Global Opportunities Trust Plc - Annual Results
Legal Entity Identifier: 2138005T5CT5ITZ7ZX58
Annual Results for the year ended
Financial Highlights
__________________________________________________________________ |NET ASSET VALUE PER SHARE|NET ASSET VALUE TOTAL RETURN | | | | |– cum inc. |(with dividends added back)* | | | | |+2.7% |+4.1% | |_________________________|________________________________________| |SHAREHOLDERS’ FUNDS |share price DISCOUNT TO NET ASSET VALUE*| | | | |£109.3m |-23.5% | |_________________________|________________________________________|
31 December 31 December %
2024 2023 Change
Net assets/shareholders’ funds (£) 109,295,000 106,411,000 +2.7
Shares in issue 29,222,180 29,222,180 -
Net asset value per share – cum inc. (pence)* 374.0 364.1 +2.7
Net asset value total return (with dividends 4.1 1.7 n/a
added back) (%)*
Share price (pence) 286.0 298.0 -4.0
Dividend per share (pence) 10.0 5.0 +100.0
Share price total return (with dividends added -2.4 -3.6 n/a
back) (%)*
Share price discount to net asset value (%)* -23.5 -18.2 n/a
Ongoing charges ratio (%)* 0.8 0.9 n/a
* Alternative Performance Measure.
CHAIR’S STATEMENT
Introduction
I am pleased to present the Company’s Annual Report and Financial Statements for the year ended
Investment performance
The Company’s Net Asset Value (‘NAV’) Total Return grew by 4.1% during the year however its share price dropped by 4.0% reflecting a widening of the discount to NAV. In comparison, the FTSE All-World Total Return Index rose by 19.8% and the Bloomberg Global Bond Index declined slightly. Equity markets remained narrow in their returns with particular reference to a small number of US technology companies where artificial intelligence became the central theme.
Shareholders should note however that the Company has no stated benchmark against which it seeks to outperform. Its objective is to achieve real long-term total return through investing in undervalued global securities. In this regard the Company’s NAV Total Return over the past three years has averaged 6.8% despite the Company retaining a defensive investment posture, achieved through a combination of high cash levels and the nature of the equity holdings.
As at
Further details on the investment performance of the Company during the year under review are provided in the Executive Director’s Report.
Discount and appointment of broker
The Company’s discount to underlying NAV averaged 20.5% during the year, and at the year end stood at 23.5%. The Board is very conscious of the level of the discount and will look closely at a range of options for improving the marketability of the Company. To this end Cavendish have been appointed as company broker with effect from
Although there were no share buybacks conducted during the year, the Board remains of the opinion that having the option to utilise share buybacks as a discount control mechanism is important and is therefore requesting that shareholders approve a renewal to this authority at the forthcoming Annual General Meeting (‘AGM’).
Increased final dividend
The return per ordinary share for the year ended
Board composition
The Board believes that its size and composition remain appropriate for the activities of the Company and the Board retains a good balance of skills and business experience to enable it to operate effectively. As such, all Directors will be standing for re- election at the forthcoming AGM.
Annual General Meeting
This year’s AGM will be held on
In addition to the formal business of the meeting,
The AGM is an opportunity for shareholders to ask questions of both the Board and of the Executive Director, and as always, the Board would welcome your attendance. If you are unable to attend the AGM in person, I would encourage you to vote in favour of all resolutions by Form of Proxy and appointing me (as Chair of the meeting) as your proxy to ensure your vote is registered.
Outlook
Whilst last year we thought that significant market rallies would be likely in response to falling inflation, these rallies have been sustained longer than we might have expected. The reason probably lies in the growth recorded in the US which has given rise to the hope that there will be a ‘soft landing’ and a meaningful recession will be avoided. Should this occur, it is just about possible to make an argument for the current extended equity valuations, however this would not leave much room for significant returns. If the global economy were to follow normal historic patterns, then there will be significant scope for negative corporate profit outcomes which would quickly puncture the current prevailing sanguine view of equity markets. Against this backdrop the Company has retained a broadly similar structure to last year in anticipation of new opportunities arising.
As noted earlier, whilst the Company’s NAV rose slightly over the year this was not reflected in the share price such that the discount widened further. To address this, efforts have begun to increase investors’ awareness of the Company and these will be intensified during 2025.
Once again, we would like to thank our shareholders for their continued support and look forward to the day when the investment landscape is more attractive. Periodically, investment articles are posted on the Company’s website when we encounter investment issues worthy of comment and we would encourage shareholders to sign up to the website to receive such notifications during the year.
Keep up to date
Shareholders can also keep up to date on the performance of the portfolio through the Company’s website at www.globalopportunitiestrust.com where you will find information on the Company, a monthly factsheet and regular updates from
As always, the Board welcomes communication from shareholders and I can be contacted directly through the Company Secretary at cosec@junipartners.com.
Chair
EXECUTIVE DIRECTOR’S REPORT
Background and context
The year was one where strong returns were delivered by global equities but focussed on a narrow range of companies. Government bonds on the other hand recorded a marginal decline. Sentiment on inflation and hence interest rates fluctuated through the year as the US Federal Reserve painted a more positive picture but with periodic reservations expressed. On the political side the damage done by the post Covid inflationary jump could be seen in the anti-incumbency voting patterns. In the
As many commentators have pointed out: a large part of global equity gains flowed from a small number of technology companies, the so called ‘magnificent seven’ (Alphabet, Amazon, Apple, Meta, Microsoft, NVIDIA, and Tesla). On the negative side, for the indices, this does pose some considerable risk if expectations are not met. On the positive side, it means that there have been different price experiences across sectors and market capitalisation levels. Whilst we remain of the view that the aggregate risk/reward on equities is not attractive, it is important to remember that in a market which has displayed such narrowness, opportunities may exist in areas where less attention has been directed. In anticipation of this, the Company’s Sub-Advisor has added experienced research resources with a long history in smaller and mid-cap equities. It is important to be ready to invest when the opportunities arise.
The economic path is not entirely clear. Under normal circumstances the need to address the debt overhang would cause the economy to slow and equity markets to retrench accordingly. Inflation would continue on a downward path and whilst recession would appear, the conditions for an upswing would begin to form. However, it is unlikely that
The portfolio
The structure of the portfolio has changed somewhat from last year. Part of this was driven by necessity and part by design.
The necessity element related to the Templeton European Long-Short fund holding. Since we initiated the holding the fund had performed much as we had hoped providing support in difficult markets and largely eking out gains in more buoyant ones. However, the manager of the fund departed and as a consequence we took the decision to exit our holding. The return for 2024 until the exit point was marginally positive. Since initiation, in
The direct equity holdings were increased to about 45% of the Company’s net assets from 40% at the end of 2023. The return over the period was approximately 8%. Within this there were a number of changes. The first was that positions in a number of Japanese companies were exited as price targets were triggered. These included
Overall, the cash component remained high at 34.2% (combining liquidity funds and net current assets). The high level of cash reflects the difficulty in finding undervalued investments, but, when these appear,
cash will be reduced. Over the year, the cash return was 4.5% against the NAV Total Return of 4.1%.
For comparative purposes, the Bloomberg Global Bond Index was marginally negative whilst the FTSE All-World Index Total Return was 19.8%. For the second year in a row the Company was short listed for the
Future prospects
Equity valuations remain stretched and the macro environment weighed down with debt. Perversely, this is a positive for the Company. Cracks will begin to appear and when they do the Company is well placed to take advantage of them. The portfolio has been structured to try and give downside protection but still provide positive returns whilst we wait for rationality to return. The most exciting period will be when this happens and the portfolio can be restructured into one with significantly higher upside. As previously mentioned in the Chair’s Statement, the Company’s share price discount to NAV widened during the year. I will be working with the Board and our newly appointed broker, Cavendish, to address the discount during 2025. Through positive investment performance, our aim is to continue to attract new shareholders and grow the Company.
Dr
Executive Director
PORTFOLIO OF INVESTMENTS
as at
Country of Valuation
Company Sector Incorporation % of Net assets
£’000
AVI Japanese Special Financials Japan 12,987 11.9
Situations Fund1
Volunteer Park Financials Luxembourg 8,130 7.4
Capital Fund SCSp2
Unilever Consumer Staples United Kingdom 3,501 3.2
TotalEnergies Energy France 3,133 2.9
Imperial Brands Consumer Staples United Kingdom 2,873 2.6
Jet2 Industrials United Kingdom 2,666 2.4
Tesco Consumer Staples United Kingdom 2,605 2.4
Alibaba Group Consumer Hong Kong 2,595 2.4
Discretionary
Qinetiq Industrials United Kingdom 2,492 2.3
Lloyds Banking Group Financials United Kingdom 2,362 2.2
ENI Energy Italy 2,313 2.1
Panasonic Consumer Japan 2,261 2.1
Discretionary
Dassault Aviation Industrials France 2,218 2.0
Orange Communication France 2,118 1.9
Services
RTX Industrials United States 2,100 1.9
Sanofi Health Care France 1,845 1.7
General Dynamics Industrials United States 1,789 1.6
Samsung Electronics Information South Korea 1,789 1.6
Technology
Breedon Group Materials United Kingdom 1,677 1.5
Whitbread Consumer United Kingdom 1,618 1.5
Discretionary
Verizon Communication United States 1,482 1.4
Communications Services
Intel Information United States 1,281 1.2
Technology
Nestle Consumer Staples Switzerland 1,213 1.1
Philips Health Care Netherlands 942 0.9
Azelis Group Materials Belgium 927 0.9
Bakkafrost Consumer Staples Denmark 906 0.8
Kalmar Industrials Finland 838 0.8
Danieli Industrials Italy 816 0.7
Terveystalo Health Care Finland 422 0.4
Equity Investments 71,899 65.8
Liquidity Fund 22,287 20.4
Investments
Total Investments 94,186 86.2
Cash and other net 15,109 13.8
assets
Net Assets 109,295 100.0
1
2
STRATEGIC REVIEW
Introduction
The purpose of this report is to provide shareholders with details of the Company’s strategy, objectives and business model as well as the principal and emerging risks and challenges the Company has faced during the year under review. It should be read in conjunction with the Chair’s Statement, the Executive Director’s Report and the portfolio information, which provide a review of the Company’s investment activity and outlook.
The Board is responsible for the stewardship of the Company, including overall strategy, investment policy, dividends, corporate governance procedures and risk management. The Board assesses the performance of the Company against its investment objective at each Board meeting by considering the key performance indicators.
Business and Status
The principal activity of the Company is to carry on business as an investment trust.
The Company is registered in
The Company is a self-managed investment company run by its Board and is authorised by the
The Company’s shares are listed on the closed-ended investment funds category of the Official List and traded on the main market of the
The Company is a member of the
Investment Objective
The Company’s investment objective is to provide shareholders with an attractive real long-term total return by investing globally in undervalued asset classes. The portfolio is managed without reference to the composition of any stock market index.
Investment Policy
The Company invests in a range of assets across both public and private markets throughout the world. These assets include both listed and unquoted securities, investments and interests in other investment companies and investment funds (including limited partnerships and offshore funds) as well as bonds (including index-linked securities) and cash as appropriate.
Any single investment in the Company’s portfolio may not exceed 15% of the Company’s total assets at the time of the relevant investment (the ‘Single Investment Limit’).
The Company may invest in other investment companies or funds and may appoint one or more sub-advisors to manage a portion of the portfolio if, in either case, the Board believes that doing so will provide access to specialist knowledge that is expected to enhance returns. The Company will gain exposure to private markets directly and indirectly through investments and interest in other investment companies and investment funds (including limited partnerships and offshore funds). The Company’s investment directly and indirectly in private markets (including through investment companies and investment funds) shall not, in aggregate, exceed 30% of the Company’s total assets, calculated at the time of the relevant investment.
The Company will invest no more than 15% of its total assets in other closed-ended listed investment companies (including investment trusts).
The Company may also invest up to 50% of its total assets in bonds, debt instruments, cash or cash equivalents when the Board believes extraordinary market or economic conditions make equity investment unattractive or while seeking appropriate investment opportunities for the portfolio or to maintain liquidity. The Single Investment Limit does not apply to cash or cash equivalents in such circumstances. In addition, the Company may purchase derivatives for the purposes of efficient portfolio management.
From time to time, when deemed appropriate and only where permitted in accordance with the
The investment objective and policy are intended to ensure that the Company has the flexibility to seek out value across asset classes rather than being constrained by a relatively narrow investment objective. The objective and policy allow the Company to be constrained in its investment selection only by valuation and to be pragmatic in portfolio construction by only investing in assets which the Executive Director considers to be undervalued on an absolute basis.
Investment Strategy
The Company’s portfolio is managed without reference to any stock market index. Investments are selected for the portfolio only after extensive research by the Executive Director. The Executive Director’s approach is long-term and focused on absolute valuation.
Dividend Policy
The Company does not have a stated dividend policy.
The Company’s investment objective is to provide real long-term total return rather than income growth. As a result, the level of revenue generated from the portfolio will vary from year to year, and any dividend paid to shareholders is likely to fluctuate.
The Board is mindful that in order for the Company to continue to qualify as an investment trust, the Company is not permitted to retain more than 15% of eligible investment income arising during any accounting period. Accordingly, the Board will ensure that any declared dividend is sufficient to enable the Company to maintain its investment trust status.
Management Arrangements
As a self-managed investment trust, the Board is fully responsible for the management of the Company and all required reporting to the
The global listed equities portion of the portfolio is managed by
Portfolio Performance
Full details on the Company’s activities during the year under review are contained in the Chair’s Statement and Executive Director’s Report. The portfolio consisted of 29 investments, excluding cash and other net assets as at
Key Performance Indicators
At each Board meeting, the Directors consider key performance indicators to assess whether the Company is meeting its investment objective.
The key performance indicators used to measure the performance of the Company over time are as follows:
Share price total return
1 year (%) 3 years (%) 5 years (%)
to 31 December 2024
Global Opportunities Trust plc -2.4 3.2 1.9
AIC Flexible Investments peer group† 8.0 -5.7 15.9
FTSE All-World Total Return Index* 19.8 28.5 74.2
NAV Total Return
1 year (%) 3 years (%) 5 years (%)
to 31 December 2024
Global Opportunities Trust plc 4.1 22.6 27.1
AIC Flexible Investments peer group† 7.9 6.2 39.1
FTSE All-World Total Return Index* 19.8 28.5 74.2
Share Price Discount to NAV
2024 (%) 2023 (%) 2022 (%)
as at 31 December
Global Opportunities Trust plc 23.5 18.2 13.5
AIC Flexible Investments peer group† 22.0 18.3 14.4
Ongoing charges ratio
2024 (%) 2023 (%) 2022 (%)
to 31 December
Global Opportunities Trust plc 0.8 0.9 0.9
AIC Flexible Investments peer group† 0.9 0.9 1.0
† Source: theaic.co.uk & Morningstar. The Company is classified by the
* The Company does not formally benchmark its performance against a specific index, the FTSE All-World Total Return Index (in sterling) has been shown for comparative purposes only.
Gearing
The Company did not have any borrowings and did not use derivative instruments for currency hedging during the year ended
Principal Risks
The Board, in conjunction with the
The principal risks and any emerging risks and uncertainties facing the Company, together with a summary of the mitigating actions and controls in place to manage these risks, and how these risks have changed over the period are set out below:
______________________________________________________________________________ |Principal Risks |Mitigation and Controls | |______________________________________|_______________________________________| |Geopolitical Risk |The Board regularly reviews the | | |Company’s portfolio, including | |Heightened geopolitical tensions, |geographical split, and its performance| |including the ongoing conflicts in |against its stated investment | |Ukraine and the Middle East, coupled |objective. | |with potential new trade tariffs | | |introduced by the US, could have an |Ongoing discussions between the | |adverse impact on global markets and |Executive Director and Sub-Advisor | |impact the Company’s portfolio. |ensures that the portfolio has exposure| | |to various geographies and sectors, in | |Now considered a principal risk, |order to reduce risk relative to | |rather than an emerging risk |less-diversified portfolios. | |______________________________________|_______________________________________| |Investment and Strategy Risk | | | |The Board meets regularly to discuss | |There can be no guarantee that the |and challenge the portfolio performance| |investment objective of the Company, |and strategy and to receive investment | |to provide shareholders with an |updates from the Executive Director. | |attractive real long-term total return|The Board receives quarterly reports | |by investing globally in undervalued |detailing all portfolio transactions | |asset classes, will be achieved. |and any other significant changes in | | |the market or stock outlooks. | |No change to this risk | | |______________________________________|_______________________________________| |Key Person Risk |The Board frequently considers | | |succession planning. Dr Nairn has | |The Company’s ability to deliver its |day-to-day responsibility for the | |investment strategy is dependent on |investment management of the Company | |the Executive Director, Dr Nairn. A |and the Sub-Advisor has a dedicated | |change in key investment management |investment team supporting the Company.| |personnel who are involved in the |Dr Nairn and the Board are also in | |management of the Company’s portfolio |regular contact with the Sub-Advisor | |could impact on future performance and|(who attends Board meetings upon | |the Company’s ability to deliver on |request), and underlying fund managers | |its investment strategy. |and would be informed of any proposed | | |changes in their personnel. | |No change to this risk | | |______________________________________|_______________________________________| | |The Board receives regular updates on | |Financial and Economic Risk |the composition of the Company’s | | |investment portfolio and market | |The Company’s investments are impacted|developments from the Executive | |by financial and economic factors |Director. Investment performance is | |including market prices, interest |continually monitored specifically in | |rates, foreign exchange rates, |the light of emerging risks throughout | |liquidity and inflation, which could |the period. The Board regularly reviews| |cause losses within the portfolio. |and agrees policies for managing market| | |price risk, interest rate risk, foreign| |No change to this risk |exchange risk, liquidity risk and | | |inflationary risk. | |______________________________________|_______________________________________| | |The Board actively monitors the | | |discount at which the Company’s shares | | |trade, and is committed to using its | |Discount Volatility Risk |powers to allot or repurchase the | | |Company’s shares. The Board may use | |As referred to in the Chair’s |share buybacks, when appropriate, to | |Statement, the Company’s share price |narrow the discount to NAV at which the| |discount to NAV widened during the |shares trade. This will be done in | |year. |conjunction with creating new demand | | |and being aware of the liquidity of the| |The Board recognises that it is in the|shares. | |long-term interests of shareholders to| | |reduce discount volatility and |The Board’s commitment to allot or | |believes that the prime driver of |repurchase shares is subject to it | |discounts over the longer term is |being satisfied that any offer to allot| |investment performance. An |or purchase shares is in the best | |inappropriate or unattractive |interests of shareholders of the | |objective and strategy may have an |Company as a whole, the Board having | |adverse effect on shareholder returns |the requisite authority pursuant to the| |or cause a reduction in demand for the|Articles of Association and relevant | |Company’s shares, both of which could |legislation to allot or purchase | |lead to a widening of the discount. |shares, and all other applicable | | |legislative and regulatory provisions. | |Risk has been heightened by a widening| | |of the discount |The Board reviews changes to the | | |shareholder register regularly and | | |considers shareholder views and | | |developments in the market place. | |______________________________________|_______________________________________| | |Compliance with the Company’s | |Regulatory Risk |regulatory obligations is monitored on | | |an ongoing basis by the Company | |The Company operates in an evolving |Secretary and other professional | |regulatory environment and faces a |advisers as required who report to the | |number of regulatory risks. |Board regularly. | | | | |Failure to qualify under the terms of |The Directors note the corporate | |sections 1158 and 1159 of the CTA may |offence of failure to prevent tax | |lead to the Company being subject to |evasion and believe all necessary steps| |capital gains tax. A breach of the |have been taken to prevent facilitation| |Listing Rules may result in censure by|of tax evasion. | |the FCA and/or the suspension of the | | |Company’s shares from listing. |The Directors are aware of their | | |responsibilities relating to price | |If all price sensitive issues are not |sensitive information and would consult| |disclosed in a timely manner, this |with their advisers if any potential | |could create a misleading market in |issues arose. This includes ensuring | |the Company’s shares. |compliance with the Market Abuse | | |Regulation. | |A Small Registered Alternative | | |Investment Fund Manager does not carry|The Company Secretary would notify the | |on a regulated activity in respect of |Board immediately if it became aware of| |its activities as an Alternative |any disclosure issues. | |Investment Fund Manager for an | | |Alternative Investment Fund for which |The Sub-Advisor has a comprehensive | |it is entitled to be registered. It |market abuse policy and any potential | |is, however, required to comply with |breaches of this policy would be | |certain requirements under the |promptly reported to the Board. | |Alternative Investment Fund Managers | | |Directive (‘AIFMD’) (which mainly |The Board has agreed service levels | |relate to reporting). |with the Company Secretary and | | |Sub-Advisor which include active and | |No change to this risk |regular review of compliance with these| | |requirements. | |______________________________________|_______________________________________| | |The Board regularly receives and | | |reviews management information on third| | |parties which the Company Secretary | | |compiles. In addition, each of the | | |third parties, where available, | | |provides a copy of its report on | | |internal controls to the Board each | |Operational Risk |year. Any breaches in controls which | | |have resulted in errors or incidents | |There are a number of operational |are required to be notified to the | |risks associated with the fact that |Board along with proposed remediation | |third parties undertake the Company’s |actions. | |administration and custody functions. | | |Operational risks include cyber |The Company employs the Administrator | |security, IT systems failure, |to prepare all financial statements of | |inadequacy of oversight and control |the Company and meets with the Auditor | |and climate risk. The main risk is |at least once a year to discuss all | |that third parties may fail to ensure |financial matters, including | |that statutory requirements, such as |appropriate accounting policies. | |compliance with the Companies Act 2006| | |and the FCA requirements, are met. |The Company is a member of the AIC, a | | |trade body which promotes investment | |No change to this risk |trusts and also develops best practice | | |for its members. | | | | | |The Executive Director and the | | |Company’s third-party suppliers have | | |contingency plans to ensure the | | |continued operation of the business in | | |the event of disruption. | |______________________________________|_______________________________________|
Culture
The Chair leads the Board and is responsible for its overall effectiveness in directing the Company. He demonstrates objective judgement, promotes a culture of openness and debate, and facilitates effective contributions by all Directors. In liaison with the Company Secretary, the Chair ensures that the Directors receive accurate, timely and clear information. The Directors are required to act with integrity, lead by example and promote this culture within the Company.
The Board seeks to ensure the alignment of the Company’s purpose, values and strategy with the culture of openness, debate and integrity through ongoing dialogue, and engagement with shareholders, the Executive Director and the Company’s other service providers. The Company has adopted a number of policies, practices and behaviours to facilitate a culture of good governance and ensure that this is maintained.
The culture of the Board is considered as part of the annual performance evaluation process which is undertaken by each Director. The culture of the Company’s service providers is also considered by the Board during the annual review of their performance and while considering their continuing appointment. In the context of the Executive Director and Sub-Advisor, particular attention is paid to environmental, social and governance, engagement and proxy voting policies.
Directors and Gender Representation
As at
Employees and Human Rights
The Board recognises the requirement under the Companies Act 2006 to detail information about human rights, employees and community issues, including information about any policies it has in relation to these matters and the effectiveness of these policies. The Company has one employee, Executive Director
Modern Slavery Statement
The Company is not within the scope of the Modern Slavery Act 2015 because it has not exceeded the turnover threshold and therefore no further disclosure is required in this regard.
Greenhouse Gas Emissions
The Company has no greenhouse gas emissions to report from its operations, nor does it have responsibility for any other emission-producing sources under the Companies Act 2006 (Strategic Report and Directors’ Report) Regulations 2013.
Environmental, Social and Governance (‘ESG’)
The Company seeks to invest in companies that are well managed with high standards of corporate governance. The Board believes this creates the proper conditions to enhance long-term value for shareholders. The Company adopts a positive approach to corporate governance and engagement with companies in which it invests.
In pursuit of the above objective, the Board believes that proxy voting is an important part of the corporate governance process and considers seriously its obligation to manage the voting rights of companies in which it is invested. It is the policy of the Company to vote, as far as possible, at all shareholder meetings of investee companies. The Company follows the relevant applicable regulatory and legislative requirements in the
The Executive Director and Sub-Advisor consider a wide range of factors when making investment decisions including an investee company’s ESG credentials.
In making fund investment decisions, the Executive Director’s assessment includes analysing the fund manager’s ESG cultural buy-in, its ESG process, procedures and reporting, its engagement with underlying portfolio companies and an operational due diligence review of the relevant manager and fund.
Duty to Promote the Success of the Company
Under section 172 of the Companies Act 2006, the Directors have a duty to act in the way they consider, in good faith, would be most likely to promote the success of the Company for the benefit of its members as a whole, and in doing so have regard (amongst other matters) to:
-- the likely consequences of any decision they make in the long term;
-- the need to foster the Company’s business relationships with its
stakeholders, which includes the shareholders, the Executive Director
and Sub-Advisor and other relevant parties as listed below;
-- the need to act independently by exercising reasonable skill and
judgement;
-- the impact of the Company’s operations on the community and the
environment;
-- the requirement to avoid a conflict of interests;
-- the desirability of the Company maintaining a reputation for high
standards of business conduct;
-- the need to act fairly between members of the Company; and
-- the need to declare any interests in proposed transactions.
Stakeholder Engagement
The Company has one employee, its Executive Director,
Shareholders
Communication and regular engagement with shareholders are given a high priority by the Board. The Executive Director seeks to maintain regular contact with major shareholders and is always available to enter into dialogue with all shareholders. A regular dialogue is also maintained with the Company’s institutional shareholders and private client asset managers through the Executive Director, who regularly reports to the Board on significant contact, the views of shareholders and any changes to the composition of the share register.
All shareholders are encouraged, if possible, to attend and vote at the AGM and at any other general meetings of the Company (if any), during which the Board is available to discuss issues affecting the Company. Shareholders wishing to communicate directly with the Board should contact the Company Secretary. The Chair is available throughout the year to respond to shareholders, including those who wish to speak with him in person. Copies of the Annual and Half-Yearly Reports are currently issued to shareholders and are also available, along with the monthly factsheets for downloading from the Company’s website at www.globalopportunitiestrust.com. The Company also releases portfolio updates to the market on a monthly basis.
Executive Director and Sub-Advisor
The Non-Executive Directors believe that maintaining a close and constructive working relationship with the Executive Director and Sub-Advisor is crucial to promoting the long-term success of the Company in an effective and responsible way. This ensures the interests of all current and potential stakeholders are properly taken into account when decisions are made. The Executive Director attends all Board meetings and provides reports on investments, performance, marketing, operational and administrative matters. The Sub-Advisor is available to attend Board meetings upon request. An open discussion regarding such matters is encouraged, both at Board meetings and by way of ongoing communication between the Board, the Executive Director and Sub-Advisor. Board members are encouraged to share their knowledge and experience with the Executive Director and Sub-Advisor, and where appropriate, the Board adopts a tone of constructive challenge. The Board keeps the ongoing performance of the Executive Director and Sub-Advisor under continual review and conducts an annual appraisal of both the parties.
Service Providers
The Company’s day-to-day operational functions are delegated to several third-party service providers, each engaged under separate contracts. In addition to the Sub-Advisor, the Company’s principal third-party service providers include the Administrator, Auditor, Company Secretary, Custodian and Registrar. The Board engages with its service providers to develop and maintain positive and productive relationships, and to ensure that they are well informed in respect of all relevant information about the Company’s business and activities. The Board, through its
Corporate Broker
The Company was pleased to announce the appointment of
The Board has requested a comprehensive marketing plan for the Company, from the Sub-Advisor, and this will be progressed in 2025.
Investee Companies
The Sub-Advisor assists with the day-to-day management of the Company’s equity investment portfolio. As such, the Sub-Advisor has responsibility for engaging with investee companies on behalf of the Company. The Sub-Advisor does so in consideration of the principles set out in the
The Board recognises the importance of engagement with investee companies. The Board is aware of evolving expectations in this regard and is committed to working with the Executive Director and Sub-Advisor, in relation to future engagement on behalf of the Company.
The above methods for engaging with stakeholders are kept under review by the Directors and discussed on a regular basis at Board meetings to ensure that they remain effective.
For and on behalf of the Board
Chair
STATEMENT OF DIRECTORS’ RESPONSIBILITIES
The Directors are responsible for preparing the Annual Report and the Financial Statements in accordance with applicable
The Companies Act 2006 (the ‘Law’) requires the Directors to prepare Financial Statements for each financial period. Under that Law, they have elected to prepare the Financial Statements in accordance with
Under the 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 Company and of the profit or loss of the Company for that period.
In preparing these Financial Statements, the Directors are required to:
-- select suitable accounting policies and then apply them consistently;
-- make judgements and estimates that are reasonable and prudent;
-- state whether applicable UK 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 Company will continue in business.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company’s transactions and disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that its Financial Statements comply with the Law and include the information required by the Listing Rules of the
Under applicable law and regulations, the Directors are also responsible for preparing a Strategic Report, Directors’ Report, Remuneration Report and Corporate Governance Statement that comply with that law and those regulations.
The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company’s website, www.globalopportunitiestrust.com. The work carried out by the Auditor does not include consideration of these matters and, accordingly, the Auditor accepts no responsibility for any changes that may have occurred to the Financial Statements since they were initially presented on the website. Legislation in the
Each of the Directors confirm to the best of their knowledge that:
-- the Financial Statements, prepared in accordance with the applicable set
of UK Accounting Standards, give a true and fair view of the assets,
liabilities, financial position and profit or loss of the Company;
-- the Annual Report includes a fair view of the development and
performance of the business and the position of the Company together
with a description of the principal risks and uncertainties that the
Company faces; and
-- in the opinion of the Board, the Annual Report and Financial Statements
taken as a whole, is fair, balanced and understandable and provides the
information necessary to assess the Company’s performance, business
model and strategy.
On behalf of the Board
Chairman
INCOME STATEMENT
for the year ended
2024 2023
Revenue Capital Total Revenue Capital Total
£’000 £’000 £’000 £’000 £’000 £’000
Gains on investments at fair value – 2,123 2,123 – 2,271 2,271
through profit or loss
Foreign exchange gains/(losses) on – 136 136 – (1,974) (1,974)
capital items
Income 2,996 33 3,029 2,460 – 2,460
Investment management fee (42) (99) (141) (49) (114) (163)
Other expenses (591) – (591) (653) – (653)
Net return before finance costs 2,363 2,193 4,556 1,758 183 1,941
and taxation
Finance costs
Interest payable and related (7) – (7) (21) – (21)
charges
Net return before taxation 2,356 2,193 4,549 1,737 183 1,920
Taxation – overseas withholding (204) – (204) (192) – (192)
tax
Net return after taxation 2,152 2,193 4,345 1,545 183 1,728
Return per ordinary share 7.4p 7.5p 14.9p 5.3p 0.6p 5.9p
All revenue and capital items in the above statement derive from continuing operations.
The total column of this statement is the profit and loss account of the Company.
The revenue and capital return columns are prepared under guidance issued by the
A separate Statement of Comprehensive Income has not been prepared as all gains and losses are included in the Income Statement.
BALANCE SHEET
as at
2024 2023
£’000 £’000
Fixed asset investments
Investments at fair value through profit or loss* 94,186 64,083
Current assets
Debtors 411 374
Cash at bank and short-term deposits 16,506 42,105
16,917 42,479
Current liabilities
Creditors (1,808) (151)
(1,808) (151)
Net current assets 15,109 42,328
Net assets 109,295 106,411
Capital and reserves
Called-up share capital 645 645
Share premium 1,597 1,597
Capital redemption reserve 14 14
Special reserve 9,760 9,760
Capital reserve 92,474 90,281
Revenue reserve 4,805 4,114
Total shareholders’ funds 109,295 106,411
Net asset value per ordinary share 374.0p 364.1p
* Investments at fair value through profit or loss includes liquidity fund investments of £22,287,000 not previously held by the Company.
The Financial Statements were approved by the Board of Directors on
Chairman
Registered in Scotland No. SC259207
STATEMENT OF CHANGES IN EQUITY
for the year ended
Share Capital
Year ended Share premium redemption Special Capital Revenue Total
capital reserve1 reserve1 reserve1
31 December £’000 reserve £’000
2024 £’000 £’000 £’000 £’000
£’000
At 1 January 645 1,597 14 9,760 90,281 4,114 106,411
2024
Net return
after – – – – 2,193 2,152 4,345
taxation
Dividends – – – – – (1,461) (1,461)
paid
At 31
December 645 1,597 14 9,760 92,474 4,805 109,295
2024
Share Capital
Year ended Share premium redemption Special Capital Revenue Total
capital reserve1 reserve1 reserve1
31 December £’000 reserve £’000
2023 £’000 £’000 £’000 £’000
£’000
At 1 January 645 1,597 14 9,760 90,098 4,030 106,144
2023
Net return
after – – – – 183 1,545 1,728
taxation
Dividends – – – – – (1,461) (1,461)
paid
At 31
December 645 1,597 14 9,760 90,281 4,114 106,411
2023
1 Distributable reserves total £100,167,000 (2023: £94,170,000). The Capital reserve comprises realised gains of £85,602,000 (2023: £80,296,000), which are distributable, and unrealised gains of £6,872,000 (2023: £9,985,000), which are not immediately distributable.
STATEMENT OF CASH FLOW
for the year ended
Year ended Year ended
31 December 2024 31 December
2023
£’000 £’000 £’000 £’000
Cash flows from operating activities
Net return on ordinary activities before 4,549 1,920
taxation
Adjustments for:
Gains on investments (2,123) (2,271)
Interest payable 7 21
Purchases of investments* (60,433) (949)
Sales of investments* 34,122 8,420
Dividend income (1,601) (1,774)
Other income (1,428) (686)
Dividend income received 1,612 1,777
Other income received 1,335 723
Decrease in receivables 2 1
Increase/(decrease) in payables 1 (29)
Overseas withholding tax deducted (174) (195)
(28,680) 5,038
Net cash flows from operating activities (24,131) 6,958
Cash flows from financing activities
Equity dividends paid from revenue (1,461) (1,461)
Interest paid (7) (21)
Net cash flows from financing activities (1,468) (1,482)
Net (decrease)/increase in cash and cash (25,599) 5,476
equivalents
Cash and cash equivalents at the start of the 42,105 36,629
year
Cash and cash equivalents at the end of the 16,506 42,105
year
* Receipts from the sale of, and payments to acquire, investment securities have been classified as components of cash flows from operating activities because they form part of the Company’s dealing operations. Amounts include liquidity fund investment subscriptions and redemptions not previously dealt by the Company.
NOTES TO THE FINANCIAL STATEMENTS
at
1. Accounting policies
Statement of compliance
The Company’s Financial Statements have been prepared under FRS 102 “The Financial Reporting Standard applicable in the
The comparative figures for the Financial Statements are for the year ended
Going concern
The financial statements have been prepared on a going concern basis and on the basis that approval as an investment trust company will continue to be met.
The Directors have made an assessment of the Company’s ability to continue as a going concern and are satisfied that the Company has adequate resources to continue in operational existence for a period of at least 12 months from the date when these financial statements were approved.
The Directors have noted that the Company, holding a portfolio consisting principally of liquid listed investments and cash balances, is able to meet the obligations of the Company as they fall due, any future funding requirements and finance future additional investments. The Company is a closed end fund, where assets are not required to be liquidated to meet day-to-day redemptions.
The Directors have completed stress tests assessing the impact of changes and scenario analysis to assist them in determination of going concern. In making this assessment, the Directors have considered plausible downside scenarios that have been financially modelled. These tests apply to any set of circumstances in which asset value and income are significantly impaired. The conclusion was that in a plausible downside scenario, the Company could continue to meet its liabilities. Whilst the economic future is uncertain, and the Directors believe that it is possible the Company could experience further reductions in income and/or market value, the opinion of the Directors is that this should not be to a level which would threaten the Company’s ability to continue as a going concern.
The Directors are not aware of any material uncertainties that may cast significant doubt on the Company’s ability to continue as a going concern, having taken into account the liquidity of the Company’s investment portfolio and the Company’s financial position in respect of its cash flows and investment commitments. Therefore, the financial statements have been prepared on the going concern basis.
Segmental reporting
The Directors are of the opinion that the Company is engaged in a single segment of business, being investment business. The Company primarily invests in listed companies.
Income recognition
Dividend and other investment income is included as revenue on the ex-dividend date, the date the Company’s right to receive payment is established. Dividends from overseas companies are shown gross of withholding tax. Where the Company has elected to receive scrip dividends in the form of additional shares rather than in cash, the amount of the cash dividend foregone is recognised as income. Any excess or shortfall compared to the cash dividend is recognised as capital. Special dividends are reviewed on an individual basis to determine whether they should be accounted for as revenue or capital. Income from private equity holdings is recognised upon notification of irrevocable income distribution by the general partner. Interest income and rebate income is included on an accruals basis.
Expenses and finance costs
All management expenses and finance costs are accounted for on an accruals basis. The Company charges 30% of management fees and finance costs related to borrowings to revenue in the Income Statement and 70% to capital in the Income Statement. All other operating expenses and finance costs are charged to revenue in the Income Statement, except costs that are incidental to the acquisition or disposal of investments, which are charged to capital in the Income Statement. Transaction costs are included within the gains and losses on investments, as disclosed in the Income Statement.
Investments
In accordance with FRS 102, Sections 11 and 12, all investments held by the Company are designated as held at fair value upon initial recognition and are measured at fair value through profit or loss in subsequent accounting periods. Investments are initially recognised at cost, being the fair value of the consideration given.
After initial recognition, investments are measured at fair value, with changes in the fair value of investments recognised in the Income Statement and allocated to capital. Realised gains and losses on investments sold are calculated as the difference between sales proceeds and cost.
For investments actively traded in organised financial markets, fair value is generally determined by reference to
Unquoted investments are valued by the Directors at fair value, using the guidelines on valuation published by the
This represents the Directors’ view of the amount for which an asset could be exchanged between knowledgeable willing parties in an arm’s length transaction.
Foreign currency
The Financial Statements have been prepared in sterling, rounded to the nearest £’000, which is the functional and reporting currency of the Company. Sterling is the currency of the primary economic environment in which the Company operates.
Transactions denominated in foreign currencies are converted to sterling at the actual exchange rate as at the date of the transaction. Assets and liabilities 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 rates subsequent to the date of the transaction is included as a gain or loss in the capital reserve or revenue reserve as appropriate.
Taxation
The charge for taxation is based on the net revenue for the year and takes into account taxation deferred or accelerated because of timing differences between the treatment of certain items for accounting and taxation purposes. Full provision for deferred taxation is made under the liability method, without discounting, on all timing differences between taxable profits and total comprehensive income that have arisen but not been reversed by the Balance Sheet date, unless such provision is not permitted by FRS 102. Deferred tax assets are only recognised if it is considered more likely than not that there will be suitable profits from which the future reversal of the underlying timing differences can be deducted. Timing differences are differences arising between the Company’s taxable profits and its results as stated in the Financial Statements which are capable of reversal in one or more subsequent periods.
Cash at bank and short-term deposits
Cash at bank and short-term deposits comprise cash at bank and short-term deposits with an original maturity date of three months or less.
Short-term debtors and creditors
Debtors and creditors with no stated interest rate and receivable within one year are recorded at transaction price. Any losses arising from impairment are recognised in the Income Statement in other operating expenses.
Dividends payable to Shareholders
Dividends payable are accounted for when they become a liability of the Company. Final dividends are recognised in the period in which they have been approved by Shareholders in a general meeting. Interim dividends are recognised in the period in which they have been declared and paid.
Own shares held in
From time to time, the Company buys back shares and holds them in
Judgements and key sources of estimation uncertainty
The preparation of the Financial Statements requires the Company to make judgements, estimates and assumptions that affect the application of policies and reported amounts in 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. Actual results may differ from these estimates.
The areas requiring judgement and estimation in the preparation of the financial statements are: the valuation of unquoted investments; and recognising and classifying unusual or special dividends received as either revenue or capital in nature. The policy for the valuation of unquoted investments is detailed in the investments section of Note 1. The accounting policy for special dividends is detailed in the income recognition section of Note 1.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future period if the revision affects both current and future periods.
Reserves
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 the 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.
Capital redemption reserve
The capital redemption reserve represents non-distributable reserves that arise from the purchase and cancellation of shares.
Special reserve
The special reserve was created by a reduction in the share premium account by order of the
Capital reserve
The following are taken to the capital reserve through the capital column in the Income Statement:
Capital reserve – other, forming part of the distributable reserves:
-- gains and losses on the realisation of investments;
-- realised exchange differences of a capital nature;
-- 70% of management fees and finance costs related to borrowings; and
-- expenses, together with related taxation effect, charged to this account
in accordance with the above policies.
Capital reserve – not distributable:
-- net movement arising from changes in the fair value of investments; and
-- unrealised exchange differences of capital nature.
Revenue reserve
The revenue reserve represents the surplus of accumulated profits and is distributable.
2. Income
2024 2023
Revenue Capital Total Revenue Capital Total
£’000 £’000 £’000 £’000 £’000 £’000
Income from investments
UK dividend income 573 – 573 464 – 464
Overseas dividend income 1,008 20 1,028 1,310 – 1,310
Liquidity fund income 711 – 711 – – –
Income from investments 2,292 20 2,312 1,774 – 1,774
Total income comprises
Income from investments 2,292 20 2,312 1,774 – 1,774
Bank interest 662 – 662 619 – 619
Rebate income1 42 13 55 67 – 67
2,996 33 3,029 2,460 – 2,460
1 Rebates of management fee from managed investment funds held in the investment portfolio.
3. Management fee
2024 2023
Revenue Capital Total Revenue Capital Total
£’000 £’000 £’000 £’000 £’000 £’000
Management fee 42 99 141 49 114 163
42 99 141 49 114 163
With effect from
The Company’s investment in the Volunteer Park Capital Fund SCSp is excluded from the market value of equity securities, prior to calculation of the management fees payable by the Company to
Prior to the appointment of
During the year ended
During the year ended
4. Dividends
2024 2023
£’000 £’000
Declared and paid
Amounts recognised as distributions to Ordinary Shareholders in the
year.
2023 final dividend of 5.0p per share paid on 31 May 2024 (2023:
year ended 31 December 2022 final dividend of 5.0p paid on 31 May 1,461 1,461
2023).
1,461 1,461
2024 2023
£’000 £’000
Proposed
Detailed below is the proposed final dividend per share in respect
of the year ended 31 December 2024 , which is the basis on which the
requirements of section 1159 of the Corporation Act 2010 are
considered. 2,922 1,461
2024 final dividend of 10.0p per share (2023 final dividend of 5.0p
per share paid on 31 May 2024 ).
The Directors recommend a final dividend of 10.0p per share for the year ended
5. Return per share
2024 2023
Net return Number of Per share Net return Number of Per share
pence pence
£’000 shares1 £’000 shares1
Revenue return 2,152 29,222,180 7.4 1,545 29,222,180 5.3
after taxation
Capital return 2,193 29,222,180 7.5 183 29,222,180 0.6
after taxation
Total return 4,345 29,222,180 14.9 1,728 29,222,180 5.9
after taxation
1
Weighted average number of ordinary shares, excluding shares held in
6. Net asset value per share
The NAV, calculated in accordance with the Articles of Association, is as follows:
2024 2023
pence Pence
Share 374.0 364.1
The NAV is based on net assets of £109,295,000 (2023: £106,411,000) and on 29,222,180 (2023: 29,222,180) shares, being the number of shares, excluding shares held in
7. Significant holdings
As at
As at
The Company had no other holdings of 3.0% or more of the share capital of any portfolio companies.
8. Related party transactions
Dr
The Company has invested in Volunteer Park Capital Fund SCSp (“VPC”).
The Company has invested in
9. Availability of Annual Report and Financial Statements
The Annual Report and Financial Statements will shortly be available to view on the Company's website at www.globalopportunitiestrust.com. where up to date information on the Company, including daily NAV and share prices, factsheets and portfolio information can also be found.
A copy of the Annual Report and Financial Statements will shortly be submitted to the Financial Conduct Authority’s National Storage Mechanism and will be available for inspection at:
https://data.fca.org.uk/#/nsm/nationalstoragemechanism
For further information please contact:
Juniper
Company Secretary
e-mail: cosec@junipartners.com
