. The estimates and associated assumptions
are based on historical experience and various other factors that are believed to be reasonable under the
circumstances, the results of which form the basis of making the judgements about carrying values of assets and
liabilities that are not readily apparent from other sources. The Directors have, to the best of their ability, provided
as true and fair a view as is possible. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates
are recognised in the period in which the estimate is revised if the revision affects only that period or in the period
of the revision and future periods if the revision affects both current and future periods.
Critical accounting estimates and assumptions made by Directors and the Investment Advisor in the application
of IFRS Accounting Standards that have a significant effect on the financial statements and estimates with a
significant risk of material adjustments in the year relate to the determination of fair value of financial instruments
with significant unobservable inputs (see note 12).
The critical judgements made by the Directors and the Investment Advisor in preparing these financial
statements are:
• Classification of the zero dividend preference share as a non-current liability in the Consolidated Statement
of Assets and Liabilities. The zero dividend preference shares meet the definition of a non-current liability as
detailed in note 3(l). Please refer to note 15 for further details.
• Categorisation of ESO Alternative Investments LP, ESO Investments 1 Limited and ESO Investments 2 Limited
as Subsidiaries. The Company is deemed to have control over these Subsidiaries. Please refer to note 3(a)
for details.
61
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
2 Basis of preparation (continued)
e. Unconsolidated structured entities
The Company invests in portfolio investments through its Subsidiaries. See note 3(a) for an explanation of why
these entities are considered controlled subsidiary investments. The purpose of the Subsidiaries is to hold
investments. The Subsidiaries meet the definition of unconsolidated structured entities under IFRS 12. There are
letters of support in place between the Company and ESO Investments 1 Limited and ESO Investments 2 Limited
for the payment of expenses. ESO Alternative Investments LP pays its own expenses.
The total fair value of the Subsidiaries, and the amount recognised in the Company’s financial statements (as
investments at fair value) is £100,722,039 (2023: £100,412,977).
In respect of ESO Alternative Investments LP, the Company has 100% beneficial ownership of the entity.
In respect of ESO Investments 1 Limited, the Company has 80% beneficial ownership of the entity.
In respect of ESO Investments 2 Limited, the Company has 80% beneficial ownership of the entity.
There are no restrictions on the ability of the above Subsidiaries to transfer funds to the Company in the form of
cash dividends or loan repayments.
The Company’s maximum exposure to loss from its interest in its Subsidiaries is equal to the total fair value of its
investment in its Subsidiaries.
The Company’s Subsidiaries invest in quoted and unquoted securities, in line with the Company’s investment policy.
The value of these investments may be impacted by market price risk arising from uncertainty about the future
market value of these holdings as well as the risk of underperformance of the underlying portfolio companies.
The exposure to investments in Subsidiaries measured at fair value is disclosed in the following table :
| 31 January | ||
| 2024 | ||
| £ | ||
| 31 January | ||
| 2023 | ||
| £ | ||
| ESO Investments 1 Limited | 52,200,243 | 43,217,307 |
| ESO Investments 2 Limited | 42,722,072 | 44,330,483 |
| ESO Alternative Investments LP | 5,799,724 | 12,865,187 |
| 100,722,039 | 100,412,977 |
During the year ended 31 January 2024 total net profit incurred on the fair value movement on investments in
Subsidiaries was £3,384,604 (2023: loss of £39,438,551) (as set out in note 11).
f. Going concern
The Group’s management has assessed the Group’s ability to continue as a going concern and is satisfied that
the Group has adequate resources to continue in business for at least twelve months from the date of approval
of financial statements. Furthermore, the management is not aware of any material uncertainties that may cast
significant doubt upon the Group’s ability to continue as a going concern. Therefore, the financial statements
continue to be prepared on the going concern basis.
62
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Notes to the Consolidated Financial Statements
For the year ended 31 January 2024 (continued)
3 Material accounting policy information
a. Subsidiaries and consolidation
The Company has subsidiaries which have been determined to be controlled subsidiary investments. Controlled
subsidiary investments are measured at fair value through profit or loss and are not consolidated in accordance
with IFRS 10. The fair value of controlled subsidiary investments is determined on a consistent basis to all other
investments measured at fair value through profit or loss, and as described in note 3.i.
A controlled subsidiary investment involves holding companies over which the Company has the power to govern
the financial and operating policies. These holding companies are subsidiaries that have been incorporated
for the purpose of holding underlying investments on behalf of the Company. Such holding companies have
no operations other than providing a vehicle for the acquisition, holding and onward sale of certain portfolio
investment companies. The holding companies are also reflected at its fair value, with the key fair value driver
thereof being the investment in the underlying portfolio company investments that the holding company holds
on behalf of the Company. The holding companies require no consolidation, because the holding companies are
not deemed to be providing investment related services, as defined by IFRS 10.
Where the Company is deemed to have control over an underlying portfolio company, either directly or indirectly,
and whether the control is via voting rights or through the ability to direct the relevant activities in return for
access to a significant portion of the variable gains and losses derived from those relevant activities, the Company
does not consolidate the underlying portfolio company; instead, the Company reflects its investment at fair value
through profit or loss.
The EPIC Private Equity Employee Benefit Trust (“EBT Subsidiary or Trust”) is treated as a subsidiary and
consolidated in the financial statements. The impact on the financial statements is immaterial. All transactions
and balances between the Company and EBT Subsidiary are eliminated on consolidation. Amounts reported in
the financial statements have been adjusted where necessary to ensure consistency with the accounting policies
adopted by the Company. Please refer to note 7 for more details.
b. Investment entity
IFRS 10: “Consolidated Financial Statements”, provides an exception to the consolidation requirement for entities
that meet the definition of an investment entity.
The Directors believe the Company meets the definition of an investment entity as the following conditions exist:
• The Company obtains funds from its members for the purpose of providing those members with investment
management services;
• The Company commits to its members that its business purpose is to invest funds solely for returns from
capital appreciation, investment income, or both; and
• The Company measures and evaluates the performance of substantially all of its investments on a fair
value basis.
The exception to consolidation requires investment entities to account for subsidiaries at fair value through profit
or loss.
c. Segmental reporting
The Directors are of the opinion that the Company is engaged in a single segment of business and geographic
area, being arranging financing for growth, buyout and special situations investments in the United Kingdom.
Information presented to the Board of Directors for the purpose of decision making is based on this single
segment. All significant operating decisions are based upon the analysis of the Company’s investments as a single
operating segment. The financial information from this segment are equivalent to the financial information of the
Company as a whole, which are evaluated on a regular basis by the Board of Directors.
63
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
3 Material accounting policy information (continued)
d. Income
Interest income is recognised as it accrues in profit or loss, using the effective interest method. Dividend income
is accounted for when the right to receive such income is established.
e. Expenses
All expenses are accounted for on an accrual basis.
f. Cash and cash equivalents
Cash and cash equivalents comprise of current cash deposits with banks only. Cash equivalents are short-term,
highly liquid investments that are readily convertible to known amounts of cash and which are subject to
insignificant risk of changes in value.
g. Finance charges
Other finance charges are recognised as an expense.
h. Trade and other payables
Trade and other payables are stated at amortised cost in accordance with IFRS 9.
i. Unsecured loan note instruments
Unsecured loan note instruments are stated at amortised cost in accordance with IFRS 9.
j. Financial assets and financial liabilities
A. Classification
Financial assets
When the Group first recognises a financial asset, it classifies it based on the business model for managing the
asset and the asset’s contractual cash flow characteristics, as follows:
• Amortised cost: a financial asset is measured at amortised cost if both of the following conditions are met:
– the asset is held within a business model whose objective is to hold assets in order to collect contractual
cash flows; and
– the contractual terms of the financial asset give rise on specified dates to cash flows that are solely
payments of principal and interest on the principal amount outstanding.
• Fair value through other comprehensive income: financial assets are classified and measured at fair value
through other comprehensive income if they are held in a business model whose objective is achieved by both
collecting contractual cash flows and selling financial assets.
• Fair value through profit or loss: any financial assets that are not held in one of the two business models
mentioned are measured at fair value through profit or loss.
When, and only when, the Group changes its business model for managing financial assets it must reclassify all
affected financial assets.
64
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Notes to the Consolidated Financial Statements
For the year ended 31 January 2024 (continued)
3 Material accounting policy information (continued)
Financial liabilities
All financial liabilities are measured at amortised cost, except for financial liabilities at fair value through profit or loss.
Such liabilities include derivatives (other than derivatives that are financial guarantee contracts or are designated
and effective hedging instruments), other liabilities held for trading, and liabilities that an entity designates to be
measured at fair value through profit or loss.
B. Recognition
The Group recognises financial assets and financial liabilities on the date it becomes a party to the contractual
provisions of the instrument.
C. Measurement
Equity and debt investments, including those held by Subsidiaries, are stated at fair value. Loans and Receivables
are stated at amortised cost less any impairment losses.
The Investment Advisor determines asset values using the valuation principles of IFRS 13.
‘Fair value’ is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date in the principal or, in its absence, the most advantages
market to which the Group has access at that date. The fair value of a liability reflects its non-performance risk.
When available, the Company measures the fair value of an instrument using the quoted price in an active market
for that instrument. A market is regarded as ‘active’ if transactions for the asset or liability take place with sufficient
frequency and volume to provide pricing information on an ongoing basis. The Company measures instruments
quoted in an active market at closing price on the relevant exchange at the measurement date.
If there is no quoted price in an active market, then the Company uses valuation techniques that maximise the
use of relevant observable inputs and minimise the use of unobservable inputs. The chosen valuation technique
incorporates all of the factors that market participants would take into account in pricing a transaction.
The Company recognises transfers between levels of the fair value hierarchy as at the end of the reporting period
during which the change has occurred.
The amortised cost of a financial asset or financial liability is the amount at which the financial asset or financial
liability is measured at initial recognition, minus principal repayments, plus or minus the cumulative amortisation
using the effective interest method of any difference between the initial amount recognised and the maturity
amount, minus any reduction for impairment. Financial assets that are not carried at fair value though profit and
loss are subject to an impairment test. For loans to portfolio companies the impairment test is undertaken as part
of the assessment of the fair value of the enterprise value of the related business, as described above. If expected
life cannot be determined reliably, then the contractual life is used.
D. Impairment
12-month expected credit losses
12-month expected credit losses are calculated by multiplying the probability of a default occurring in the next
12 months with the total (lifetime) expected credit losses that would result from that default, regardless of when
those losses occur. Therefore, 12-month expected credit losses represent a financial asset’s lifetime expected
credit losses that are expected to arise from default events that are possible within the 12 month period following
origination of an asset, or from each reporting date for those assets in initial recognition stage.
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EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
3 Material accounting policy information (continued)
Lifetime expected credit losses
Lifetime expected credit losses are the present value of expected credit losses that arise if a borrower defaults on
its obligation at any point throughout the term of a lender’s financial asset (that is, all possible default events during
the term of the financial asset are included in the analysis). Lifetime expected credit losses are calculated based
on a weighted average of expected credit losses, with the weightings being based on the respective probabilities
of default.
E. Derecognition
The Company derecognises a financial asset when the contractual rights to the cash flows from the financial asset
expire or it transfers the financial asset and the transfer qualifies for derecognition in accordance with IFRS 9.
The Company uses the weighted average method to determine realised gains and losses on derecognition.
A financial liability is derecognised when the obligation specified in the contract is discharged, cancelled or expired.
k. Share capital
Ordinary share capital
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary shares and
share options are recognised as a deduction from equity, net of any tax effects.
Repurchase of share capital (treasury shares)
When share capital recognised as equity is repurchased, the amount of the consideration paid, which includes
directly attributable costs, net of any tax effects, is recognised as a deduction from equity. Repurchased shares
are classified as treasury shares and are presented as a deduction from total equity. When treasury shares are
sold or reissued subsequently, the amount received is recognised as an increase in equity, and the resulting
surplus or deficit on the transaction is transferred to / from revenue reserves.
Capital Reserve and Revenue Reserve and other equity
The capital reserve comprises net gains and losses on investments. The revenue reserve and other equity comprise
other income and expenses plus other items recorded directly in equity (excluding items recorded as share
capital / share premium).
l. Jointly owned share plan (“JOSP”) and share-based payments
Directors of the Company and certain employees of the Investment Advisor (together “Participants”) receive
remuneration in the form of equity-settled share-based payment transactions, through a JOSP Scheme.
Equity-settled share-based payments are measured at fair value at the date of grant. The fair value is determined
based on the share price of the equity instrument at the grant date. The fair value determined at the grant date of
the equity-settled share-based payment is expensed on a straight-line basis over the vesting period, based on the
Company’s estimate of the number of shares that will eventually vest. The instruments are subject to a three-year
service vesting condition from the grant date, and their fair value is recognised as a share-based expense with a
corresponding increase in revenue reserves within equity over the vesting period. Contributions received from
employees as part of the JOSP arrangement are recognised directly in equity in the line share ownership scheme
participation.
The assets (other than investments in the Company’s shares), liabilities, income and expenses of the Trust established
to operate the JOSP scheme are consolidated in these financial statements. Any expense incurred by the Trust are
borne by the Company. The Trust’s investment in the Company’s shares is deducted from shareholders’ funds in
the Consolidated Statement of Asset and Liabilities as if they were treasury shares (see note 7).
66
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Notes to the Consolidated Financial Statements
For the year ended 31 January 2024 (continued)
3 Material accounting policy information (continued)
m. Zero dividend preference shares (“ZDP”)
Under IAS 32 – Financial Instruments: Presentation, the ZDP Shares are classified as financial liabilities and are held
at amortised cost. An accrual for the final capital entitlement of the ZDP Shares is included in the Consolidated
Statement of Comprehensive Income as a finance cost and is calculated using the effective interest rate method
(“EIR”). The costs of issue of the ZDP Shares are amortised over the period to the ZDP Share redemption date.
n. Future changes in accounting policies
Several new standards and interpretations have been published that are not mandatory for 31 January 2024
reporting periods and earlier application is permitted; however, the Group has not adopted early the new or
amended standards in preparing these financial statements.
The Directors do not expect the adoption of the standards and interpretations to have a material impact on the
Group’s financial statements in the period of initial application.
o. Change in categorisation of holding companies
During the year ended 31 January 2023, the Directors reassessed its categorisation of ESO Alternative Investments
LP, ESO Investments 1 Limited and ESO Investments 2 Limited from Associates to Subsidiaries. These entities
were set up by the Company as holding vehicles for investments acquired for the benefit of the Company. The
holding companies are structured entities and as such voting rights or similar rights are not the dominant factor
in decision-making power over them. As a result, the Directors deem the classification of these entities as
Subsidiaries to be more appropriate.
4 Interest income
| 2024 | ||
| Group | ||
| £ | ||
| 2023 | ||
| Group | ||
| £ | ||
| Interest earned on cash balances | 366,660 | 79,899 |
| Total | 366,660 | 79,899 |
67
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
5 Investment advisory, administration and performance fees
Investment advisory fees
The investment advisory fee payable to EPIC Investment Partners LLP (“EPIC”) is assessed and payable at the end
of each fiscal quarter and is calculated as 2 per cent. of the Group’s NAV where the Group’s NAV is less than £100
million; otherwise the investment advisory fee is calculated as the greater of £2.0 million or the sum of 2 per cent.
of the Group’s NAV comprising Level 2 and Level 3 portfolio assets, 1 per cent. of the Group’s NAV comprising
Level 1 assets, no fees on assets which are managed or advised by a third-party manager, 0.5 per cent. of the
Group’s net cash (if greater than nil), and 2 per cent. of the Group’s net cash (if less than nil) (i.e. reducing fees for
net debt positions).
The charge for the current year was £1,832,745 (2023: £1,755,442). The amount outstanding as at 31 January 2024
was £484,400 (2023: £487,107 ) (see note 14).
Administration fees
EPIC Administration Limited provides accounting and financial administration services to the Group. The fee
payable to EPIC Administration Limited is assessed and payable at the end of each fiscal quarter and is calculated
as 0.15 per cent. of the Group’s NAV where the Group’s NAV is less than £100 million (subject to a minimum fee of
£35,000); otherwise the advisory fee shall be calculated as 0.15 per cent. of £100 million plus a fee of 0.1 per cent.
of the excess of the Group’s NAV above £100 million.
The charge for the current year was £141,330 (2023: £147,043).
Other administration fees during the year were £82,406 (2023: £76,302).
Performance fees paid by Subsidiaries
The Subsidiaries are stated at fair value. Performance fees are paid to the Investment Advisor based on the
performance of the Subsidiaries and deducted in calculating the fair value of Subsidiaries.
Performance fee in ESO Investments 1 Limited
The distribution policy of ESO Investments 1 Limited includes an allocation of profits to the Investment Advisor
such that, for each investment where a returns hurdle of 8 per cent. per annum has been achieved, the Investment
Advisor is entitled to receive 20 per cent. of the increase above the base value of investment. As at 31 January
2024, £4,983,792 has been accrued in the profit share account of the Investment Advisor in the records of
ESO Investments 1 Limited (2023: £nil accrued).
Performance fee in ESO Investments 2 Limited
The distribution policy of ESO Investments 2 Limited includes an allocation of profit to the Investment Advisor
such that, for each investment where a returns hurdle of 8 per cent. per annum has been achieved, the Investment
Advisor is entitled to receive 20 per cent. of the increase above the base value of investment. As at 31 January
2024, £9,104,320 has been accrued in the profit share account of the Investment Advisor in the records of ESO
Investments 2 Limited (2023: £9,112,002 accrued).
Joint Owned Share Plan (“JOSP”) and share-based payments
Directors of the Company and certain employees of the Investment Advisor (together “Participants”) receive
remuneration in the form of equity-settled share-based payment transactions, through a JOSP Scheme
(see note 7).
68
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Notes to the Consolidated Financial Statements
For the year ended 31 January 2024 (continued)
6 Directors’ fees
| 2024 | ||||
| Company | ||||
| £ | ||||
| 2024 | ||||
| Share–based | ||||
| payment | ||||
| £ | ||||
| 2023 | ||||
| Company | ||||
| £ | ||||
| 2023 | ||||
| Share–based | ||||
| payment | ||||
| £ | ||||
| C.L. Spears (Chairman) | 42,000 | 6,393 | 42,000 | 9,388 |
| N.V. Wilson (resigned on 30 September 2023) | 22,474 | 5,972 | 32,000 | 9,216 |
| H. Bestwick | 32,000 | 6,393 | 32,000 | 9,388 |
| D.R. Pirouet | 34,000 | 8,298 | 34,000 | 6,132 |
| M.M. Gray | 32,000 | 4,296 | 32,000 | 2,093 |
| Total | 162,474 | 31,352 | 172,000 | 36,217 |
In addition to the fees noted above, C.L. Spears, H. Bestwick and M.M Gray received during the year;
• £3,750 each as Directors’ fees for their directorship of ESO Investments 1 Limited; and
• £3,750 each as Directors’ fees for their directorship of ESO Investments 2 Limited.
Aggregate Directors’ fees for ESO Investments 1 Limited and ESO Investments 2 Limited for the year ended
31 January 2024 amounted to £22,500 (2023 : £22,500).
Nicholas Wilson resigned on 30 September 2023. The share-based payment expense is calculated as set out
in note 7.
7 Share-based payment expense
The cost of equity-settled transactions to Participants in the JOSP Scheme are measured at fair value at the grant
date. The fair value is determined based on the share price of the equity instrument at the grant date.
The Trust was created to award shares to Participants as part of the JOSP. The Trust is consolidated in these
financial statements in accordance with Note 3a. Participants are awarded a certain number of shares (“Matching
Shares”) which are subject to a three-year service vesting condition from the grant date. In order to receive their
Matching Share allocation Participants are required to purchase shares in the Company on the open market
(“Bought Shares”). The Participant will then be entitled to acquire a joint ownership interest in the Matching Shares
for the payment of a nominal amount, on the basis of one joint ownership interest in one Matching Share for every
Bought Share they acquire in the relevant award period.
The Trust holds the Matching Shares jointly with the Participant until the award vests. These shares carry the same
rights as the rest of the ordinary shares.
The Trust held 1,546,693 (2023: 1,290,202) matching shares at the year-end which have historically not voted
(see note 16).
257,061 shares vested to Participants in the year ended 31 January 2024 (2023: 862,290). 305,082 shares were
awarded to Participants in the year ended 31 January 2024 (2023: 156,173). The weighted average fair value of the
shares awarded during the period is 146.33 pence per share.
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EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
7 Share-based payment expense (continued)
The fair value of awards granted under the JOSP is recognised as an employee benefits expense, with a
corresponding increase in equity. This has been calculated on the basis of the fair value of the equity instruments,
which is the share price of the equity instrument on the AIM market of the London Stock Exchange at the grant
date and the estimated number of equity instruments to be issued after the vesting period, less the amount
paid for the joint ownership interest in the Matching Shares from the Participants. As the Company does not pay
dividends, no expected dividends were incorporated into the measurement value. No other features other than
the share price of the equity instrument is incorporated into the measurement of the fair value of the awards.
The impact of revision to original estimates, if any, is recognised in profit or loss, with a corresponding adjustment
to equity.
The total share-based payment expense in the year ended 31 January 2024 was £339,593 (2023: £555,225).
Of the total share-based payment expense in the year ended 31 January 2024, £31,352 related to the Directors
(2023: £36,217) and the balance related to members, employees and consultants of the Investment Advisor.
8 Other expenses
The breakdown of other expenses presented in the Consolidated Statement of Comprehensive Income is
as follows:
| 31 January | ||
| 2024 | ||
| Total | ||
| £ | ||
| 31 January | ||
| 2023 | ||
| Total | ||
| £ | ||
| Administration fees | (223,806) | (223,345) |
| Directors’ and officers’ insurance | (27,993) | (27,464) |
| Professional fees | (145,363) | (94,442) |
| Board meeting and travel expenses | (1,639) | (1,085) |
| Auditors’ remuneration | (81,200) | (61,350) |
| Interim review remuneration* | (26,350) | (17,000) |
| Bank charges | (1,404) | (1,705) |
| Foreign exchange movement | (1,137) | 2,687 |
| Nominated advisor and broker fees | (55,001) | (62,322) |
| Listing fees | (53,472) | (52,769) |
| Sundry expenses | (18,310) | (18,621) |
| Other expenses | (635,675) | (557,416) |
* This relates to the interim review of the half yearly financial report which was performed by the auditors.
9 Taxation
The Company is a tax resident of Jersey and is subject to 0 per cent. corporation tax (2023: 0 per cent.).
ESO Alternative Investments LP is transparent for tax purposes.
ESO Investments 1 Limited and ESO Investments 2 Limited are tax resident in Jersey and are subject to 0 per cent.
(2023: 0 per cent.) corporation tax.
70
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Notes to the Consolidated Financial Statements
For the year ended 31 January 2024 (continued)
10 Dividends paid and proposed
No dividends were paid or proposed for the year ended 31 January 2024 (2023: £nil).
11 Investments at fair value through profit or loss
| 31 January | ||
| 2024 | ||
| £ | ||
| 31 January | ||
| 2023 | ||
| £ | ||
| Investments at fair value through profit and loss* | 100,722,039 | 100,412,977 |
| 100,722,039 | 100,412,997 |
Investments roll forward schedule
| 31 January | ||
| 2024 | ||
| £ | ||
| 31 January | ||
| 2023 | ||
| £ | ||
| Investments at fair value at 1 February | 100,412,977 | 140,525,060 |
| Purchase of investments | 3,350,000 | 3,174,948 |
| Proceeds from investments | (6,425,542) | (3,848,880) |
| Net fair value movements | 3,384,604 | (39,438,551) |
| Reclassification of debtor balance to investee | – | 400 |
| Investments at fair value | 100,722,039 | 100,412,977 |
* Comprises Subsidiaries stated at fair value in accordance with accounting policy set out in note 3(a) (ESO Investments 1
Limited, ESO Investments 2 Limited and ESO Alternative Investments LP).
Discussion of the performance of individual investments is presented in the Chairman’s Statement and the
Investments Advisor’s Report.
12 Fair value of financial instruments
The Company determines the fair value of financial instruments with reference to IPEV guidelines and the valuation
principles of IFRS 13 (Fair Value Measurement). The Company measures fair value using the IFRS 13 fair value
hierarchy, which reflects the significance and certainty of the inputs used in deriving the fair value of an asset:
• Level 1: Inputs that are quoted market prices (unadjusted) in active markets for identical instruments;
• Level 2: Inputs other than quoted prices included within Level 1 that are observable either directly (i.e. as
prices) or indirectly (i.e. derived from prices). This category includes instruments valued using quoted market
prices in active markets for similar instruments, quoted prices for identical or similar instruments in markets
that are considered less than active or other valuation techniques in which all significant inputs are directly or
indirectly observable from market data;
• Level 3: Inputs that are unobservable. This category includes all instruments for which the valuation technique
includes inputs not based on observable data and the unobservable inputs have a significant effect on
the instrument’s valuation. This category includes instruments that are valued based on quoted prices for
similar instruments but for which significant unobservable adjustments or assumptions are required to reflect
differences between the instruments.
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EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
12 Fair value of financial instruments (continued)
The Investment Advisor undertakes the valuation of financial instruments required for financial reporting purposes.
Recommended valuations are reviewed and approved by the Investment’s Advisor’s Valuation Committee for
circulation to the Company’s Board. The Audit and Risk Committee of the Company’s Board meets at least
once every six months, in line with the Company’s semi-annual reporting periods, to review the recommended
valuations and approve final valuations for adoption in the Company’s financial statements.
The Company recognises transfers between levels of the fair value hierarchy at the end of the reporting period
during which the change has occurred.
Valuation framework
The Company employs the valuation framework detailed below with respect to the measurement of fair values.
A valuation of the Company’s investments held via its Subsidiaries are prepared by the Investment Advisor with
reference to IPEV guidelines and the valuation principles of IFRS 13 (Fair Value Measurement). The Investment
Advisor recommends these valuations to the Board of Directors. The Audit and Risk Committee of the Company’s
Board considers the valuations recommended by the Investment Advisor, determines any amendments required
and thereafter adopts the fair values presented in the Company’s financial statements. Changes in the fair value of
financial instruments are recorded in the Consolidated Statement of Comprehensive Income in the line item “Net
fair value movement on investments”.
Quoted investments
Quoted investments traded in an active market are classified as Level 1 in the IFRS 13 fair value hierarchy. The
investment in Luceco is a Level 1 asset. For Level 1 assets, the holding value is calculated from the closing price
on the relevant exchange at the measurement date.
Quoted investments traded in markets that are considered less than active are classified as Level 2 in the IFRS
13 fair value hierarchy. The investment in EPIC Acquisition Corp was considered to be a Level 2 asset in the
year ended 31 January 2023. For the year ended 31 January 2024, the investment in EPIC Acquisition Corp is
considered to be a Level 3 asset, and therefore no assets are considered to be Level 2.
Unquoted private equity investments and unquoted fund investments
Private equity investments and fund investments are classified as Level 3 in the IFRS 13 fair value hierarchy. The
investments in Whittard, David Phillips, Rayware, Denzel’s, Pharmacy2U, European Capital Private Debt Fund LP,
EPIC Acquisition Corp and EAC Sponsor Limited are considered to be Level 3 assets. Various valuation techniques
may be applied in determining the fair value of investments held as Level 3 in the fair value hierarchy;
• For underperforming assets, net asset or liquidation valuation is considered more applicable, in particular
where the business’ performance be contingent on shareholder financial support;
• For performing assets, market approach is considered to be the most appropriate with a specific focus on
trading comparables, applied on a forward basis. Transaction comparables, applied on a historic basis may
also be considered. The financial metric to which the multiple is applied will depend on the stage of the
company and the sector in which it operates. Typically, mature companies will be valued on the basis of the
basis of an EBITDA multiple, while growth companies will be valued on the basis of a sales multiple;
• For assets managed and valued by third party managers, the valuation methodology of the third party manager
is reviewed. If deemed appropriate and consistent with reporting standards, the valuation prepared by the
third-party manager will be used.
72
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Notes to the Consolidated Financial Statements
For the year ended 31 January 2024 (continued)
12 Fair value of financial instruments (continued)
For the year ended 31 January 2024, a public comparable sales multiple valuation is employed for the investment
in Denzel’s. The valuation methodology has been amended from investment cost given the elapsed time since
investment, with changes in market conditions and trading outlook in the intervening period.
The Investment Advisor believe that it is appropriate to apply an illiquidity discount to the multiples of comparable
companies when using them to calculate valuations for small, private companies. This discount adjusts for the
difference in size between generally larger comparable companies and the smaller assets being valued. The
illiquidity discount also considers the premium the market gives to comparable companies for being freely
traded or listed securities. The Investment Advisor has determined between 15 per cent. and 25 per cent. to be
an appropriate illiquidity discount with reference to market data and transaction multiples seen in the market in
which the Investment Advisor operates.
Where portfolio investments are held through subsidiary holding companies, the net assets of the holding
company are added to the value of the portfolio investment being assessed to derive the fair value of the holding
company held by the Company.
EPIC Acquisition Corp and EAC Sponsor Limited
EPIC Acquisition Corp (“EAC”) is a special purpose acquisition company (“SPAC”). For the year ended 31 January
2024, a liquidation valuation is employed for the holdings in EPIC Acquisition Corp and EAC Sponsor Limited,
calculated on the basis of the value of ESO Alternative Investments LP’s holding in a liquidation scenario. The
investments are considered as Level 3 assets. For the year ended 31 January 2023, EPIC Acquisition Corp was
valued on a marked to market basis and considered a Level 2 asset and EAC Sponsor Limited was valued on the
basis of a probability weighted range of implied values under potential realisation scenarios and considered a
Level 3 asset. The valuation methodology has been amended to a liquidation value to reflect the announcement in
January 2024 that EPIC Acquisition Corp. will return all residual capital to third parties and wind up. The liquidation
valuation approach implies both assets are considered Level 3 assets.
Although management believes that its estimates of fair value are appropriate, the use of different methodologies
or assumptions could lead to different measurements of fair value. For fair value measurements of EPIC Acquisition
Corp and EAC Sponsor Limited’s assets, changing one or more of the assumptions used to reasonably possible
alternative assumptions would have the following effects on the investment valuations. The key inputs into the
preparation of the valuations of EPIC Acquisition Corp and EAC Sponsor Limited were the distributions available
in a liquidation scenario to EAC Sponsor Limited. If these inputs had been taken at the higher end of the range of
expected realisations, the value of these assets and profit for the year would have been £33,299 higher. If these
inputs had been taken at the lower end of the range, their would be nil change to the value of these assets and
profit for the year, given the valuation is prepared on a nil realisation basis. This sensitivity excludes amounts held
by EPIC Acquisition Corp. in escrow, which will deliver a fixed distribution in the event of a liquidation scenario.
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Report and Accounts for the year ended 31 January 2024
12 Fair value of financial instruments (continued)
Fair value hierarchy – Financial instruments measured at fair value
The Company’s investments in the Subsidiaries at 31 January 2024 are classified as Level 3 (in line with 31 January
2023), given the variation in classification of the underlying assets. The Company values these investments on the
basis of the net asset value of these holdings.
The table below analyses the underlying investments held by the Subsidiaries measured at fair value at the
reporting date by the level in the fair value hierarchy into which the fair value measurement is categorised.
The Board assesses the fair value of the total investment, which includes debt and equity.
The tables below show the gross amount and the net amount of all investments held via the Subsidiaries per
the fair value hierarchy. The net amount is a result of the application of profit share adjustments relating to the
performance fees discussed in Note 5.
| 31 January 2024 | |||
| Level 1 | |||
| £ | |||
| Level 3 | |||
| £ | |||
| Total | |||
| £ | |||
| Financial assets at fair value through profit or loss | |||
| Unquoted private equity investments (including debt) | – | 59,103,536 | 59,103,536 |
| Fund investments | – | 451,348 | 451,348 |
| Quoted investments* | 48,865,293 | 5,262,427 | 54,127,720 |
| Investments at fair value through profit or loss | 48,865,293 | 64,817,311 | 113,682,604 |
| Other asset and liabilities (held at cost) | – | – | 1,127,547 |
| Performance fee adjustment | (8,732,750) | (5,355,362) | (14,088,112) |
| Total | 40,132,543 | 59,461,949 | 100,722,039 |
| 31 January 2023 | ||||
| Level 1 | ||||
| £ | ||||
| Level 2 | ||||
| £ | ||||
| Level 3 | ||||
| £ | ||||
| Total | ||||
| £ | ||||
| Financial assets at fair value through profit or loss | ||||
| Unquoted private equity investments (including debt) | – | – | 47,752,184 | 47,752,184 |
| Unquoted fund investments | – | – | 3,184,749 | 3,184,749 |
| Quoted investments | 50,501,249 | 5,495,557 | – | 55,996,806 |
| Investments at fair value through profit or loss | 50,501,249 | 5,495,557 | 50,936,933 | 106,933,739 |
| Other asset and liabilities (held at cost) | – | – | – | 2,591,240 |
| Performance fee adjustment | (8,743,708) | – | (368,294) | (9,112,002) |
| Total | 41,757,541 | 5,495,557 | 50,568,639 | 100,412,977 |
* There has been a change in the designation of the level of fair value hierarchy of EPIC Acquisition Corp from Level 2 to
Level 3 during the current year, with the valuation methodology amended to a liquidation value approach.
74
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Notes to the Consolidated Financial Statements
For the year ended 31 January 2024 (continued)
12 Fair value of financial instruments (continued)
The following table, detailing the value of portfolio investments only, shows a reconciliation of the opening balances
to the closing balances for fair value measurements in Level 3 of the fair value hierarchy for the underlying
investments held by the Subsidiaries.
| Unquoted investments (including debt) | ||
| 31 January | ||
| 2024 | ||
| £ | ||
| 31 January | ||
| 2023 | ||
| £ | ||
| Balance as at 1 February | 50,568,639 | 47,886,854 |
| Additional investments | 3,350,912 | 2,086,948 |
| Capital distributions from investments | (2,694,993) | (2,235,136) |
| Transfer to Level 3 investments | 5,495,557 | – |
| Change in fair value through profit & loss | 2,741,834 | 2,829,973 |
| Balance as at 31 January | 59,461,949 | 50,568,639 |
Significant unobservable inputs used in measuring fair value
The table below sets out information about significant unobservable inputs used at 31 January 2024 in measuring
financial instruments categorised as Level 3 in the fair value hierarchy.
| Description | ||
| Fair value at | ||
| 31 January | ||
| 2024 | ||
| £ | Significant unobservable inputs | |
| Unquoted private equity investments (including debt) | 53,748,174 | Sales / EBITDA multiple |
| Fund investments | 5,713,775 | Reported net asset value or liquidation value |
Significant unobservable inputs are developed as follows:
• Trading comparable multiple: valuation multiples used by other market participants when pricing comparable
assets. Relevant comparable assets are selected from public companies determined to be proximate to the
investment based on similarity of sector, size, geography or other relevant factors. The valuation multiple for a
comparable company is determined by calculating the enterprise value of the company implied by its market
price as at the reporting date and dividing by the relevant financial metric (sales or EBITDA).
• Reported net asset value: for assets managed and valued by a third party, the manager provides periodic
valuations of the investment. The valuation methodology of the third-party manager is reviewed. If deemed
appropriate and consistent with reporting standards, the Board will adopt the valuation prepared by the
third-party manager. Adjustments are made to third party valuations where considered necessary to arrive at
the Director’s estimate of fair value.
• Investment cost: for recently acquired assets (typically completed in the last twelve months), the Investment
Advisor considers the investment cost an appropriate fair value for the asset. No asset was valued using
investment cost as at 31 January 2024.
• Liquidation value: for underperforming assets, the Investment Advisor considers the value recovered in the
event of a liquidation of the asset an appropriate fair value for the asset.
75
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
12 Fair value of financial instruments (continued)
Although management believes that its estimates of fair value are appropriate, the use of different methodologies
or assumptions could lead to different measurements of fair value. For fair value measurements of Level 3 assets,
changing one or more of the assumptions used to reasonably possible alternative assumptions would have the
following effects on the Level 3 investment valuations:
• For the Company’s investment in mature Level 3 assets, the valuations used in the preparation of the
financial statements imply an average EV to EBITDA multiple of 7.2x (weighted by each asset’s total valuation)
(2023: 6.7x). The key unobservable inputs into the preparation of the valuation of mature Level 3 assets was
the EBITDA multiple applied to the asset’s financial forecasts. A sensitivity of 25 per cent. has been applied
to these multiples, in line with the maximum liquidity discount employed in the valuations. If these inputs had
been taken to be 25 per cent. higher, the value of the Level 3 assets and profit for the year would have been
£15,161,561 higher. If these inputs had been taken to be 25 per cent. lower, the value of the Level 3 assets and
profit for the year would have been £17,786,484 lower. A corresponding increase or decrease in the asset’s
financial forecasts would have a similar impact on the Company’s assets and profit.
• For the Company’s investment in growth Level 3 assets, the valuations used in the preparation of the financial
statements imply an average EV to sales multiple of 1.5x (weighted by each asset’s total valuation) (2023:
1.4x). The key unobservable inputs into the preparation of the valuation of growth Level 3 assets were the
sales multiple applied to the asset’s financial forecasts. A sensitivity of 25 per cent. has been applied to these
multiples, in line with the maximum liquidity discount employed in the valuations. If these inputs had been
taken to be 25 per cent. higher, the value of the Level 3 assets and profit for the year would have been
£860,072 higher. If these inputs had been taken to be 25 per cent. lower, the value of the Level 3 assets
and profit for the year would have been £707,743 lower. A corresponding increase or decrease in the asset’s
financial forecasts would have a similar impact on the Company’s assets and profit.
Classification of financial assets and liabilities
The table below sets out the classifications of the carrying amounts of the Company’s financial assets and liabilities
into categories of financial instruments.
| 31 January 2024 | |||
| At fair | |||
| value | |||
| £ | |||
| At amortised | |||
| cost | |||
| £ | |||
| Total | |||
| £ | |||
| Financial assets | |||
| Investments at fair value through profit or loss | 100,722,039 | – | 100,722,039 |
| Cash and cash equivalents | – | 14,462,495 | 14,462,495 |
| 100,722,039 | 14,462,495 | 115,184,534 | |
| Financial liabilities | |||
| Trade and other payables | – | 676,284 | 676,284 |
| Unsecured loan note instruments* | – | 3,987,729 | 3,987,729 |
| Zero dividend preference shares** | – | 13,714,191 | 13,714,191 |
| – | 18,378,204 | 18,378,204 |
76
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Notes to the Consolidated Financial Statements
For the year ended 31 January 2024 (continued)
12 Fair value of financial instruments (continued)
| 31 January 2023 | |||
| At fair | |||
| value | |||
| £ | |||
| At amortised | |||
| cost | |||
| £ | |||
| Total | |||
| £ | |||
| Financial assets | |||
| Investments at fair value through profit or loss | 100,412,977 | – | 100,412,977 |
| Cash and cash equivalents | – | 22,226,008 | 22,226,008 |
| 100,412,977 | 22,226,008 | 122,638,985 | |
| Financial liabilities | |||
| Trade and other payables | – | 596,790 | 596,790 |
| Unsecured loan note instruments* | – | 3,987,729 | 3,987,729 |
| Zero dividend preference shares** | – | 20,721,001 | 20,721,001 |
| – | 25,305,520 | 25,305,520 |
* The Directors consider that the fair value of the unsecured loan note instruments is the same as its carrying value.
** The Directors consider that the fair value of the zero dividend preference shares is £12,812,500 (2023: £19,100,000) calculated
on the basis of the quoted price of the instrument on the London Stock Exchange of 102.50 pence as at 31 January 2024
(2023: 95.50 pence).
13 Cash and cash equivalents
| 2024 | ||
| £ | ||
| 2023 | ||
| £ | ||
| Current and call accounts | 14,462,495 | 22,226,008 |
| 14,462,495 | 22,226,008 |
The current and call accounts have been classified as cash and cash equivalents in the Consolidated Statement
of Cash Flows.
14 Trade and other payables
| 2024 | ||
| £ | ||
| 2023 | ||
| £ | ||
| Trade payables | 91,297 | 1,008 |
| Accrued administration fee | 36,330 | 36,533 |
| Accrued audit fee | 20,918 | 9,920 |
| Accrued professional fee | 29,272 | 45,489 |
| Accrued investment advisor fees | 484,400 | 487,107 |
| Accrued Directors’ fees | 11,667 | 14,333 |
| Other payables | 2,400 | 2,400 |
| Total | 676,284 | 596,790 |
77
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
15 Liabilities
Unsecured Loan Notes (“ULN”)
The Company has issued ULN’s that are redeemable on 24 July 2024, following the extension of their maturity
in July 2023. The Company’s ULN’s are quoted on the Aquis Stock Exchange. The interest rate for the period
up to 23 July 2023 was 7.5 per cent per annum. The interest rate was increased to 8.0 per cent per annum for
the period subsequent to 23 July 2023. At 31 January 2024, £3,987,729 (2023: £3,987,729) of ULNs in principal
amount were outstanding. Issue costs totalling £144,236 have been offset against the value of the loan note
instrument and have been amortised over the period to 24 July 2022. The total issue costs expensed in the year
ended 31 January 2024 was £nil (2023: £10,303). The carrying value of the ULNs in issue at the year end was
£3,987,729 (2023: £3,987,729). The total interest expense for the ULNs for the year is £309,049 (2023: £309,382).
The comparatives for interest expense includes the amortisation of the issue costs. The carrying value of the ULN
is presented under current liabilities in the current period as they are redeemable within 12-month period from
the Consolidated Statement of Assets and Liabilities date. The ULN has in place Financial Covenants including an
Interest Coverage Test (that the ratio of cash and cash equivalents to interest payable is greater than or equal to
6:1) and a Gross Asset Test (that the ratio of gross asset value to financial indebtedness of the Company is greater
than or equal to 2:1). The Covenants have been met for the years ended 31 January 2024 and 31 January 2023.
Zero Dividend Preference Shares (“ZDP Shares”)
On 17 December 2021 the Company issued 20,000,000 ZDP Shares at a price of £1 per share, raising £20,000,000.
The Company’s ZDP shares are admitted to trade on the main market of the London Stock Exchange (standard
listed). The ZDP Shares will not pay dividends but have a final capital entitlement at maturity on 16 December 2026
of 129.14 pence per ZDP Share. It should be noted that the predetermined capital entitlement of a ZDP Share is not
guaranteed and is dependent upon the Company’s gross assets being sufficient on 16 December 2026 to meet
the final capital entitlement. Under IAS 32 – Financial Instruments: Presentation, the ZDP Shares are classified as
financial liabilities and are held at amortised cost. Issue costs totalling £573,796 have been offset against the value
of the ZDP Shares and are being amortised over the life of the instrument. In July 2023, the Company completed
the repurchase of 7,500,000 ZDP shares, which are held in treasury. Following this buyback, the Company has
12,500,000 ZDP shares remaining in issue. The total issue costs expensed in the year ended 31 January 2024 was
£115,359 (2023: £115,359). The carrying value of the ZDP Shares in issue at the year-end was £13,714,191 (2023:
£20,721,001). The total finance charge for the ZDP Shares for the year is £868,190 (2023: £1,128,093). This includes
the ZDP Share finance charge and the amortisation of the Issue costs.
| 31 January | ||
| 2024 | ||
| £ | ||
| 31 January | ||
| 2023 | ||
| £ | ||
| Balance as at 1 February | 20,721,001 | 19,580,190 |
| ZDP non cash charge | 945,348 | 1,140,811 |
| Buyback of ZDP shares | (7,952,158) | – |
| Total | 13,714,191 | 20,721,001 |
78
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Notes to the Consolidated Financial Statements
For the year ended 31 January 2024 (continued)
16 Share capital
| 2024 | ||||
| Number | ||||
| 2024 | ||||
| £ | ||||
| 2023 | ||||
| Number | ||||
| 2023 | ||||
| £ | ||||
| Authorised share capital | ||||
| Ordinary shares of 5p each | 45,000,000 | 2,250,000 | 45,000,000 | 2,250,000 |
| Called up, allotted and fully paid | ||||
| Ordinary shares of 5p each | 34,616,554 | 1,730,828 | 34,616,554 | 1,730,828 |
| Ordinary shares of 5p each held in treasury | (4,739,707) | – | (4,951,575) | – |
| 29,876,847 | 1,730,828 | 29,664,979 | 1,730,828 | |
| Share Premium | – | 13,619,627 | – | 13,619,627 |
No shares were issued during the year ended 31 January 2024 and year ended 31 January 2023.
During the year ended 31 January 2024, the Company transferred 211,868 out of treasury to the Trust
(2023: repurchase of 1,855,000 shares into treasury) with a total value of £350,006 (2023: £2,587,375). These
shares are held as treasury shares.
During the year ended 31 January 2024, the Trust purchased 301,684 shares (2023: 280,739 shares) with a total
value of £525,920 (2023: £484,821). 257,061 shares vested to Participants in the year ended 31 January 2024
(2023: 862,290). At 31 January 2024 1,546,693 shares were held by the Trust (2023: 1,290,202) (see note 7).
17 Basic and diluted loss per share (pence)
Basic loss per share for the year ended 31 January 2024 is 1.39 pence (2023: basic loss per share of 147.95
pence). This is calculated by dividing the loss of the Group for the year attributable to the ordinary shareholders of
£396,462 (2023: loss of £43,836,210) divided by the weighted average number of shares outstanding, excluding
the shares of the EBT subsidiary, during the year of 28,469,486 (2023: 29,628,992 shares). The basic loss per
share for the year ended 31 January 2023 has been restated to exclude the shares of the EBT subsidiary from the
weighted average number of outstanding shares so that it is consistent with the calculation for the year ended
31 January 2024.
Diluted loss per share for the year ended 31 January 2024 is 1.33 pence (2023: diluted profit per share of
141.77 pence). This is calculated by dividing the loss of the Group for the year attributable to ordinary shareholders
of £396,462 (2023: loss of £43,836,210) divided by the weighted average number of shares outstanding, including
the shares of the EBT subsidiary, during the year of 29,832,732 (2023: 30,921,130 shares).
18 NAV per share (pence)
The Group’s NAV per share of 324.26 pence (2023: 328.41 pence) is based on the net assets of the Group at the
year-end of £96,879,976 (2023: £97,421,364) divided by the outstanding shares of 29,876,847 (2023: 29,664,979).
The shares of the EBT subsidiary are included in the outstanding shares when calculating the Company’s NAV per
share to ensure that the NAV per share is stable in the event of share purchases made by the EBT subsidiary or
the vesting of shares of the EBT subsidiary.
79
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
19 Net cash used in operating activities
Reconciliation of profit before finance cost and tax to net cash used in operating activities:
| 2024 | ||
| Group | ||
| £ | ||
| 2023 | ||
| Group | ||
| £ | ||
| Loss for the year before taxation | (396,462) | (43,836,210) |
| Adjustments for non-cash income / expense | ||
| Net fair value movement on investments | (3,384,604) | 39,438,551 |
| Interest on unsecured loan note instruments | 309,049 | 309,382 |
| Zero dividend preference shares finance charge | 868,190 | 1,128,093 |
| Loss before finance cost | (2,603,827) | (2,960,184) |
| Adjustments: | ||
| Share-based payment expense | 339,593 | 555,225 |
| Purchase of investments | (3,350,000) | (3,174,948) |
| Proceeds from investments | 6,425,542 | 3,848,880 |
| 811,308 | (1,731,027) | |
| Working capital changes | ||
| Movement in trade and other receivables and prepayments | 14,253 | 6,848 |
| Movement in trade and other payables | 79,494 | (373,147) |
| Non-cash items | ||
| Effect of exchange rate fluctuations on cash and cash equivalents | 1,294 | (2,310) |
| Net cash generated from / (used in) operating activities | 906,349 | (2,099,636) |
20 Financial instruments
The Company’s financial instruments comprise:
• Investments in listed and unlisted companies held by Subsidiaries, comprising equity and loans
• Cash and cash equivalents, ZDP shares and unsecured loan note instruments; and
• Accrued interest and trade and other receivables, accrued expenses and trade and other payables.
Financial risk management objectives and policies
The main risks arising from the Company’s financial instruments are liquidity risk, credit risk, market price risk and
interest rate risk. None of those risks are hedged. These risks arise through directly held financial instruments and
through the indirect exposures created by the underlying financial instruments in the Subsidiaries. These risks are
managed by the Directors in conjunction with the Investment Advisor. The Investment Advisor is responsible for
day to day management of financial instruments in the Subsidiaries.
Capital management
The Company’s capital comprises share capital, share premium and reserves and is not subject to externally
imposed capital requirements.
80
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Notes to the Consolidated Financial Statements
For the year ended 31 January 2024 (continued)
20 Financial instruments (continued)
Liquidity risk
Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with
its financial liabilities that are settled by delivering cash or another financial asset. The Company’s liquid assets
comprise cash and cash equivalents and trade and other receivables, which are readily realisable.
Residual contractual maturities of financial assets
| 31 January 2024 | ||||||
| Less than | ||||||
| 1 Month | ||||||
| £ | ||||||
| 1 – 3 | ||||||
| Months | ||||||
| £ | ||||||
| 3 months | ||||||
| to 1 year | ||||||
| £ | ||||||
| 1 – 5 | ||||||
| years | ||||||
| £ | ||||||
| Over | ||||||
| 5 years | ||||||
| £ | ||||||
| No stated | ||||||
| maturity | ||||||
| £ | ||||||
| Financial assets | ||||||
| Cash and cash equivalents | 14,462,495 | – | – | – | – | – |
| Total | 14,462,495 | – | – | – | – | – |
| 31 January 2023 | ||||||
| Less than | ||||||
| 1 Month | ||||||
| £ | ||||||
| 1 – 3 | ||||||
| Months | ||||||
| £ | ||||||
| 3 months | ||||||
| to 1 year | ||||||
| £ | ||||||
| 1 – 5 | ||||||
| years | ||||||
| £ | ||||||
| Over | ||||||
| 5 years | ||||||
| £ | ||||||
| No stated | ||||||
| maturity | ||||||
| £ | ||||||
| Financial assets | ||||||
| Cash and cash equivalents | 22,226,008 | – | – | – | – | – |
| Total | 22,226,008 | – | – | – | – | – |
Residual contractual maturities of financial liabilities
| 31 January 2024 | ||||||
| Less than | ||||||
| 1 Month | ||||||
| £ | ||||||
| 1 – 3 | ||||||
| Months | ||||||
| £ | ||||||
| 3 months to | ||||||
| 1 year | ||||||
| £ | ||||||
| 1 – 5 | ||||||
| years | ||||||
| £ | ||||||
| Over | ||||||
| 5 years | ||||||
| £ | ||||||
| No stated | ||||||
| maturity | ||||||
| £ | ||||||
| Financial liabilities | ||||||
| Trade and other payables | 676,284 | – | – | – | – | – |
| Loan note instruments | – | – | 3,987,729 | – | – | – |
| Zero dividend preference | ||||||
| shares | – | – | – | 16,142,500 | – | – |
| Total | 676,284 | – | 3,987,729 | 16,142,500 | – | – |
| 31 January 2023 | ||||||
| Less than | ||||||
| 1 Month | ||||||
| £ | ||||||
| 1 – 3 | ||||||
| Months | ||||||
| £ | ||||||
| 3 months to | ||||||
| 1 year | ||||||
| £ | ||||||
| 1 – 5 | ||||||
| years | ||||||
| £ | ||||||
| Over | ||||||
| 5 years | ||||||
| £ | ||||||
| No stated | ||||||
| maturity | ||||||
| £ | ||||||
| Financial liabilities | ||||||
| Trade and other payables | 596,790 | – | – | – | – | – |
| Loan note instruments | – | – | 3,987,729 | – | – | – |
| Zero dividend preference | ||||||
| shares | – | – | – | 25,827,284 | – | – |
| Total | 596,790 | – | 3,987,729 | 25,827,284 | – | – |
81
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
20 Financial instruments (continued)
Credit risk
Credit risk is the risk that an issuer or counterparty will be unable or unwilling to meet a commitment that it has
entered into with the Company.
The Company, through its interests in Subsidiaries, has advanced loans to a number of private companies
which exposes the Company to significant credit risk. The loans are advanced to unquoted private companies,
which have no credit risk rating. They are entered into as part of the investment strategy of the Company and its
Subsidiaries, and credit risk is managed by taking security where available (typically a floating charge) and the
Investment Advisor taking an active role in the management of the borrowing companies.
Although the Investment Advisor looks to set realistic repayment schedules, it does not necessarily view a
portfolio company not repaying on time and in full as ‘underperforming’ and seeks to monitor each portfolio
company on a case-by-case basis. However, in all cases the Investment Advisor reserves the right to exercise
step in rights. In addition to the repayment of loans advanced, the Company and Subsidiaries will often arrange
additional preference share structures and take significant equity stakes so as to create shareholder value. It is the
performance of the combination of all securities including third party debt that determines the Company’s view
of each investment.
At the reporting date, the Company’s financial assets exposed to credit risk amounted to the following (excluding
exposure in the underlying Subsidiaries):
| 2024 | ||
| £ | ||
| 2023 | ||
| £ | ||
| Cash and cash equivalents | 14,462,495 | 22,226,008 |
| Total | 14,462,495 | 22,226,008 |
Cash balances are placed with HSBC Bank plc, Barclays Bank plc and Santander Financial Services plc, all of
which have the credit rating of A1 Stable (Moody’s).
Market price risk
Market price risk is the risk that the value of a financial instrument will fluctuate as a result of changes in market
prices (other than those arising from interest rate risk or currency risk). The Company is exposed to a market price
risk via its equity investments held through its interests in Subsidiaries, which are stated at fair value.
Market price risk sensitivity
The Company is exposed to market price risk with regard to its underlying equity interests in a number of quoted
and unquoted companies which are stated at fair value. Luceco plc was quoted on the Main Market of the London
Stock Exchange at 31 January 2024. EPIC Acquisition Corp’s shares and warrants were quoted on the Euronext
Amsterdam Stock Exchange at 31 January 2024.
If Luceco plc’s share price had been 5.0 per cent. higher than actual close of market on 31 January 2024, EPE
Special Opportunities Limited’s NAV per share would have been 2.0 per cent. (2023: 2.03 per cent.) higher than
reported. If Luceco’s share price had been 5.0 per cent. lower than actual close of market on 31 January 2024, EPE
Special Opportunities Limited’s NAV per share would have been 2.0 per cent. (2023: 2.03 per cent.) lower than
reported. These movements would have had a corresponding effect on the profit for the year.
A sensitivity is not prepared for EPIC Acquisition Corp. given that the vehicle is in liquidation.
82
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Notes to the Consolidated Financial Statements
For the year ended 31 January 2024 (continued)
20 Financial instruments (continued)
Interest rate risk
The Company is exposed to interest rate risk through its unsecured loan note instruments and on its cash
balances. Most of the loans are at fixed rates. Cash balances earn interest at variable rates. The unsecured loan
note instruments carry fixed interest rates.
The table below summarises the Company’s exposure to interest rate risks. It includes the Company’s financial
assets and liabilities at the earlier of contractual re-pricing or maturity date, measured by the carrying values of
assets and liabilities:
| 31 January 2024 | ||||||
| Less than | ||||||
| 1 month | ||||||
| £ | ||||||
| 1 month | ||||||
| to 1 year | ||||||
| £ | ||||||
| 1 – 5 years | ||||||
| £ | ||||||
| Over | ||||||
| 5 years | ||||||
| £ | ||||||
| Non- | ||||||
| interest | ||||||
| bearing | ||||||
| £ | ||||||
| Total | ||||||
| £ | ||||||
| Assets | ||||||
| Receivables and cash | ||||||
| Cash and cash equivalents | 14,462,495 | – | – | – | – | 14,462,495 |
| Total financial assets | 14,462,495 | – | – | – | – | 14,462,495 |
| Liabilities | ||||||
| Financial liabilities measured | ||||||
| at amortised cost | ||||||
| Trade and other payables | – | – | – | – | (676,284) | (676,284) |
| Unsecured loan note instruments | – | (3,987,729) | – | – | – | (3,987,729) |
| Total financial liabilities | – | (3,987,729) | – | – | (676,284) | (4,664,013) |
| 31 January 2023 | ||||||
| Less than | ||||||
| 1 month | ||||||
| £ | ||||||
| 1 month | ||||||
| to 1 year | ||||||
| £ | ||||||
| 1 – 5 years | ||||||
| £ | ||||||
| Over | ||||||
| 5 years | ||||||
| £ | ||||||
| Non- | ||||||
| interest | ||||||
| bearing | ||||||
| £ | ||||||
| Total | ||||||
| £ | ||||||
| Assets | ||||||
| Receivables and cash | ||||||
| Cash and cash equivalents | 22,226,008 | – | – | – | – | 22,226,008 |
| Total financial assets | 22,226,008 | – | – | – | – | 22,226,008 |
| Liabilities | ||||||
| Financial liabilities measured at | ||||||
| amortised cost | ||||||
| Trade and other payables | – | – | – | – | (596,790) | (596,790) |
| Unsecured loan note instruments | – | (3,987,729) | – | – | – | (3,987,729) |
| Total financial liabilities | – | (3,987,729) | – | – | (596,790) | (4,584,519) |
83
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
20 Financial instruments (continued)
Interest rate sensitivity
The Company is exposed to market interest rate risk via its cash balances and unsecured loan note instruments.
A sensitivity analysis has not been provided as it is not considered significant to Company performance.
Currency risk
The Group has no significant exposure to foreign currency risk.
Exposure to other market price risk
The Investment Advisor monitors the concentration of risk for equity and debt securities based on counterparties
and industries (and geographical location). The Company’s underlying investments including bank deposits held
through its Subsidiaries are concentrated in the following industries.
| 2024 | ||
| % | ||
| 2023 | ||
| % | ||
| Consumer and Retail | 49 | 41 |
| Engineering, Manufacturing and Distribution | 35 | 34 |
| Healthcare | 2 | 2 |
| Credit Funds | <1 | 3 |
| Bank Deposits | 13 | 20 |
| 100 | 100 |
The Group notes that there was a concentration on the Consumer and Retail sector, representing 49 per cent. of
investments for the year ended 31 January 2024 (2023: Consumer and Retail sector representing 41 per cent.). The
Company monitors carefully the sector concentration risk across the portfolio.
Operational risk
‘Operational risk’ is the risk of direct or indirect loss arising from a wide variety of causes associated with the
processes, technology and infrastructure supporting the Company’s activities (both at the Company and at its
service providers) and from external factors (other than credit, market and liquidity risks) such as those arising
from legal and regulatory requirements and generally accepted standards of investment management behaviour.
The Company’s objective is to manage operational risk so as to balance the limitation of financial losses and
damage to its reputation with achieving its investment objective of generating returns to investors.
The primary responsibility for the development and implementation of controls over operational risk rests with the
Board of Directors. This responsibility is supported by the development of overall standards for the management
of operational risk, which encompasses the controls and processes at the service providers and the establishment
of service levels with the service providers, in the following areas:
• documentation of controls and procedures;
• requirements for:
– appropriate segregation of duties between various functions, roles and responsibilities;
– reconciliation and monitoring of transactions; and
– periodic assessment of operational risk faced;
84
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Notes to the Consolidated Financial Statements
For the year ended 31 January 2024 (continued)
20 Financial instruments (continued)
• the adequacy of controls and procedures to address the risks identified;
• compliance with regulatory and other legal requirements;
• development of contingency plans;
• training and professional development;
• ethical and business standards; and
• risk mitigation, including insurance if this is effective.
The Company’s key service providers include the following:
• Administrator: Langham Hall Fund Management (Jersey) Limited
• Investment Advisor: EPIC Investment Partners LLP
• Financial Administrator: EPIC Administration Limited
• Nominated Advisor and Broker: Numis Securities Limited
• Registrar and CREST Providers: Computershare Investor Services (Jersey) Limited
The Directors’ assessment of the adequacy of the controls and processes in place at the service providers with
respect to operational risk is carried out via regular discussions with the service providers as well as site visits to
their offices. The Company also undertakes periodic third-party reviews of service providers’ activities.
21 Directors’ interests
Four of the Directors have interests in the shares of the Company as at 31 January 2024 (2023: five). Clive Spears
holds 63,010 ordinary shares (2023: 51,841). Heather Bestwick holds 50,600 ordinary shares (2023: 39,431). David
Pirouet holds 33,635 ordinary shares (2023: 17,309). Michael Gray holds 11,627 ordinary shares (2023: 5,614).
22 Related parties
The Company has no ultimate controlling party.
Directors’ fees expenses during the year amounted to £162,474 (2023: £172,000) of which £11,667 is accrued as at
31 January 2024 (2023: £14,333).
There were no shares re-acquired from related parties during the year ended 31 January 2024 (2023: nil). Certain
Directors of the Company and other participants are incentivised in the form of equity settled share-based
payment transactions, through a Jointly Owned Share Plan (see note 7).
Details of remuneration payable to key service providers are included in note 5 to the financial statements.
Performance fees are paid to the Investment Advisor based on the performance of the Subsidiaries and deducted
in calculating the fair value of Subsidiaries (see note 5).
In December 2021, ESO Alternative Investments LP invested €10 million into EPIC Acquisition Corp (“EAC”), a
special purpose acquisition company (“SPAC”) and EAC’s sponsor, EAC Sponsor Limited (the “Sponsor”). The
Sponsor was jointly led by the Investment Advisor and TT Bond Partners (an independent party). In January 2024,
EPIC Acquisition Corp announced that it will return all residual capital to the Company and to third parties and wind
up. In February 2024, the realisation of the investment in EPIC Acquistion Corp was completed, returning €6.2
million. The realisation from EAC Sponsor Limited remains subject to the completion of the liquidation.
85
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
22 Related parties (continued)
In July 2023, the Company agreed the extension of the maturity of £4.0 million unsecured loan notes to 24 July
2024. Delphine Brand, a Managing Partner of EPIC and a connected party of Giles Brand (a person discharging
managerial responsibilities (“PDMR”) for the Company), is a minority holder of the unsecured loan notes.
Giles Brand, Managing Partner of the Investment Advisor, is a director of certain portfolio holding vehicles, including
Luceco plc and Hamsard 3145 Limited (trading as Whittard of Chelsea).
23 Commitments and Contingencies
As at 31 January 2024, ESO Investments 1 Limited has a contingent guarantee of £1.75 million outstanding
(2023: £nil) in favour of Rayware Limited and its third party debt providers (a £2.50 million guarantee was provided
in July 2023 of which £0.75 million was drawn down in the subsequent period).
24 Other information
The revenue and capital reserves are presented in accordance with the Board of Directors’ agreed principles,
which are that the net gain / loss on investments is allocated to the capital reserve and all other income and
expenses are allocated to the revenue reserve and other equity. The total reserve of the Company for the year
ended 31 January 2024 is £81,529,521 (2023: £82,070,909).
25 Subsequent events
In February 2024, the Company received €6.2 million as proceeds from the realisation of its holding in EPIC
Acquisition Corp.
86
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Alternative Performance Measures
An Alternative Performance Measure is a numerical measure of the Group’s historical or current performance.
Measures Denition
Premium / Discount to NAV The amount by which the share price of the Company is either higher (premium) or lower
(discount) than the NAV per share, expressed as a percentage of the NAV pershare.
Please nd a reconciliation to the NAV per share of the Company below:
31 January
2024
31 January
2023
Share price (pence) 165 170
NAV per share (pence) 324 328
Discount to NAV (%) 49% 48%
EBITDA Earnings before interest, taxation, depreciation and amortisation.
This measure is calculated at the level of the underlying portfolio and therefore is not
directly reconcilable to GAAP metrics in the nancial statements.
EV / EBITDA multiple The EV / EBITDA multiple is calculated by dividing a company’s Enterprise Value (‘EV’)
by its annual EBITDA. The mature unquoted asset valuation EV / EBITDA multiple
quoted in the report is weighted by the Fair Value of the underlying investments, and
excludes assets at a pre-protability growth stage.
This measure is calculated at the level of the underlying portfolio and therefore is not
directly reconcilable to GAAP metrics in the nancial statements.
31 January
2024
31 January
2023
Mature unquoted asset valuation 7.2x 6.7x
EV / Sales multiple The EV / Sales multiple is calculated by dividing a company’s EV by its annual Sales.
This measure is calculated at the level of the underlying portfolio and therefore is not
directly reconcilable to GAAP metrics in the nancial statements.
IRR The gross Internal Rate of Return (“IRR”) of an investment or set of investments,
calculated as the annual compound rate of return on the investment cashows. Gross
IRR does not reect expenses to be borne by the relevant fund or its investors, including
performance fees, management fees, taxes and organisational or transactionexpenses.
This measure is calculated at the level of the underlying portfolio and therefore is not
directly reconcilable to GAAP metrics in the nancial statements.
31 January
2024
31 January
2023
Portfolio IRR 22% 23%
EPIC IRR 15% 16%
Liquidity Company liquidity is calculated as cash balances held by the Company, inclusive of
cash held by Subsidiaries in which the Company is the sole investor.
Please nd a reconciliation to the cash balances held by the Company below:
31 January
2024
31 January
2023
Cash held by the Company 14,462,495 22,226,008
Cash held by the Subsidiaries 868,510 2,284,081
Total liquidity 15,331,005 24,510,089
87
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Measures Denition
Portfolio Sales CAGR The portfolio sales compound annual growth rate (“CAGR”) is calculated on the basis
of the CAGR implied by the sum of the annual sales for the portfolio companies’ latest
completed nancial year vs. the prior three year period.
This measure is calculated at the level of the underlying portfolio and therefore is not
directly reconcilable to GAAP metrics in the nancial statements.
31 January
2024
31 January
2023
Portfolio Sales CAGR 8% 12%
MM The Money Multiple (“MM”) is calculated as the total gross realisations from an investment
or set of investments, divided by the total cost of the investment. Gross money multiple
does not reect expenses to be borne by the relevant fund or its investors, including
performance fees, management fees, taxes and organisational or transaction expenses.
This measure is calculated at the level of the underlying portfolio and therefore is not
directly reconcilable to GAAP metrics in the nancial statements.
31 January
2024
31 January
2023
Portfolio MM 3.1x 3.1x
EPIC MM 2.3x 2.3x
NAV per share The Group’s NAV per share is calculated as the net assets of the Group at the year-end
divided by the outstanding shares.
The shares of the EBT subsidiary are included in the outstanding shares when calculating
the Company’s NAV per share to ensure that the NAV per share is stable in the event of
share purchases made by the EBT subsidiary or the vesting of shares of the EBT subsidiary.
31 January
2024
31 January
2023
Net asset value (£) 96,879,976 97,421,364
Outstanding shares 29,876,847 29,664,979
NAV per share (pence) 324.26 328.41
Net Debt Net Debt is calculated as the total third party debt of a portfolio company, less cash balances.
This measure is calculated at the level of the underlying portfolio and therefore is not
directly reconcilable to GAAP metrics in the nancial statements.
Portfolio Leverage Portfolio Leverage is calculated as the aggregate Net Debt of the portfolio, divided by
the aggregate annual EBITDA of the portfolio.
This measure is calculated at the level of the underlying portfolio and therefore is not
directly reconcilable to GAAP metrics in the nancial statements.
31 January
2024
31 January
2023
Portfolio Leverage 1.4x 1.3x
Annualised share price return The annualised share price return is calculated as the CAGR implied by the Company’s
share price vs. the share price 10 years prior.
Please nd a reconciliation to the share price of the Company below:
31 January
2024
31 January
2023
Company’s share price 10 years prior to the yearend
(pence) 87 56
Company’s share price at the year end (pence) 165 170
Annualised share price return (%) 7% 12%
88
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
Percentage holding
Giles Brand 35.5%
Corporation of Lloyds 9.9%
Asset Value Investors 5.1%
First Equity 4.8%
Boston Trust Company Limited (Trustee to the ESO JOSP Scheme) 4.5%
Lombard Odier Darier Hentsch 3.5%
Total over 3% holding 63.3%
Unaudited schedule of shareholders holding
over 3% of issued shares
As at 31 January 2024
Directors
C.L. Spears (Chairman)
H. Bestwick
D.R. Pirouet
M.M. Gray
Investment
Advisor
EPIC Investment Partners LLP
Audrey House
16-20 Ely Place
London EC1N 6SN
Auditors and
Reporting
Accountants
PricewaterhouseCoopers CI LLP
37 Esplanade
St Helier, Jersey
Channel Islands JE1 4XA
Bankers
Barclays Bank plc
1 Churchill Place
Canary Wharf
London E14 5HP
HSBC Bank plc
1st Floor
60 Queen Victoria Street
London EC4N 4TR
Santander International
PO Box 545
19-21 Commercial Street
St Helier, Jersey, JE4 8XG
Administrator
and Company
Address
Langham Hall Fund Management
(Jersey) Limited
Gaspe House
66-72 Esplanade, St Helier
Jersey JE1 2LH
Financial
Administrator
EPIC Administration Limited
Audrey House
16-20 Ely Place
London EC1N 6SN
Nominated
Advisor and
Broker
Numis Securities Limited
45 Gresham Street
London EC2V 7BF
Registered
Agent
(Bermuda)
Conyers Dill & Pearman
Clarendon House, 2 Church Street
Hamilton HM 11
Bermuda
Registrar
and CREST
Providers
Computershare Investor Services
(Jersey) Limited
Queensway House
Hilgrove Street
St. Helier JE1 1ES
Investor
Relations
Richard Spiegelberg
Cardew Company
29 Lincoln’s Inn Fields
London WC2A 3EG
Company Information
89
EPE Special Opportunities
Report and Accounts for the year ended 31 January 2024
EPE Special Opportunities
Registered in Bermuda number 53954. The Company’s ordinary shares are quoted on the AIM Market of the London Stock Exchange,
and the Growth Market of the Aquis Stock Exchange (formerly the NEX Exchange). The Company’s ULN’s are quoted on the Aquis
Stock Exchange. The Company’s zero dividend preference shares are admitted to trade on the main market of the London Stock
Exchange (standard listed). The Company is advised by EPICInvestment Partners LLP.