XLON:INV ESEF Annual Report
INVESTMENT COMPANY PLC(THE) (XLON:INV)
ESEF Annual Report
2024-10-03
For: 2024-06-30
View Original
Added on
September 22, 2026
The Investment
Company plc
01
The Investment
Company plc
Directors and Advisers
02
Strategic Report
03
Summary of Results
03
Investment Objective
04
Investment Policy
04
Chairman’s Statement
05
Investment Manager's Report
06
Portfolio and Assets
09
Principal Risks and Risk Management
13
Section 172(i) Statement
15
Environmental, Social and Governance Report
16
Directors’ Report
18
Corporate Governance Statement
26
Audit Committee Report
30
Directors’ Remuneration Report
32
Statement of Directors’ Responsibilities
36
Independent Auditor's Report to the Members
38
Consolidated Income Statement
46
Consolidated Statement of Changes in Equity
47
Company Statement of Changes in Equity
48
Consolidated Balance Sheet
49
Company Balance Sheet
50
Consolidated and Company Cash Flow Statements
51
Notes to the Financial Statements
52
Shareholder Information
70
Notice of Annual General Meeting
71
02
The Investment
Company plc
02
The Investment
Company plc
DIRECTORS AND ADVISERS
Directors
I.R. Dighé (Chairman)
D.A. Horner (appointed 26 July 2023)
T.M. Metcalfe
M.H.W. Perrin
M.J. Weeks (resigned 26 July 2023)
Advisers
Secretary, Administrator and Registered Office
ISCA Administration Services Limited
The Office Suite
Den House
Den Promenade
Teignmouth TQ14 8SY
Telephone: 01392 487056
Custodian
Fiske plc
100 Wood Street
London ED2V 7AN
Broker
Singer Capital Markets Advisory LLP
One Bartholomew Lane
London EC2N 2AX
Independent Auditor
PKF Littlejohn LLP
Statutory Auditor
15 Westferry Circus
Canary Wharf
London E14 4HD
Investment Manager
Chelverton Asset Management Limited
Ground Floor Office
Basildon House
7 Moorgate
London EC2R 6AF
Solicitor
Stephenson Harwood LLP
1 Finsbury Circus
London EC2M 7SH
Registrar
Equiniti Limited
Aspect House
Spencer Road
Lancing
West Sussex BN99 6DA
Telephone: 0371 384 2030
Website: shareview.co.uk
Identification Codes
ISIN:
GB0004658257
SEDOL:
0465825
Bloomberg:
INV LN
LEI:
2138004PBWN5WM2XST62
Website:
https://theinvestmentcompanyplc.co.uk
For general shareholder queries please contact:
03
03
Summary of Results
At 30 June
2024
At 30 June
2023
Change
%
Equity Shareholders’ funds (£)
7,376,741
16,270,804
(54.66)
Number of ordinary shares in issue
1,837,205
4,772,049
(61.50)
Net asset value (“NAV”) per ordinary share
401.52p
340.96p
17.76
Ordinary share price (mid)
353.00p
340.00p
3.82
Discount to NAV
12.08%
0.28%
(11.80)
At 30 June
2024
At 30 June
2023
Total return per ordinary share*
49.50p
15.49p
Dividends paid per ordinary share
–
–
* The total return per ordinary share is based on total income after taxation as detailed in the Consolidated Income
Statement and in Note 6.
STRATEGIC REPORT
04
The Investment
Company plc
04
The Investment
Company plc
STRATEGIC REPORT
continued
Investment Objective
At a General Meeting held on 26 June 2023, the members voted to amend the investment objective which is to
maximise capital growth for Shareholders over the long-term by investing in high-quality, quoted, UK small and
mid-cap companies.
Investment Policy
Investment
Company
plc
("the
Company")
intends
to
fulfil
its
investment
objective
through
investing in cash-generative quoted UK small and
mid-cap companies that are expected to grow faster
than the UK stock market as a whole over the long
The Company will primarily invest in equity securities
of companies with shares admitted to listing on the Main
Market, the AQSE or to trading on AIM with a market
capitalisation of less than £250 million at the time of
investment. The Company may also invest in companies
with shares admitted to listing on the Main Market, the
AQSE or to trading on AIM with a market capitalisation
of £250 million or more at the time of investment
for liquidity purposes. The Company will identify
prospective companies through a formal quantitative
and qualitative screening process which focuses on
criteria such as the ability to convert a high proportion
of profit into cash, sustainable margins, limited working
capital intensity and a strong management team.
Companies that successfully pass the screening process
will form part of the Company’s ‘investable universe’ of
prospective companies.
The Company has not set any limits on sector weightings
within the portfolio but its exposures to sectors and
stocks will be reported to, and monitored by, the
Board in order to ensure that adequate diversification
is achieved. The Company will maintain a diversified
portfolio of a minimum of 60 holdings in UK small and
mid-cap companies.
The Company may also invest in cash, cash equivalents,
near cash instruments and money market instruments.
The Company will apply the following restrictions on its
investments:
•
not more than 10% of the Company’s gross assets at
the time of investment will be invested in the securities
of a single issuer;
•
no investment will be made in companies that are not
listed or traded on the Main Market, the AQSE or AIM
at the time of investment, nor in any companies which
have not applied for their shares to be admitted to
listing or trading on these markets;
•
no investment will be made in other listed or unlisted
closed-ended investment funds or in any open-ended
investment funds; and
• the
Company
will
not
invest
directly
in
FTSE
100 companies (preference shares, loan stocks or
notes, convertible securities or fixed interest securities
or any similar securities convertible into shares), nor
will it invest in the securities of other investment trusts
or in unquoted companies. The Company may, on
some occasions, hold such investments as a result
of corporate actions by investee companies. If the
Company holds shares in a company which enters
the FTSE 100, it may not immediately divest of those
shares but will do so when it considers appropriate,
subject to market conditions.
The Company may hold assets acquired by the
Company prior to the adoption of its investment
policy for which there is no market and whose value
the Company has written down to zero. The Company
shall dispose of such assets as soon as is reasonably
practicable.
No material change will be made to the investment
policy without the approval of Shareholders by ordinary
resolution.
05
05
Chairman’s Statement
Shareholders will be aware that at the beginning of
this
financial
period,
on
26
July
2023,
Chelverton
Asset Management were appointed as the Company’s
Investment Manager to oversee all aspects of the
management of the Company's assets and were able to
immediately introduce a new investment policy.
The
results
of
their
endeavours
are
set
in
their comprehensive Investment Manager’s Report on
pages 6 to 8. Your Board is delighted with their progress.
Performance for the 11 months ending 30 June 2024 is
that the net asset value ”NAV” has increased by 18.6%
to 401.52p and the share price by 3.8% to 353.0p. The
Company's performance over the year is in the Summary
of Results table on page 3.
Board
As I reported last year, Michael Weeks resigned following
the restructure of the Company in July 2023 and David
Horner joined the Board as part of this re-organisation.
Outlook
Despite the many headwinds experienced in the UK
domestic funds sector Chelverton’s management of the
assets has laid down a very credible track record from
which to grow the size of the Company.
As market conditions ease the Board and the Investment
Manager look forward to taking advantage of these
opportunities in the not too distant future. We take this
opportunity to thank all Shareholders for their support and
loyalty to the Company.
I. R. Dighé
Chairman
18 September 2024
06
The Investment
Company plc
06
The Investment
Company plc
As Manager, we are now 11 months into running the
Company’s investment portfolio since the change of
mandate and our appointment by the Board. By the
end of the Company’s interim period to 31 December
2023, we had exited all possible legacy holdings and
invested just under three quarters of the proceeds in
57 small and mid-sized UK listed equities, in line with
the new mandate. By the Company’s year-end, the
portfolio was 96% invested across 85 companies that
met the new investment criteria.
It has been an extraordinary period from both a macro
economic and political newsflow perspective. Initially,
UK inflation proved much stickier than had been
expected, putting a dampener on the market, especially
at the small and mid-cap end, where the Company
now invests. The conflict in the Middle East prompted
another sell-off in small and mid-caps, as investors
fought shy of what is perceived to be a riskier asset
class. The latter part of calendar 2023 and the first half
of 2024 saw a rapid decline in UK inflation, which was
helpful for the UK equity market. Finally, the election of
a Labour Government with a commanding majority in
Parliament, post the Company’s year-end, has barely
caused the domestic equity market to blink.
From a performance perspective, having got off to a
difficult start with small and mid-cap equities remaining
out of favour, the portfolio then enjoyed a 10.9% NAV
appreciation in the last two months of the first half
to end December 2023, from its nadir in October, as
inflation started to fall rapidly. This recovery carried on
into the second half of the Company’s financial year,
until June 2024 when the portfolio gave up some of its
gains after a strong run, as the market rebound paused
for breath. Notwithstanding this modest setback, by
the end of the period, the Company’s NAV had risen
23.6% from its low point at the end of October 2023.
As we pointed out in the Interim Report, whilst the
evidence points to small cap equity outperformance
over the long-term, this trend is punctuated by periods
of often quite severe underperformance and de-rating
during periods of economic stress, whether caused by
inflation, conflicts or, as in 2007/8, a financial crisis.
We have just come through one such period, driven
by the first instance of high inflation seen this century,
initially arising out of supply chain disruption caused
by the pandemic, then exacerbated by the invasion
of Ukraine, which led to a loss of consumer and
business confidence. The Board’s decision to change
the Company’s investment strategy to capital growth
by investing in UK listed small and mid-cap equities
presciently coincided with the turn in fortune for this
oversold segment of the UK market.
The portfolio as it is now constructed very much
represents the Manager’s investment objective of
generating long-term capital growth by investing in
cash generative UK listed businesses, that can grow
faster than the rest of the market through the business
cycle and are able to fund their organic growth from
their own cash generation, either because they are high
margin or asset light and preferably a combination of
both. This strategy has proved to be highly effective
for the open-ended Chelverton UK Equity Growth
Fund, which the Investment Team also manages. On
top of these financial characteristics of self-funded
growth, the Manager also looks for companies with
good revenue visibility, characterised by subscription
revenues for software or data provision, repeating
revenues for essential goods and services or in the case
of industrials, design wins for essential components into
their end customer products, which are unlikely to be
replaced. Finally, the Manager looks for companies with
sustainable margins and sensible management teams.
Whilst the funds were being invested, a substantial part
of the Company's cash was invested in UK Treasury
stock, to optimise allowable income rather than income
arising from holding cash on deposit.
Investment Manager's Report
STRATEGIC REPORT
continued
07
07
At the sector level, the investment strategy not
surprisingly leads us to invest in Technology stocks
(22.2% weighting in the portfolio at the year-end), given
their often above average growth, high margins and
recurring subscription revenues. The Company’s largest
software
stocks
include
Gamma Communications
,
which provides software and systems for managing
businesses communications networks on a subscription
basis;
dotDigital
, an omnichannel marketing software
platform business;
Celebrus Technologies
, software for
real time data aggregation from multiple sources and
subsequent analysis for marketing communications and
fraud detection;
Auction Technologies
, the provision of
online bidding services for auctioneers; and
Accesso
Technology
, a leading global online ticketing software
provider.
Another sector of note is Financials (11.6% of the
portfolio). Here, as Managers, we prefer high margin,
asset light financial service providers with sticky client
relationships manifested in low customer churn such as
JTC
, the fund administration and back-office service
provider for alternative funds and high net worth
investors, and
Brooks MacDonald
and
Mattioli Woods
,
the
wealth
managers.
Other
significant
holdings
include
Alpha Group International
, a fast growing
tech-enabled provider of FX management to mid sized
business customers and alternative banking services
to Alternative Investment funds, both markets poorly
served by the mainstream banks.
Media (11.5% weighting) comprises business subscription
data providers like
Global Data
and
Pulsar
, an online
consumer content provider,
LBG Media
, and marketing
services companies like
Next Fifteen
,
YouGov
and
System1 Group
.
More recently with the prospect of an economic
recovery, the Manager has been building up the
Company’s exposure to quality cyclicals. Here the
Manager has built up the Company’s Construction
exposure
(11.9%
weighting),
focusing
on
building
materials companies with good margins and strong
market positions, rather than the more asset intensive
builders or low margin contractors. Holdings include
SigmaRoc
, a leading European aggregates business;
Eurocell
, a manufacture and distributor in the UK
of
window
and
roofing
components;
Volution
,
a
leading supplier of ventilation products in Europe and
Australasia; and
Severfield
, the UK market leader in
structural steel with a joint venture with an indigenous
steel producer in the fast-growing Indian market.
In Consumer (11.7% of the portfolio) the Manager has
invested in a mix of non-cyclical consumer staples
like
Premier Foods
, owner of heritage brands like Mr
Kipling, Ambrosia, Oxo, Batchelors and Angel Delight,
and
Tate and Lyle
, the international food ingredients
business.
Warpaint
, the cosmetics company, is an out
and out growth stock. More recently, the Manager has
built up the Company’s exposure to more cyclical stocks,
like
DFS
, Britain’s largest furniture retailer;
Victorian
Plumbing
, the online bathroom products business, which
is rapidly growing market share, and finally
On the
Beach
, the online tour operator, ahead of a potential
pick-up in consumer spending arising from a return to
real wage growth and a pick-up in housing transactions
from depressed levels.
Finally, whilst less exposed to the domestic economy,
after a low initial weighting the Manager has more
recently built up the portfolio’s Industrials exposure (11.3%
weighting at the year-end) as overstocking caused by
earlier post pandemic supply chain disruption, which has
impacted industrial companies recent trading, starts to
normalise. The Manager has recently added
Morgan
Advanced Materials
, insulation materials and industrial
consumables;
Spectris
, a leading global industrial and
life science precision measuring and testing business
and
TT Electronics
, electronic components and sub-
assemblies, to its earlier holdings of
Vesuvius
, steel and
foundry consumables, and
Bodycote
, industrial heat
treatment.
08
The Investment
Company plc
08
The Investment
Company plc
As Manager, we believe we have been able to assemble
a portfolio of UK small and mid-cap equities, that meet
our investment criteria, at attractive valuations at a
time when these companies have been out of favour
with the market. Consequently, we feel the portfolio
is well placed to generate long-term capital growth
as the economy and investor sentiment improve. Our
confidence in the valuations we have paid is borne
out by the number of bids for UK listed companies we
have seen from Private Equity and overseas trade
buyers with three companies in the portfolio –
Mattioli
Woods
,
Alpha Financial Markets Consulting
and
Tyman
– succumbing to agreed offers. Another holding,
Ascential
, has successfully de-merged and sold off
two of its divisions generating significant shareholder
returns, with the remaining business subject to an
agreed bid from Informa post period end, whilst
Global
Data
sold a minority interest in one of its divisions at a
substantial premium to the underlying valuation for the
whole group, coupled with the high number of share
buy-backs being conducted by management teams,
who feel their share prices are too low.
We enter the second half of calendar 2024 with a new
government with a substantial majority, which should
provide some much-needed political stability, after
the recent merry-go-round of Chancellors and Prime
Ministers. This political back-drop, coupled with the
prospect of lower interest rates before too long, will
help provide a more supportive back-drop for domestic
equity investors. A manifesto commitment to increase
UK pension fund investment in UK markets would be a
welcome change from the steady disinvestment we’ve
seen for many years, providing a real liquidity boost for
the Company’s small and mid-cap end of the market.
Chelverton Asset Management
18 September 2024
STRATEGIC REPORT
continued
Investment Manager's Report
continued
Security
Holding
Fair Value
£
% of total
net assets
Restore
65,000
171,600
2.3
Clarkson
4,000
165,600
2.3
JTC
16,250
156,000
2.1
Alpha Group International
6,666
149,986
2.0
Sigmaroc
225,000
149,400
2.0
Global Data
67,750
147,017
2.0
Premier Foods
92,500
146,705
2.0
Gamma Communications
10,000
141,000
1.9
Bodycote
20,000
136,200
1.9
AJ Bell
35,000
132,650
1.8
Eurocell
100,000
129,000
1.8
dotdigital
137,500
127,188
1.7
Learning Technologies Group
150,000
126,751
1.7
Oxford Metrics
125,000
123,750
1.7
Tate & Lyle
20,000
119,600
1.6
Celebrus Technologies
51,333
119,093
1.6
Ebiquity
300,000
117,000
1.6
Volution Group
25,000
112,750
1.5
Auction Technology Group
22,500
112,726
1.5
Inchcape
15,000
111,600
1.5
Warpaint London
17,940
109,434
1.5
Accesso Technology Group
15,000
108,900
1.5
Advanced Medical Solutions Group
50,675
108,445
1.5
Severfield
140,000
106,120
1.4
Portfolio and Assets
At 30 June 2024
09
09
Security
Holding
Fair Value
£
% of total
net assets
Spectris
3,750
104,175
1.4
Vesuvius
22,500
103,838
1.4
LBG Media
95,000
100,700
1.4
Pulsar
111,378
99,126
1.3
Duke Capital Limited
325,000
99,125
1.3
Alpha Financial Markets
18,750
93,000
1.3
FDM Group (Holdings)
22,500
92,364
1.3
Balfour Beatty
25,000
91,250
1.2
Tyman
25,000
90,625
1.2
EnSilica
175,000
87,500
1.2
Eckoh
212,500
87,125
1.2
Epwin Group
100,000
86,000
1.2
On the Beach Group
62,500
85,750
1.2
TT Electronics
57,500
83,950
1.1
1Spatial
125,000
82,500
1.1
YouGov
20,000
81,200
1.1
Hostelworld
50,000
80,000
1.1
Trufin
100,000
80,000
1.1
Spectra Systems
36,250
79,750
1.1
Next 15 Group
10,000
79,700
1.1
Coats Group
100,000
79,100
1.1
Man Group
32,500
78,650
1.1
System1 Group
15,300
78,030
1.1
Morgan Advanced
25,000
77,250
1.1
Portfolio and Assets
continued
At 30 June 2024
10
The Investment
Company plc
10
The Investment
Company plc
STRATEGIC REPORT
continued
Security
Holding
Fair Value
£
% of total
net assets
Big Technologies
50,000
77,000
1.0
Aptitude Software Group
20,000
74,000
1.0
Adriatic Metals
35,000
70,875
1.0
Victorian Plumbing
75,000
69,600
0.9
XP Power Limited
4,694
69,283
0.9
Alfa Financial Software Holdings
36,000
66,816
0.9
Mattioli Woods
8,500
66,810
0.9
Zoo Digital
100,000
64,000
0.9
Wickes
47,500
63,175
0.9
Inspired
85,000
62,050
0.8
RWS Holdings
32,500
61,035
0.8
Macfarlane Group
50,000
59,250
0.8
Water Intelligence
14,500
58,725
0.8
Somero Enterprise Inc.
17,500
58,275
0.8
Aquis Exchange
12,500
58,250
0.8
Merit Group
70,000
58,100
0.8
Kooth
20,000
58,000
0.8
The Pebble Group
100,000
57,000
0.8
DFS Furniture
50,000
55,000
0.7
DP Poland
500,000
52,500
0.7
SDI Group
75,000
48,000
0.7
Microlise Group
35,000
47,250
0.6
PCI-PAL
75,893
46,295
0.6
Acuity RM
1,142,857
40,000
0.5
Portfolio and Assets
continued
At 30 June 2024
11
11
Security
Holding
Fair Value
£
% of total
net assets
Brooks Macdonald
2,000
39,000
0.5
Alliance Pharma
100,000
38,900
0.5
Breedon Group
10,000
38,650
0.5
Getbusy
50,000
34,500
0.5
Seeing Machines
760,000
34,200
0.5
Dianomi
75,000
33,750
0.5
Gooch & Housego
7,000
33,040
0.4
Ascential
9,393
32,078
0.4
Diaceutics
25,000
30,750
0.4
Arecor Therapeutics
25,000
28,750
0.4
Concurrent Technology
25,000
25,500
0.3
Luceco
10,000
16,560
0.2
Invinity Energy Systems
71,739
13,630
0.2
PJSC Lukoil ADR (Rep 1 Ord RUB0.025)
9,500
–
0.0
Total equity investments
7,069,820
95.8
Cash
252,293
3.4
Other assets net of other liabilities
54,628
0.8
Total cash and other net current assets
306,921
4.2
Total net assets
7,376,741
100.0
Portfolio and Assets
continued
At 30 June 2024
12
The Investment
Company plc
12
The Investment
Company plc
STRATEGIC REPORT
continued
Principal Risks and Risk Management
Principal Risks and Uncertainties
The management of the business and the execution of the Company’s strategy are subject to a number of risks. A
robust assessment of the principal risks to the Group and Company has been carried out, including those that would
threaten its business model, future performance, solvency and liquidity.
The current economic environment and the conflicts in Ukraine and the Middle East, continue to have an effect on both
global and domestic economies. These events are all being closely monitored by the Board as is their potential impact
on the Company.
The Group’s principal risks are set out below. An explanation of how these have been mitigated or managed is also
provided, where appropriate. The key business risks affecting the Group are:
RISK
MITIGATION
BUSINESS
RISK
The
profitability,
market
positioning
and
outlook for companies in which the Company
is invested may decline or fail to make
expected progress. This may be because of
internal factors at the investee company or
external factors such as competitive pressures,
economic downturns or political events.
The
Company
looks
to
invest
in
businesses
that
can
demonstrate
resilient characteristics and a shared
philosophy around long term creation
of value.
CONCENTRATION
RISK
The Company has too much exposure to one
stock or sector.
Investments in any one company shall
not exceed 10% of the Company's
gross assets at the time of acquisition.
MONETARY
RISK
The
widespread
implications
of
monetary
policies, which include inflationary pressures,
pose a risk to the real value of the Company's
assets.
The
Company
looks
to
own
a
portfolio of assets that possess an
enduring real value whether from the
value of the underlying assets in an
investment, or in the investee’s ability
to create an enduring profit stream.
OPERATIONAL
RISK
The Company is reliant on service providers
including, ISCA Administration Services Limited
as Administrator and Company Secretary, and
Fiske plc as Custodian. Failure of the internal
control systems of these parties could result in
losses to the Company.
The
Board
formally
reviews
the
Company’s service providers on an
annual basis.
There are other risks that are becoming more prominent but are not yet considered key risks.
13
13
Principal Risks and Risk Management
continued
Global conflict
The conflicts in Ukraine and the Middle East have had
a significant impact, inter alia, on inflation and, in
conjunction with affairs in China, an impact on supply
chains and globalisation. Investee companies will vary
as to the impact on them and their ability to adapt.
Inflationary pressure
Inflation has reduced in the last 12 months and the Bank
of England has recently reduced interest rates.
In addition, there are other risks that may materially
impact the Company, however, the likelihood thereof is
considered small.
Foreign currency risk
Under the previous investment policy in operation at
the beginning of the year, the Company was invested
in stocks in overseas markets dominated in foreign
currencies
thus
increasing
the
foreign
currency
risk. However, with the change in investment policy
described above, as the portfolio moved to UK stocks
this risk was removed.
Regulatory risk
The Company operates in an evolving regulatory
environment and faces a number of regulatory risks.
A breach of sections 1158/1159 of the Corporation Tax
Act 2010 would result in the Company being subject to
capital gains tax on portfolio investments. Breaches
of other regulations, including the Companies Act
2006, the United Kingdom Listing Authority ("UKLA")
Listing Rules, the UKLA Disclosure Guidance and
Transparency Rules, or the Alternative Investment
Fund Managers’ Directive, could lead to a detrimental
outcome. Breaches of controls by service providers to
the Company could also lead to reputational damage or
loss. The Board monitors compliance with regulations,
with reports from the Administrator.
Discount volatility
The Company’s shares may trade at a price which
represents a discount to its underlying NAV.
Market price risk
The Board monitors the prices of financial instruments
held by the Company on a regular basis. In addition,
it is the Board’s policy to hold an appropriate spread
of investments in the portfolio in order to reduce risks
arising from investment decisions and investment
valuations. The Board actively monitors market prices
throughout the year and meets regularly in order to
review investment strategy. All of the equity investments
held by the Company are listed on a recognised Stock
Exchange.
Liquidity risk
The
Company's
assets
mainly
comprise
readily
realisable quoted securities that can be sold to meet
funding commitments if necessary.
Credit risk
The failure of a counterparty to a transaction to
discharge its obligations under that transaction that
could result in the Company suffering a loss. Normal
delivery versus payment practice and a review of
counterparties and custodians by the Board mean that
this is not a significant risk.
Interest rate risk
This is not considered to be a direct risk to the Company
other than through its effect on investee companies.
14
The Investment
Company plc
14
The Investment
Company plc
STRATEGIC REPORT
continued
Section 172(i) Statement
Section 172(i) of the Companies Act 2006, requires
Directors to take into consideration the interests of
stakeholders in their decision making. The Directors
continue to have regard to the interests of, and
the impact of the firm’s activities on, the various
stakeholders in the firm and to consider what is most
likely to promote the success of the Company for its
members in the long term.
The Board considers the following:
•
the likely consequences of any decisions in the long-
term;
• the
need
to
foster
the
Company’s
business
relationships with service suppliers;
• the
impact
of
the
Company’s
operations
on
the community and environment;
• the desirability of the Company maintaining a
reputation for high standards of business conduct,
and
•
the need to act fairly as between Shareholders of the
Company.
Whilst the importance of giving due consideration to our
stakeholders is not new, S172 requires that the Board
elaborates how it discharges its duties in this respect.
We have categorised our key stakeholders into two
groups. Where appropriate, each group is considered
to include both current and potential stakeholders:
• Shareholders.
• Investment
Manager,
Administrator
and
other
service providers.
Shareholders
Our Shareholders are of course the owners of the
Company and we need to act fairly as between
members of the Company.
During the previous year the Board considered the size of
the Company and after consultation with Shareholders
made the following proposals to Shareholders:
1.
To offer existing Shareholders an exit from the
Company via a Tender Offer.
2.
To announce an Offer for Subscription to enable
new Shareholders to subscribe for new shares in
the Company.
3.
To change the Investment Objective and Policy.
4.
To appoint Chelverton Asset Management as
Investment Manager.
5.
To cancel the share premium account and capital
redemption reserve.
The proposals were approved by Shareholders at a
General Meeting on 26 June 2023 and enacted during
the year.
We have a regular dialogue with our key Shareholders
– but all are welcome to be in communication. All
Shareholders are encouraged to attend our Annual
General Meeting.
Investment Manager
As part of the changes as stated above, Chelverton
Asset Management were appointed as Investment
Manager on 26 July 2023. Details of the Investment
Management Agreement are given in Note 3 on
page 57.
Administrator and other service providers
The Board seeks to maintain constructive liaison with its
service providers so as to optimise the way in which the
Company’s needs are met.
ISCA
Administration
Services
acted
as
Company
Secretary and Administrator during the year and
worked with the Directors to ensure the Company
continued to operate efficiently.
The Strategic Report has been approved by the Board
of Directors.
On behalf of the Board
I. R. Dighé
Chairman
18 September 2024
15
15
Environmental, Social and Governance ("ESG") Report
As
signatories
to
the
United
Nations-supported
Principles of Responsible Investing ("PRI") and UK
Stewardship Code, the Investment Manager integrates
material ESG issues into their investment process and
stewardship. Whilst we do not pursue a sustainability
objective as part of the investment mandate the
Investment
Manager
considers
company
ESG
management an investment quality indicator, relevant
to the maintenance of competitive advantage. We
review ESG issues as part of our qualitative review of
any prospective holding. On initial investment decisions,
we rely on the support of our ESG team where we have
any material ESG concerns, or if the company sits within
a sector that is subject to high ESG risk with reference
to recognised material ESG risk maps. We then engage
the ESG team throughout the life of the holding, both
as part of conviction building where we have concerns,
and ahead of company meetings where there might be
noted concerns. From an engagement perspective, our
aim is to support the development of more sustainable
business practice in the face of rising systemic risks, such
as climate change and resource depletion. Our aim is to
protect and enhance investment returns for our clients
over the long term in the face of these evolving ESG
risks. We seek to work collaboratively with committed
holding to support the adoption of relevant ESG
management targets and improved ESG reporting. We
send an annual letter to all committed holdings outlining
our ESG management and reporting expectations
and asking for the completion of a proprietary ESG
questionnaire where we require further information.
This proprietary information is used to supplement
information provided by 3rd party ESG data providers,
which we use for contextual purposes only, and it
informs
subsequent
company
engagements.
We
monitor company progress in relation to a range of
relevant issues, including the diversity of the leadership
team and wider workforce, the adoption of a credible
carbon emissions reduction strategy, adherence to
an environmental policy that includes biodiversity
considerations where this is most appropriate, and the
responsible adoption and use of new technologies.
16
The Investment
Company plc
16
The Investment
Company plc
STRATEGIC REPORT
continued
17
The Directors present their report and audited financial
statements for the year ended 30 June 2024.
The Company
The Company is an investment company within the
meaning of Section 833 of the Companies Act 2006 and
has been granted approval from HM Revenue & Customs
(“HMRC”) as an investment trust under sections 1158 and
1159 of the Corporation Tax Act 2010 and will continue
to be treated as an investment trust company, subject to
continuing to meet the conditions for approval. During
the year, the Company had a premium listing on the
London Stock Exchange. Subsequent to the year end,
this category has been changed to an ESCC listing. The
Company's principal activity is portfolio investment.
The Directors are of the opinion that the Company has
conducted its affairs for the year ended 30 June 2024
so as to be able to continue to qualify as an investment
trust.
The Company’s status as an investment trust allows it
to obtain an exemption from paying taxes on the profits
made from the sale of its investments and all other net
capital gains.
As an investment company, managed and marketed
in the UK, the Company is an Alternative Investment
Fund (“AIF”) under the provisions of the Alternative
Investment
Fund
Manager’s
Directive
(“AIFMD”).
The Company was registered by the FCA as a Small
Registered UK Alternative Investment Fund Manager
(“AIFM”) with effect from 29 March 2018.
The Company owned Abport Limited, an investment
dealing company, and New Centurion Trust Limited
("NCT"), which was placed into members' voluntary
liquidation
on
29
May
2024
(the
“Subsidiaries”).
The Company and its wholly owned Subsidiaries
together comprise a group (the “Group”).
Investment Policy
The Company’s Investment Policy is set out on page 4.
Performance
Details
of
the
Company’s
performance
during
the financial year are provided in the Chairman’s
Statement on page 5 and the financial statements on
pages 46 to 68.
DIRECTORS’ REPORT
Key Performance Indicators (“KPIs”)
The Board reviews performance by reference to a number of KPIs and considers that the most relevant KPIs are
those that communicate the financial performance and strength of the Group as a whole. The Board monitors the
following KPIs:
NAV performance:
The NAV per
ordinary share at 30 June 2024
was 401.52p per share (2023:
340.96p). The total return of the
NAV was 17.76% (2023: 1.39%).
Discount of share price in relation
to NAV:
Over the year to 30 June
2024, the Company’s share price
moved from trading at a discount
of 0.28% to a discount of 12.08%.
Ongoing
Charges
Ratio:
The
Ongoing
Charges
Ratio
for
the
year
to
30
June
2024
amounted
to
2.00%
(2023:
2.39%).
Going Concern
In accordance with the Financial Reporting Council’s
guidance
on
going
concern,
the
Directors
have
undertaken a review of the Company’s ability to
continue as a going concern.
The Directors believe that the Company is well placed
to manage its business risks and that the assets of
the Company consist mainly of securities which are
readily realisable. The Directors are of the opinion that
18
The Investment
Company plc
the Company has adequate resources to continue in
operational existence for the foreseeable future and
that it is therefore appropriate to adopt the going
concern basis in preparing the financial statements. In
arriving at this conclusion, the Directors have considered
the liquidity of the portfolio and reviewed cash flow
forecasts showing the ability of the Company to meet
obligations as they fall due for a period of at least 12
months from the date that these financial statements
were approved.
In addition, the Directors have regard to ongoing
investor interest in the sustainability of the Company’s
business model and in the continuation of the Company,
specifically being interested in feedback from meetings
and conversations with Shareholders.
In addition to considering the principal risks on pages
13 and 14 and the financial position of the Company as
described above, the Board has also considered the
following further factors:
• the Investment Manager continues to adopt a long-
term view when making investments;
•
regulation will not increase to a level that makes the
running of the Company uneconomical; and
•
the performance of the Company will be satisfactory
and should performance be less than the Board deem
acceptable it has the powers to take appropriate
action.
Viability Statement
Over the Company’s life it has experienced a number
of significant social and economic events impacting
world history. The level of inflation, interest rates and
the conflicts in Ukraine and the Middle East are the
latest events impacting not just this Company but
all commercial entities. The change in the investment
objective and policy and the decision as supported by
Shareholders during the previous year demonstrates
the viability of the Company as a vehicle for delivering
investment performance to Shareholders. The Board's
analysis is based on the performance and progress of the
Company and its investment portfolio, an assessment
of current and future risks, the appropriateness of
the investment strategy and review of the financial
position of the Company, and operating expenses
over the next two years. In addition, consultation with
key Shareholders as to their perspectives is a key
consideration.
The Directors also consider viability in the context
of the Company being a going concern and it being
appropriate that the accounts are prepared on such
a basis. This is elaborated in Note 1 to the financial
statements.
Future Prospects
The future of the Company is dependent upon the
success of the investment strategy. The outlook for the
Company is discussed in the Chairman’s Statement on
page 5.
Board Diversity
When recruiting a new Director, the Board’s policy is
to appoint individuals on merit matched against the
skill requirements identified by the Board. The changes
to the Board during the reporting period were driven
from the re-structuring undertaken and voted on by
Shareholders including David Horner joining the Board
as a representative of the newly appointed Investment
Manager.
The Board believes diversity is important in bringing an
appropriate range of skills, knowledge and experience
to the Board and gives this consideration when
recruiting new Directors. The Board is required to
disclose their compliance in relation to the targets on
board diversity set out under paragraph 9.8.6R (9) of
the Listing Rules which are as follows:
1.
at least 40% of the individuals on the Board of
Directors are women;
2.
at least one of the senior positions on the Board of
Directors is held by a woman; and
3.
at least one individual on the Board of Directors is
from a minority ethnic background.
19
The table below sets out the composition of the Board
at the year-end based on the prescribed criteria.
Gender
Identity
Number
of Board
members
Percentage
of the
Board
Number
of senior
positions on
the Board
Men
4
100%
2
Women
–
0%
–
Ethnic
Background
Number
of Board
members
Percentage
of the
Board
Number
of senior
positions on
the Board
White British
or other White
(including minority
-white groups)
4
100%
2
Mixed/Multiple
Ethnic Groups
–
–
–
Asian/Asian
British
–
–
–
Black/African
–
–
–
Other ethnic group
including Arab
–
–
–
Not specified/
prefer not to say
–
–
–
The Board notes that it does not currently meet the
targets for women or ethnic diversity in the Board’s
current composition. When making appointments in
the future the Board will continue to operate an open-
minded approach to recruitment without restrictions
against any perceived group or individual. The Board
will
take
into
consideration
the
diversity
targets
set by Listing Rule 9.8.6R (9) when making future
appointments, however due to the size of the Board
meeting a target of 40% of Directors being women with
one being a senior Board position, and one individual
being from a minority ethnic background may not be
reached in the immediate future.
The Company does not have any employees other
than Directors and, as a result, the Board does not
consider it necessary to establish means for employee
engagement with the Board as required by the latest
version of the UK Corporate Governance Code.
Environmental, Human Rights, Employee, Social
and Community Issues
The Board consists entirely of Non-Executive Directors
and during the year the Company had no employees.
The Company has no direct impact on the community
or the environment, and as such has no environmental,
human rights, social or community policies. In carrying
out
its
investment
activities
and
in
relationships
with suppliers, the Company aims to conduct itself
responsibly, ethically and fairly.
Environmental, Social and Governance ("ESG") factors
are considered as part of the commercial evaluation of
investee companies.
The Investment Manager's ESG process is shown on
page 16.
Modern Slavery Act
As an investment vehicle that does not provide goods
or services in the normal course of business, nor does
it have, apart from the Directors, any employees, the
Directors consider that the Company is not required to
make a slavery or human trafficking statement under
the Modern Slavery Act 2015.
Criminal Finances Act 2017 and Bribery Act 2010
The Company has zero tolerance towards the criminal
facilitation of tax evasion and a policy of zero tolerance in
relation to bribery and corruption both in its own actions
and those of its third party advisors and service providers.
Greenhouse Gas Emissions
As an investment company with its activities outsourced
to third parties or managed by the Non-Executive
Directors, the Company’s own direct environmental
impact is minimal. The Company has no greenhouse gas
emissions to report from its operations, nor does it have
responsibility for any other emissions producing sources
under the Companies Act 2006 (Strategic Report and
Directors’ Reports) Regulations 2013. Furthermore, the
Company and Group considers itself to be a low energy
user under the Streamlined Energy & Carbon Reporting
regulations and therefore is not required to disclose
energy and carbon information.
20
The Investment
Company plc
DIRECTORS' REPORT
continued
Directors
Ian Dighé (Chairman)
was appointed to the Board on
6 July 2018. He has significant listed company experience,
particularly in the investment banking, corporate broking,
asset management and closed end funds sectors. He was
a co-founder of Bridgewell Group plc and was Chairman
of Miton Group plc from February 2011, overseeing the
successful refinancing and subsequent growth of the
group. He retired from the Miton board in December
2017. He is Chairman of Seneca Growth Capital VCT plc
and Pennant International Group plc, an Independent
non-Executive director of Edelweiss Holdings plc, and a
director of a number of private companies, and charities.
Tim Metcalfe
was appointed to the Board on 6 July
2018. He is an experienced corporate adviser, having
spent 30 years in a variety of City roles including with
Robert Fleming & Co., N M Rothschild, Westhouse
Securities, and Northland Capital Partners. He was Joint
CEO of Zeus Capital, prior to being the co-founder, in
2015, of IFC Advisory, an investor relations and financial
PR adviser to small and mid-cap companies. He is a
non-executive director of Spiritus Mundi plc and non-
executive chairman of Nichols Cars Limited.
Martin
Perrin
(Audit
Committee
Chairman)
was
appointed to the Board in June 2013. He is a non-
executive director of Fiske plc. He is a Chartered
Accountant and Chartered Fellow of the Securities
Institute and has wide international experience of
operations and finance in both regulated financial
services firms and in technology companies in industry.
David Horner
was appointed to the Board on 26 July
2023. He qualified as a chartered accountant and has
considerable experience of analysing and working
with smaller companies. In 2013 he resigned his
membership of The Institute of Chartered Accountants
in England and Wales, as his career is now fully involved
in fund management. He founded Chelverton Asset
Management Limited, Macaulay Capital plc and is
Chairman and major shareholder of CEPS plc.
Details of the interests of the Directors in the share
capital of the Company are set out in the Directors’
Remuneration Report on page 34.
In accordance with the policy adopted by the Board,
all Directors will stand for election at the forthcoming
AGM. Further details of the independence of the
Board and Board tenure is provided in the Corporate
Governance Statement.
The Board has considered the position of the Directors
as part of the evaluation process and believes that
it would be in the Company’s best interests for each
of them to be proposed for election or re-election at
the forthcoming AGM, given their material level of
contribution and commitment to the role.
As a non-executive Director of Fiske plc, Mr Perrin
is deemed to be interested in the Company’s past
management
agreement
and
current
custody
agreement. Mr Horner, by virtue of being Managing
Director
of
Chelverton
Asset
Management,
the
Company's Investment Manager from 26 July 2023, is
deemed to be interested in the Investment Management
Agreement. There were no other contracts subsisting
during the year under review or up to the date of this
report in which a Director of the Company is or was
materially interested and which is or was significant in
relation to the Company’s business.
Directors’ and Officers’ Liability Insurance
Directors’ and Officers’ liability insurance cover was in
place throughout the financial year and as at the date
of this report. The Company’s Articles of Association
provide, subject to the provisions of UK legislation, that
the Directors may be indemnified out of the assets of
the Company in respect of liabilities they may sustain or
incur in connection with their appointment.
Conflicts of Interest
The Companies Act 2006 provides that a director
must avoid a situation where they could have, a direct
or indirect interest that conflicts, or could perceivably
conflict with the Company’s interests. The Company’s
Articles of Association permit the Board to consider
and, if appropriate, to authorise situations where a
Director has an interest that conflicts, or might possibly
conflict, with the Company. The Board has a formal
system in place at each board meeting for the Directors
21
to
declare
situations
for
authorisation
by
those
Directors not involved in the situation. Any situations
considered
and
any
authorisations
subsequently
given are appropriately recorded. Any Director who
is considered conflicted might be asked to leave the
meeting or remain but not participate in the discussion
and abstain from voting or influencing a decision or
course of action. All Directors acknowledge that any
decision they take as a Directors of the Company must
be taken to promote the success of the Company.
The Board believes that the system it has in place for
reporting, considering and recording situations where a
Director has an interest that conflicts such as Mr Perrin’s
and Mr Horner's appointments as discussed on page 26,
or might possibly conflict, with the Company operated
effectively during the year under review.
Capital Structure
As at 30 June 2024, the Company’s issued share capital
consisted of 5,584,878 ordinary shares of 50p each of
which 3,747,673 are held in Treasury. The total of shares
in circulation is 1,837,205.
The above figure of 1,837,205 may be used by
Shareholders as the denominator for the calculations
by which they will determine if they are required to
notify their interest, or a change to their interest in, the
Company under the FCA's Disclosure Guidance and
Transparency Rules.
In addition, there are 1,717,565 fixed rate preference
shares of 50p in issue, all of which are held by New
Centurion Trust Limited a wholly owned subsidiary of the
Company, now in liquidation. The fixed rate preference
shares are non-voting, are entitled to receive a
cumulative dividend of 0.01p per share per annum, and
are entitled to receive their nominal value, 50p, on a
distribution of assets or winding up. Preference shares
are disclosed as equity in accordance with IAS 32.
At any general meeting of the Company, holders of
ordinary shares are entitled to one vote on a show of
hands and on a poll, to one vote for every share held.
During the year under review the Company did not
repurchase any ordinary shares in the market, issue any
ordinary shares or sell ordinary shares from treasury.
The Company held 3,747,673 shares in treasury as at
30 June 2024.
At the General Meeting on 26 June 2023, Shareholders
gave approval to proposals that included a Tender Offer
to buy back shares and an Issue to raise new capital. As
announced on 18 July 2023, 3,980,664 ordinary shares
were validly tendered pursuant to the Tender Offer,
constituting 83.4% of the existing issued share capital.
All validly tendered ordinary shares were accepted in
full, with 3,747,673 ordinary shares repurchased by the
Company and 232,991 ordinary shares sold to Incoming
Shareholders pursuant to the Matched Bargain Facility.
In addition, on 26 July 2023 the Company issued
812,829 new ordinary shares ("new ordinary shares")
in connection with the Offer for Subscription and
Intermediaries Offer.
Substantial Shareholdings
As at 30 June 2024, the Company had been notified of
the following notifiable interests in its voting rights:
Number of
ordinary
shares
% of
voting
rights
Mr J. Baker
287,042
15.62
Chelverton Asset
Management
90,000
4.90
Controlling Party
The Director’s consider that there is no controlling
party.
Change of Control
The Directors are not aware of any agreements
between Shareholders that may result in restrictions on
the transfer of securities or voting rights. The Directors
are not aware of any other restrictions on the transfer
of shares in the Company other than certain restrictions
that may from time to time be imposed by laws and
regulations. There are no agreements to which the
Company is party that might affect its control following
a successful takeover bid.
22
The Investment
Company plc
DIRECTORS' REPORT
continued
Requirements of the FCA Listing Rules
FCA Listing Rule 9.8.4 requires the Company to
include certain information in a single identifiable
section of the Annual Report or a cross-reference
table indicating where the information is set out. The
Directors confirm that the only disclosures required
in relation to FCA Listing Rule 9.8.4, is that as a Non-
Executive Director of Fiske, Mr Perrin is deemed to
have an interest in the Company’s Custody Agreement
and Mr Horner, as Managing Director of Chelverton
Asset Management, is deemed to have an interest in
the Investment Management Agreement. There were
no other contracts subsisting during the year to which
the Company was a party and in which a Director of the
Company is or was materially interested; or between
the Company and a controlling shareholder.
Articles of Association
Under section 21 of the Companies Act 2006 the
Company’s
Articles
of
Association
can
only
be
amended by special resolution at a general meeting
of the Shareholders. The Articles of Association were
amended at the General Meeting on 26 June 2023 and
became effective on 26 July 2023.
Annual General Meeting
The Company’s AGM will be held at the offices of
Chelverton Asset Management Limited, Ground Floor
Office, Basildon House, 7 Moorgate, London EC2R 6AF
on Thursday 31 October 2024 at 10.00 am. The Notice
of Meeting is set out on pages 71 to 73.
Shareholders are encouraged to submit their proxy
votes ahead of the meeting to ensure that their votes
count towards deciding each resolution. Appointing
the Chair of the meeting rather than a named person
will ensure that the vote will count. The business of this
year’s AGM consists of 16 resolutions.
Ordinary Business
Resolutions 1 to 9 are the normal resolutions concerning
the approval of the Report and Accounts and the
re-election of Directors and are self explanatory.
Resolution 3 being to approve the Remuneration Policy,
which the Company is required to put to a Shareholder
vote every three years, and was last voted on in 2021.
There have been no changes to the Policy since this was
last voted on by Shareholders.
Authority to allot shares and to allot and sell shares
on a non-pre-emptive basis
Resolutions 10 and 11: seek authority to issue shares
and to disapply pre-emption rights
The Board wishes to have the authority to issue ordinary
shares from time to time and may only allot shares for
cash if authorised to do so by Shareholders in a General
Meeting.
Accordingly, an ordinary resolution to authorise the
Directors to allot ordinary shares up to an aggregate
nominal amount of £183,720 equal to 20% of the
Company’s issued ordinary share capital, excluding
shares held in Treasury, at the date of this Notice, will
be proposed as Resolution 10.
In addition, Resolution 11 is being proposed as a special
resolution to authorise the Directors to disapply the
pre-emption rights of existing Shareholders in relation
to the issue of ordinary shares under Resolution 10 and
to sell ordinary shares from Treasury up to a maximum
nominal amount of £183,720 equal to 20% of the
Company’s issued share capital, excluding shares held
in Treasury, as at the date of the Notice of AGM.
The Directors intend to issue ordinary shares, subject
to any applicable regulatory requirements, when it is
in the best interests of Shareholders to do so at a price
at or above the prevailing Net Asset Value per ordinary
share. These Resolutions are separate and are not
linked to the authority sought by Resolutions 13 and 14
below.
These authorities, if approved, will expire at the Annual
General Meeting of the Company to be held in 2025.
Purchase of Own Shares
Resolution 12: Authority to purchase shares
Resolution 12, a special resolution, will renew the
Company’s authority to make market purchases of up
to 14.99% of its issued ordinary shares, excluding shares
23
held in Treasury, either for cancellation or placing
into treasury at the determination of the Directors.
Purchases of ordinary shares will be made within
guidelines established from time to time by the Board.
Any purchase of ordinary shares would be made only
out of the available cash resources of the Company.
The Directors would use this authority to address any
significant imbalance between the supply and demand
for the Company’s ordinary shares and to manage the
discount to NAV at which the ordinary shares trade.
Ordinary shares will be repurchased only at prices
below the NAV per ordinary share, which should have
the effect of increasing the NAV per ordinary share for
remaining Shareholders. This authority will expire at the
AGM to be held in 2025 when a resolution to renew the
authority will be proposed.
Special Business
The Board are proposing four items of Special Business
that are not generally, items recurring at every AGM,
Resolutions 13 and 14 are seeking the authority from
Shareholders to issue approximately 5 million new
ordinary shares of 50 pence each, by way of one
or more offers to both existing and new investors.
Following the General Meeting in 2023, and the change
of Investment Policy, the Company undertook a tender
and offer to repurchase and issue new shares. Having
built a new portfolio of stocks in accordance with the
new Investment Policy the Company continues to assess
its opportunities to increase scale through the issue of
new shares to investors. Full details of any such offers
are expected to be announced in due course.
Resolutions 13 and 14 seek authority to issue up to
£2,500,000 in nominal value of new ordinary shares in
pursuit of the Board's intention to grow the Company
through one or more offers. The authorities sought in
these Resolutions are separate and in addition to those
sought in Resolutions 10 and 11 above.
Accordingly, an ordinary resolution to authorise the
Directors to allot ordinary shares up to an aggregate
nominal
amount
of
£2,500,000
equating
to
approximately to 272% of the Company’s issued ordinary
share capital, excluding shares held in Treasury, at the
date of this Notice, will be proposed as Resolution 13.
In addition, Resolution 14 is being proposed as a special
resolution to authorise the Directors to disapply the
pre-emption rights of existing Shareholders in relation
to the issue of ordinary shares under Resolution 13
and to sell ordinary shares from treasury up to a
maximum nominal amount of £2,500,000 equating
to approximately 272% of the Company’s issued share
capital, excluding shares held in Treasury, as at the date
of the Notice of AGM.
The Directors intend to issue, or sell from Treasury,
ordinary shares, subject to any applicable regulatory
requirements, when it is in the best interests of
Shareholders to do so at a price at or above the prevailing
Net Asset Value. Full details of any such offers are
expected to be announced when the Directors consider
it to be in the interests of the Company to implement
such offers. These Resolutions are separate and are
not linked to the authority sought by Resolutions 11 and
12 above. A Resolution to sub-divide the current shares
ordinary shares is also being sought. Any changes to the
nominal value of the shares in issue would change the
number of shares being issued but not the total nominal
value of the shares issued.
These authorities, if approved, will expire at the Annual
General Meeting of the Company to be held in 2026.
Resolution 15:
Sub division of Ordinary Shares – Ordinary Resolution
At the General Meeting held on 26 June 2023
Shareholders approved a resolution to sub-divide the
shares. This authority was not used at the time of the
tender offer, and the Board is now seeking to renew
this authority. The proposal is for the Company to sub-
divide the Ordinary Shares with a nominal value of
£0.50 each into ordinary shares with a nominal value of
£0.10 each. Such sub-division is designed to improve the
liquidity of the Ordinary Shares and lower the variation
in daily price movements.
24
The Investment
Company plc
DIRECTORS' REPORT
continued
If the resolution is passed, the Company will notify
Shareholders by RNS as to when the sub-division
of the Ordinary Shares is proposed to take effect.
The Company will issue new share certificates to all
Shareholders for the number of shares held at the new
nominal value.
Notice Period for General Meetings
Resolution 16: Authority for a 14 day notice period
Resolution 16, a special resolution, will give the Directors
the ability to convene General Meetings, other than
annual general meetings, on a minimum of 14 clear
days’ notice. The minimum notice period for annual
general meetings will remain at 21 clear days. The
approval will be effective until the Company’s AGM to
be held in 2025, at which it is intended renewal will be
sought. The Directors will only call a General Meeting
on 14 days’ notice where they consider it to be in the
interests of Shareholders to do so and the relevant
matter is required to be dealt with expediently.
Continuation
The Company’s Articles provide that an ordinary
resolution be put to Shareholders at the Annual General
Meeting, proposing that the Company continues in
existence as a closed-ended investment company, every
5 years. At the General Meeting held on 26 June 2023,
Shareholders approved the amendment of the Articles
of Association in respect to the continuation vote, the
next such vote will be at the Annual General Meeting in
2028 and every fifth general meeting thereafter.
Recommendation
The Directors consider that all the resolutions to
be proposed at the AGM are likely to promote the
success of the Company and are in the best interests
of the Company and its Shareholders as a whole. The
Directors unanimously recommend that Shareholders
vote in favour of each resolution, as they intend to do in
respect of their own beneficial holdings.
Post balance sheet events
Full details of the post balance sheet events are given in
Note 19 on page 68.
Reappointment of Auditors
PKF Littlejohn LLP, the independent external Auditor of
the Company, were appointed in 2018. Resolutions to
reappoint PKF Littlejohn LLP as the Company’s Auditor,
and to authorise the Audit Committee to determine
their remuneration will be proposed at the forthcoming
AGM.
Auditor Information
In accordance with the requirement and definitions
under section 418 of the Companies Act 2006, each
of the Directors at the date of approval of this report
confirms that:
• so far as they are each aware, there is no relevant
audit information of which the Company’s Auditor is
unaware; and
•
each Director has taken all the steps that he ought to
have taken as a Director to make himself aware of
any relevant audit information and to establish that
the Company’s Auditor is aware of that information.
The Directors’ Report was approved by the Board on
18 September 2024.
On behalf of the Board
I. R. Dighé
Chairman
18 September 2024
25
Corporate Governance Statement
The Corporate Governance Statement forms part of the Directors’ Report.
26
The Investment
Company plc
Statement of Compliance
The
Directors
have
adopted
the
Association
of
Investment
Companies
("AIC")
Code
published
in February 2019 for the financial year ended 30 June
2024. The AIC Code addresses the principles and
provisions set out in the UK Corporate Governance
Code (“the UK Code”) as well as setting out additional
principles and recommendations on issues that are of
specific relevance to the Company.
The
Board
considers
that
reporting
against
the
principles and recommendations of the AIC Code,
and by reference to the AIC Guide as outlined above,
will provide the most appropriate information to
Shareholders.
The AIC Code was endorsed in February 2019 by the
Financial Reporting Council (“FRC”) which has confirmed
that in complying with the AIC Code, the Company will
meet its obligations in relation to the UK Code. The AIC
Code is available online at: www.theaic.co.uk. A copy of
the UK Code can be found at: www.frc.org.uk.
This statement has been compiled in accordance with
the FCA’s Disclosure and Transparency Rule (“DTR”) 7.2
on Corporate Governance Statements.
The Board considers that the Company has complied
fully with the AIC Code and the relevant provisions of
the UK Code, except as set out below.
The Company does not employ a chief executive, nor
any executive Directors. The systems and procedures
of the Administrator and other service providers, and
the annual statutory audit as well as the size of the
Company’s operations, gives the Board confidence
that an internal audit function is not appropriate. The
Company is therefore not reporting further in respect
of these areas.
The Board has further considered the principles of the
UK Code and believes that the Company has complied
with the provisions thereof for the year under review,
except as outlined above.
The Board of Directors
Throughout the year the Board consisted of four
non-executive Directors.
Michael Weeks resigned as a Director on 26 July 2023
and David Horner was appointed on the same day.
Mr Perrin, who is a non-executive Director of Fiske plc,
is considered to be independent by the Board. Fiske plc
were until 4 November 2020 the investment manager
and remain as the Company's custodian. David Horner
is not considered to be independent by the Board due
to him being the Managing Director of the Company's
Investment Manager, appointed on that date.
The Board is responsible for all matters of direction
and control of the Company and Group, including its
investment policy, strategy and delivery. The Directors
review at regular meetings the Company’s investments
and all other important issues to ensure that control is
maintained over the Company and Group's affairs.
The Chairman, Mr I. R. Dighé, is considered to be
independent and has no conflicting relationships. He
considers himself to have sufficient time to commit to
the Company’s affairs.
The AIC Code recommends that the Board should
appoint one of its independent non-executive directors
to be the Senior Independent Director. Mr Metcalfe is
the Company’s Senior Independent Director.
The Board has formalised the arrangements under
which Directors, in the furtherance of their duties, may
take independent professional advice.
DIRECTORS' REPORT
continued
27
The Directors each have a service contract, copies of
which are available on request from the Secretary. Mr
Perrin is approaching his thirteenth year as Chairman
of the Audit Committee, his independence is reviewed
on an annual basis and the Board is committed to
reviewing his continuing appointment at an appropriate
time.
The appointment of a new Director would be on the
basis of a candidate’s merits and the skills/experience
identified by the Board as being desirable to complement
those of the existing Directors. The Company’s diversity
policy, is set out on pages 19 and 20, but diversity is just
one of the factors that would be taken into account
when making a new appointment.
Board Operation
The Directors meet at regular Board meetings usually once a quarter, with additional meetings arranged as
necessary. Further discussions were held by the Directors throughout the year. During the year ended 30 June 2024,
the number of formal Board and Committee meetings attended by each Director who served during the year was
as follows:
Board
Meetings
Audit Committee
Meetings
Number
entitled to
attend
Number
attended
Number
entitled to
attend
Number
attended
Ian Dighé
5
5
1
1
David Horner (appointed 26 July 2023)
5
5
n/a
n/a
Tim Metcalfe
5
5
1
1
Martin Perrin
5
5
1
1
Michael Weeks (resigned 26 July 2023)
0
0
1
1
Performance Evaluation
An annual evaluation for the year ended 30 June 2024
has been carried out. This took the form of a formal
questionnaire by the Directors as to the effectiveness
of the Board, the chairmanship and its Committees and
how the Company can better serve Shareholders.
There
were
no
significant
actions
arising
from
the evaluation process and it was agreed that the
current composition of the Board and its Committees
was appropriate and that the Board and its Committees
were functioning effectively.
Tenure
In terms of overall length of tenure, the AIC Code
does not make specific restrictions on tenure for
Directors. Some market commentators have expressed
opinions that considerable length of service (which
has generally been defined as a limit of 9 years) may
lead to the compromise of a Director’s independence.
The Board does not believe that a Director should
be appointed for a finite period. The AIC Code does
recommend that it should have a policy on tenure of
its Chairman. The Board has noted that there is no
requirement under the AIC Code for its Chairman to
stand down after nine years however, it has adopted a
nine-year maximum tenure policy for its Chairman.
28
The Investment
Company plc
Re-election of Directors
All Directors shall seek annual re-election by the
Shareholders
at
the
Company’s
Annual
General
Meeting (“AGM”).
The Chairman and the Senior independent Director
have subsequently undertaken a review and assessment
of the effectiveness of the revised structure in delivering
the new Investment Policy and meeting the Board's
obligations to Shareholders. This review undertaken
through meetings and discussion with each individual
Director has concluded that each Director, and the
Board and its Committees, are working well and no
weaknesses have been identified requiring a revision to
the Board. The Board has considered the election and
re-election of each individual Director and recommends
their election and re-election on the basis of their skills,
knowledge and continued contribution.
Board Responsibilities
The Board is responsible for the determination and
implementation of the Company’s investment policy and
strategy and has overall responsibility for the Company’s
activities. The Board’s main roles are to create value for
Shareholders, to provide leadership to the Company
and to approve the Company’s strategic objectives.
The Board has adopted a schedule of matters reserved
for its decision and specific responsibilities that includes:
reviewing the Company’s investments, asset allocation,
gearing policy, cash management, investment outlook
and revenue forecasts.
The Company's day-to-day administrative functions
have been subcontracted to a number of service
providers,
each
engaged
under
separate
legal
agreements.
At each Board meeting the Directors follow a formal
agenda, which is circulated in advance by the Company
Secretary. The Company Secretary and Administrator
regularly provide financial information, together with
briefing notes and papers in relation to changes in
the Company’s economic and financial environment,
statutory
and
regulatory
changes
and
corporate
governance best practice.
Committees of the Board
The Company has appointed an Audit Committee to
monitor specific operations, further details are provided
in the Audit Committee Report on pages 30 and 31. Given
the size of the Board, it is not felt appropriate to have
a separate Management Engagement, Nomination or
Remuneration Committee. The functions that would
be normally carried out by these Committees are dealt
with by the full Board.
When
the
Board
undertakes
any
function
as
a
Management Engagement Committee, Mr Horner
abstains from the meeting and any decisions reached
relating to Chelverton Asset Management Limited, and
likewise Mr Perrin relating to Fiske plc.
During the year, the Audit Committee was comprised
of all of the Directors of the Company, excluding Mr
Horner, and was chaired by Mr Perrin. Given the size of
the Board, it was deemed proportionate and practical
for all the other Directors to sit on the Audit Committee.
Mr Perrin FCA, is a chartered accountant with a wide
experience of operations and finance in industry.
The Board is satisfied that Mr Perrin has recent and
relevant financial experience in the sector the Company
operates to guide the Committee in its deliberations.
Internal Control Review
The Directors are responsible for the Group’s risk
management and systems of internal control, for the
reliability of the financial reporting process and for
reviewing their effectiveness.
Throughout the year under review and up to the date of
this Annual Report, there has been an ongoing process
for identifying, evaluating and managing the principal
risks faced by the Group, which accords with guidance
supplied by the FRC on risk management, internal
control and related financial and business reporting.
This is reviewed on a regular basis by the Board. The
internal control systems are designed to ensure that
proper accounting records are maintained, that the
financial information on which business decisions are
made and which are issued for publication is reliable
and that the assets of the Group are safeguarded.
The risk management process and Group systems of
DIRECTORS' REPORT
continued
29
internal control are designed to manage rather than
eliminate the risk of failure to achieve the Group’s
objectives. It should be recognised that such systems
can only provide reasonable, not absolute, assurance
against material misstatement or loss.
The Directors have carried out a robust review of the
effectiveness of the systems of internal control as they
have operated during the year and up to the date of
approval of the Annual Report and Financial Statements.
The internal control systems in place are considered to
be effective as there were no matters arising from
this review that required further investigation and no
significant failings or weaknesses were identified.
Risk assessment and a review of internal controls is
undertaken regularly in the context of the Company’s
overall investment objective. The Board, through the
Audit Committee, has identified risk management
controls in four key areas: corporate strategy; published
information and compliance with laws and regulations;
relationships with service providers; and investment
and business activities. In arriving at its judgement, the
Board has considered the Company’s operations in light
of the following factors:
• the nature and extent of risks which it regards as
acceptable for the Company to bear within its overall
business objective;
•
the threat of such risks becoming reality;
• the Company’s ability to reduce the incidence and
impact of risk on its performance; and
•
the cost to the Company and benefits related to the
Company and third parties operating the relevant
controls.
Most functions for the day-to-day management of the
Company are sub-contracted to third party service
providers, and the Directors therefore obtain regular
assurances
and
information
from
these
suppliers
regarding their internal systems and controls.
Internal Audit
As the Company’s investment management is carried
out by the Board and the administration and custodial
activities
are
carried
out
by
third
party
service
providers the Board does not consider it necessary
to have an internal audit function. The Board reviews
financial information produced by the Administrator on
a regular basis.
Relations with Shareholders
Communication with Shareholders is given a high priority
by the Board. All Shareholders are encouraged to vote
at the AGM. Shareholders that wish to communicate
directly with the Board or to lodge a question in advance
of the AGM should contact the Company Secretary at
the address on page 2 or contact the Board via email to
The Annual and Half-Yearly Reports of the Group
are prepared by the Board to present a full, fair,
balanced and understandable review of the Group's
performance, business model and strategy. Copies
of these are released to the London Stock Exchange.
The Annual Report is dispatched to Shareholders by
mail and is also available from the Secretary or at
https://theinvestmentcompanyplc.co.uk.
The
Board
maintains
regular
dialogue
with
representatives of the Company’s largest Shareholders
throughout the year. The Board is mindful of feedback
received from Shareholders.
Disclosure Guidance and Transparency Rules (“DGTR”)
Other information required to be disclosed pursuant
to the DGTR has been placed in the Directors’ Report
because it is information which refers to events that
have taken place during the course of the year.
On behalf of the Board
I. R. Dighé
Chairman
18 September 2024
30
Role of the Audit Committee
The primary responsibilities of the Audit Committee
(the “Committee”) are:
•
to monitor the integrity of the financial statements of
the Group, and review the financial reporting process
and the accounting policies of the Group;
• to present a fair balance and understandable
assessment of the Group’s Annual Report and
Financial Statements;
•
to keep under review the effectiveness of the Group’s
internal control environment and risk management
systems;
•
to review annually the need for the Group to have its
own internal audit function;
• to make recommendations to the Board in relation
to the re-appointment or removal of the external
Auditor and to approve its remuneration and terms
of engagement;
•
to review the effectiveness of the audit process;
• to develop and implement a policy on the supply of
non-audit services by the Auditor; and
• to review and monitor the Auditor’s independence
and objectivity.
Matters considered in the year
The Committee met once during the financial year to
consider the financial statements and to review the
internal control systems.
The Audit Committee has:
• reviewed the need for the Group to have its own
internal audit function;
•
reviewed the internal controls and risk management
systems of the Company and those of its third party
service providers;
• reviewed and, where appropriate, updated the
Company’s risk register;
•
agreed the audit plan with the Auditor, including the
principal areas of focus;
•
received and discussed with the Auditor its report on
the results of the audit; and
•
reviewed the Group’s financial statements.
The principal issues identified by the Committee were
the valuation and ownership of the investment portfolio,
in particular the unquoted holdings and revenue
recognition. The Board relies on the Administrator to
use correct listed prices and seeks comfort in the testing
of this process through the internal control statements.
This was discussed with the Administrator and Auditor
at the conclusion of the audit of the financial statements.
The
Committee
assesses
annually
whether
it
is
appropriate to prepare the Group's financial statements
on a going concern basis. The Board’s conclusions are
set out in Note 1 of the financial statements.
The Committee considers the internal control system
of the Company and its third party service providers.
There were no significant matters of concern identified
in the Committee’s review of the internal controls of the
Company and its third party service providers.
Following consideration of the above, and its detailed
review, the Committee was of the opinion that the
Annual Report and Financial Statements, taken as a
whole, are fair, balanced and understandable and
provide the information necessary to assess the Group’s
position and performance, business model and strategy
and advised the Board accordingly.
The Investment
Company plc
AUDIT COMMITTEE REPORT
31
Auditor
The Audit Committee will, in accordance with the terms
of reference of the Committee, continue to consider
the need to put the audit out to tender, the Auditor’s
performance, its fees and independence, along with
matters raised during each audit.
Audit Fees
An audit fee of £50,000 has been agreed in respect
of the audit for the year ended 30 June 2024. Of this
amount, £45,820 relates to the Audit of the Company
and £4,180 in respect of the subsidiary companies.
Audit services
The Committee reviews the need for non-audit services
and authorises such on a case by case basis, having
consideration to the cost-effectiveness of the services
and the independence and objectivity of the Auditor.
No non-audit services were provided to the Group in
the year under review.
Appointment of the Auditor
The Committee conducted a review of PKF Littlejohn
LLP’s independence and audit process effectiveness as
part of its review of the financial reporting for the year
ended 30 June 2024. In considering the effectiveness,
the Committee reviewed the audit plan in July 2024,
discussing the materiality level and identification of
key financial reporting risks. The Committee also
considered the execution of the audit against the plan,
as well as the Auditor’s reporting to the Committee
in respect of the financial statements. Based on this,
the Committee were satisfied that the quality of the
external audit process had been good with appropriate
focus and challenge on the key audit risks.
The Committee advises the Board on the appointment
of the external auditor and determines the Auditor's
remuneration.
It
keeps
under
review
the
cost
effectiveness and also the independence and objectivity
of the external auditor. The Committee was satisfied
that the objectivity and independence of the auditor
was not impaired during the year.
This is the sixth year in which PKF Littlejohn LLP has
conducted the audit. As a Public Interest Entity listed
on the London Stock Exchange the Company is subject
to mandatory auditor rotation requirements. The
Company will be required to put the external audit out to
tender at least every ten years and change the Auditor
at least every twenty years. Under the legislation the
Company will be required to put the audit out to tender,
at the latest, following the 2028 year end. The auditor is
required to rotate partners every five years.
The current audit partner for the Company, Ian Cowan,
is in his sixth year in this role. Due to significant changes
in the capital structure and the investment objective
and policy voted on by Shareholders in a meeting on
26 June 2023, the Audit Committee requested that Ian
Cowan be appointed for an additional year.
M. H. W. Perrin (FCA)
Chairman, Audit Committee
18 September 2024
DIRECTORS’ REMUNERATION REPORT
The Board has prepared this report in accordance with the requirements of the Large and Medium Sized Companies
and Groups (Accounts and Reports) (Amendment) Regulations 2013. An ordinary resolution for the approval of the
Remuneration Report will be put to Shareholders at the forthcoming AGM. The law requires the Company’s Auditor
to audit certain disclosures provided. Where disclosures have been audited, they are indicated as such. The Auditor’s
opinion is included in the Independent Auditor’s Report on pages 38 to 45.
Annual Statement from the Chairman
The Directors’ Remuneration Report for the year ended
30 June 2024 is set out below.
Given the size of the Board, it is not considered
appropriate for the Company to have a separate
Remuneration Committee and the functions of this
Committee are carried out by the Board as a whole.
Each Director of the Company takes no part in
discussions concerning their own remuneration.
Remuneration Policy
The Board’s policy is that the remuneration of non-
executive
Directors
should
reflect
the
experience
of the Board as a whole, and is determined with
reference to comparable financial organisations and
appointments.
The Directors’ fees are determined within the limits
set out in the Company’s Articles of Association, not to
exceed a maximum aggregate amount of £250,000
per annum. In addition, Directors may be paid extra
remuneration for the performance of service which in
the opinion of the Director is beyond the ordinary and
usual duties of a Director. Under the Company’s Articles
of Association, if any Director performs or agrees to
perform services (including services as a member of
any committee(s)) which in the opinion of the Directors
are beyond the ordinary and usual duties of a Director,
the Director may (unless otherwise expressly resolved
by the Company in general meeting) be paid such
extra remuneration by way of salary or otherwise, as
the Directors may determine, which shall be charged
as part of the Company’s ordinary working expenses.
However, as the Directors do not receive performance
related pay, any additional remuneration would not be
based on a percentage of profits.
Directors have not been paid bonuses, pension benefits,
share options, long-term incentive schemes or other
performance-related benefits or compensation for
loss of office. Director’s fees will be reviewed in the
future, within the context of growing the assets of the
Company, and will be subject to Shareholder approval.
Fees for any new Director appointed will be on the
above basis. Any views expressed by Shareholders on
the fees being paid to Directors would be taken into
consideration by the Board.
The terms of appointment provide that Directors shall
retire and be subject to annual re-election at each
Annual General Meeting of the Company in accordance
with the Articles of Association of the Company.
Compensation will not be paid upon early termination
of appointment.
A resolution to approve the Remuneration Policy will be
put to Shareholders at the AGM.
Shareholder views of remuneration policy
The formal views of unconnected Shareholders have
not been sought in the preparation of this policy.
Employees
The Company does not have any employees and,
therefore no Chief Executive Officer. Accordingly,
the disclosures required under paragraphs 18(2), 19,
38 and 39 of Schedule 8 of the Large and Medium
sized Companies and Groups (Accounts and Reports)
Regulations 2008 are not required.
32
The Investment
Company plc
Directors’ Emoluments for the Year (audited information)
The Directors who served in the year received the following total emoluments:
Year ended
30 June 2024
Year ended
30 June 2023
Fees
£
Total
£
Fees
£
Total
£
Ian Dighé
20,000
20,000
20,000
20,000
David Horner (appointed 26 July 2023)
–
–
–
–
Tim Metcalfe
20,000
20,000
20,000
20,000
Martin Perrin
20,000
20,000
20,000
20,000
Michael Weeks (resigned 26 July 2023)
1,667
1,667
20,000
20,000
Tom Cleverley (resigned 28 October 2022)
–
–
6,667
6,667
61,667
61,667
86,667
86,667
Michael Weeks resigned from the Board on 26 July 2023 and David Horner was appointed on the same day. Mr
Horner has waived his right to receive fees. Directors emoluments for the year to 30 June 2025 are expected to be
£20,000 each for Mr Dighé, Mr Metcalfe and Mr Perrin.
Company Performance
The Company does not have a specific benchmark against which performance is measured. The graph
below compares the total return (assuming all dividends are reinvested) to holders of ordinary shares compared to
the total shareholder return of the Numis Small Companies plus AIM ex Investment Trusts.
The Company has had several different investment objectives and policies which makes any long-term comparison
to an index difficult, however, the Numis Small Companies plus AIM ex Investment Trusts is the closest broad index
against which to measure the Company’s recent performance.
Shareholder return (pence) rebased to 100
350
300
250
200
150
100
50
ORDINARY SHARES
NAV Total Return
Share price Total Return
Numis Small Companies plus AIM ex Investment Trusts
31 March
2012
31 March
2010
30 June
2013*
30 June
2020
30 June
2019
30 June
2018
30 June
2017
30 June
2016
30 June
2015
30 June
2014
30 June
2023
*15 months to 30 June 2013.
30 June
2021
31 March
2011
30 June
2022
30 June
2024
33
Relative Importance of Spend on Pay
The table below shows the proportion of the Company’s income spent on pay.
2024
£
2023
£
2023/2024
Change
%
2022
£
2022/2023
Change
%
2021
£
2021/2022
Change
%
Dividends paid to Ordinary
Shareholders in the year
–
–
–
–
–
143,161
(100.0)%
Directors’ fees
61,667
86,667
(28.8)
100,000
(13.3)
86,292
15.9
Directors’ Beneficial and Family Interests
The interests of the current Directors and their families in the voting rights of the Company are set out below:
As at
30 June
2024
No. of ordinary
shares
As at
30 June
2023
No. of ordinary
shares
Ian Dighé
37,996
30,820
David Horner (appointed 26 July 2023)
28,704
–
Tim Metcalfe*
47,505
47,505
Martin Perrin*
36,000
21,695
Michael Weeks
–
32,000
* Together with their connected persons.
There were no changes in these holdings up to the date of this Report.
34
The Investment
Company plc
DIRECTORS’ REMUNERATION REPORT
continued
Voting at Annual General Meeting
In accordance with the requirement of the Companies Act 2006 Shareholder approval for the Remuneration Report
will be sought at the 2024 AGM.
An ordinary resolution adopting the Remuneration Report was approved at the AGM held on 7 November 2023. The
votes cast by proxy were as follows:
Directors’ Remuneration Report
Number of
votes
% of votes
cast
For and discretionary
226,658
99.00
Against
2,296
1.00
Total votes cast
228,954
100.00
Number of votes withheld
–
Voting on the Remuneration Policy at the AGM held on 27 October 2021 was as follows:
Directors’ Remuneration Policy
Number of
votes
% of votes
cast
For and discretionary
1,697,560
83.32
Against
339,744
16.68
Total votes cast
2,037,304
100.00
Number of votes withheld
1,266,909
Approval
The Directors’ Remuneration Report was approved by the Board on 18 September 2024.
On behalf of the Board
I. R. Dighé
Chairman
35
The Directors are responsible for preparing this Annual
Report and the financial statements in accordance with
applicable law and regulations. Company law requires
the Directors to prepare financial statements for each
financial year. Under that law, the Directors have
prepared the Group and Company financial statements
in
accordance
with
UK
adopted
international
accounting
standards
in
conformity
with
the
requirements of the Companies Act 2006. Additionally,
the Financial Conduct Authority’s Disclosure Guidance
and Transparency Rules require the Directors to
prepare the Group financial statements in accordance
with UK adopted international accounting standards.
Under company law the Directors must not approve
the financial statements unless they are satisfied that
they give a true and fair view of the state of affairs of
the Group and Company and of the profit or loss of the
Group and Company for that period.
In preparing those financial statements, the Directors
are required to:
• select suitable accounting policies and then apply
them consistently;
•
make judgements and estimates that are reasonable
and prudent;
• state whether applicable UK adopted international
accounting
standards,
in
conformity
with
the
requirements of the Companies Act 2006 and, for
the Group, UK adopted international accounting
standards
have
been
followed,
subject
to
any
material departures disclosed and explained in the
financial statements; and
•
prepare the financial statements on the going
concern basis unless it is inappropriate to presume
that the Group will continue in business.
The Directors are responsible for keeping adequate
accounting records that are sufficient to show and
explain
the
Group’s
and
Company’s
transactions
and disclose with reasonable accuracy at any time
the financial position of the Group and Company
and
enable
them
to
ensure
that
the
financial
statements comply with the Companies Act 2006. They
are also responsible for safeguarding the assets of the
Group and Company and hence for taking reasonable
steps for the prevention and detection of fraud and
other irregularities.
Under applicable law and regulations, the Directors
are also responsible for preparing a Strategic Report,
Directors’ Report, Directors’ Remuneration Report and
Corporate Governance Statement that comply with
that law and those regulations, and for ensuring that
the Annual Report includes information required by the
Listing Rules of the Financial Conduct Authority.
The financial statements are available on the Company’s
website
at
https://theinvestmentcompanyplc.co.uk.
The Directors are also responsible for the maintenance
and integrity of the Company’s website. Visitors to the
website need to be aware that legislation in the United
Kingdom covering the preparation and dissemination
of the financial statements may differ from legislation
in their jurisdiction.
36
The Investment
Company plc
STATEMENT OF DIRECTORS’ RESPONSIBILITIES
We confirm that to the best of our knowledge:
•
the Group and Company financial statements, which
have been prepared in accordance with UK adopted
international accounting standards in conformity with
the requirements of the Companies Act 2006 and,
for the Group, UK adopted international accounting
standards, give a true and fair view of the assets,
liabilities, financial position and profit of the Group
and Company;
• the Annual Report includes a fair review of the
development and performance of the business and
the position of the Group and Company together with
a description of the principal risks and uncertainties
faced by the Group and Company; and
•
the Annual Report and financial statements, taken as
a whole, are fair, balanced and understandable and
provide the information necessary for Shareholders
to assess the position and performance, business
model and strategy of the Group and Company.
On behalf of the Board
I. R. Dighé
Chairman
18 September 2024
37
38
The Investment
Company plc
38
Opinion
We have audited the Financial Statements of The
and its subsidiaries (the ‘Group’) for the year ended
30 June 2024 which comprise the Consolidated Income
Statement, the Consolidated and Company Statements
of Changes in Equity, the Consolidated and Company
Balance Sheets, the Consolidated and Company Cash
Flow Statements and notes to the Financial Statements,
including significant accounting policies. The financial
reporting framework that has been applied in their
preparation
is
applicable
law
and
UK-adopted
international accounting standards and as regards the
Parent Company Financial Statements, as applied in
accordance with the provisions of the Companies Act
2006.
In our opinion:
•
the Financial Statements give a true and fair view of
the state of the Group’s and of the Parent Company’s
affairs as at 30 June 2024 and of the Group’s profit
for the year then ended;
• the
Group
Financial
Statements
have
been
properly prepared in accordance with UK-adopted
international accounting standards;
•
the Parent Company Financial Statements have been
properly prepared in accordance with UK-adopted
international accounting standards and as applied in
accordance with the provisions of the Companies Act
2006; and
• the Financial Statements have been prepared in
accordance with the requirements of the Companies
Act 2006.
Basis for opinion
We conducted our audit in accordance with International
Standards on Auditing (UK) (ISAs (UK)) and applicable
law. Our responsibilities under those standards are
further described in the Auditor’s responsibilities for the
audit of the Financial Statements section of our report.
We are independent of the Group and Parent Company
in accordance with the ethical requirements that are
relevant to our audit of the Financial Statements in the
UK, including the FRC’s Ethical Standard as applied to
listed public interest entities, and we have fulfilled our
other ethical responsibilities in accordance with these
requirements. We believe that the audit evidence we
have obtained is sufficient and appropriate to provide
a basis for our opinion.
Conclusions relating to going concern
In
auditing
the
Financial
Statements,
we
have
concluded that the Directors’ use of the going concern
basis of accounting in the preparation of the Financial
Statements is appropriate. Our evaluation of the
Directors’ assessment of the Group’s and Parent
Company’s ability to continue to adopt the going
concern basis of accounting included:
• challenging
management’s
key
inputs
and
assumptions
in
modelling
future
financial
performance and cashflow requirements, including
consideration of the key changes arising from
adapting the new investment objective and ensuring
any relevant investment commitments are reflected
therein;
• assessing liquidity and the ability of management to
trade in the investment portfolio, which underpins the
ability to meet the future obligations and operational
expenditure as required;
•
checking the mathematical accuracy of the forecast
used to model future financial performance and
cashflow requirements;
• assessing
the
mitigating
factors
available
to
management including their ability to generate cash
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS
39
39
Our application of materiality
The scope of our audit was influenced 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 financial statement line items and disclosures
and in evaluating the effect of misstatements, both individually and in aggregate, on the Financial Statements as a
whole.
Based on our professional judgement, we determined materiality for the Financial Statements as follows:
Group
Parent Company
Overall materiality
£228,000 (2023: £337,000)
£228,000 (2023: £336,000)
Performance materiality
£159,600 (2023: £235,900)
£159,600 (2023: £235,200)
Triviality
£11,400 (2023: £16,850)
£11,400 (2023: £16,800)
Basis for determining materiality
3% (2023: 2%) of gross assets
Rationale for the benchmark
applied
We have set our overall materiality at 3% of gross assets as the carrying value
of the investments is a key driver of shareholder value and a key performance
indicator used by management and forms more than 90% of gross assets. The
basis of materiality has been consistently applied in the current and previous
year.
Performance materiality represents amounts set by the Auditor at less than the
overall materiality to reduce the probability that the aggregate of uncorrected
and undetected misstatements exceeds the overall materiality. In setting this
we consider the overall control environment and our experience from previous
audits which has indicated a low number of corrected and uncorrected
misstatements. Based on these factors we have set performance materiality
at 70% (2023: 70%) of our overall materiality.
from the investment portfolio, should it be deemed
necessary, and the liquidity of the portfolio; and
• assessing the appropriateness of the going concern
disclosures included with the Financial Statements.
Based on the work we have performed, we have not
identified any material uncertainties relating to events
or conditions that, individually or collectively, may cast
significant doubt on the Group's or Parent Company’s
ability to continue as a going concern for a period
of at least twelve months from when the Financial
Statements are authorised for issue.
Our responsibilities and the responsibilities of the
Directors with respect to going concern are described
in the relevant sections of this report.
40
The Investment
Company plc
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS
continued
40
In addition to the above, we determined a specific materiality in our audit of the Consolidated and Parent Company
Income Statement as follows:
Group
Parent Company
Overall materiality
£19,000 (2023: £20,000)
£18,000 (2023: £18,000)
Performance materiality
£13,300 (2023: £14,000)
£12,600 (2023: £12,600)
Triviality
£950 (2023: £1,000)
£900 (2023: £900)
Basis for determining
materiality
5% (2023: 5%) of other expenses
Rationale for the
benchmark applied
We consider expenses to be a stable metric for Income Statement materiality and have
applied this method consistently in the current and previous year. Cost control is a key
focus of the Group, and hence this is deemed to be a suitable performance indicator to
use for determining materiality.
For the reasons noted above, performance materiality has been set at 70% (2023: 70%)
of the overall materiality.
We set materiality for each component of the Group at a lower level of materiality, dependent on the size and our
assessment of the risk of material misstatement of that component. This was consistent between the Balance Sheet
and Income Statement. For Abport Limited, overall materiality was set at £10,000 (2023: £10,000). We further
applied performance materiality thresholds of 70% (2023: 70%) for the component materiality.
We have agreed with the Audit Committee that we would report to the Committee individual audit differences
in excess of the trivial thresholds outlined above, as well as differences below these thresholds that, in our view,
warranted reporting on quantitative grounds.
We also report to the Audit Committee on disclosure matters that we identified when assessing the overall
presentation of the Financial Statements.
Our approach to the audit
In designing our audit, we determined materiality and assessed the risk of material misstatement in the Financial
Statements. In particular, we looked at areas involving significant accounting estimates and judgements by the
Directors and considered future events that are inherently uncertain. We also addressed the risk of management
override of internal controls, including among other matters, consideration of whether there was evidence of bias
that represented a risk of material misstatement due to fraud.
The Group’s only significant and material component was the Parent Company and this was subject to a full scope
audit by a team with relevant sector experience undertaken from our office based in London. The components
identified as not significant and not material were subject to review procedures undertaken by the same audit team.
41
41
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the
Financial Statements of the current period and include the most significant assessed risks of material misstatement
(whether or not due to fraud) we identified, including those which had the greatest effect on: the overall audit
strategy, the allocation of resources in the audit; and directing the efforts of the engagement team. These matters
were addressed in the context of our audit of the Financial Statements as a whole, and in forming our opinion
thereon, and we do not provide a separate opinion on these matters.
Key Audit Matter
How our scope addressed this matter
Valuation and ownership of investments (notes 1 and 8)
The Group holds investments with a carrying value
of £7,069,820 as at 30 June 2024. The Group’s
investments comprise of listed holdings and are valued
using the appropriate level of the fair value hierarchy
as per IFRS 13
Fair Value Measurement
.
All investments are classified as Level 1 in the fair
value hierarchy, valued using quoted prices in active
markets. However, the risk of misstatement remains
due to:
•
potential errors in pricing data;
•
possible
inactive
markets
for
some
small-cap
stocks; and
•
risk of management override in the valuation
process.
Furthermore, there is a risk that the Group does not hold
the legal title to the investments. As above, investments
are a highly significant component of the Balance Sheet
and therefore if the investments were not rightfully
owned, this would have a material impact on the
Financial Statements. Therefore, this is determined to
be a key audit matter.
Our work in this area included:
• testing the portfolio of listed investment valuations
to closing bid prices published by an independent
pricing source;
•
agreeing the listed investments held at the year end
to the custody report received directly from the
custodian Fiske plc;
• testing a sample of investment additions and
disposals
and
corroborating
to
supporting
documentation including recalculating any realised
gains/losses
on
disposal
to
ensure
individual
investment purchases and disposals, including any
resulting gains and losses, are accurately recorded;
and
• performing
a
reconciliation
of
the
investment
holdings, verifying that the correct classification has
been applied to each holding and that the fair value
hierarchy disclosure is presented in accordance with
IFRS 13.
Based on the work performed, we are satisfied that
the Group and Parent Company’s valuation of the
investments held is appropriate, and that the Group
and Parent Company hold legal title to the investments.
42
The Investment
Company plc
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS
continued
42
Other information
The other information comprises the information
included in the Annual Report, other than the Financial
Statements and our Auditor’s Report thereon. The
Directors are responsible for the other information
contained within the Annual Report. Our opinion on
the Group and Parent Company Financial Statements
does not cover the other information and, except to the
extent otherwise explicitly stated in our report, we do
not express any form of assurance conclusion thereon.
Our responsibility is to read the other information and,
in doing so, consider whether the other information is
materially inconsistent with the Financial Statements
or our knowledge obtained in the course of the audit,
or otherwise appears to be materially misstated. If
we identify such material inconsistencies or apparent
material misstatements, we are required to determine
whether this gives rise to a material misstatement in
the Financial Statements themselves. If, based on the
work we have performed, we conclude that there is a
material misstatement of this other information, we are
required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the
Companies Act 2006
In our opinion the part of the Directors’ Remuneration
Report to be audited has been properly prepared in
accordance with et Companies act 2006.
In our opinion, based on the work undertaken in the
course of the audit:
•
the information given in the Strategic Report and the
Directors’ Report for the financial year for which the
Financial Statements are prepared is consistent with
the Financial Statements; and
• the Strategic Report and the Directors’ Report have
been prepared in accordance with applicable legal
requirements.
Matters on which we are required to report by
exception
In the light of the knowledge and understanding of the
Group and the Parent Company and their environment
obtained in the course of the audit, we have not
identified material misstatements in the Strategic
Report or the Directors’ Report.
We have nothing to report in respect of the following
matters in relation to which the Companies Act 2006
requires us to report to you if, in our opinion:
• adequate accounting records have not been kept
by the Parent Company, or returns adequate for
our audit have not been received from branches not
visited by us; or
•
the Parent Company Financial Statements are not in
agreement with the accounting records and returns;
or
• certain
disclosures
of
Directors’
remuneration
specified by law are not made; or
• we have not received all the information and
explanations we require for our audit.
Corporate governance statement
We have reviewed the Directors' statement in relation
to going concern, longer-term viability and that part
of the Corporate Governance Statement relating to
the Group’s and Parent Company's compliance with
the provisions of the UK Corporate Governance Code
specified for our review by the Listing Rules.
43
43
Based on the work undertaken as part of our audit, we
have concluded that each of the following elements
of the Corporate Governance Statement is materially
consistent
with
the
Financial
Statements
or
our
knowledge obtained during the audit:
• Directors'
statement
with
regards
to
the
appropriateness of adopting the going concern
basis of accounting and any material uncertainties
identified set out on page 19;
• Directors’ explanation as to their assessment of the
Group’s prospects, the period this assessment covers
and why the period is appropriate set out on page 19;
• Directors’
statement
on
whether
they
have
a
reasonable expectation that the Group will be able to
continue in operation and meet its liabilities set out on
page 19;
• Directors' statement that they consider the Annual
Report and the Financial Statements, taken as a
whole, to be fair, balanced and understandable set
out on pages 36 and 37;
•
Board’s confirmation that it has carried out a robust
assessment of the emerging and principal risks set
out on pages 28 and 29;
• the section of the Annual Report that describes the
review of effectiveness of risk management and
internal control systems set out on pages 28 and 29;
and
•
the section describing the work of the audit committee
set out on pages 30 and 31.
Responsibilities of Directors
As explained more fully in the Statement of Directors’
Responsibilities,
the
Directors
are
responsible
for
the preparation of the Group and Parent Company
Financial Statements and for being satisfied that they
give a true and fair view, and for such internal control
as the Directors determine is necessary to enable the
preparation of Financial Statements that are free from
material misstatement, whether due to fraud or error.
In preparing the Group and Parent Company Financial
Statements, the Directors are responsible for assessing
the Group's and the Parent Company’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 the Parent Company or
to cease operations, or have no realistic alternative but
to do so.
Auditor’s responsibilities for the audit of the Financial
Statements
Our objectives are to obtain reasonable assurance
about whether the Financial Statements as a whole
are free from material misstatement, whether due
to fraud or error, and to issue an Auditor’s Report
that includes our opinion. Reasonable assurance is
a high level of assurance but is not a guarantee that
an audit conducted in accordance with ISAs (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 influence the
economic decisions of users taken on the basis of these
Financial Statements.
44
The Investment
Company plc
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS
continued
44
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:
• We obtained an understanding of the Group and
Parent Company and the sector in which they
operate to identify laws and regulations that could
reasonably be expected to have a direct effect
of
the
Financial
Statements.
We
obtained
our
understanding in this regard through discussions with
management, industry research, and the application
of our cumulative audit knowledge and experience of
the sector.
• We determined the principal laws and regulations
relevant to the Group and Parent Company in this
regard to be those arising from the Financial Conduct
Authority (FCA) Rules, UKLA Listing Rules, Disclosure
Guidance and Transparency Rules, the principles
of the UK Corporate Governance Code applied by
the AIC Code of Corporate Governance (the AIC
Code), the AIC Statement of Recommended Practice
Financial Statements of Investment Trust Companies
and Venture Capital Trusts issued in July 2022 (“AIC
SORP”) to the extent that this is consistent with IFRS,
Companies Act 2006, Alternative Investment Fund
Managers’ Directive and UK tax legislation including
qualification as an investment trust under section 1158
of the Corporation Tax Act 2010.
• We designed our audit procedures to ensure the
audit team considered whether there were any
indications of non-compliance by the Group and
Parent Company with those laws and regulations.
These procedures included, but were not limited
to enquiries of management, review of minutes of
those charged with governance review of legal and
regulatory correspondence and reviewing financial
statement disclosures and testing to supporting
documentation to assess compliance with applicable
laws and regulations.
•
We also identified the risks of material misstatement of
the Financial Statements due to fraud. We considered,
in addition to the non-rebuttable presumption of risk of
fraud arising from management override of controls,
the risk of fraud related to revenue recognition, the
posting of unusual journals and the manipulation of
the Group’s alternative performance profit measures
and other key performance indicators to meet
externally communicated targets. To address the
risk of fraud related to revenue recognition, our audit
work included, but was not limited to:
–
evaluating the appropriateness of the information
systems and effectiveness of the design and
implementation of the related controls;
– substantively testing the income recognised in
the Financial Statements, including deferred and
accrued income balances recognised as at the
year-end;
– tracing a sample of dividend income received to
bank statements and dividend declarations issued
by the companies in which the investments are held;
– performing a review of the revenue recognition
accounting policy for compliance with IFRS 15, to
the extent relevant given the nature of the Group’s
activities, along with the AIC SORP;
– for a sample of unrealised investments gains,
tracing to verified supporting calculations and in
the case of listed investments, agreeing the price
increases to stock exchanges websites; and
45
45
– reviewing
post-year
end
receipts
to
ensure completeness of income recorded in the
accounting period.
•
As in all of our audits, we addressed the risk of fraud
arising from management override of controls by
performing audit procedures which included, but
were not limited to: the testing of journals; reviewing
accounting estimates for evidence of bias; and
evaluating the business rationale of any significant
transactions that were deemed unusual or outside the
normal course of business.
Because of the inherent limitations of an audit,
there is a risk that we will not detect all irregularities,
including those leading to a material misstatement
in the Financial Statements or non-compliance with
regulation. This risk increases the more that compliance
with a law or regulation is removed from the events
and transactions reflected in the Financial Statements,
as we will be less likely to become aware of instances
of non-compliance. The risk is also greater regarding
irregularities occurring due to fraud rather than error,
as fraud involves intentional concealment, forgery,
collusion, omission or misrepresentation.
A
further
description
of
our
responsibilities
for
the
audit
of
the
Financial
Statements
is
located
on
the
Financial
Reporting
Council’s
website
at:
www.frc.org.uk/auditorsresponsibilities.
This description forms part of our Auditor’s Report.
Other matters which we are required to address
We were appointed by the Audit Committee on
29 November 2018 to audit the Financial Statements
for the period ended 30 June 2019 and subsequent
financial periods. Our total uninterrupted period of
engagement is six years, covering the periods ended
30 June 2019 to 30 June 2024.
The non-audit services prohibited by the FRC’s Ethical
Standard were not provided to the Group or the Parent
Company and we remain independent of the Group
and the Parent Company in conducting our audit.
Our audit opinion is consistent with the additional report
to the Audit Committee.
Use of our report
This report is made solely to the Company’s members,
as a body, in accordance with Chapter 3 of Part 16 of
the Companies Act 2006. Our audit work has been
undertaken so that we might state to the Company’s
members those matters we are required to state to
them in an Auditor’s Report and for no other purpose.
To the fullest extent permitted by law, we do not accept
or assume responsibility to anyone, other than the
Company and the Company's members as a body, for
our audit work, for this report, or for the opinions we
have formed.
Ian Cowan (Senior Statutory Auditor)
For and on behalf of PKF Littlejohn LLP
Statutory Auditor
15 Westferry Circus
Canary Wharf
London E14 4HD
18 September 2024
The notes on pages 52 to 68 form part of these financial statements.
CONSOLIDATED INCOME STATEMENT
For the year ended 30 June 2024
Year ended
30 June 2024
Year ended
30 June 2023
Notes
Revenue
£
Capital
£
Total
£
Revenue
£
Capital
£
Total
£
Gains on investments at fair
value through profit or loss
8
Exchange (losses)/gains on
capital items
(10,484 )
(10,484 )
Investment income
2
Investment management fee
3
Other expenses
4
(188,232 )
(188,232 )
(396,562 )
(396,562 )
Return/(loss) before taxation
(93,087 )
Taxation
5
(3,629 )
(3,629 )
(45,020 )
(45,020 )
Total income/ (loss) after
taxation
(138,107 )
Revenue
pence
Capital
pence
Total
pence
Revenue
pence
Capital
pence
Total
pence
Return/(loss) on total income
after taxation per 50p
ordinary share – basic &
diluted
6
(2.89
The total column of this statement is the Income Statement of the Group prepared in accordance with international
accounting standards in conformity with the requirements of the Companies Act 2006. The supplementary revenue
and capital columns are prepared in accordance with the Statement of Recommended Practice (“AIC SORP”) issued
in July 2022 by the Association of Investment Companies.
The Group did not have any income or expense that was not included in total income for the year. Accordingly, total
income is also total comprehensive income for the year, as defined by IAS 1 (revised) and no separate Statement of
Comprehensive Income has been presented.
All revenue and capital items in the above statement derive from continuing operations. No operations were
acquired or discontinued during the year.
46
The Investment
Company plc
The notes on pages 52 to 68 form part of these financial statements.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 30 June 2024
Ordinary
share
capital
£
Share
premium
£
Capital
redemption
reserve
£
Special
reserve
£
Capital
reserve
£
Revenue
reserve
£
Total
£
Balance at
1 July 2023
(1,523,855 )
Total comprehensive
income
Net return for the year
Transactions with
Shareholders recorded
directly to equity
Cancellation of share
premium account and
capital redemption
reserve
(4,453,903 )
(2,408,820 )
Share issue
Cost of shares
purchased under
Tender Offer and
held in Treasury
(6,862,723 )
(5,795,417 )
(12,658,140 )
Ordinary dividends
Tender Offer costs
(82,235 )
(82,235 )
Balance at
30 June 2024
(1,503,749 )
Balance at
1 July 2022
(1,385,748 )
Total comprehensive
income
Net return/(loss)
for the year
(138,107 )
Transactions with
Shareholders recorded
directly to equity
Tender Offer costs
(516,583 )
(516,583 )
Balance at
30 June 2023
(1,523,855 )
47
The notes on pages 52 to 68 form part of these financial statements.
For the year ended 30 June 2024
Ordinary
share
capital
£
Preference
share
capital
£
Share
premium
£
Capital
redemption
reserve
£
Special
reserve
£
Capital
reserve
£
Revenue
reserve
£
Total
£
Balance at
1 July 2023
2,386
,
025
858,783
4,453,903
2,408,820
–
5,450,799
1,003,304
16,561,634
Total comprehensive
income
Net return for the year
–
–
–
–
–
1,562,294
27,453
1,589,747
Transactions with
Shareholders
recorded directly to
equity
Cancellation of share
premium account and
capital redemption
reserve
–
–
(4,453,903) (2,408,820)
6,862,723
–
–
–
Share issue
406,414
–
2,425,325
–
–
–
–
2,831,739
Cost of shares
purchased under
Tender Offer and
held in Treasury
–
–
–
–
(6,862,723)
(5,795,417)
–
(12,658,140)
Tender Offer costs
–
–
–
–
–
(82,235)
–
(82,235)
Ordinary dividends
–
–
–
–
–
–
1,927
1,927
Preference share
dividends paid
–
–
–
–
–
–
(172)
(172)
Balance at
30 June 2024
2,792,439
858,783
2,425,325
–
–
1,135,441
1,032,512
8,244,500
Balance at
1 July 2022
2,386,025
858,783
4,453,903
2,408,820
–
5,626,497
1,128,452 16,862,480
Total comprehensive
income
Net return/(loss)
for the year
–
–
–
–
–
340,885
(124,976)
215,909
Transactions with
Shareholders
recorded directly to
equity
Tender Offer costs
–
–
–
–
–
(516,583)
–
(516,583)
Preference share
dividends paid
–
–
–
–
–
–
(172)
(172)
Balance at
30 June 2023
2,386,025
858,783
4,453,903
2,408,820
–
5,450,799
1,003,304
48
The Investment
Company plc
The notes on pages 52 to 68 form part of these financial statements.
CONSOLIDATED BALANCE SHEET
At 30 June 2024
Notes
30 June
2024
£
30 June
2023
£
Non-current assets
Investments held at fair value through profit or loss
8
Current assets
Trade and other receivables
11
Cash and cash equivalents
Current liabilities
Trade and other payables
12
(210,298 )
(601,160 )
(210,298 )
(601,160 )
Net current assets
Net assets
Capital and reserves
Ordinary share capital
13
Share premium
Capital redemption reserve
Special reserve
Capital reserve
Revenue reserve
(1,503,749 )
(1,523,855 )
Shareholders’ funds
NAV per 50p ordinary share
15
I. R. Dighé
Company Number: 0004205
49
The notes on pages 52 to 68 form part of these financial statements.
At 30 June 2024
Notes
30 June
2024
£
30 June
2023
£
Non-current assets
Investments held at fair value through profit or loss
8
7,069,820
8,564,470
Investment in subsidiaries
9
807,496
326,277
7,877,316
8,890,747
Current assets
Trade and other receivables
11
318,775
80,759
Cash and cash equivalents
251,625
8,281,759
570,400
8,362,518
Current liabilities
Trade and other payables
12
(203,216)
(691,631)
(203,216)
(691,631)
Net current assets
367,184
7,670,887
Net assets
8,244,500
16,561,634
Capital and reserves
Ordinary share capital
13
2,792,439
2,386,025
Preference share capital
14
858,783
858,783
Share premium
2,425,325
4,453,903
Capital redemption reserve
–
2,408,820
Special reserve
–
–
Capital reserve
1,135,441
5,450,799
Revenue reserve
1,032,512
1,003,304
Shareholders’ funds
8,244,500
16,561,634
As permitted by section 408 of the Companies Act 2006, the Company has not presented its own Income Statement.
The amount of the Company’s return for the financial year dealt with in the financial statements of the Group is a
gain after tax of £1,589,747 (2023: gain of £215,909).
These financial statements were approved by the Board on 18 September 2024 and were signed on its behalf by:
I. R. Dighé
Chairman
50
The Investment
Company plc
The notes on pages 52 to 68 form part of these financial statements.
For the year ended 30 June 2024
Notes
30 June
2024
£
30 June
2023
£
30 June
2024
£
30 June
2023
£
Cash flows used in operating activities
Income received from investments
269,318
303,1 1 4
Interest received
50,706
6,451
Overseas taxation paid
(4,475 )
(46,539 )
(4,475)
(46,539)
Investment management fees paid
–
–
Other cash payments
(352,286 )
(382,266 )
(339,205)
(370,586)
Net cash used in operating activities
(36,735 )
(119,240 )
(23,656)
(107,560)
Cash flows used in financing activities
Proceeds from Share Issue
3,618,690
–
Funding of Tender Offer
(13,445,091 )
(13,445,091)
–
Tender Offer expenses paid
(539,075 )
(35,000 )
(539,075)
(35,000)
Net cash used in financing activities
(10,365,476 )
(35,000 )
(10,365,476)
(35,000)
Cash flows generated from investing activities
Purchase of investments
8
(9,459,505 )
(3,412,011 )
(9,459,505)
(3,412,011)
Sale of investments
8
11,831,583
11,173,539
Loans to subsidiaries
(13,080)
3,049
Net cash generated from investing activities
2,358,998
7,764,577
Net (decrease)/increase in cash and cash equivalents
(8,030,133 )
(8,030,134)
7,622,017
Reconciliation of net cash flow to
movement in net cash
(Decrease)/increase in cash
(8,030,133 )
(8,030,134)
7,622,017
Exchange rate movements
(4,121 )
–
(4,1 2 1 )
(Decrease)/increase in net cash
(8,030,133 )
(8,030,134)
7,617,896
Net cash at start of period
8,281,759
663,863
Net cash at end of period
251,625
8,281,759
Analysis of net cash
Cash and cash equivalents
251,625
8,281,759
251,625
Group
Company
51
The Company is a public limited company limited by shares and incorporated and registered in England and
Corporation Tax Act 2010. The Company’s registered office is The Office Suite, Den House, Den Promenade,
The Group’s consolidated financial statements for the year ended 30 June 2024 , which comprise the audited results
of the Company and its wholly owned subsidiaries, Abport Limited and New Centurion Trust Limited (until the date of
liquidation) (together referred to as the “Group”), have been prepared in accordance with UK adopted international
accounting standards and in accordance with the requirements of the Companies Act 2006. The annual financial
statements have also been prepared in accordance with the AIC Statement of Recommended Practice issued in July
2022 (“AIC SORP”), except to any extent where it is not consistent with the requirements of UK IFRS.
In order to better reflect the activities of an investment trust company and in accordance with guidance issued by
the AIC, supplementary information which analyses the Income Statement between items of a revenue and capital
nature have been prepared alongside the Income Statement.
The Directors have made an assessment of the Group’s ability to continue as a going concern. This has included a
review of the Group’s financial position in respect of its cash flows and investment commitments (of which there are
none of significance), the working arrangements of key service providers, the continued eligibility to be approved as
an investment trust company, the impact of the current economic environment and the conflicts in Ukraine and the
Middle East. In addition, the Directors are not aware of any material uncertainties that may cast significant doubt
upon the Group’s ability to continue as a going concern.
The Directors are satisfied that the Group has sufficient resources to continue in business for the foreseeable future
being a period of at least 12 months from the date that these financial statements were approved. Therefore, the
IFRS 10 stipulates that subsidiaries of Investment Entities are not consolidated. The Investment Company meets all three
characteristics of an Investment Entity as described, however, it is envisaged that one of the subsidiaries will be a dealing
subsidiary and, therefore consolidated financial statements are presented for the Group. The financial statements of the
subsidiaries are prepared for the same reporting year as the parent Company, using consistent accounting policies. All
The Directors are of the opinion that the Group is engaged in a single segment of business, being investment
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2024
52
The Investment
Company plc
The following, relevant accounting standards and their amendments were in issue at the year end but will not be in
effect until after this financial year.
International Accounting Standards | Effective date* | |
IAS 1 | (Amendments) Presentation of Financial Statements regarding classification of | 1 January 2024 |
liabilities as Current or Non-current | ||
IAS 1 | (Amendments) Classification of liabilities as Current or Non-current – Deferral of | 1 January 2024 |
effective date | ||
IAS 7 | (Amendments) Statement of Cash Flows | 1 January 2024 |
IFRS 7 | (Amendments) Financial Instruments: Disclosures: Supplier Finance Arrangements | 1 January 2024 |
IAS 21 | (Amendments) Lack of Exchangeability | 1 January 2025 |
* Years beginning on or after
The Directors do not expect that the adoption of the standards listed above will have a material impact on the
The preparation of financial statements in conformity with IFRS requires management to make judgements,
estimates and assumptions that affect the application of policies and the reported amounts in the Balance Sheet,
the Consolidated Income Statement and the disclosure of contingent assets and liabilities at the date of the financial
statements. 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 judgements
about carrying values of assets and liabilities that are not readily apparent from other sources.
The estimates and underlying assumptions are based on historical experience and other factors that are considered
to be relevant. These are reviewed on an ongoing basis. Actual results may differ from these estimates. 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 period if the revision affects both current and future periods.
The investment portfolio is valued by reference to quoted prices. However, the Board assesses the portfolio for any
investments which it considers the value has fallen permanently below cost. Any such loss is treated as a permanent
impairment and as a realised loss, even though the investment is still held.
continued
NOTES TO THE FINANCIAL STATEMENTS
54
The Investment
Company plc
As the Group’s business is investing in financial assets with a view to profiting from their total return in the form
of income and capital growth, Investments are classified at fair value through profit or loss on initial recognition
in accordance with IFRS 9. The portfolio of financial assets is managed and its performance evaluated on a fair
value basis, in accordance with a documented investment strategy, and information about the portfolio is provided
internally on that basis to the Group’s Board of Directors.
Investments are measured initially, and at subsequent reporting dates, at fair value, and derecognised at trade date
where a purchase or sale is under a contract whose terms require delivery within the time-frame of the relevant
market. For quoted investments this is deemed to be bid market prices or closing prices.
Changes in fair value of investments and realised gains and losses on disposal are recognised in the Consolidated
Income Statement as capital items. The holdings of the investment in subsidiaries are stated at cost less any provision
for impairment in value. All investments for which fair value is measured or disclosed in the Financial Statements are
Transactions denominated in foreign currencies are converted to Pounds Sterling at the actual exchange rate as at
the date of the transaction. Items that are denominated in foreign currencies at the year-end are reported at the
rate of exchange at the Balance Sheet date. Any gain or loss arising from a change in exchange rate subsequent
to the date of the transaction is included as an exchange gain or loss in the capital reserve or the revenue account
Cash comprises cash at bank and demand deposits. 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.
For the purpose of the Cash Flow Statement, cash and cash equivalents consist of cash and cash equivalents as
Current assets are initially recognised at cost and subsequently measured at amortised cost and balances revalued
for exchange rate movement. Current assets comprise debtors, prepayments and cash and are subject to review
Current liabilities are initially recognised at cost and subsequently measured at amortised cost and balances revalued
for exchange rate movement. Current liabilities comprise accruals and other creditors and are subject to review for
1. Accounting Policies
Dividends receivable on quoted equity shares are taken to revenue or capital depending on the nature of the dividend,
on an ex-dividend basis. Special dividends are considered individually to ascertain the reason behind the payment
and determine whether they are treated as revenue or capital. Dividends receivable on equity shares where no ex-
dividend date is quoted are brought into account when the Company’s right to receive payment is established. Fixed
returns on non-equity shares are recognised on a time-apportioned basis.
Dividends from overseas companies are shown gross of any non-recoverable withholding taxes which are disclosed
separately in the Consolidated Income Statement.
Dividend income will only be recognised when there is reasonable certainty that the issuer has the ability to make
The tax expense represents the sum of the tax currently payable. The tax payable is based on the taxable profit
for the year. Taxable profit differs from net profit as reported in the Consolidated Income Statement because it
excludes items that are taxable or deductible in other years and it further excludes items that are never taxable or
deductible. The Group’s liability for current tax is calculated using tax rates applicable at the Balance Sheet date.
No taxation liability arises on gains from sales of fixed asset investments by the Group by virtue of its investment
trust status. However, the net revenue (excluding UK dividend income) accruing to the Group is liable to corporation
Dividends to Shareholders are recognised as a liability in the period in which they are paid or approved in general
meetings and are taken to the Statement of Changes in Equity. Dividends declared and approved by the Company
Issued share capital consists of ordinary shares with voting rights and issued preference shares which are non-voting.
The issued preference shares, owned in their entirety by New Centurion Trust Limited, a wholly-owned subsidiary of
the Company, are entitled to receive a cumulative dividend of 0.01p per share per annum, and are entitled to receive
55
continued
NOTES TO THE FINANCIAL STATEMENTS
56
The Investment
Company plc
Share Premium
The share premium account represents the accumulated premium paid for shares issued in previous periods above
their nominal value less issue expenses. This is a reserve forming part of non-distributable reserves. The following
items are taken to this reserve:
•
costs associated with the issue of equity; and
•
premium on the issue of shares.
The reserve represents the nominal value of the shares bought back and cancelled. This reserve is not distributable.
Capital Reserve
Capital expenses, gains or losses on realisation of investments held at fair value through profit or loss and changes
in fair value of investments are transferred to the capital reserve.
The following are taken to this reserve:
•
gains and losses on the disposal of investments;
•
net movement arising from changes in the fair value of investments held and subsidiaries classified as at “fair
value through profit or loss”;
•
exchange differences and appropriate costs of a capital nature;
•
dividends receivable of a capital nature;
•
expenses together with the related taxation effect, allocated to this reserve in accordance with the above policies; and
•
the cost of the Tender Offer.
Realised gains on investments less expenses, provisions and unrealised gains may be considered by the Board for
distribution. The unrealised gains are not distributable.
Revenue Reserves
The net revenue for the year is transferred to the revenue reserve and any dividends paid are deducted from the
revenue reserve.
The revenue reserve represents the surplus accumulated profits and is distributable.
Special Reserve
The special reserve was created by a Court Order on 18 July 2023. The cost of share buybacks and any dividend
Year ended | Year ended | |||||
30 June 2024 | 30 June 2023 | |||||
Revenue | Capital | Total | Revenue | Capital | Total | |
£ | £ | £ | £ | £ | £ | |
Income from investments: | ||||||
UK dividends | 122,596 | 118,536 | 241,132 | 52,082 | – | 52,082 |
Unfranked dividend income | ||||||
(including scrip dividends) | 13,548 | – | 13,548 | 244,942 | – | 244,942 |
UK fixed interest | 23,188 | – | 23,188 | – | – | – |
159,332 | 118,536 | 277,868 | 297,024 | – | 297,024 | |
Other income | ||||||
Bank deposit and other | ||||||
interest | 50,708 | – | 50,708 | 6,451 | – | 6,451 |
Total income | 210,040 | 118,536 | 328,576 | 303,475 | – | 303,475 |
Year ended | Year ended | |
30 June | 30 June | |
2024 | 2023 | |
£ | £ | |
Investment management fee | – | – |
Following completion of the Tender Offer, on 26 July 2023 Chelverton Asset Management was appointed as
Investment Manager.
The Investment Manager is entitled to an annual fee of 0.75% of the Net Asset Value. To the extent that the ongoing
charges ratio exceeds 2% the Investment Manager has waived the management fee and shall instead make a
contribution to the Company to ensure that the ongoing charges ratio does not exceed 2%. An amount of £189,476 is
available to offset against future investment management fees.
57
continued
NOTES TO THE FINANCIAL STATEMENTS
58
The Investment
Company plc
Year ended | Year ended | |
30 June | 30 June | |
2024 | 2023 | |
£ | £ | |
Administration and secretarial services | 85,000 | 85,000 |
Auditor's remuneration for: | ||
– audit of the Group’s financial statements | 50,000 | 46,300 |
Directors’ remuneration (see Note 18) | 61,667 | 86,667 |
Investment Manager's contribution to expenses (see Note 3) | (189,476) | – |
Other expenses | 181,041 | 178,595 |
Total expenses | 188,232 | 396,562 |
The audit of the Group’s financial statements includes the cost of the audit of Abport Limited of £4,180 (2023:
Year ended 30 June 2024 | Year ended 30 June 2023 | |||||
Revenue | Capital | Total | Revenue | Capital | Total | |
£ | £ | £ | £ | £ | £ | |
Current Taxation | – | – | – | – | – | – |
Overseas taxation suffered | 3,629 | – | 3,629 | 45,020 | – | 45,020 |
3,629 | – | 3,629 | 45,020 | – | 45,020 | |
The current tax charge for the year differs from the standard rate of corporation tax in the UK of 25.0%. The
differences are explained below:
Year ended 30 June 2024 | Year ended 30 June 2023 | |||||
Revenue | Capital | Total | Revenue | Capital | Total | |
£ | £ | £ | £ | £ | £ | |
Return on ordinary activities | 21,808 | 994,467 | 1,016,275 | (93,087) | 877,303 | 784,216 |
Tax at UK Corporation tax | ||||||
rate of 25.0% (2023: 20.5%) | 5,452 | 248,617 | 254,069 | (19,083) | 179,847 | 160,764 |
Effects of: | ||||||
UK dividends that are not | ||||||
taxable | (30,649) | (29,634) | (60,283) | (10,677) | – | (10,677) |
Overseas dividends that are | ||||||
not taxable | – | – | – | (11,172) | – | (11,172) |
Non-taxable investment | ||||||
(gains) | – | (218,983) | (218,983) | – | (179,847) | (179,847) |
Overseas taxation suffered | 3,629 | – | 3,629 | 45,020 | – | 45,020 |
Unrelieved expenses | 25,197 | – | 25,197 | 40,932 | – | 40,932 |
Actual current tax charged | ||||||
to the revenue account | 3,629 | – | 3,629 | 45,020 | – | 45,020 |
Factors that may affect future tax charges
will generate sufficient taxable income in the future to use these expenses to reduce future tax charges and therefore
no deferred tax asset has been recognised.
Deferred tax is not provided on capital gains and losses arising on the revaluation or disposal of investments because
the Company meets (and intends to continue for the foreseeable future to meet) the conditions for approval as an
59
continued
NOTES TO THE FINANCIAL STATEMENTS
60
The Investment
Company plc
Returns per share are based on the weighted average number of shares in issue during the year. Normal and diluted
returns per share are the same as there are no dilutive elements on share capital.
Year ended | Year ended | |||||
30 June 2024 | 30 June 2023 | |||||
Revenue | Capital | Total | Revenue | Capital | Total | |
Return/(loss) after taxation | ||||||
attributable to ordinary | ||||||
Shareholders (£) | 18,179 | 994,467 | 1,012,646 | (138,107) | 877,303 | 739,196 |
Weighted average number | ||||||
of ordinary shares in issue | ||||||
(excluding shares held in | ||||||
Treasury) | 2,045,691 | 4,772,049 | ||||
Return/(loss) per ordinary | ||||||
share basic and diluted | ||||||
(pence) | 0.89 | 48.61 | 49.50 | (2.89) | 18.38 | 15.49 |
Amounts recognised as distributions to equity holders in the year.
Year ended | Year ended | |
30 June | 30 June | |
2024 | 2023 | |
£ | £ | |
Unclaimed dividends in respect of prior periods | ||
clawed back after 12 years | 1,927 | – |
Total | 1,927 | – |
Group | Company | |||
2024 | 2023 | 2024 | 2023 | |
£ | £ | £ | £ | |
Investments held at fair value through profit or loss | ||||
Opening book cost | 8,123,670 | 15,087,359 | 8,177,670 | 15,107,651 |
Opening net investment holding gains | 440,800 | 357,884 | 386,800 | 336,968 |
Opening valuation | 8,564,470 | 15,445,243 | 8,564,470 | 15,444,619 |
Movements in the year: | ||||
Purchases at cost | 9,504,441 | 3,439,089 | 9,504,441 | 3,439,089 |
Sales proceeds | (11,885,506) | (11,196,367) | (11,885,503) | (11,195,700) |
Realised gains on sales | 544,141 | 793,589 | 490,138 | 826,631 |
Unrealised gains in the year | 342,274 | 82,916 | 396,274 | 49,831 |
Closing valuation | 7,069,820 | 8,564,470 | 7,069,820 | 8,564,470 |
Being: | ||||
Book cost | 6,286,746 | 8,123,670 | 6,286,746 | 8,177,670 |
Net investment holding gains | 783,074 | 440,800 | 783,074 | 386,800 |
7,069,820 | 8,564,470 | 7,069,820 | 8,564,470 | |
Group | Company | |||
2024 | 2023 | 2024 | 2023 | |
£ | £ | £ | £ | |
Summary of capital gains | ||||
Realised gains on sales | 544,141 | 793,589 | 490,138 | 826,631 |
Unrealised gains in the year | 342,274 | 82,916 | 396,274 | 49,831 |
886,415 | 876,505 | 886,412 | 876,462 | |
Group | Company | |||
2024 | 2023 | 2024 | 2023 | |
£ | £ | £ | £ | |
Transaction costs | ||||
Costs on purchases | 32,920 | 5,734 | 32,920 | 5,734 |
Costs on sales | 39,595 | 21,680 | 39,595 | 21,592 |
72,515 | 27,414 | 72,515 | 27,326 | |
continued
NOTES TO THE FINANCIAL STATEMENTS
62
The Investment
Company plc
Reconciliation of cash movements in investment transactions
The difference between the purchases in Note 8 of £9,504,441 and that shown in the Cash Flow Statement on
page 51 is £44,936 which is represented by outstanding trades of £44,936.
The difference between the sales proceeds in Note 8 of £11,885,506 and that shown in the Cash Flow Statement on
page 51 is £53,923 which is represented by an exchange loss of £10,484 and outstanding trades of £43,439.
Fair Value Hierarchy
Fair value is the amount at which an asset could be sold in an ordinary transaction between market participants at
the measurement date, other than a forced or liquidation sale. The Group measures fair values using the following
hierarchy that reflects the significance of the inputs used in making the measurements.
Categorisation within the hierarchy has been determined on the basis of the lowest level input that is significant to
the fair value measurement of the relevant asset as follows:
Level 1 – valued using quoted prices, unadjusted in active markets for identical assets and liabilities.
Level 2 – valued by reference to valuation techniques using observable inputs for the asset or liability other than
quoted prices included in Level 1.
Level 3 – valued by reference to valuation techniques using inputs that are not based on observable market data for
the asset or liability.
The table below sets out the fair value measurement of financial instruments as at 30 June 2024, by the level in the
fair value hierarchy into which the fair value measurement is categorised.
Group | Level 1 | Level 2 | Level 3 | Total |
At 30 June 2024 | £ | £ | £ | £ |
Financial assets at fair value through profit or loss: | ||||
Equities | 7,069,820 | – | – | 7,069,820 |
7,069,820 | – | – | 7,069,820 |
Group | Level 1 | Level 2 | Level 3 | Total |
At 30 June 2023 | £ | £ | £ | £ |
Financial assets at fair value through profit or loss: | ||||
Equities | 5,975,907 | – | – | 5,975,907 |
Exchange traded commodities | 2,588,563 | – | – | 2,588,563 |
8,564,470 | – | – | 8,564,470 |
There were no transfers between levels during the current or prior year.
The valuation techniques used by the Group are set out in the Accounting Policies in Note 1.
Valuation process for Level 2 investments
Investments classified within level 2 are valued by reference to quoted prices but not being actively traded have
been treated as level 2.
Valuation process for Level 3 investments
Investments classified within Level 3 comprise those valued by reference to an indicative price list of an independent
third party broker, but the said price list is not sufficiently definitive or observable/publicly available, so as to meet
Company | Company | |
30 June | 30 June | |
2024 | 2023 | |
£ | £ | |
At cost | 5,410,552 | 5,410,552 |
Provision for diminution in value | (4,603,056) | (5,084,275) |
Net value | 807,496 | 326,277 |
At 30 June 2024, the Company held interests in the following subsidiary companies:
Country of | % share of | % share of | ||
Incorporation | capital held | voting rights | Nature of business | |
Abport Limited | England | 100% | 100% | Investment dealing company |
New Centurion Trust | England | 100% | 100% | Investment dealing company |
(in liquidation) |
The registered office of the Subsidiaries is the same as that of the Company.
On 29 May 2024, New Centurion Trust Limited was placed into members' voluntary liquidation. This subsidiary is a
The Company has no notified interests in 3% or more of the voting rights of any companies at 30 June 2024 (30 June
8. Investments
63
continued
continued
NOTES TO THE FINANCIAL STATEMENTS
64
The Investment
Company plc
Group | Company | |||
2024 | 2023 | 2024 | 2023 | |
£ | £ | £ | £ | |
Amounts due from subsidiaries | – | – | 53,849 | 55,690 |
Dividends receivable | 14,495 | 5,944 | 14,495 | 5,944 |
Taxation recoverable | – | 639 | – | 639 |
Trade receivables | 43,439 | – | 43,439 | – |
Other receivables | 206,992 | 18,485 | 206,992 | 18,486 |
264,926 | 25,068 | 318,775 | 80,759 |
The carrying amount of such receivables approximates to their fair value. Trade and other receivables are not past
Group | Company | |||
2024 | 2023 | 2024 | 2023 | |
£ | £ | £ | £ | |
Preference dividends payable to the Company’s wholly | ||||
owned subsidiary | – | – | – | 1,721 |
Amounts due to subsidiaries | – | – | – | 101,533 |
Trade payables | 44,936 | – | 44,936 | – |
Other accruals | 165,362 | 601,160 | 158,280 | 588,377 |
210,298 | 601,160 | 203,216 | 691,631 |
Group and Company | Group and Company | |||
2024 | 2023 | |||
Number | £ | Number | £ | |
Issued allotted and fully paid: | ||||
Ordinary shares of 50p each | 5,584,878 | 2,792,439 | 4,772,049 | 2,386,025 |
As announced on 18 July 2023, 3,980,664 ordinary shares were validly tendered pursuant to the Tender Offer,
constituting 83.4% of the existing issued share capital. All validly tendered ordinary shares were accepted in full, with
3,747,673 ordinary shares repurchased by the Company and 232,991 ordinary shares sold to Incoming Shareholders
pursuant to the Matched Bargain Facility. Tender Offer costs totalling £598,818 were incurred as part of this offer.
An amount of £516,583 was incurred at 30 June 2023 and a further £82,235 incurred during the year.
13. Ordinary Share Capital
In addition, on 26 July 2023 the Company issued 812,829 new ordinary shares in connection with the Offer for
Subscription and Intermediaries Offer.
Following Admission, and completion of the Tender Offer, the Company's total issued share capital comprises of
5,584,878 ordinary shares. The Company holds all 3,747,673 ordinary shares that were repurchased pursuant to
the Tender Offer in Treasury. Therefore, the total number of shares with voting rights in the Company is 1,837,205.
The above figure of 1,837,205 may be used by Shareholders as the denominator for the calculations by which they
will determine if they are required to notify their interest, or a change to their interest in, the Company under the
FCA's Disclosure Guidance and Transparency Rules.
The ordinary shares entitle the holders to receive all ordinary dividends and all remaining assets on a winding up,
after the fixed rate preference shares have been satisfied in full.
At the year end, the Company held 3,747,673 ordinary shares in Treasury (2023: None).
14. Issued Preference Share Capital
Group | Company | |||
2024 | 2023 | 2024 | 2023 | |
£ | £ | £ | £ | |
Issued preference share of 50p each | – | – | 858,783 | 858,783 |
The 1,717,565 fixed rate preference shares are non-voting, entitled to receive a cumulative dividend of 0.01p per
share per annum, and are entitled to receive their nominal value of 50p, on a distribution of assets or a winding
up. The whole of the issue is held by New Centurion Trust Limited, a wholly owned subsidiary of the Company. New
Centurion Trust was placed into members' voluntary liquidation on 29 May 2024.
The Directors do not consider the fair values of the issued preference share capital to be significantly different from
The NAV per ordinary share is calculated as follows:
2024 | 2023 | |
£ | £ | |
Net Assets | 7,376,741 | 16,270,804 |
Ordinary shares in issue (excluding Treasury shares) | 1,837,205 | 4,772,049 |
NAV per ordinary share | 401.52p | 340.96p |
The underlying investments of the wholly owned subsidiary New Centurion Trust Limited comprise issued preference
share capital in the Company, as discussed in Note 14 and, being effectively eliminated on consolidation, the valuation
65
continued
NOTES TO THE FINANCIAL STATEMENTS
66
The Investment
Company plc
Investment Objective and Policy
At a General Meeting held on 26 June 2023, the members voted to amend the Investment Objective to: maximise
capital growth for Shareholders over the long-term by investing in high-quality, quoted, UK small and mid-
cap companies.
Risks
The Group’s financial risk management can be found in the Strategic Report on pages 13 and 14.
The Group’s financial instruments comprise securities, cash balances, receivables and payables. They are classified
in the following categories:
•
those to be measured subsequently at fair value through profit or loss; and
•
those to be measured at amortised cost.
The financial assets held at amortised cost include trade and other receivables, cash and cash equivalents.
The main risks identified arising from the Group’s financial instruments are:
(a)
market price risk, including currency risk, interest rate risk and other price risk;
(b)
liquidity risk; and
(c)
credit risk.
The Board reviews and agrees policies for managing each of these risks, which are summarised below.
Market price risk arises mainly from uncertainty about future prices of financial instruments used in the Group’s
business. It represents the potential loss the Group might suffer through holding market positions by way of price
movements, interest rate movements and exchange rate movements. The Board assesses the exposure to market
price risk when making each investment decision and monitor these risks on the whole of the investment portfolio
on an ongoing basis.
In the early part of the year, the Group’s total return and net assets were affected by currency translation movements
as a significant proportion of the Company’s assets were denominated in currencies other than Sterling, which is the
Group’s functional currency. It was not the Group’s policy to hedge this currency risk. Under the new investment
policy, voted for on 26 June 2023, the Company invests in UK companies only, hence this risk has little direct impact
16. Financial Instruments and Associated Risks
Interest rate risk
The Group’s financial assets and liabilities, include cash, equity shares, preference shares and fixed interest stocks.
As the majority of the Group’s financial assets and liabilities are non-interest bearing the direct exposure to interest
rates is not material.
The impact of movements would not significantly affect the net assets attributable to ordinary Shareholders or the
total profit.
Other price risk
Other price risk arises from changes in market prices other than those arising from currency risk or interest rate risk.
The Board manages the risks inherent in the investment portfolio by maintaining a spread of investments across
different sectors and monitoring market prices throughout the year. The Board meets regularly in order to review
This is the risk that the Group will encounter difficulty in meeting its obligations associated with financial liabilities. All
liabilities are due within one year.
The Group invests in a spread of investments which are traded on recognised stock markets and which can be readily
The Group does not have any significant exposure to credit risk arising from one individual party. Credit risk is spread
across a number of counterparties, each having an immaterial effect on the Group’s cash flows should a default
happen. The Group assesses its debtors from time to time to ensure they are neither past due or impaired.
The maximum exposure of financial assets to credit risk at the Balance Sheet date was as follows:
Group | Company | |||
2024 | 2023 | 2024 | 2023 | |
£ | £ | £ | £ | |
Financial assets neither past due or impaired | ||||
Trade and other receivables | 264,926 | 25,068 | 318,775 | 80,759 |
Cash and cash equivalents | 252,293 | 8,282,426 | 251,625 | 8,281,759 |
517,219 | 8,307,494 | 570,400 | 8,362,518 |
Sensitivity Analysis
At the year end, the Board believes that the Group's assets are mainly exposed to market price risk. A fall of 20%
in the value of the equity shares would reduce the assets of the Company by 1,413,964 or 77.0 pence per share. An
67
continued
NOTES TO THE FINANCIAL STATEMENTS
68
The Investment
Company plc
Capital is managed so as to maximise the return to Shareholders while maintaining a capital base to allow the Group
to operate effectively. Capital is managed on a consolidated basis and to ensure that the Group will be able to
continue as a going concern.
In order to maintain or adjust the capital structure, the Group may pay dividends to Shareholders, return capital to
Shareholders, issue new shares or sell securities to reduce debt.
Fiske plc, a company in which Mr Perrin is a non-executive director, is the Company's custodian. An amount of £6,449
(2023: £7,248) was paid to Fiske plc pursuant to the custody agreement and, as at the year end, £nil (2023: £1,228)
was payable to Fiske plc.
At the year end, the Board consisted of four non-executive Directors all of whom, with the exception of Mr Horner,
who is Managing Director of Chelverton Asset Management, the Company's Investment Manager, are considered
to be independent by the Board. Mr Dighé holds a directorship within Edelweiss Holdings plc (“Edelweiss”), who
were significant Shareholders in the Company in the previous year. For the year ended 30 June 2024, the Directors,
including the Chairman but excluding David Horner, received an annual fee of £20,000. Further information can be
found within the Directors' Remuneration Report on page 33.
Michael Weeks resigned from the Board on 26 July 2023 and David Horner was appointed as a non-executive
Director. Mr Horner is the Managing Director of the Investment Manager. Mr Horner has waived his right to receive
fees. Further information regarding waived investment management fees can be found in Note 3 on page 57.
The Directors did not receive any other form of remuneration and at the year end, there were no outstanding fees
payable to Directors (2023: £nil).
The preference shares of the Parent Company will be repaid to NCT via a Scheme of Arrangement at a date still to
69
SHAREHOLDER INFORMATION
Fraud Warning
Fraudsters use persuasive and high-pressure tactics to
lure investors into scams and we are aware of entities
from time to time purporting to be The Investment
Company plc. They may offer to sell shares that
turn out to be worthless or non-existent, or to buy
shares at an inflated price in return for an upfront
payment. While high profits are promised, if you
buy or sell shares in this way you will probably lose
your money. Detailed advice on how to avoid and
report potential investment scams is available on the
FCA website: www.fca.org.uk/scamsmart.
The Company has also been made aware of attempts
to issue documentation in the Company’s name which is
not legitimate. Anyone wishing to verify the authenticity
of any documentation should contact the Company
Secretary on 01392 487056 or [email protected].
The Company has also been made aware of a website
purporting to be the Company's website which is not
legitimate. Anyone wishing to verify the authenticity of
the website should contact the Company Secretary on
01392 487056 or [email protected].
70
The Investment
Company plc
NOTICE OF ANNUAL GENERAL MEETING
Notice is hereby given that the 158th Annual General Meeting of the Company will be held at the offices of Chelverton
Asset Management Limited, Ground Floor Office, Basildon House, 7 Moorgate, London EC2R 6AF on Thursday
31 October 2024 at 10.00 am to consider and, if thought fit, pass the following resolutions, of which numbers 1 to 10,
13 and 15 will be proposed as ordinary resolutions and numbers 11, 12, 14 and 16 as special resolutions.
Ordinary Business
Resolution 1 – Ordinary Resolution
To receive and adopt the Strategic Report, Reports of the Directors and Auditor and the audited financial statements
for the year ended 30 June 2024.
Resolution 2 – Ordinary Resolution
To receive and approve the Directors’ Remuneration Report.
Resolution 3 – Ordinary Resolution
To approve the Company’s Remuneration Policy as set out on page 32 of the Annual Report and Accounts for the
year ended 30 June 2024.
Resolution 4 – Ordinary Resolution
To re-elect I.R. Dighé as a Director of the Company.
Resolution 5 – Ordinary Resolution
To re-elect D.A. Horner as a Director of the Company.
Resolution 6 – Ordinary Resolution
To re-elect T.M. Metcalfe as a Director of the Company.
Resolution 7 – Ordinary Resolution
To re-elect M. H. W. Perrin as a Director of the Company.
Resolution 8 – Ordinary Resolution
To re-appoint PKF Littlejohn LLP as Auditor of the Company to hold office from the conclusion of this meeting until
the conclusion of the next meeting at which financial statements are laid before the Company.
Resolution 9 – Ordinary Resolution
To authorise the Directors to determine the remuneration of the Auditor.
Resolution 10 – Ordinary Resolution
THAT, in substitution for any existing authorities, the Directors be and are hereby generally and unconditionally
authorised in accordance with Section 551 of the Companies Act 2006 (“the Act”) to exercise all the powers of the
Company to allot ordinary shares of 50 pence each in the capital of the Company (“ordinary shares”) up to an
aggregate nominal amount of £183,720 (being 20% of the issued ordinary share capital, excluding Treasury shares, of
71
the Company at the date of this Notice), during the period commencing on the date of the passing of this Resolution
and expiring at the conclusion of the Annual General Meeting of the Company to be held in 2025 (unless previously
renewed, varied or revoked by the Company in general meeting) (the “Section 551 period”), but so that the Company
may, at any time prior to the expiry of the Section 551 period, make offers or agreements which would or might require
ordinary shares to be allotted after the expiry of the Section 551 period and the Directors may allot ordinary shares in
pursuance of such offers or agreements as if the authority had not expired.
Resolution 11 – Special Resolution
THAT, in substitution for any existing authorities, and subject to the passing of Resolution 10, the Directors be
and they are hereby empowered, in accordance with Sections 570 and 573 of the Act, to allot ordinary shares for
cash pursuant to the authority conferred on the Directors by Resolution 10 above, and to sell ordinary shares from
Treasury for cash as if Section 561(1) of the Act did not apply to any such allotment or sale, up to an aggregate
nominal amount of £183,720 (being 20% of the issued ordinary share capital, excluding Treasury shares, of the
Company at the date of this Notice), such power to expire at the conclusion of the Annual General Meeting of the
Company to be held in 2025 (unless previously renewed, varied or revoked by the Company in general meeting) save
that the Company may, at any time prior to the expiry of such power, make an offer or enter into an agreement
which would or might require ordinary shares to be allotted or sold after the expiry of such power and the Directors
may allot or sell ordinary shares in pursuance of such an offer or agreement as if such power had not expired.
Resolution 12 – Special Resolution
THAT, the Company is hereby generally and unconditionally authorised in accordance with Section 701 of the Act
to make market purchases (within the meaning of Section 693(4) of the Act) of ordinary shares of 50p each in the
capital of the Company (“ordinary shares”) provided that:
(a)
the maximum aggregate number of ordinary shares authorised to be purchased is such a number thereof
being 14.99% of the ordinary shares in issue, excluding shares held in Treasury at the date of the passing of this
Resolution;
(b)
the minimum price which may be paid for each ordinary share is 50p, or nominal value;
(c)
the maximum price which may be paid for each ordinary share shall not be more than the higher of: (i) an
amount equal to 105% of the average of the middle market quotations of ordinary shares taken from the Daily
Official List of the London Stock Exchange for the five business days immediately preceding the day on which
the contract of purchase is made; and (ii) the higher of the price of the last independent trade in the ordinary
shares and the highest then current independent bid for the ordinary shares on the London Stock Exchange;
(d)
this authority will (unless previously renewed, varied or revoked by the Company in general meeting) expire at
the conclusion of the Annual General Meeting of the Company to be held in 2025;
(e)
the Company may make a contract of purchase for ordinary shares under this authority before this authority
expires which will or may be executed wholly or partly after its expiration; and
(f)
any ordinary shares bought back under the authority hereby granted may, at the discretion of the Directors, be
cancelled or held in Treasury and if held in Treasury may be resold from Treasury or cancelled at the discretion
of the Directors.
72
The Investment
Company plc
NOTICE OF ANNUAL GENERAL MEETING
continued
Special Business
Resolution 13 – Ordinary Resolution (to permit one or more offers up to 5 million shares)
THAT, in substitution for any existing authorities, and in addition to the authority sought in Resolution 10, the Directors
be and are hereby generally and unconditionally authorised in accordance with Section 551 of the Companies Act
2006 (“the Act”) to exercise all the powers of the Company to allot ordinary shares of 50 pence each in the capital
of the Company (“ordinary shares”) up to an aggregate nominal amount of £2,500,000 (being approximately 272%
of the issued ordinary share capital, excluding Treasury shares, of the Company at the date of this Notice), during
the period commencing on the date of the passing of this Resolution and expiring at the conclusion of the Annual
General Meeting of the Company to be held in 2026 (unless previously renewed, varied or revoked by the Company
in general meeting) (the “Section 551 period”), but so that the Company may, at any time prior to the expiry of
the Section 551 period, make offers or agreements which would or might require ordinary shares to be allotted
after the expiry of the Section 551 period and the Directors may allot ordinary shares in pursuance of such offers or
agreements as if the authority had not expired.
Resolution 14 – Special Resolution (to permit one or more offers up to 5 million shares)
THAT, in substitution for any existing authorities, subject to the passing of Resolution 13, and in addition to the
authority sought in Resolution 11, the Directors be and they are hereby empowered, in accordance with Sections
570 and 573 of the Act, to allot ordinary shares for cash pursuant to the authority conferred on the Directors by
Resolution 13 above, and to sell ordinary shares from Treasury for cash as if Section 561(1) of the Act did not apply
to any such allotment or sale, up to an aggregate nominal amount of £2,500,000 (being approximately 272% of the
issued ordinary share capital, excluding Treasury shares, of the Company at the date of this Notice), such power
to expire at the conclusion of the Annual General Meeting of the Company to be held in 2026 (unless previously
renewed, varied or revoked by the Company in general meeting) save that the Company may, at any time prior to
the expiry of such power, make an offer or enter into an agreement which would or might require ordinary shares to
be allotted or sold after the expiry of such power and the Directors may allot or sell ordinary shares in pursuance of
such an offer or agreement as if such power had not expired.
Resolution 15 – Ordinary Resolution
THAT, in accordance with section 618 of the Companies Act 2006, each of the ordinary shares of £0.50 each in the
capital of the Company as at the date of this resolution (the “Existing Ordinary Shares”) which are credited as fully
paid be sub-divided into 5 ordinary shares of £0.10 each in the capital of the Company, such shares having the same
rights and being subject to the same restrictions (save as to nominal value) as each of the Existing Ordinary Shares.
Resolution 16 – Special Resolution
THAT, a General Meeting other than an Annual General Meeting may be called on not less than 14 clear days' notice.
By order of the Board.
ISCA Administration Services Limited
The Office Suite
Den House
Den Promenade
Teignmouth TQ14 8SY
18 September 2024
73
NOTES
Right to appoint a proxy
1.
A member entitled to attend and vote at this meeting may appoint one or more persons as his/her proxy to
attend, speak and vote on his/her behalf at the meeting. A proxy does not need to be a member of the Company.
A member may appoint more than one proxy in relation to a meeting provided that each proxy is appointed to
exercise the rights attached to a different share or shares held by that member.
2.
A proxy form which may be used to make such appointment and give proxy directions accompanies this notice.
If you do not receive a proxy form and believe that you should have one, or if you require additional proxy forms
in order to appoint more than one proxy, please contact the Registrar on +44 (0) 371 384 2030. If calling from
outside of the UK, please ensure the country code is used. The helpline is open Monday to Friday 8.30am to
5.30pm, excluding public holidays in England and Wales.
Procedure for appointing a proxy
3.
To be valid, the proxy form, together with any power of attorney or other authority under which it is signed or
a notarially certified copy thereof, should be lodged at the office of the Company’s Registrar, Equiniti Limited,
Aspect House, Spencer Road, Lancing, West Sussex BN99 6DA and must be received by post or (during normal
business hours only) by hand at Equiniti Limited, Aspect House, Spencer Road, Lancing West Sussex no later than
48 hours (excluding non-working days) before the time of the meeting or any adjournment thereof.
4.
The return of a completed proxy form will not preclude a member from attending the Annual General Meeting
and voting in person if he or she wishes to do so. The termination of the authority of a person to act as proxy
must be notified to the Company in writing.
Nominated persons
5.
Any person to whom this notice is sent who is a person nominated under Section 146 of the Companies Act
2006 to enjoy information rights (a “Nominated Person”) may, under an agreement between him/her and the
member by whom he or she was nominated, have a right to be appointed (or to have someone else appointed)
as a proxy for the Annual General Meeting. If a Nominated Person has no such proxy appointment right or does
not wish to exercise it, he/she may, under any such agreement, have a right to give instructions to the member
as to the exercise of voting rights.
6.
The statement of the rights of members in relation to the appointment of proxies in Notes 1 and 3 above does
not apply to Nominated Persons. The rights described in those notes can only be exercised by members of the
Company.
Record date and entitlement to vote
7.
To be entitled to attend and vote at the Annual General Meeting (and for the purpose of the determination by
the Company of the votes they may cast), members must be entered on the Company’s register of members
at 18:30 on 29 October 2024 (or, in the event of any adjournment, 48 hours before the time of the adjourned
meeting). Changes to the register of members after the relevant deadline will be disregarded in determining
the right of any person to attend and vote at the meeting. Only holders of ordinary shares are entitled to attend
and vote at the Annual General Meeting.
74
The Investment
Company plc
NOTICE OF ANNUAL GENERAL MEETING
continued
8.
As at 17 September 2024, (the business day prior to the publication of this notice), the Company’s issued share
capital amounted to 5,584,878 ordinary shares of which 3,747,673 are held in Treasury and carry no vote. The
total of shares in circulation is 1,837,205 ordinary shares carrying one vote each. The total voting rights in the
Company as at 17 September 2024 were 1,837,205 votes.
Members’ rights
9.
In accordance with Section 319A of the Companies Act 2006, the Company must cause any question relating to
the business being dealt with at the meeting put by a member attending the meeting to be answered. No such
answer need be given if:
(a)
to do so would:
(i)
interfere unduly with the preparation for the meeting, or
(ii)
involve the disclosure of confidential information;
(b)
the answer has already been given on a website in the form of an answer to a question; or
(c)
it is undesirable in the interests of the Company or the good order of the meeting that the question be answered.
10.
A corporation which is a member can appoint one or more corporate representatives who may exercise, on its
behalf, all its powers as a member provided that no more than one corporate representative exercises powers
over the same share.
11.
Members should note that it is possible that, pursuant to requests made by members of the Company under Section
527 of the Companies Act 2006, the Company may be required to publish on a website a statement setting out any
matter relating to: (i) the audit of the Company’s accounts (including the auditor’s report and the conduct of the
audit) that are to be laid before the Annual General Meeting; or (ii) any circumstances connected with an auditor of
the Company ceasing to hold office since the previous meeting at which annual accounts and reports were laid in
accordance with Section 437 of the Companies Act 2006.The Company may not require the members requesting
any such website publication to pay its expenses in complying with Sections 527 or 528 of the Companies Act 2006.
Where the Company is required to place a statement on a website under Section 527 of the Companies Act 2006, it
must forward the statement to the Company’s auditor not later than the time when it makes the statement available
on the website. The business which may be dealt with at the Annual General Meeting includes any statement that the
Company has been required under Section 527 of the Companies Act 2006 to publish on a website.
12.
Members satisfying the thresholds in Section 338 of the Companies Act 2006 may require the Company to give,
to members of the Company entitled to receive notice of the Annual General Meeting, notice of a resolution which
those members intend to move (and which may properly be moved) at the Annual General Meeting. A resolution may
properly be moved at the Annual General Meeting unless: (i) it would, if passed, be ineffective (whether by reason of
any inconsistency with any enactment or the Company’s constitution or otherwise); (ii) it is defamatory of any person;
or (iii) it is frivolous or vexatious. A request made pursuant to this right may be in hard copy or electronic form, must
identify the resolution of which notice is to be given, must be authenticated by the person(s) making it and must be
received by the Company not later than six weeks before the date of the Annual General Meeting.
13.
Members satisfying the thresholds in Section 338A of the Companies Act 2006 may request the Company
to include in the business to be dealt with at the Annual General Meeting any matter (other than a proposed
resolution) which may properly be included in the business at the Annual General Meeting. A matter may
properly be included in the business at the Annual General Meeting unless (i) it is defamatory of any person or
(ii) it is frivolous or vexatious. A request made pursuant to this right may be in hard copy or electronic form, must
identify grounds for the request, must be authenticated by the person(s) making it and must be received by the
Company not later than six weeks before the date of the Annual General Meeting.
75
76
The Investment
Company plc
NOTICE OF ANNUAL GENERAL MEETING
continued
Electronic Proxy Appointment through CREST
14.
CREST members who wish to appoint a proxy or proxies, or amend an instruction to a previously appointed
proxy, through the CREST electronic proxy appointment service may do so for the Annual General Meeting to
be held at 10.00am on 31 October 2024 and any adjournment(s) thereof, by using the procedures described in
the CREST manual (available via www.euroclear.com). CREST personal members or other CREST sponsored
members, and those CREST members who have appointed (a) voting service provider(s), should refer to their
CREST sponsor or voting service provider(s), who will be able to take the appropriate action on their behalf.
In order for a proxy appointment or instruction made using the CREST service to be valid, the appropriate
CREST message (a CREST Proxy Instruction) must be properly authenticated in accordance with Euroclear
UK & Ireland Limited (Euroclear)’s specifications and must contain the information required for such
instructions, as described in the CREST manual. The message, regardless of whether it relates to the
appointment of a proxy or to an instruction to a previously appointed proxy, must be transmitted so as to
be received by the issuer’s agent (ID: RA19) by no later than 10.00am on 29 October 2024.
For this purpose, the time of receipt will be taken to be the time (as determined by the timestamp applied to
the message by the CREST Applications Host) from which the issuer’s agent is able to retrieve the message
by enquiry to CREST in the manner prescribed by CREST.
CREST members and, where applicable, their CREST sponsors or voting service provider(s) should note
that Euroclear does not make available special procedures in CREST for any particular messages. Normal
system timings and limitations will therefore apply in relation to the input of CREST proxy instructions. It is
the responsibility of the CREST member concerned to take (or, if the CREST member is a CREST personal
member or sponsored member or has appointed (a) voting service provider(s), to procure that his/her
CREST sponsor or voting service provider(s) take(s)) such action as shall be necessary to ensure that a
message is transmitted by means of the CREST system by any particular time. In this connection, CREST
members and, where applicable, their CREST sponsors or voting service provider(s) is/are referred, in
particular, to those sections of the CREST manual concerning practical limitations of the CREST system and
timings.
The Company may treat as invalid a CREST proxy instruction in the circumstances set out in Regulation
35(5)(a) of the Uncertificated Securities Regulations 2001.
Documents
15.
The Annual Report incorporating this Notice of Annual General Meeting and, if applicable, any members’
statements, members’ resolutions or members’ matters of business received by the Company after the dates of
this Notice will be available on the Company’s website, https://theinvestmentcompanyplc.co.uk.
16.
A copy of the Directors’ service contracts will be available for inspection at the registered office of the Company
during usual business hours on any weekday (except weekends and public holidays) until the date of the meeting
and at the place of the meeting for a period of fifteen minutes prior to and during the meeting.
Registered in England and Wales No. 0004205
The Investment
Company plc
FOUNDED 1868
REGISTERED NO. 4205
ENGLAND AND WALES