Mid Wynd International Investment Trust Plc - Half-year Report
Half-Yearly Financial Report (Unaudited) for the six months ended
Financial Highlights
Total returns Six months ended 31 Six months ended 31 Year ended 30 June
December 2024 December 2023 2024
Net asset value per 0.8% 6.8% 13.9%
share†
Share price† 0.1% 9.7% 17.1%
MSCI All Country 6.5% 7.0% 20.1%
World Index (GBP)
Revenue and dividends Six months ended 31 Six months ended 31 Year ended 30 June
December 2024 December 2023 2024
Revenue earnings per 2.01p 4.72p 8.00p
share
Dividends per share* 3.85p 3.85p 8.00p
Ongoing charges† 0.64% 0.60% 0.60%
As at 31 December As at 31 December As at
Capital 2024 2023
30 June 2024
Net asset value per 812.18p 763.33p 810.22p
share
Share price 794.00p 750.00p 797.00p
Net cash† 1.9% 1.7% 1.4%
Discount† 2.2% 1.7% 1.6%
Source: Lazard/Morningstar
†Alternative Performance Measure.
* The interim dividend for the six months to
Since
Total returns to 31 December 2024 3 years* 5 years* 10 years* Lazard
appointment
Net asset value per share† 1.6% 48.0% 295.5% 11.6%
Share price† 1.6% 39.7% 290.9% 11.0%
MSCI All Country World Index (GBP) 26.8% 70.9% 201.1% 21.1%
Source: Lazard/Morningstar
†Alternative Performance Measure.
* Total returns over 3, 5 and 10 years cover the period over which
Chairman’s Statement
Performance
I am pleased to present my first report as Chairman of the Company.
For the six months ended
As at
The Ongoing Charges Ratio as at
These share buybacks were accretive to net asset value for existing shareholders, enhancing the NAV total return by approximately £712,000, equivalent to 56.9% of the Company’s operating expenses for the six months to
Earnings and dividend
The net return for the six months to
Share capital
During the six months to
Following the period end, 934,500 ordinary shares were bought back and are held in
The Board
On
Contact us
Shareholders can keep up to date with developments between formal reports by visiting our new website at midwynd.com where you will find information on the Company and a factsheet which is updated monthly.
In addition, the Board is always keen to hear from shareholders and, should you wish, you can contact me via the Company Secretary at cosec@junipartners.com .
Outlook
After a lacklustre opening six months, the Board retains confidence in the strategy and stock selection skills of our manager. As shown in the Investment Manager's Review, the companies in our portfolio continue to show robust operational performance with solid earnings growth. This is not currently being reflected in their share prices, but this cannot remain the case indefinitely and as long - term investors we remain patient. At a time when equity indices have become dangerously concentrated, we continue to support our manager's approach of holding a well-diversified portfolio of quality businesses.
Chairman
Investment Manager’s Review
Overview
The Company’s NAV rose by 0.8% between
Last year was undoubtedly disappointing for us, and periods like this invariably give rise to questions. One question that has been raised is whether an investment process that has served us very well for most of the past 14 years is right for today’s world of higher rates and changing economic circumstances?
Our conclusion, after long reflection, is that recent performance, in the main, is the result of the unusually ‘narrow’ market environment. 2 We continue to believe that investing in high-quality companies whose earnings are growing faster than the market average should increase investor wealth and deliver outperformance in the long run. We certainly consider the portfolio to be attractively valued and are confident it will benefit from a more normalised market environment.
Market Review
Global stock markets rose during the first six months of the fiscal year (second half of calendar 2024), with investor optimism centred on the US. It is important to note that this rise was not simply a story of markets’ strength: it was also a story of their unusual narrowness.
The MSCI ACWI, a broad global index, returned 6.5% in GBP terms during the second half of 2024 and is up around 40% since the end of 2022. The US market, represented by the S&P 500 Index, gained 9.5% during the second half of 2024 and is up over 50% since the end of 2022. 3 Such figures are well worth placing in broader context.
Since 1985, in US dollar terms, the US stock market has appreciated to such a degree on only a handful of occasions. All have tended to be clustered around key events in market history, including Black Monday (1987), the dot-com bubble (late 1990s/early 2000s), the recovery that followed the global financial crisis (2010) and the recovery that followed the COVID-19 pandemic (2021).
The extraordinary performance of NVIDIA underlines how the recent boom has been driven largely by stocks related to artificial intelligence (‘AI’). The chip designer’s weighting in the MSCI ACWI grew from 0.6% at the start of 2023 to 4.3% at the end of 2024.
The stock is up 789% over the past 24 months. 4 This is nearly 20 times the return of the MSCI ACWI and nearly 80 times that of the MSCI ACWI Equal Weighted Index – a disparity that has caused a historically wide spread in returns between the two indices.
Just 27% of the S&P 500’s constituents outperformed the index over 2024 – only slightly better than 2023’s 26%. Such figures, which are even lower than those seen during the dot-com bubble, underscore the remarkable narrowness of markets.
Against this backdrop, US markets drove overall returns.
A second factor – which is harder to explain – is that, although the portfolio generates a higher return on capital than the market both in aggregate and across sectors, and it has kept up with the market in terms of growing earnings, the portfolio has lagged the multiple expansion seen elsewhere. Some of our disappointing stocks have been working through inventory issues but still managed to generate stronger earnings power than average. It is a reminder that the market in the short term is a voting machine and in the long term a weighing machine. We are long-term investors and look forward to the scales tipping.
1 Past performance is not a reliable indicator of future returns.
2 Source: Bloomberg
3 Source: Bloomberg
4 Source: Bloomberg
Financial Productivity – Returns on Capital
We use Cash Flow Return on Investment (‘CFROI’) as our preferred Return on Capital metric. Our holdings have a median forward CFROI that is more than double that of the MSCI ACWI. Within sectors, our holdings have a median CFROI that is 1.6 to 4.4 times greater than within the MSCI ACWI sectors. Note that we typically do not invest in Energy, Materials, Real Estate, or Utilities those companies typically do not generate the levels of returns on capital that we seek.
Going forward, we believe the key drivers of returns in 2024 – valuation re-rating and narrow markets – should abate, with market attention returning to quality stocks. We believe that our portfolio looks well positioned to benefit from this shift.
Our investment process
The search for Compounders
In the light of the commentary so far, it might be helpful here to remind investors of our core investment principles. We manage the Company’s portfolio in accordance with our Global Quality Growth strategy. This aims to invest in businesses we consider to be “Compounders”.
We define a Compounder as a company we believe is capable of generating consistently high returns on capital and reinvesting in its business to drive future growth. This process should create a virtuous “compounding cycle” of wealth creation in which investors can share.
We believe the broader market undervalues Compounders because it adheres to the economic law of competition. This prescribes that high returns on capital attract competition, squeezing market share, driving down prices and resulting in an erosion of profitability. But we see plenty of real-world examples to show the theory does not work in practice.
In our view, Compounders have sustainable advantages that help them keep competitors at bay. Although the market assumes their profitability will fade, they deliver consistently high financial productivity for longer than expected.
As a result, investors who focus more on near-term earnings multiples rather than a company’s long-term earning power are likely to undervalue these exceptional businesses. This means that when these Compounders “beat the fade” they tend to beat the market, too.
We prefer to own Compounders for long periods to allow the compounding cycle to drive cash flows and share prices higher. This is reflected in the strategy’s turnover, which during the past five years has averaged just 10-15% annually – an approach that has also helped keep trading costs low.
Our investment process is reinforced by empirical research covering 25 years of markets and supported by Lazard’s extensive fundamental research team of over 70 global sector specialists. Drawing on this expertise, we look to build a portfolio that is broadly diversified across sectors, regions and competitive advantages and which can generate attractive total returns for investors.
Portfolio activity: our process in practice
Although the average holding period for our Global Quality Growth strategy is between seven and 10 years, we aim to take full advantage whenever the market gives us an opportunity to improve the quality of our portfolio. The following examples illustrate how we have applied this aspect of our investment process over the past six months.
-- Appleremains the world’s leading smartphone vendor, with a loyal and
satisfied installed base. Its iOS platform has a powerful network
effect, with an installed base of more than one billion helping to drive
continued innovation from developers – a competitive edge that is
difficult to replicate.
In addition to the adjacent product categories that benefit from the iOS ecosystem’s leadership and integration (iPad, Watch, Mac, AirPods), Apple has built a diversified and growing high-margin revenue stream of software and services, which together now account for more than 20% of total revenues and close to 70% of gross margins. This has become a significant growth driver and has reduced the business’s cyclicality from hardware product cycles.
-- Corpay is a global payments company that helps businesses and consumers
easily pay expenses. Its suite of solutions enhances the management of
expenses related to vehicles (e.g. fuelling and parking), travel (e.g.
hotel bookings) and payables (e.g. paying vendors), with the majority of
revenues coming from commercial fleet operators. The company also
provides important analytics, allowing customers to monitor and control
fuel spend, optimise routing and improve overall efficiency.
Corpay is a highly financially productive company, consistently achieving top-decile returns on capital for over a decade thanks primarily to its competitive advantages. It enjoys high barriers to entry through its proprietary closed-loop payment networks, specialised multichannel sales networks and high switching costs for customers – resulting in very high renewal rates. Over the past 10 years it has achieved mid-teens earnings growth by reinvesting cash flows to drive organic growth, acquiring companies in new verticals and cross-selling to existing customers. It has also invested in EV charging networks, home charging equipment and fuel-agnostic software to address the electrification of commercial fleets. According to company data, EVs generate more revenue for Corpay than standard internal combustion engine vehicles – although the general transition to EVs is likely to remain gradual.
Exposure by sector and region
In line with our investment process, our sectoral and regional exposures are driven by stock selection. No top
-
down allocations are made. Changes in exposure from
-- Purchases:Equifax (Industrials), Corpay (Financials), Diageo (Consumer
Staples) and Apple and Cadence Design Systems (Information Technology)
-- Sales: Alphabet (Communication Services ), Shimano (Consumer
Discretionary), Estée Lauder (Consumer Staples) and Intuit (Information
Technology)
Sector exposure fell in Consumer Discretionary and rose in Information Technology as we shifted our position in Alphabet to Apple. Typically, the strategy has zero weight in Real Estate, Energy, Materials and Utilities, as companies in these sectors tend not to generate sufficient returns on capital to be considered of high quality.
Performance
NAV, discount and share price
The Company’s NAV rose by 0.8% in GBP terms between
As discussed earlier, unusually narrow markets can create a headwind for active managers whose investment process is geared towards portfolio diversification. We would expect the portfolio to experience a relative lag when a significant area of the market becomes notably extended or overbought, as has been the case in this instance.
Key stock-level contributors to portfolio performance
The following stocks have been key contributors to the Company’s absolute returns during the period covered in this report.
Five principal contributors
Contribution to
Company Total Return (%)
Aon 0.80
Salesforce 0.71
Visa 0.69
Apple 0.63
Accenture 0.55
Source: Lazard/FactSet.
Data in GBP and for the period from
-- Aonis a global insurance broker and consultant. The company is seeing
better revenue growth across its business lines of commercial risk,
reinsurance, health and wealth, with margin expansion.
-- Salesforce, a leading customer relationship management (‘CRM’) software
producer, rose as the company announced plans to hire a thousand new
salespeople to sell its new Agentforce AI capabilities amid indications
of strong customer interest. We believe the business is undervalued, as
it has attractive exposure to secular growth in digital transformation
investment, a leading multiproduct suite and a recurring subscription
revenue stream, with significant room for margin expansion.
-- Visa continues to generate a high level of financial productivity and
has been showing purchase volume and transaction growth. The global
payments company’s brand and four-party ecosystem – card-issuing banks,
consumers, merchants and merchant acquirers – serve as strong barriers
to competition as digital payments increase.
-- Appleremains the world’s leading smartphone vendor, as noted earlier. It
benefits from a substantial installed base, the network effects of its
iOS platform and a diversified and growing high-margin revenue stream of
software and services.
-- Accentureis an IT services consultant that is strongly positioned to
assist corporate clients through their digitisation journeys, including
the integration of AI into their businesses. The company had seen a
slowdown in discretionary spending and a shift of budgets towards AI,
with its shares rebounding from an oversold position.
Key stock-level detractors to portfolio performance
The following stocks have been key detractors from the Company’s absolute returns during the period covered in this report.
Five principal detractors
Contribution to
Company Total Return (%)
ASML (0.77)
Alphabet (0.74)
VAT Group (0.74)
Adobe (0.51)
Booz Allen Hamilton (0.35)
Source: Lazard/FactSet.
Data in GBP and for the period from
-- ASMLhas a virtual monopoly in leading-edge lithography machines that
“print” circuits on to semiconductor silicon wafers. While the
increasing complexity of chip designs is fuelling demand for the
company’s equipment, shares have experienced headwinds in light of
capital expenditure cuts from key semiconductor companies, as well as
fears of potential tariffs and possible bans on shipments of chips to
China .
-- Alphabet, Google’s parent company, generates a high level of financial
productivity through search/digital advertising, supported by its
dominant share in search query volumes. Adjacent product areas –
including Android, Chrome, Maps, YouTube and Gmail – create an ecosystem
that drives consumer usage across the Google platform. However, the US
Department of Justice (‘DOJ’) is considering a break-up of the company,
whose pre-eminence in the US browser market has been judged an illegal
monopoly. While there is a long runway before a final decision, we
believe the DOJ’s proposals increase risk to the company’s operating
income and competitive positioning. The market also appears concerned
about the return on investment from AI capital expenditure. We shifted
our position to what we regard as better risk/reward opportunities –
namely, Apple.
-- VAT Group makes vacuum valves, which are critical components of
semiconductor manufacturing equipment. We see demand for these
increasing as more steps of the manufacturing process incorporate vacuum
environments to achieve higher circuit density and thinner circuit line
widths. However, due to cyclical weakness in the equipment market,
orders for the company’s valves were below expectations.
-- Adobe, an established leader in digital transformation, should be a
winner as AI is integrated into workflows, but the market seems to be
concerned about the pace of AI-related revenues and low-end competition.
We believe Adobe will be able to benefit from its leadership in core
markets and innovation, which can drive double-digit earnings growth.
Continued growth in content creation should generate increased need for
the company’s products, benefiting average revenue per user (‘ARPU’) and
subscriber growth.
-- Booz Allen Hamilton one of the leading providers high-end management and
technology consulting services, catering to the US government. It fell
in response to the incoming Trump administration’s creation of the
Department of Government Efficiency (‘DOGE’), with investors fearing a
cut in government spending on contractors. We continue to like the
company due to its high returns and asset-light business model, which
for several years has grown organic revenue more than the industry’s
average.
Key sectoral and regional contributors to portfolio performance
As discussed above, our sectoral and regional exposures are driven by stock selection.
At the sectoral level, Financials and Information Technology contributed to total return. This was offset by holdings in Industrials, Health Care and Communications Services.
Sector contributions
Contribution to
Sector Total Return (%)
Financials 2.30
Information Technology 0.58
Energy 0.00*
Materials 0.00*
Real Estate 0.00*
Utilities 0.00*
Consumer Staples (0.09)
Consumer Discretionary (0.13)
Communication Services (0.33)
Health Care (0.40)
Industrials (1.08)
Source: Lazard/FactSet.
Data in GBP and for the period from
* Portfolio has no exposure.
At the regional level, holdings in
Regional contributions
Contribution to
Region Total Return (%)
North America 1.69
Emerging Markets 0.60
Japan 0.18
Asia ex Japan 0.16
United Kingdom 0.05
Europe ex UK (1.84)
Source: Lazard/FactSet.
Defined by country of listing.
Data in GBP and for the period from
Outlook
We reiterate our firm belief that investing in the highest-quality companies is the best way to increase investor wealth and outperform over the long term. We are optimistic about the prospects for 2025, as we expect many of the performance headwinds of 2024 to abate.
Our confidence stems from our fundamental research, which persuades us that the companies we are invested in should continue to deliver solid earnings and cash flow growth. We are reminded that share prices do not always follow fundamentals over the short term. As long-term investors, we need to have the patience and fortitude to follow our conviction and stay the course through challenging periods. We believe the market will assign a higher valuation to our companies over time if they continue to demonstrate strong operating performance.
We continue to look for ways to improve the quality of the portfolio, primarily by shifting positions in favour of names where we see a higher level of quality, where barriers to competition are stronger or where reinvestment opportunities are more prevalent, for example. We are in constant dialogue with our fundamental research analysts regarding new ideas and updates on existing holdings, and we also meet company management ourselves to source further opportunities and to build our perspective on the operating environment that businesses are facing.
AI has the potential to transform companies over the long term, and we certainly do not underestimate its power. We believe the market is ascribing most of AI’s value to those businesses that are building AI infrastructure rather than to the many that are poised to benefit from this transformative technology. We believe equity markets could broaden as investors seek a more attractive risk/reward profile, and a strategy such as ours – which is focused on financial productivity – should benefit from a more normalised market environment and a rotation into high-quality names.
We expect to see continued volatility, both as the US Federal Reserve and other central banks seek to balance the goals of maintaining financial stability and controlling inflation and as
We remain focused on our philosophy of investing the portfolio in high-quality companies – Compounders – whose barriers to competition can sustain elevated levels of financial productivity and which can reinvest back into their business at similar returns in order to drive future growth. Spanning 25 years of equity markets, our extensive experience suggests this approach should deliver outperformance over time.
We thank you for your continued investment.
Fund Managers
Interim Management Report and Responsibility Statement
Principal Risks and Uncertainties
Pursuant to DTR 4.2.7R of the Disclosure Guidance and Transparency Rules, the principal risks and uncertainties faced by the Company include strategic risk, market risks, legal and regulatory risk and operational risks including reliance on third-party service providers and reliance on key personnel.
The Directors have assessed these risks and are of the opinion the nature of the risks and the way in which they are managed have not materially changed from the description provided on pages 20 to 22 of the previous Annual Financial Report for the year ended
Related Party Transactions
During the six months ended
Going Concern
The Directors have considered the Company’s principal risks and uncertainties together with its current financial position, the liquid nature of its investments, assets and liabilities, projected revenue and expenses and the Company’s dividend policy and share buyback programme. It is the Directors’ opinion that the Company has adequate resources to continue in operational existence for the foreseeable future, a period of at least 12 months from the approval of this Half-Yearly Financial Report. For this reason, the going concern basis of accounting continues to be used in the preparation of these financial statements.
Responsibility Statement of the Directors in respect of the Half-Yearly Financial Report
The Directors confirm that to the best of their knowledge, in respect of the Half-Yearly Financial Report for the six months ended
-- the condensed set of financial statements has been prepared in
accordance with Financial Reporting Standard (‘FRS’) 104: ‘Interim
Financial Reporting’;
-- the Half-Yearly Financial Report, includes a fair review of the
information required by:
(a) DTR 4.2.7R of the Disclosure Guidance and Transparency Rules, being an indication of the important events that have occurred during the first six months of the financial year and their impact on the financial statements; and a description of the principal risks and uncertainties for the remaining six months of the year; and
(b) DTR 4.2.8R of the Disclosure Guidance and Transparency Rules, being related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the entity during that period, and any changes in the related party transactions described in the last Annual Financial Report that could do so.
The Half-Yearly Financial Report for the six months ended
Chairman
Condensed Statement of Comprehensive Income
For the six months For the six months
ended ended For the year ended
31 December 2024 31 December 2023 30 June 2024 (audited)
(unaudited) (unaudited)
Revenue Capital Total Revenue Capital Total Revenue Capital Total
£’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000
Gains on
investments - 2,215 2,215 - 24,097 24,097 - 49,019 49,019
held at
fair value
Currency
(losses)/ - (41) (41) - 100 100 - 61 61
gains
Income 1,535 - 1,535 3,291 - 3,291 5,650 110 5,760
Investment
management (81) (732) (813) (69) (622) (691) (134) (1,207) (1,341)
fee
Other (312) (126) (438) (466) (69) (535) (665) (218) (883)
expenses
Net return
before
finance 1,142 1,316 2,458 2,756 23,506 26,262 4,851 47,765 52,616
costs and
taxation
Finance
costs of - - - (4) (34) (38) (2) (21) (23)
borrowings
Net return
on ordinary
activities 1,142 1,316 2,458 2,752 23,472 26,224 4,849 47,744 52,593
before
taxation
Taxation on
ordinary (187) - (187) (47) - (47) (448) (71) (519)
activities
Net return
on ordinary
activities 955 1,316 2,271 2,705 23,472 26,177 4,401 47,673 52,074
after
taxation
Net return
per 2.01p 2.76p 4.77p 4.72p 40.92p 45.64p 8.00p 86.66p 94.66p
ordinary
share
The total column of this statement is the profit and loss account of the
Company.
All revenue and capital items in this statement derive from continuing
operations. No operations were acquired or discontinued during the period.
The net return for the period disclosed above represents the Company’s total
comprehensive income.
Condensed Statement of Financial Position
As at As at As at
31 December 2024 31 December 2023 30 June 2024 (audited)
(unaudited) (unaudited)
£’000 £’000 £’000
Non current assets
Investments held at
fair value through 363,729 412,360 398,094
profit or loss
Current assets
Debtors 605 543 1,950
Cash and cash 7,192 6,969 5,742
equivalents
7,797 7,512 7,692
Creditors
Amounts falling due (776) (550) (1,692)
within one year
Net current assets 7,021 6,962 6,000
Total net assets 370,750 419,322 404,094
Capital and reserves
Share capital 3,320 3,320 3,320
Capital redemption 16 16 16
reserve
Share premium account 242,115 242,115 242,115
Capital reserve 120,334 167,545 152,673
Revenue reserve 4,965 6,326 5,970
Shareholders’ funds 370,750 419,322 404,094
Net asset value per 812.18p 763.33p 810.22p
ordinary share
Condensed Statement of Changes in Equity
For the six months ended 31 December 2024 (unaudited)
Share Capital Capital Revenue Shareholders’
capital redemption Share premium reserve1,2 reserve2 funds
reserve
£’000 £’000 £’000 £’000 £’000 £’000
Balance at 1 3,320 16 242,115 152,673 5,970 404,094
July 2024
Net return on
ordinary
activities - - - 1,316 955 2,271
after
taxation
Repurchase of
shares into - - - (33,655) - (33,655)
Treasury
Dividends - - - - (1,960) (1,960)
paid
Shareholders’
funds at 31 3,320 16 242,115 120,334 4,965 370,750
December 2024
For the six months ended 31 December 2023 (unaudited)
Share Capital Capital Revenue Shareholders’
capital redemption Share premium reserve1,2 reserve2 funds
reserve
£’000 £’000 £’000 £’000 £’000 £’000
Balance at 1 3,320 16 242,115 196,730 6,845 449,026
July 2023
Net return on
ordinary
activities - - - 23,472 2,705 26,177
after
taxation
Repurchase of
shares into - - - (52,657) - (52,657)
Treasury
Dividends - - - - (3,224) (3,224)
paid
Shareholders’
funds at 31 3,320 16 242,115 167,545 6,326 419,322
December 2023
For the year ended 30 June 2024 (audited)
Share Capital Capital Revenue Shareholders’
capital redemption Share premium reserve1,2 reserve2 funds
reserve
£’000 £’000 £’000 £’000 £’000 £’000
Balance at 1 3,320 16 242,115 196,730 6,845 449,026
July 2023
Net return on
ordinary
activities - - - 47,673 4,401 52,074
after
taxation
Repurchase of
shares into - - - (91,730) - (91,730)
Treasury
Dividends - - - - (5,276) (5,276)
paid
Shareholders’
funds at 30 3,320 16 242,115 152,673 5,970 404,094
June 2024
1 Capital reserve as at 31 December 2024 includes realised gains of £69,481,000
(31 December 2023 : £133,904,000; 30 June 2024 : £101,175,000).
2 The Company may pay dividends from both capital and revenue reserves.
Condensed Statement of Cash Flows
For the six months For the six months For the year ended 30
ended31 December ended31 December June 2024 (unaudited)
2024 (unaudited) 2023 (unaudited)
£’000 £’000 £’000
Net cash outflow
from operations (1,630) (1,363) (2,649)
before dividends and
interest
Dividends received 1,529 3,118 5,672
from investments
Interest received 6 113 133
Interest paid - (39) (23)
Net cash
(outflow)/inflow (95) 1,829 3,133
from operating
activities
Cash flow from
investing activities
Purchase of (46,083) (388,879) (375,073)
investments
Sale of investments 83,687 439,638 463,853
Realised currency (38) 98 65
(losses)/gains
Net cash generated
from investing 37,566 50,863 88,845
activities
Cash flow from
financing activities
Repurchase of shares (34,058) (54,737) (93,200)
into Treasury
Dividends paid (1,960) (3,224) (5,276)
Net cash outflow
from financing (36,018) (57,961) (98,476)
activities
Net increase/
(decrease) in cash 1,453 (5,269) (6,498)
and cash equivalents
Cash and cash
equivalents at start 5,742 12,243 12,243
of the period
Increase/(decrease)
in cash in the 1,453 (5,269) (6,498)
period
Currency losses on
cash and cash (3) (5) (3)
equivalents
Cash and cash
equivalents at end 7,192 6,969 5,742
of the period
Notes to the Half-Yearly Financial Report
1.(a) Accounting policies The unaudited condensed financial statements for the six months to31 December 2024 comprise the statements set out in the Interim Report together with the related notes. The financial statements have been prepared in accordance with the Company’s accounting policies as set out in the Annual Financial Report for the year ended30 June 2024 and are presented in accordance with the Companies Act 2006 (the ‘Act’), FRS 104 and the requirements of the Statement of Recommended Practice ‘Financial Statements ofInvestment Trust Companies and Venture Capital Trusts’ (‘SORP’) issued by theAssociation of Investment Companies (‘AIC’) inJuly 2022 . The financial information contained within this Half-yearly Financial Report does not constitute statutory accounts as defined in sections 434 to 436 of the Act. The financial information for the year ended30 June 2024 has been extracted from the statutory accounts which have been filed with the Registrar of Companies. The Auditors’ report on those accounts was not qualified and did not contain statements under sections 498(2) or (3) of the Act. The unaudited condensed financial statements for the six months ended31 December 2024 have been prepared on a going concern basis. 1.(b) Expenses All expenses are accounted for on an accruals basis. Expenses are charged through the revenue reserve except where they relate directly to the acquisition or disposal of an investment, in which case they are added to the cost of the investment or deducted from the sale proceeds, and where they are connected with the maintenance or the enhancement of the value of investments are charged to the capital reserve. The management fees, company secretarial and administration fees, the cost of operating the discount control mechanism and finance costs are allocated 90% to capital and 10% to revenue. 2. Return per share Return per share has been calculated based on the weighted average number of ordinary shares in issue for the six months ended31 December 2024 being 47,602,419 (six months ended31 December 2023 : 57,362,785 and year ended30 June 2024 : 55,010,567). 3. Dividends An interim dividend for the six months ended31 December 2024 of3.85 pence per ordinary share (six months ended31 December 2023 :3.85 pence ) has been declared. This dividend will be paid on28 March 2025 to those shareholders on the register at close of business on7 March 2025 . 4. Borrowing facilities On19 February 2021 , the Company entered into a three year agreement with The Bank of Nova Scotia (UK Branch) for aUS$60 million multi-currency revolving credit facility. Following a review, the Company terminated the agreement on11 September 2023 . 5. Fair value hierarchy All investments are designated at fair value through profit or loss on initial recognition in accordance with FRS 102. The following table provides an analysis of these investments based on the fair value hierarchy as described below which reflects the reliability and significance of the information used to measure their fair value. The disclosure is split into the following categories: Level 1 – Investments with unadjusted quoted prices in an active market; Level 2 – Investments whose fair value is based on inputs other than quoted prices that are either directly or indirectly observable; Level 3 – Investments whose fair value is based on inputs that are unobservable (i.e. for which market data is unavailable). 31 December 31 December 30 June 2024 2024 2023 £’000 £’000 £’000 (unaudited) (unaudited) (audited) Level 1 363,729 412,360 398,094 Total value of investments 363,729 412,360 398,094 6. Reconciliation of net return before finance costs and taxation to cash from operations For the six For the six For the year months ended 31 months ended 31 ended30 June December December 2024 2024 2023 £’000 £’000 £’000 (unaudited) (unaudited) (audited) Net return before finance costs 2,458 26,262 52,616 and taxation Gains on investments (2,215) (24,097) (49,019) Currency losses/(gains) 41 (100) (61) Increase/(decrease) in accrued 207 87 (79) income and other debtors Dividend income (1,529) (3,118) (5,672) Interest received (6) (113) (133) (Decrease)/increase in creditors (399) (237) 218 Overseas tax suffered (187) (322) (792) Corporation tax refunded - 275 273 Net cash outflow from operations (1,630) (1,363) (2,649) before interest and dividends 7. Analysis of changes in net cash At 30 June Cashflow Exchange At 31 December 2024 movements 2024 £’000 £’000 £’000 £’000 (audited) (unaudited) (unaudited) (unaudited) Cash and cash 5,742 1,453 (3) 7,192 equivalents Total 5,742 1,453 (3) 7,192 8. Share capital In the six months ended31 December 2024 , 4,225,500 ordinary shares were purchased intoTreasury at a total cost of £33,655,000 (six months ended31 December 2023 : 7,445,136 ordinary shares at a total cost of £52,657,000 and year ended30 June 2024 : 12,504,096 ordinary shares at a total cost of £91,730,000). In the six months ended31 December 2024 , no ordinary shares were sold fromTreasury (six months ended31 December 2023 and year ended30 June 2024 : no ordinary shares were sold fromTreasury ). In the six months ended31 December 2024 , no new ordinary shares were allotted (six months ended31 December 2023 and year ended30 June 2024 : no new ordinary shares were allotted). As at31 December 2024 , 20,732,258 ordinary shares were held inTreasury (31 December 2023 : 11,447,798;30 June 2024 : 16,506,758). 9. Net asset value per ordinary share The calculation of the net asset value per ordinary share is based on the following: 31 December 31 December 30 June 2024 2023 2024 (unaudited) (unaudited) (audited) Shareholders’ funds 370,750 419,322 404,094 (£’000) Number of ordinary shares in issue at 45,648,856 54,933,316 49,874,356 period end Net asset value per 812.18p 763.33p 810.22p ordinary share 10. Related party transactions The Directors are considered to be related parties. No Director has an interest in any transactions which are, or were, unusual in their nature or significant to the nature of the Company. The Directors receive fees for their services. During the six months ended31 December 2024 , £85,000 was paid to Directors (six months ended31 December 2023 : £82,000 and year ended30 June 2024 : £163,000) of which £nil was outstanding at the period end (31 December 2023 : outstanding £nil;30 June 2024 : outstanding £nil). 11. Transactions with the Investment Manager The investment management fees payable to Lazard and the Company’s former investment manager, Artemis are disclosed in the Statement of Comprehensive Income. The amount outstanding to Lazard at31 December 2024 was £364,000 (31 December 2023 amount outstanding to Artemis: £525,000 and year ended30 June 2024 amount outstanding to Lazard: £738,000). The existence of an independent Board of Directors demonstrates that the Company is free to pursue its own financial and operating policies and therefore the Investment Manager is not considered to be a related party. 12. Post Balance Sheet Events Following the period end and up to24 February 2025 , 934,500 ordinary shares were bought back to be held inTreasury , at a total cost of £7,615,000. 13. Status of this report These are not full statutory accounts for the purposes of Section 434 of the Companies Act 2006 and are unaudited. Statutory accounts for the year ended30 June 2024 , which received an unqualified audit report and which did not contain a statement under Section 498 of the Companies Act 2006, have been lodged with the Registrar of Companies. No full statutory accounts in respect of any period after30 June 2024 have been reported on by the Company’s auditors or delivered to the Registrar of Companies. A copy of the Half-Yearly Financial Report will be sent to shareholders and is available on the Company’s website at midwynd.com. Shareholders are encouraged to visit the website for further information on the Company. For further information please contact:Juniper Partners Limited Company Secretary email: cosec@junipartners.com
