Augmentum Fintech plc - Annual Financial Report
Annual Financial Report for the year ended
Financial highlights
•
NAV before performance fee £285.4 million
1
(
•
NAV per share after performance fee 161.5p
2
(
•
Cash reserves of £29.3 million as at
Portfolio highlights
• Top nine holdings account for 80% of the invested NAV and delivered 33% 3 average revenue growth; four of the nine are profitable.
• Eight exits from the portfolio since inception with an average premium of 33% to the last reported valuation, realising a cumulative £100 million in proceeds.
• Combined IRR of 31% 4 of the eight exits.
•
During the reporting period
•
• FullCircl was acquired by NASDAQ listed US digital banking platform nCino.
• Average profit growth rate for the top nine positions of 107% 5
Investment activity
• Maintained valuation and investment discipline across the portfolio and new investment opportunities. Over the year, £18.9 million was invested in:
• Two new companies:
•
Pemo which provides expense management and corporate payment solutions for businesses in the
• LoopFX which provides an FX matching service for banks and asset managers.
• 12 follow-on investments into existing portfolio companies.
• Post year end: Led a funding round of £4.5 million into retail investment platform RetailBook.
“Our portfolio continues to deliver impressive operating performance. In the last year we have made two exciting new investments. The wider market environment remains inhospitable, but we took opportunities to exit
“Augmentum’s portfolio includes businesses of significant scale, delivering impressive growth; their combined revenues grew by 31% from £0.93 billion to £1.22 billion and their aggregate profitability is now £65 million, a margin of 5.4%, up from a loss of £29 million and -3.1% a year earlier. Six of our businesses are now profitable, with the total profit of these businesses having more than doubled from over £50 million to over £130 million.
“The fundamentals of our portfolio of businesses are good with strong top line growth and improving profitability. Our strategy is time-tested and proven despite the current challenging market conditions, with a gross IRR of 31% and 2.4x multiple on realisations since inception.
“While markets remain mired in uncertainty and frustration, the European fintech sector is scaling impressively with several €1 billion+ businesses paving the way – including a number in our portfolio. As a Board we are very mindful of the discount to NAV and we are working hard to find ways to narrow the discount. In the meantime, we believe our portfolio of extraordinary businesses represents a compelling investment proposition for growth-savvy investors.”
“After a period of necessary recalibration, the European fintech market is entering a new chapter of stability and maturity. The inflated valuation multiples of the post-Covid era have returned to more sustainable levels, and the underlying fundamentals of the sector are robust, reinforced by supportive public policy in the
“Our performance is clear evidence of this resilience. We have realised over £100 million from eight exits since our IPO, achieving a 38% combined IRR and an average 33% premium to last reported valuations. This discipline is also reflected in our current portfolio, where our top nine investments are delivering significant revenue growth and a clear path to profitability.
“Looking ahead, we believe the next five years will be defining for European fintech. As capital increasingly flows into the region, our strong track record and robust portfolio position us perfectly to continue backing the category leaders of tomorrow and delivering exceptional value to shareholders.”
Notes
1. NAV before performance fee.
2. The Board considers the NAV per share after any performance fees payable to be the most accurate way to reflect the underlying value of each share.
3. Average revenue growth taken as LTM to
4. Annualised IRR on invested capital and realisations since inception using valuations at the last reporting date. This measure does not include the impact of net expenses and the performance fee provision.
5. Average profit growth of the top 9 companies by Fair Value. PBT used where available, otherwise next best reported profit metric used.
Enquiries
Augmentum Fintech
+44 (0)20 3961 5420
Tim Levene (Portfolio Manager)
nigel@augmentum.vcNigel Szembel (Analysts and IR)
Woodrow Communications
+44 (0)20 8636 8753
Henry Kirby press@augmentum.vc
(Press and Media)
Peel Hunt LLP Liz Yong , Huw Jeremy +44 (0)20 7418 8900
(Investment Banking)
Singer Capital Markets James Moat , James Fischer +44 (0)20 7496 3000
(Investment Banking)
Frostrow Capital LLP
+44 (0)20 3709 8733
Paul Griggs (Company Secretary)
About
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Annual Report and Financial Statements
for the year ended
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CHAIRMAN’S STATEMENT
Performance Highlights
31 March 2025 31 March 2024
NAV per Share after performance fee1* 161.5p 167.4p
NAV per Share after performance fee Total Return* (3.5%) 5.4%
85.0p 100.5p
Total Shareholder Return* (15.4%) 3.6%
Discount to NAV per Share after performance fee* (47.4%) (40.0%)
Ongoing Charges Ratio* 2.0% 2.0%
* These are considered to be Alternative Performance Measures. Please see the Glossary and Alternative Performance Measures on page 79.
1 The Board considers the NAV per share after any performance fees provision to be the most accurate way to reflect the underlying value of each share, whereas accounting standards require the Group’s consolidated NAV per share to be presented before such fees are deducted as a consequence of our Portfolio Manager being within our Group structure and the fees therefore being eliminated on consolidation.
To read about our KPIs see page 23.
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Introduction
This is our seventh, and my first, annual report since the launch of the Company in
It has been a frustrating year on several counts. On the one hand, as you can see below and in our Portfolio Manager’s report, our portfolio continues to deliver impressive operating performance, we have made two exciting new investments, and we disposed of
Our mission and strategy
Your company’s mission is to become Europe’s leading fintech venture investor. Fintech is a growth sector that the
We are currently unique, in two respects. We are the only European fintech venture capital fund which is an
Our vision sees our portfolio growing over the medium term to over €1 billion, comprising more than 30 investments, with several investments having ‘graduated’ via an IPO. On the journey, we expect to see our brand strengthening, our talent pool growing, and our relationships deepening across the European fintech ecosystem of regulators, capital providers, entrepreneurs and fintech supply chains.
Our strategy has four pillars:
•
Focusing on fintech venture opportunities
. Early stage private fintech businesses in and around
Our Portfolio Manager aims, before costs, for our diversified portfolio of such investments to generate a long-term return of 20% on invested capital and for cash invested to return on average 3x at exit. In practice, successful venture capital portfolios can expect to see a wide range of exit multiples and rely for their strong returns on the outsized winners – which are usually rare.
• Building a team and network with a reputation for board-level expertise. As well as being strong allocators of capital, we need to be appealing partners for top entrepreneurs – bringing expertise, relationships and resources to the table.
• Operating with a high Return on Investment mindset . We revere value-for-money, and we want maximum ‘bang for our buck’.
• Operating as patient capital . We think and operate for the long term.
Performance
Our portfolio companies delivered very strong trading performance over the year, and I want to congratulate the management teams leading our businesses. The 25 extraordinary businesses in our portfolio include businesses of significant scale, delivering impressive growth; their combined revenues grew by 31% from £0.93 billion to £1.22 billion and their aggregate profitability is now £65 million, a margin of 5.4%, up from a loss of £29 million and -3.1% a year earlier. Six of our businesses are now profitable, with the total profit of these businesses having more than doubled from over £50 million to over £130 million.
Our portfolio is diversified across different fintech sectors, European markets and maturity stages. Its exposure to the constituent companies’ strong trading performance, weighted by our respective shareholdings, reflects the strong performance cited above. Our share of these companies’ revenues grew approximately 27% last year to £49 million, and our share of profits/(losses) was a breakeven performance.
Of course, trading performance does not directly map across to Net Asset Value. Your Board considers its governance role in the valuations process to be of utmost importance and understands that shareholders and potential investors can be sceptical of private equity valuations as they cannot be readily verified in the way that public equities can. We consider and challenge all of the investment valuations used for the full and half year financial statements. These are then in turn reviewed by our independent AIFM, Frostrow, and our external auditors, BDO. The valuations are arrived at using appropriate and consistent methodologies in accordance with
We have marked down one of our larger holdings, the
Aside from
Grover
’s unique situation, our portfolio’s strong trading performance contributed a £31.1 million increase to our Net Asset Value. However, our valuations took a £15.2 million knock from the decline in multiples of publicly traded comparables as markets grew uneasy over the possible approach of the Trump administration to tariffs. This was particularly felt among growth and technology stocks (which comprise the bulk of our peer comparables). The NASDAQ* fell 14% from its December all-time high to
Our Portfolio Manager invested £18.9 million during the year, including in two new investments LoopFX and Pemo , and nine follow-on investments – as detailed in the Portfolio Manager’s report. The exits previously mentioned realised £16.3 million. Further details on all transactions are provided in the Portfolio Manager’s report.
We are disappointed that the cumulative effect of these movements is that your Company’s NAV after performance fee at
And just as trading performance does not map directly across to Net Asset Value, nor does Net Asset Value map directly across to share price performance. The first few months of 2025 have seen significant market turmoil, which affected our share price too. With the S&P500 and NASDAQ now up slightly on the start of the year, one might almost forget the sharp drops both indices – and indeed our own share price - endured earlier this calendar year – reaching their nadir almost exactly at the end of our financial year.
Our share price on
Whatever the reasons, and notwithstanding a subsequent recovery in our share price to 99.0p per share at the last close (
There is a full review of the portfolio and investment transactions during the year in the Portfolio Manager’s Review beginning on page 16.
*NASDAQ Composite Index (total return, dollars)
Portfolio Management
At its launch the Company adopted an internalised management structure, with
Since that time, an unanticipated disadvantage of the internalised structure emerged. During 2021, the Company was advised that the long-term employee benefit plan to incentivise employees of AFML and align them with shareholders through participation in the realised investment profits of the Group had adverse accounting consequences for the Group. To address this, the AFML employee remuneration plan that had been in place was terminated. AFML continued to be entitled to a performance fee as before, but the allocation to AFML employees of any performance fee paid by the Company to AFML changed to being at the discretion of the board of AFML, with oversight from the
Following careful consideration by the Board, and having consulted with the Company’s major shareholders, the Board has agreed that, subject to shareholder approval, AFML will appoint
There will be no change to the overall level of fees paid by the Company and
A separate circular in relation to this, convening a General Meeting to be held at
Cash Reserves, Discount and Share Buybacks
The use of the Company’s cash reserves is a matter of regular Board review. We aim to balance the benefits of highly accretive buybacks when discounts are high against ensuring that we hold appropriate reserves to fund follow on investments and capture the best of the new investment opportunities that we continue to see.
The Company’s shares traded at a discount to NAV throughout the year under review and up to the date of this report. The Board continues to discuss our position in the market with its advisers. We believe our share price performance does not fairly reflect the true value of our portfolio. Instead, our discount, in common with many other investment trusts, reflects wider market dynamics and the particular circumstances of some of our shareholders – and presents a buying opportunity for some future shareholders. We are working hard to turn the market’s challenges into opportunities.
Share buybacks are one of the mechanisms your Board actively considers. When I consulted with several of our shareholders earlier this calendar year I made a point of canvassing views on share buybacks. There was widespread agreement that buybacks, while accretive to NAV, are not effective in controlling the discount. Accordingly, we only bought back 2,550,383 shares (1.5% of our issued share capital) in the financial year (2024: 4,687,567 shares, 2.7% of issued share capital) – and only as allowed under market abuse rules. All the shares repurchased by the Company are being held in treasury. The average purchase price was 104.9p per share, representing an average discount to the prevailing NAV per share after performance fee of 37.5% and adding 1.0p to the NAV per share. No shares have been bought back since March, up to the date of this annual report.
We will seek to renew shareholders’ authorities to issue and buy back shares at the forthcoming AGM.
Dividend
No dividend has been declared or recommended for the year.
AGM
Our AGM will be held on Wednesday,
Details of all the resolutions can be found in the Notice of AGM, which is published separately from this annual report and will be sent to shareholders when the annual report is published. Both documents will also be available to view on or download from the Company’s website at www.augmentum.vc.
Your Directors consider that all the resolutions listed are in the best interests of the Company and its shareholders and recommend voting in favour of them, as your Directors intend to do in respect of their own holdings.
Outlook
The fundamentals of our portfolio of businesses are good with strong top line growth and improving profitability. Our strategy is time-tested and proven despite the current challenging market conditions, with a gross IRR of 31% and 2.4x multiple on realisations.
While markets remain mired in uncertainty and frustration, the European fintech sector is scaling impressively with several €1 billion+ businesses paving the way – including several in our portfolio. As a Board we are very mindful of the discount to NAV and we are working hard to find ways to narrow the discount. In the meantime, we believe our portfolio of extraordinary businesses represents a compelling investment proposition for growth-savvy investors.
Chairman
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PORTFOLIO MANAGER’S REVIEW
Overview
Earlier this year, my outlook for the global economy was decidedly more optimistic, with expectations of falling interest rates, the potential for deficit-reducing policies, and hopes for a lighter regulatory touch in key sectors. However, the intervening period has been marked by a rise in profound uncertainty, driven by macroeconomic volatility, political disruption, and rapidly shifting global dynamics. While the precise path of geopolitical events remains unpredictable, one thing remains clear, fintech’s potential in
Following the Covid-era surge, where abundant capital led to significantly inflated valuation multiples, the market has undergone a necessary recalibration. We have now entered a period of relative stability and, encouragingly, the underlying fundamentals of the fintech sector remain robust. For the first time in a while, we are seeing tangible signs of more favourable conditions for the thawing of the IPO market. The fintech sector continues to evolve and mature, particularly in
We are encouraged by the continued policy support for the fintech and startup sectors, including a strong commitment to fostering innovation and domestic capital formation, across the markets in which we invest. The
Amid this dynamic context,
This maturation has come through deliberate strategy: investing early, backing high-quality management teams and supporting their growth with capital and insight through cycles. In doing so, we have built one of the few vehicles that offer public market investors access to the full lifecycle of Europe’s leading fintech businesses.
Fintech Market Dynamics and the Impact of AI
Global fintech funding saw a 13% decline in 2024 with public multiples 30% off the highs of 2022. Despite this backdrop, revenues across the sector have grown 38% since 2022 and in the
Notably, the focus on capital efficiency and profitability across both private and public fintech companies has reinforced a “flight to quality” trend. This dynamic plays to our strengths - our rigorous investment criteria and sector specialisation mean that we remain a preferred partner to exceptional founders, and our pipeline of opportunities reflects this. We continue to see exciting opportunities across the diverse fintech spectrum, including in AI-driven wealth management, payments, alternative lending, the modern finance stack, insurtech, regtech and compliance, and infrastructure for the energy sector.
The emergence of Artificial Intelligence, and notably Generative AI (GenAI) in recent years, has generated significant opportunities within the fintech industry. While AI’s capacity for profound change is indisputable, its present rate of uptake across the sector presents a varied landscape. Thus far, many mature financial technology firms have chiefly utilised GenAI to streamline operations, concentrating on decreasing expenses and boosting output in functions like software creation, AML/KYC process automation, marketing initiatives, and customer support. A considerable portion of these larger companies are still in experimental stages or are only just starting to deploy AI broadly across their operations. Conversely, newer, more nimble fintechs are showing more rapid movement, integrating AI more fundamentally into their foundational strategies right from their inception. This swift adoption is, in part, propelled by pressure from investors to deliver greater results with fewer resources. This is reflected in AI-centric fintechs typically requiring about 15% less capital in their initial funding stages yet attracting an outsized portion (49%) of overall equity investments.
It will be hard to ignore the impact of Agentic AI over the coming years. Distinct from existing GenAI that needs ongoing user direction, Agentic AI is engineered for independent operation carrying out functions, acquiring knowledge, and adjusting for specific user requirements. Although still in its early development, this technology holds the promise of radically altering the financial services domain by transcending an assistive function to become genuine actors.
This movement towards autonomous AI is set to speed up fundamental shifts first introduced during the initial wave of financial technology. It will evolve the emphasis from simply broadening access to financial products to making sophisticated intelligence widely available. Imagine AI agents that take initiative in overseeing financial matters, such as consistently identifying superior savings products and actioning the movement of capital, thereby disrupting established revenue systems built on consumer inaction. The transition from automated processes to self-governing autonomy will witness AI agents handling intricate operations with far less need for human input, for example, within industry-specific SaaS (software as a service) platforms that manage stock levels, arrange funding, and conduct supplier discussions. Moreover, Agentic AI will advance customisation to an intensely individualised level of hyper-personalisation, providing bespoke financial guidance and automated modifications to expenditure and investment plans that factor in current information and personal objectives, a standard of service once reserved for affluent customers but potentially accessible to a wider audience.
Internally, we are also working hard to harness the power of the latest in AI tooling to enhance our investing edge. Whether it be AI powered research to help identify the best opportunities or agentic workflows that ensure we do not miss opportunities that have previously been identified within our systems. We see AI being a core element of how we function as an organisation going forward.
Regulation will be both a help and a hindrance, but there should be no doubt that the impact of AI will become ever more significant, even if the impact in financial services takes a little longer to play out. We are undergoing a generational opportunity, and one in which we expect many current and future portfolio companies to benefit from.
Portfolio Highlights
A recent BCG report estimated that of the 37,000 fintechs globally, less than 100 were generating more than
The portfolio now comprises 25 companies, with two new investments in
LoopFX
and
Pemo
, and exits from
Tide
, the portfolio’s largest holding, maintained strong momentum over the past 12 months, which has been further reflected in an £11.2 million write up. The company is broadening its product suite and market presence for small businesses across all regions. In the
Despite a 121% year-on-year increase in processing volume in the first half of this year versus the same period last year, we have reduced our valuation of real-time payments solution
Volt
in line with public market comparables reflecting the focus over the past 18
months of reducing cash burn and improving the unit economics. The reduction in cost base has both extended the company's runway and left it well positioned to pursue its next phase of growth. Notable recent milestones include
Volt
’s launch in
20 years since launch,
BullionVault
sadly lost its pioneering founder and chairman
Founded in 2011,
iwoca
is on track to deliver its mission of financing one million small businesses: to date the business has funded some 100,000 businesses across the
While several companies continue to scale while optimising profitability, others are undergoing critical transitions.
Positioned at the intersection of core banking modernisation and embedded finance, XYB is pioneering a new category of Adaptive Financial Infrastructure, a modular, API-first approach to helping banks evolve legacy systems without the need for full replacement. The company has reorganised internally and invested in AI-driven tooling to optimise workflows and enhance scalability. XYB continues to collaborate with IBM and is actively engaged with some of the world’s largest financial institutions to shape the future of real-time banking infrastructure.
Anyfin
continues to trade in line with budget as the company prioritises strengthening unit economics and bolstering its operational, compliance and finance functions to support future growth and its “Kreditmarknadsbolag” license. Effectively a ‘light’ banking license, this license, which can be passported across
Intellis continues to develop new proprietary intellectual property in artificial intelligence which allows it to operate profitably in financial markets both on its balance sheet and through license partners. Success in FX trading has led to other strategies being deployed in the commodities and digital assets arena which we expect to deliver a more substantive impact over the coming financial year.
WeMatch
continues to deliver steady growth as it builds out its platform for total return swap and securities lending markets globally. The platform now connects over 1,000 traders and 100 institutions, streamlining pre-execution, negotiation, and post-trade workflows. In 2024, the company achieved 82% year-on-year volume growth across financial instruments reaching
The digitisation of the insurance market remains a high priority for participants across the ecosystem.
Artificial
is emerging as one of the leading businesses facilitating this via their cutting-edge technology platform enabling algorithmic underwriting, something that has been impossible to deliver at scale across the industry with outdated legacy systems. Commercial traction continues to progress with
Artificial
signing multiple enterprise contracts with some of the largest stakeholders in the space; AON, Apollo, Axis, Gallagher and more, and a successful partnership with
Farewill was acquired by funerals group Dignity in exchange for shares in Castelnau Group Limited , which has a controlling stake in Dignity. The acquisition resulted in a downward valuation of our stake, although we expect there to be meaningful future upside from the current level.
Exposure to digital assets remains focused on the infrastructure layer, where regulatory momentum, particularly in the US, has driven renewed confidence and asset price recovery. Portfolio companies like
Gemini
,
ParaFi
and
Tesseract
are well placed to benefit from this shift. Blockchain ecosystems are scaling at pace. Three critical trendlines in the blockchain space are simultaneously inflecting: (i) stablecoin adoption, (ii) real-world asset tokenisation, and (iii) the convergence of traditional capital markets onto blockchain rails. The institutionalisation of the sector is in full swing with the likes of
Investments
In a year marked by macroeconomic uncertainty and subdued market sentiment, we maintained our disciplined investment approach, with a sharp focus on a healthy balance between capital preservation and investing in new and follow-on opportunities where we have high conviction. Our selective deployment of capital during the period reflects our belief that periods of market stress can present outsized opportunities for disciplined, patient investors with a long-term outlook.
In
In
Post year end we announced that we led a funding round of £4.5 million into retail investment platform RetailBook . RetailBook addresses the challenge of limited retail investor access to primary capital markets by providing a platform for participation in investment opportunities, including IPOs, follow-on placings, and bond offerings, on the same terms as institutional investors. The service is accessed through established retail investment platforms.
Exits and Realisations
Exits during the year took total realisations since IPO to over £100
million.
Although these exits did not deliver a “venture outcome”, they still delivered over £16 million in realisations, which was achieved in a challenging exit environment. Maintaining strong exit discipline remains a core part of our investment strategy, ensuring we realise value at the right time to deliver returns for shareholders and recycle capital into the next generation of high growth fintech opportunities.
As public and private market sentiment improves, we expect to see renewed M&A momentum across the fintech sector, driven by strategic appetite from both incumbents and larger tech players. Financial institutions are increasingly turning to acquisition over in-house development to accelerate digital transformation, creating strong demand for high-quality, scalable fintech scale-ups. This dynamic reduces reliance on the IPO market as the primary exit route for fintechs, with strategic trade sales and secondary transactions offering attractive alternatives. Companies in the portfolio, many of which operate at the intersection of key trends of strategic interest for such acquirers, are well-positioned to benefit from this dynamic, increasing the likelihood of further value-accretive exits.
Performance and Valuation Discipline
While we have seen a drop in the Company’s NAV per share of 5.9p over the past 12 months, which on the surface is disappointing, it masks the significant progress made across the portfolio by many key holdings.
The impact on valuations from multiple compression, and a significant write down in Grover , have countered the 115% revenue growth and 173% increase in profitability across our top 9 investments over the last 24 months. As in any venture portfolio, there are winners and losers, however we believe Augmentum’s portfolio remains well positioned to deliver our long-term IRR target of 20%.
As at
Valuation remains a rigorous process governed by objective methodologies and approved by the Company’s Valuations Committee and Board. Public market comparables are used for 78% of the portfolio. Downside Protections in the form of preferred shares and anti dilution provisions are in place for 19 of 25 companies, ensuring that investor capital is appropriately safeguarded.
Outlook
We believe that the next five years will mark a defining chapter for European fintech, a sector at the intersection of innovation, regulation and global capital flows. With rate cycles peaking and early cuts now behind us, the stage is set for a recovery in risk appetite. Market sentiment is already responding: fintech valuations are recovering, capital markets are stabilising and M&A activity is accelerating. Exit markets are poised to reopen, driven by pent-up demand and investor appetite for growth-stage businesses with strong fundamentals. Our job is to ensure that Augmentum’s portfolio companies are at the front of the queue, and that realisations are delivered at appropriate premiums, reflective of their maturity, profitability and strategic relevance.
In an increasingly competitive market, we believe the foundations we have laid over the last seven years give us a significant edge. Through our proprietary deal sourcing platform,
As Europe’s fintech ecosystems mature, generating repeat founders, deeper pools of talent, and more ambitious ventures, we remain confident that the best vintages lie ahead. With patience, discipline, and clarity of purpose, we look forward to delivering exceptional outcomes for shareholders.
Thank you for your continued support.
CEO
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INVESTMENT OBJECTIVE AND POLICY
Investment objective
The Company’s investment objective is to generate capital growth over the long term through investment in a focused portfolio of fast growing and/or high potential private financial services technology (“fintech”) businesses based predominantly in the
Investment policy
In order to achieve its investment objective, the Company invests in early or later stage investments in unquoted fintech businesses. The Company intends to realise value through exiting these investments over time.
The Company seeks exposure to early stage businesses which are high growth, with scalable opportunities, and have disruptive technologies in the banking, insurance and wealth and asset management sectors as well as those that provide services to underpin the financial sector and other cross-industry propositions.
Investments are expected to be mainly in the form of equity and equity-related instruments issued by portfolio companies, although investments may be made by way of convertible debt instruments. The Company intends to invest in unquoted companies and will ensure that the Company has suitable investor protection rights where appropriate. The Company may also invest in partnerships, limited liability partnerships and other legal forms of entity. The Company will not invest in publicly traded companies. However, portfolio companies may seek initial public offerings from time to time, in which case the Company may continue to hold such investments without restriction. The Company may also hold securities in publicly traded companies, including non-fintech companies, that have been received as consideration for the Company’s holding in a portfolio company (“Listed Consideration Securities”).
The Company may acquire investments directly or by way of holdings in special purpose vehicles or intermediate holding entities (such as the Partnership*).
The Management Team has historically taken a board or board observer position at investee companies and, where in the best interests of the Company, will do so in relation to future investee companies.
The Company’s portfolio is expected to be diversified across a number of geographical areas predominantly within the
The Management Team will actively manage the portfolio to maximise returns, including helping to scale the team, refining and driving key performance indicators, stimulating growth, and positively influencing future financing and exits.
Investment restrictions
The Company will invest and manage its assets with the object of spreading risk through the following investment restrictions:
• the value of no single investment (including related investments in group entities or related parties) will represent more than 15% NAV, save that one investment in the portfolio may represent up to 20% of NAV;
• the aggregate value of seed stage investments will represent no more than 1 per cent. of Net Asset Value; and
•
at least 80% of NAV will be invested in businesses which are headquartered in or have their main centre of business in the
•
the aggregate value of holdings of
In addition, the Company will itself not invest more than 15 per cent. of its gross assets in other investment companies or investment trusts which are listed on the Official List of the
Each of the restrictions above will be calculated at the time of investment and disregard the effect of the receipt of rights, bonuses, benefits in the nature of capital or by reason of any other action affecting every holder of that investment. The Company will not be required to dispose of any investment or to rebalance the portfolio as a result of a change in the respective valuations of its assets.
For the purposes of the investment policy, “NAV” means the consolidated assets of the Company and its consolidated subsidiaries (together “the Group”) less their consolidated liabilities, determined in accordance with the accounting principles adopted by the Group from time to time.
Hedging and derivatives
Save for investments made using equity-related instruments as described above, the Company will not employ derivatives of any kind for investment purposes, but derivatives may be used for currency hedging purposes.
Borrowing policy
The Company may, from time to time, use borrowings to manage its working capital requirements but shall not borrow for investment purposes. Borrowings will not exceed 10% of the Company’s Net Asset Value, calculated at the time of borrowing.
Cash management
The Company may hold cash on deposit and may invest in cash equivalent investments, which may include short-term investments in money market type funds and tradeable debt securities.
There is no restriction on the amount of cash or cash equivalent investments that the Company may hold or where it is held. The Board has agreed prudent cash management guidelines with the AIFM and the Portfolio Manager to ensure an appropriate risk/return profile is maintained. Cash and cash equivalents are held with approved counterparties.
It is expected that the Company will hold between 5 and 15 per cent. of its Gross Assets in cash or cash equivalent investments, for the purpose of making follow-on investments in accordance with the Company’s investment policy and to manage the working capital requirements of the Company.
Changes to the investment policy
No material change will be made to the investment policy without the approval of Shareholders by ordinary resolution. Non-material changes to the investment policy may be approved by the Board. In the event of a breach of the investment policy set out above or the investment and gearing restrictions set out therein, the Management Team shall inform the AIFM and the Board upon becoming aware of the same and if the AIFM and/or the Board considers the breach to be material, notification will be made to a
* Please refer to the Glossary on page 79.
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PORTFOLIO REVIEW
Fair Fair
value of Net Impact of Investment value of % of Net
holding investments/ foreign gains/ holding assets
at (realisations currency rate (losses) at after
31 March £’000 changes#£’000 £’000 31 March performance
2024 2025 fee
£’000 £’000
Tide 51,293 2,000 – 11,924 65,217 24.1%
Zopa Bank^ 39,291 505 – (3,488) 36,308 13.4%
Volt 25,458 – – (5,437) 20,021 7.4%
BullionVault^ 13,119 (400) – 3,687 16,406 6.1%
Iwoca 7,926 – – 6,552 14,478 5.4%
Grover 35,893 4,451 (932) (25,354) 14,058 5.2%
XYB 7,135 3,500 – 1,984 12,619 4.7%
AnyFin 9,415 843 (197) 1,190 11,251 4.2%
Intellis 10,074 – 130 910 11,114 4.1%
Gemini 10,924 – (266) (1,344) 9,314 3.4%
Top 10 210,528 10,899 (1,265) (9,3676) 210,786 78.0%
Investments
Other 44,407 1,027 (383) (58) 44,993 16.6%
Investments*
Onfido 10,148 (9,930) – – 218 0.1%
Total 265,083 1,996 (1,648) (9,434) 255,997 94.7%
Investments
Cash & cash 38,505 32,256 12.0%
equivalents
Net other (271) (2,837) (1.1%)
liabilities
Net Assets 303,317 285,416 105.6%
Performance (18,980) (15,244) (5.6%)
Fee provision
Net Assets
after 284,337 270,172 100.0%
performance
fee
# The amounts in both columns are included within (Losses)/Gains on Investments in the Income Statement.
^
Held via
*
There are fifteen other investments (
.
KEY INVESTMENTS
Tide
Tide’s (www.tide.co) mission is to help small and mid-sized businesses (“SMEs”) save time and money in the running of their businesses. Members (customers) can be set up with an account number and sort code in less than 10 minutes, and the company continues to build a comprehensive suite of digital banking services for businesses, including automated accounting, savings, credit, business loans, card readers and invoicing. Tide acquired Onfolk in 2024, giving Tide members a payroll solution.
Tide acquired Funding Options in 2022, giving Tide’s customers access to a wider range of credit options and created Partner Credit Services, one of the UK’s biggest digital marketplaces for SME credit. Tide is also expanding geographically, with a significant business now established in
Source: Tide 31 March 31 March
2025 2024
£’000 £’000
Cost: 19,376 17,376
Value: 65,217 51,293
Valuation Methodology^ Rev. Multiple Rev. Multiple
As per last filed audited accounts of the investee company for the year to
2023 2022
£’000 £’000
Turnover 119,351 59,176
Pre tax loss (43,714) (39,795)
Net assets 19,372 32,444
^ See note 13(iii) on pages 63 to 65.
.
Founded in 2020, with a full banking licence and backed by some of Silicon Valley’s most iconic investors, digital bank Zopa (www.zopa.com) is building the "Home of Money".
Source: Zopa Bank 31 March 31 March
2025 2024
£’000 £’000
Cost: 33,670 33,670
Value: 36,308 39,291
Valuation Methodology^ Rev.Multiple Rev.Multiple
As per last filed audited accounts of the investee company for the year to
2024 2023
£’000 £’000
Operating income 298,612 223,544
Pre tax profit 28,774 10,828
Net assets 496,446 410,385
.
Volt
Volt (www.volt.io) is building the infrastructure for global real-time payments. Launched in 2019, its payment network is the first to unite domestic account-to-account schemes to a single interoperable standard. Scaling and enterprise businesses use it to accept real-time payments (via a Pay by Bank option at checkout), initiate payouts and manage funds. In doing so, they benefit from faster settlement times, lower fees, and full visibility of payment value chains.
Headquartered in
Recent milestones for Volt include partnerships with Farfetch and Pay.com, the development of its one-click checkout in
Source: Volt 31 March 31 March
2025 2024
£’000 £’000
Cost: 9,800 9,800
Value: 20,021 25,459
Valuation Methodology Rev. Multiple Rev. Multiple
Volt is not required to publicly file audited accounts.
.
BullionVault
BullionVault (www.bullionvault.com) is a physical gold and silver market for private investors online. It enables people across 175 countries to buy and sell professional-grade bullion at competitive prices online. BullionVault currently has £4 billion of assets under management, with over £100 million worth of gold and silver traded monthly.
Each user’s property is stored in secure, specialist vaults in
The BullionVault holding was one of the seed assets acquired by the Company at its IPO in
Source: BullionVault 31 March 31 March
2025 2024
£’000 £’000
Cost: 8,424 8,424
Value: 16,406 13,119
Valuation Methodology Earnings Multiple Earnings Multiple
Dividends paid* 400 799
*BullionVault has shifted from paying a single final dividend to issuing three interim dividends, which has resulted in a delay in distributing dividends for its most recent financial year.
As per last filed audited accounts of the investee company for the year to
2024 2023
£’000 £’000
Gross profit 17,325 13,311
Pre tax profit 18,937 13,023
Net assets 53,307 46,323
.
Founded in 2011, iwoca (www.iwoca.co.uk) uses award-winning technology to disrupt small business lending across
In
funding from partners including Barclays,
31 March 31 March
Source: Iwoca 2025 2024
£’000 £’000
Cost: 7,852 7,852
Value: 14,478 7,926
Valuation Methodology Earnings Multiple Earnings Multiple
As per last filed audited accounts of the investee company for the year to
2024 2023
£’000 £’000
Turnover 234,160 142,584
Pre tax profit 59,133 21,784
Net assets 94,686 54,976
.
Grover
Source: Grover 31 March 31 March
2025 2024
£’000 £’000
Cost: 13,745 9,295
Value: 14,058 35,893
Valuation Methodology Rev. Multiple Rev. Multiple
As an unquoted German company, Grover is not required to publicly file audited accounts.
.
XYB
XYB (www.xyb.co) offers a platform for modern adaptive financial infrastructure. Launched by Monese in
In 2024, XYB partnered with IBM to provide technologies and consulting expertise that can help financial services organisations address the growing requirements for core modernisation initiatives. XYB also counts HSBC and Investec amongst its client base. The BaaS sector shows strong growth as established banks and fintech companies continue to bring innovative digital products to market.
Source: XYB 31 March 31 March
2025 2024
£’000 £’000
Cost: 10,635* n/a
Value: 12,619 n/a
Valuation Methodology Rev. Multiple n/a
XYB is a new company and no accounts have been filed.
* Includes legacy Monese investment costs attributable to the XYB business
.
Anyfin
Anyfin (www.anyfin.com) was founded in 2017 by former executives of
Anyfin is currently available in
Source: Anyfin 31 March 31 March
2025 2024
£’000 £’000
Cost: 10,768 9,924
Value: 11,251 9,416
Valuation Methodology Rev. Multiple Rev. Multiple
As an unquoted Swedish company, Anyfin is not required to publicly file audited accounts.
.
Intellis
Intellis (https://intellis.ch), based in
Following an initial investment of €1 million In 2019,
Source: Intellis 31 March 31 March
2025 2024
£’000 £’000
Cost 2,696 2,696
Value 11,114 10,074
Valuation Methodology P/E Multiple P/E Multiple
As an unquoted Swiss company, Intellis is not required to publicly file audited accounts.
.
Gemini
Gemini (www.gemini.com) enables individuals and institutions to safely and securely buy, sell and store cryptocurrencies. Gemini was founded in 2014 by Cameron and
Gemini announced acquisitions of portfolio management services company BITRIA and trading platform Omniex in
Source: Gemini 31 March 31 March
2025 2024
£’000 £’000
Cost: 10,150 10,150
Value: 9,314 8,306
Valuation Methodology Rev. Multiple Rev. Multiple
Gemini is not required to publicly file audited accounts.
.
OTHER INVESTMENTS
Wematch
Wematch (www.wematch.live) is a capital markets digital trading and workflow platform that helps financial institutions transition liquidity to an orderly electronic service, improving productivity and de-risking the process of voice broking. Their solution helps traders find liquidity, negotiate, trade, optimise and manage the lifecycle of their portfolios of assets and trade structures in the securities trading space.
Created in 2017, Wematch is headquartered in
.
Artificial
Artificial (www.artificial.io) is an established underwriting technology provider for the London Insurance Market. This
.
Parafi
.
Tesseract
Tesseract provides an enabling crypto infrastructure to connect digital asset lenders with digital asset borrowers. This brings enhanced capital efficiency with commensurate cost reduction to trading, in a space that is currently significantly under-leveraged relative to traditional capital markets.
.
.
Pemo
Founded in 2022, Pemo (www.pemo.io) provides an expense management and business payments solution, via corporate cards, to SME businesses in the
Headquartered in
.
Wayhome
Wayhome (www.wayhome.co.uk) offers a unique part-own part-rent model of home ownership, requiring as little as 5% deposit with customers paying a market rent on the portion of the home that they don’t own, with the ability to increase the equity in the property as their financial circumstances allow. Wayhome launched to the public in
Wayhome opens up owner-occupied residential property as an asset class for pension funds, who will earn inflation-linked rent on their investment.
.
Baobab
Operating as a data-first MGA (Managing
In
.
LoopFX
LoopFX (www.theloopfx.com) is a
LoopFX has secured integrations with major trading platforms, including State Street’s FX Connect, FactSet’s Portware, and FlexTrade’s FlexFX. These integrations mark a significant step toward reshaping institutional FX trading infrastructure.
.
Epsor
Epsor (www.epsor.fr) is a
.
Castelnau Group
Castelnau Group Limited is a listed investment company that is now held following the share-for-share acquisition of Farewill, which was introduced to the portfolio in 2019, by
.
Sfermion
Sfermion (www.sfermion.io) is an investment fund focused on the non-fungible token (NFT) ecosystem. Their goal is to accelerate the emergence of the open metaverse by investing in the founders, companies, and entities creating the infrastructure and environments forming the foundations of our digital future.
.
Founded in 2015,
By aggregating their demand into a crowd capable of participating as a market,
Augmentum’s holding derives from WhiskeyInvestDirect being spun out of BullionVault in 2020.
.
Habito
Habito (www.habito.com) is reshaping the United Kingdom’s £1.3 trillion mortgage market by removing complexity, hidden costs, and friction from the home financing experience. The company’s mission is to make homeownership across the
Since launching in 2016, Habito has supported over 500,000 customers and facilitated more than £11 billion in mortgages. The business combines proprietary technology with expert advice to deliver a transparent, efficient alternative to the traditional mortgage process. Building on its core broking proposition, Habito has expanded into a fully integrated home-buying platform. Habito Plus offers customers an end-to-end solution – combining mortgage broking, conveyancing, and surveying – into one seamless, digital-first experience. In 2025, Habito was awarded Best Broker for Digital Innovation at the Mortgage Strategy Awards, recognising its continued leadership in transforming how
In
.
Previse
Previse (www.previ.se) is an AI-powered platform transforming B2B payments and supplier financing. Previse ingests and harmonises complex transaction data to identify working capital opportunities and deliver instant payment without needing to wait for invoice approval. Its patented machine learning precisely assesses payment risk, enabling funders to underwrite early payments at scale. Previse’s platform supports a range of payment and financing methods, including virtual cards and supply chain finance, with intelligent orchestration to optimise payment timing. Working in partnership with organisations like Mastercard, Previse powers next-generation solutions to enable B2B payments globally.
.
RetailBook
RetailBook (www.retailbook.com) is an
RetailBook pioneered retail access to primary markets in the
Post period end, in
.
STRATEGIC REPORT
Business Review
The Strategic Report, set out on pages 20 to 32, provides a review of the Company’s business, performance during the year and its strategy going forward. It also considers the principal risks and uncertainties facing the Company and includes information for shareholders to assess how the Directors have performed their duty to promote the success of the Company. In this respect, information on how the Directors have discharged their duties under Section 172 of the Companies Act 2006 can be found on pages 28 and 29.
The Strategic Report contains certain forward-looking statements. These statements are made by the Directors in good faith based on the information available to them up to the date of this report and such statements should be treated with caution due to the inherent uncertainties, including both economic and business risk factors, underlying any such forward-looking information.
Strategy and Strategic Review
In accordance with its investment objective and policy, the Company continued throughout the year under review to pursue the generation of capital growth over the long term through investment in a focused portfolio of fast growing and/or high potential private financial services technology (“fintech”) businesses based predominantly in the
The Company is an approved investment trust company and an alternative investment fund (“AIF”) under the Alternative Investment Fund Managers Regulations (“UK AIFMD”). It has appointed
Principal Risks and Risk Management
The Board is responsible for the ongoing identification, evaluation and management of the risks faced by the Company and has established a process for the regular review of these risks and their mitigation. This process accords with the
The Company maintains a framework of identified key risks, with the policies and processes devised to monitor, manage and mitigate them where possible. This risk map is reviewed regularly by the Audit Committee.
Further details of the financial risks are included in note 13 starting on page 62.
The Board has carried out a robust assessment of the emerging and principal risks facing the Company, including those that would threaten its business model, future performance, solvency and liquidity. Further details of the risk management processes that are in place can be found in the Corporate Governance Statement.
The Board considers that the risks set out below are the principal risks currently facing the Company.
Principal Risks and Uncertainties Mitigation
Investment Risks
The Company invests in early-stage
companies which, by their nature, may
be smaller capitalisation companies.
Such companies may not have the
financial strength, diversity and the
resources of larger and more
established companies, and may find it
more difficult to operate, especially
in periods of low economic growth.
Additionally, these investments may be
very illiquid, so there may not be an The Portfolio Manager has put in place a
economical means of realisation if rigorous investment process which
circumstances favour early exit. ensures disciplined investment selection
and portfolio management. This includes
The performance of the Group’s detailed due diligence, regular
portfolio is influenced by a number of portfolio reviews and in many cases
factors. These include, but are not active engagement with portfolio
limited to: companies by way of board representation
or observer status.
(i) the quality of the initial
investment decision; Investing in young businesses that may
be cash consuming for a number of years
(ii) reliance on co-investment parties; is inherently risky. In order to reduce
the risks of permanent capital loss the
(iii) the quality of the management Portfolio Manager will, where possible,
team of each underlying portfolio structure investments to afford a degree
company and the ability of that team to of downside protection through
successfully implement its business mechanisms such as a liquidation
strategy; preference and/or anti-dilution
provisions.
(iv) the success of the Portfolio
Manager in building an effective The Portfolio Manager provides a
working relationship with each team in detailed update at each Board meeting,
order to agree and implement including, inter alia, investee company
value-creation strategies; developments and funding requirements.
(v) changes in the market or
competitive environment in which each
portfolio company operates; and
(vi) environmental, social and
governance (“ESG”) factors.
Any of these factors could have an
impact on the valuation of an
investment and on the Group’s ability
to realise the investment in a
profitable and timely manner.
Strategy Implementation Risks The Board seeks shareholder views
directly and via its advisers,
The Group is subject to the risk that
its long-term strategy and its level of monitors the discount and regularly
performance fail to meet the considers options available to
expectations of its shareholders.
the Company.
This risk is currently elevated by the
persistent discount to NAV at An experienced fintech Portfolio Manager
has been retained in order
which the Company’s shares have been
trading, since it prevents to deliver the strategy.
fund raising through share issues to The Company and the Portfolio Manager
further exploit the Company’s endeavour to keep the
investment strategy and could reflect a market informed of portfolio
lack of demand for its shares. developments.
The Group attempts to mitigate this risk
by making investments across a range of
Portfolio Diversification Risk companies in a range of fintech company
subsectors and in companies at different
The Group is subject to the risk that stages of their lifecycle in accordance
its portfolio may not be adequately with the Investment Objective and
diversified, being heavily concentrated Investment Policy. There is also
in the fintech sector and the portfolio geographic diversification with 70.5% of
value may be dominated by a single or the portfolio being based in the UK and
limited number of companies. 29.5% in continental Europe , Israel . the
US and the Middle East . Given the nature
of the Company’s Investment Objective
this remains a significant risk.
Valuation Risk
The valuation of investments in
accordance with IFRS 13 and
International Private Equity and
Venture Capital (IPEV) Valuation
Guidelines requires considerable
judgement and is explained in note
18.12.
The Company’s investments are illiquid
and a sale may require the consent of
other interested parties. Such
investments may therefore be difficult
to value and realise. Such realisations The Company has a rigorous valuation
may involve significant time and cost policy and process as set out in notes
and/or result in realisations at levels 18.4 and 18.12. This process is led by
below the value of such investments as the Board and includes benchmarking
estimated by the Company. valuations against actual prices
received when a sale of shares is made,
Valuations are often based on as well as taking account of liquidity
comparator prices and market-based issues and/or any restrictions over
multiples, which can be affected by investments.
equity market sentiment and
comparators’ situations that may not To mitigate this risk the Board has
reflect the individual positions of agreed prudent cash management
companies invested in. guidelines with the AIFM and Portfolio
Manager.
Cash Risk
The Group maintains sufficient cash
The Company may require cash to fund resources to manage its ongoing
potential follow-on investments in operational and investment commitments.
existing investee companies. If the Regular discussions are held to consider
Company does not hold sufficient cash the future cash requirements of the
to participate in subsequent funding Company and its investments to ensure
rounds carried out by portfolio that sufficient cash is maintained.
companies, this could result in the
interest the Company holds in such
businesses being diluted. This may have
a material adverse effect on the
Company’s financial position and
returns for shareholders.
Returns to the Company through holding
cash and cash equivalents are
relatively low. The Company may hold
significant cash balances, particularly
when a fundraising has taken place, and
this may have a drag on the Company’s
performance.
Macroeconomic Risks
Within the constraints dictated by its
The performance of the Group’s objective, the Company’s portfolio is
investment portfolio is materially diversified across a range of sectors,
influenced by economic conditions. has no leverage, a net cash balance and
These may affect demand for services the Portfolio Manager seeks to structure
supplied by investee companies, foreign investments to provide downside
exchange rates, input costs, interest protection where possible.
rates, debt and equity capital markets
and the number of active trade and The Board, AIFM and Portfolio Manager
financial buyers. monitor the macroeconomic environment
and this is discussed at each Board
All of these factors could have an meeting, along with the potential
impact on the Group’s ability to impact. The Portfolio Manager also
realise a return from its investments provides a detailed update on the
and cannot be directly controlled by investments at each meeting, including,
the Group. Particular current factors inter alia, developments in relation to
include inflation, recession fears and the macro environment and trends.
the conflicts in Ukraine and the Middle
East .
The Board manages this risk by:
• receiving reports from AFML at each
Board meeting, such reports include any
significant changes in the make-up of
the team supporting the Company;
• delegating to the Management
Engagement & Remuneration Committee
Key person risk oversight of the remuneration of
employees of AFML;
There is a risk that the individuals
responsible for managing the portfolio • meeting the wider team, outside the
may leave their employment or may be designated lead managers, at the
prevented from undertaking their Portfolio Manager’s offices and by video
duties. conference, and encouraging the
participation of the wider AFML team in
investor updates; and
• delegating to the Management
Engagement & Remuneration Committee
responsibility to perform an annual
review of the service received from
AFML, including, inter alia, the team
supporting the lead managers and
succession planning.
To manage these risks the Board:
• receives compliance reports from the
AIFM and the Portfolio Manager, which
include, inter alia, details of
compliance with applicable laws and
regulations;
Operational Risk
• reviews internal control reports,
The Board is reliant on the systems of where available, key policies, including
the Group and Company’s service measures taken to combat cybersecurity
providers and as such disruption to, or issues, and also the disaster recovery
a failure of, those systems could lead procedures of its service providers;
to a failure to comply with law and
regulations leading to reputational • maintains a risk matrix with details
damage and/or financial loss to the of risks to which the Group and Company
Group and/or Company. are exposed, the controls relied on to
manage those risks and the frequency of
operation of the controls; and
• receives updates on pending changes to
the regulatory and legal environment and
progress towards the Group and Company’s
compliance with these.
Emerging Risks
The Company has carried out a robust assessment of the Company’s emerging and principal risks and the procedures in place to identify emerging risks are described below.
The Audit Committee reviews the risk map at least half-yearly. Emerging risks are discussed in detail as part of this process and also throughout the year to try to ensure that emerging (as well as known) risks are identified and, so far as practicable, mitigated.
The experience and knowledge of the Directors are useful in these discussions, as are update papers and advice received from the
Board’s key service providers such as the Portfolio Manager, the AIFM and the Company’s Brokers. In addition, the Company is a member of the AIC, which provides regular technical updates as well as drawing members’ attention to forthcoming industry and/or regulatory issues and advising on compliance obligations .
The Board does not expect the conflicts in
ESG
As mentioned above under Investment Risks, the Board recognises therisks posed by environmental, social and governance (“ESG”) factors,particularly with respect to the portfolio. Investment companies are currently exempt from reporting under the
Performance and Prospects
Performance
The Board assesses the Company’s performance relative to its investment objective using the following Key Performance Indicators (“KPIs”). Due to the unique nature and investment policy of the Company, with no direct listed competitors or comparable indices, the Board considers that there is no relevant external comparison against which to assess the KPIs and as such performance against the KPIs is considered on an absolute basis. Information on the Company’s performance is provided in the Chairman’s Statement and the Portfolio Manager’s Review. The KPIs have not changed from the prior year:
• The Net Asset Value (“NAV”) per share after performance fee total return*
The Directors regard the NAV per share after performance fee total return as being the critical measure of value delivered by the Company over the long term. The Board considers that the NAV per share after performance fee better reflects the current value of each share than the consolidated NAV per share figure, the calculation of which eliminates the performance fee.
This is an Alternative Performance Measure (“APM”) and its calculation is explained in the Glossary on page 79 and in note 15 on page 66. Essentially, it adds back distributions made in the period to the change in the NAV after performance fee to arrive at a total return.
The Group’s NAV per share after performance fee total return for the year was (3.5%) (2024: positive 5.4%). This result is discussed in the Chairman's Statement on page 2.
• The Total Shareholder Return (“TSR”)*
The Directors also regard the Company’s TSR as a key indicator of performance. Like the NAV per share after performance fee total return discussed above, this is an APM and its calculation is explained in the Glossary on page 80. The TSR is similar in nature to the NAV per share after performance fee total return, except that it adds back distributions made in the period to the change in the share price, to reflect more closely the return in the hands of shareholders. Share price performance is monitored closely by the Board.
The Company's TSR for the year was (15.4%) (2024: positive 3.6%). In common with other investment trusts the share price has been under pressure since the swing in market sentiment in 2022 and especially since the start of 2025.
• Ongoing Charges Ratio (“OCR”)*
Ongoing charges represent the costs that shareholders can reasonably expect the Company to pay from one year to the next, under normal circumstances.
The Board reviews the costs incurred in operating the Company at each Board meeting and seeks to maintain a sensible balance between strong service and keeping costs down.
The terms of appointment of the Company’s AIFM and the Portfolio Manager are set out on pages 24 and 25. In reviewing their continued appointment the Board took into account the ongoing charges ratio of other investment companies with specialist mandates.
The Group’s OCR for the year was 2.0% (2024: 2.0%).
Discount/Premium*
The Board monitors the price of the Company's shares in relation to their NAV after performance fee and the premium/discount at which the shares trade. Shareholder approvals are sought each year to issue and buy back shares, which can assist in reducing share price volatility. However, the level of discount or premium is understood to be mostly a function of investor sentiment and demand for the shares, over which the Board has little influence. The Company has the same Portfolio Manager, management fee arrangements and cost base that it had in 2021 when the shares traded at a premium to NAV and the Board does not believe that Company specific factors have influenced the discount. Rather, the share price falling to a discount to NAV at the beginning of 2022 correlates with market sentiment turning against growth stocks generally, with the Company's shares being affected notwithstanding the portfolio’s potential. At
The Board has sought to communicate its faith in the underlying value of the portfolio and simultaneously to take advantage of the discount by continuing to undertake a limited programme of accretive share buybacks, to the benefit of remaining shareholders. However, this was scaled back during the latter half of the financial year to prioritise the need to retain cash for new and follow-on investments. All shares purchased are held in treasury and will potentially be reissued when the share price returns to a premium to NAV after performance fee. Shareholder authorities to issue and buy back shares are being sought at the forthcoming AGM.
Performance, Prospects and Future developments
The Company’s current position and prospects are described in the Chairman’s Statement and Portfolio Manager’s Review sections of this annual report.
The Board’s primary focus is on the Portfolio Manager’s investment approach and performance, which are thoroughly discussed at every Board meeting. In addition, the AIFM, the Portfolio Manager and the Company’s Brokers update the Board on company communications, promotion, investor feedback and market background.
Outlines of performance, investment activity and strategy, market background during the year and outlook are provided in the Chairman’s Statement on pages 2 to 4 and the Portfolio Manager’s Review on pages 16 to 19.
*See Glossary on page 79
Viability Statement
The Board has considered the Company’s financial position, including its ability to liquidate portfolio assets and meet its expenses as they fall due, and notes the following:
As part of its review the Board considered the impact of a significant and prolonged decline in the Company’s performance and prospects. This included modelling the impact of a 50% fall in the value of the investment portfolio, the impact of this on the Company’s ongoing charges and reviewing the ability of the Company to meet its liabilities as they fall due and support investee companies with future funding requirements in such a scenario.
The expenses of the Company are predictable and modest in comparison with the assets and there are no capital commitments currently foreseen which would alter that position.
In considering the Company's longer-term viability, as well as considering the principal risks on pages 20 to 22 and the financial position of the Company, the Board considered the following factors and assumptions:
• The Company is and will continue to be invested primarily in long-term illiquid investments which are not publicly traded;
• The Board reviews the liquidity of the Company, regularly considers any commitments it has and cash flow projections;
• The Board, AIFM and Portfolio Manager will continue to adopt a long-term view when making investments and anticipated holding periods will be at least five years;
• As detailed in the Directors’ Report, the Valuations Committee oversees the valuation process;
• There will continue to be demand for investment trusts;
• Regulation will not increase to a level that makes running the Company uneconomical; and
• The performance of the Company will continue to be satisfactory.
Whilst acknowledging that market and economic uncertainty remain heightened in view of inflation, concerns about a recession and the
Going Concern
In light of the conclusions drawn in the foregoing Viability Statement and as set out in note 18.1 to the financial statements on page 67, the Company has adequate financial resources to continue in operational existence for at least the next 12 months from the date of signing of this report.
Therefore, the Directors believe that it is appropriate to continue to adopt the going concern basis in preparing the financial statements. In reviewing the position as at the date of this report, the Board has considered the guidance on this matter issued by the
Management Arrangements
Principal Service Providers
The Company is structured as an internally managed closed-ended investment company.
The other principal service providers to the Company are
Frostrow, under the terms of its AIFM agreement with the Company, provides, inter alia , the following services:
•
oversight of the portfolio management function delegated to
• promotion of the Company’s shares;
• investment portfolio administration and valuation;
• risk management services;
• share price discount and premium monitoring;
• administrative and company secretarial services;
• advice and guidance in respect of corporate governance requirements;
• maintenance of the Company’s accounting records;
• review of the Company’s website;
• preparation and publication of annual and half year reports; and
• ensuring compliance with applicable legal and regulatory requirements.
AIFM Fees
Under the terms of the AIFM Agreement Frostrow is entitled to an annual fee of:
• on NAV up to £150 million: 0.225% per annum;
• on that part of NAV in excess of £150 million and up to £500 million: 0.2% per annum; and
• on that part of NAV in excess of £500 million: 0.175% per annum,
calculated on the last working day of each month and payable monthly in arrears.
The AIFM Agreement may be terminated by either party on giving notice of not less than 12 months.
Portfolio Manager
Under the terms of its Portfolio Management Agreement,
• seeking out and evaluating investment opportunities;
• recommending the manner by which monies should be invested, disinvested, retained or realised;
• advising on how rights conferred by the investments should be exercised;
• analysing the performance of investments made; and
• advising the Company in relation to trends, market movements and other matters which may affect the investment objective and policy of the Company.
Portfolio Manager Fees
Portfolio Management Fee
Under the terms of the
Performance Fee
The Portfolio Manager is entitled to a performance fee in respect of the performance of any investments and follow-on investments. Each performance fee operates in respect of investments made during a 24 month period and related follow
-
on investments made for a further 36 month period, save that the first performance fee would be in respect of investments acquired using 80% of the net proceeds of the Company’s IPO in
Subject to certain exceptions, the Portfolio Manager receives, in aggregate, 15% of the net realised cash profits from the investments and follow-on investments made over the relevant period once the Company has received an aggregate annualised 10% realised return on investments (the “hurdle”) and follow-on investments made during the relevant period. The Portfolio Manager’s return is subject to a ‘’catch-up’’ provision in its favour. The performance fee is paid in cash as soon as practicable after the end of each relevant period, save that at the discretion of the Board payments of the performance fee may be made in circumstances where the relevant basket of investments has been realised in part, subject to claw-back arrangements in the event that payments have been made in excess of the Portfolio Manager’s entitlement to any performance fees as calculated following the relevant period.
The Portfolio Management Agreement was subject to a nonmaterial amendment in
Based on the investment valuations as at
The Portfolio Management Agreement may be terminated by either party giving notice of not less than 12 months.
AIFM and Portfolio Manager Evaluation and Re-Appointment
The performance of Frostrow as
Following a review at a
• the quality and depth of experience of the management, company secretarial, administrative and marketing team that the AIFM brought to the management of the Company; and
• the quality and depth of experience allocated by the Portfolio Manager to the management of the portfolio, together with the clarity and rigour of the investment process.
Depositary
The Company has appointed
The Depositary provides the following services, inter alia , under its agreement with the Company:
• verification of non-custodial investments;
• safe keeping of custodial assets;
• cash monitoring;
• processing of transactions; and
• foreign exchange services.
The Depositary must take reasonable care to ensure that the Company is managed in accordance with the Financial Conduct Authority’s Investment Funds Sourcebook, the
Under the terms of the Depositary Agreement, the Depositary is entitled to receive an annual fee of £25,000 plus certain event driven fees.
The notice period on the Depositary Agreement is not less than six months.
Registrar
The Company’s registrar is
Dividend Policy
The Company invests with the objective of achieving capital growth over the long term and it is not expected that a revenue dividend will be paid in the foreseeable future. The Board intends only to pay dividends out of revenue to the extent required in order to maintain the Company’s investment trust status.
Potential returns of capital
It is expected that the Company will realise investments from time to time. The proceeds of these disposals may be re - invested, used for working capital purposes or, at the discretion of the Board, returned to shareholders.
The Company has committed to return to Shareholders up to 50 per cent. of the gains realised by the disposal of investments in each financial year, with such returns of capital expected to be made on an annual basis. The Company may also seek to make returns of capital to Shareholders where available cash is not expected to be substantially deployed within the following 12-18 months. The options for effecting any return of capital to shareholders may include the Company making tender offers to purchase Shares, paying special dividends or any alternative method or a combination of methods. Certain methods intended to effect a return of capital may be subject to, amongst other things, shareholder approval. Shareholders should note that the return of capital by the Company is at the discretion of the Directors and is subject to, amongst other things, the working capital requirements of the Company. The Board has affirmed, that the Company will continue to retain the bulk of the proceeds of the investment realisations to date for reinvestment to support its capital growth objective and utilise the balance to support accretive share buybacks.
Company Promotion
The Company has retained the services of
Further, in addition to AIFM services, Frostrow also provides investor relations & marketing services.
Engaging regularly with investors:
The Company’s brokers and Frostrow meet with institutional investors, discretionary wealth managers and execution-only platform providers around the
Making Company information more accessible:
Frostrow manages the investor database and produces all key corporate documents, distributes factsheets, annual reports and updates from the Portfolio Manager on portfolio and market developments; and
Monitoring market activity, acting as a link between the Company, shareholders and other stakeholders:
The Company’s brokers and Frostrow maintain regular contact with sector broker analysts and other research and data providers, and provide the Board with up-to-date information on the latest shareholder and market developments.
Community, Social, Employee, Human Rights, Environmental Issues, Anti-bribery and Anti-corruption
The Company is committed to carrying out business in an honest and fair manner with a zero-tolerance approach to bribery, tax evasion and corruption. As such, policies and procedures are in place to prevent bribery and corruption. In carrying out its activities, the Company aims to conduct itself responsibly, ethically and fairly, including in relation to social and human rights issues.
As an investment trust with limited internal resource, the Company has little impact on the environment. The Company believes that high ESG (Environmental, Social and Governance) standards within both the Company and its portfolio companies make good business sense and have the potential to protect and enhance investment returns. Consequently, the Group’s investment process ensures that ESG issues are taken into account and best practice is encouraged.
Diversity
There are currently three male and two female Directors (being 40% female representation) on the Board, and these Directors have three different nationalities and diverse educational backgrounds. The Company aims to have a balance of relevant skills, experience and background amongst the Directors on the Board and believes that all Board appointments should be made on merit and with due regard to the benefits of diversity. The Company's diversity policy is set out on page 42. The Board also encourages diversity within AFML, where the team of 13 people represents four different nationalities and is 38% female. The Board is also keen to promote the benefits of diversity in the companies we invest in.
Engaging with our stakeholders
The following ‘Section 172’ disclosure describes how the Directors have had regard to the views of the Company’s stakeholders in their decision-making.
Why? How?
Who? HOW THE BOARD THE AIFM AND THE
STAKEHOLDER GROUP THE BENEFITS OF ENGAGEMENT PORTFOLIO MANAGER HAS ENGAGED
WITH OUR STAKEHOLDERS WITH OUR STAKEHOLDERS
Frostrow as AIFM, the
Portfolio Manager and the
Company’s joint brokers on
behalf of the Board complete a
programme of investor
relations throughout the year.
In addition, the Chairman and
the Senior Independent
Clear communication of the Director have met with, and
Company’s strategy and the endeavours to make themselves
performance against its available to meet with,
objective can help the share shareholders wishing to
price trade at a narrower engage.
discount or a wider premium
to its net asset value which Key mechanisms of engagement
benefits shareholders. included:
New shares may be issued to • The Annual General Meeting;
Investors meet demand without diluting
the NAV per share of existing • The Company’s website which
shareholders. Increasing the hosts reports, video
size of the Company can interviews with the managers
benefit liquidity as well as and regular market commentary;
spread costs.
• Online newsletters and
Understanding investor facsheets;
preferences in relation to
potential Board decisions, • One-on-one investor
such as in relation to meetings;
possible distributions.
• Investor meetings with the
Portfolio Manager and AIFM;
and
• The Portfolio Manager hosts
an annual Capital Markets Day
event to inform investors
about portfolio constituents.
The Board meets regularly with
the Company’s Portfolio
Manager throughout the year
Engagement with our Portfolio both formally at the quarterly
Manager is necessary to Board meetings and more
evaluate performance against regularly on an informal
the stated strategy and to basis. The Board also receives
understand any risks or quarterly performance and
opportunities this may compliance reporting at each
Portfolio Manager present to the Company. It Board meeting.
also provides clarity on the
Board’s expectations and The Portfolio Manager’s
helps ensure that portfolio attendance at each Board
management costs are closely meeting provides the
monitored and remain opportunity for the Portfolio
competitive. Manager and Board to further
reinforce their mutual
understanding of what is
expected from all parties.
The Company contracts with
third parties for other
services including:
depositary, investment
accounting & administration,
company secretarial and share The Board and Frostrow engage
registration. It is necessary regularly with all service
for the Company's success to providers both in one-to-one
ensure the third parties to meetings and via regular
whom we have outsourced written reporting. This
Service Providers services complete their roles regular interaction provides
diligently and correctly. an environment where topics,
issues and business
The Company ensures all development needs can be dealt
service providers are paid in with efficiently and
accordance with their terms collegiately.
of business.
The Board closely monitors
the Company’s Ongoing Charges
Ratio.
AFML has an open plan office,
facilitating ready interaction
In order to attract and and engagement. Senior team
retain talent to ensure the members report to the Board at
Employees of AFML Group has the resources to each meeting.
successfully implement its
strategy and manage Given the small number of
third-party relationships. employees, engagement is at an
individual level rather than
as a group.
The Board encourages the
Company’s Portfolio Manager to
Incorporating consideration engage with companies and in
of ESG factors into the doing so expects ESG issues to
investment process assists in be a key consideration. The
Portfolio companies understanding and mitigating Portfolio Manager seeks to
risks of an investment and take a board seat, or have
potentially identifying board observer status, on all
future opportunities. investments. See page 30 for
further detail on AFML’s ESG
approach to investing.
What? Outcomes and Actions
WHAT WERE THE KEY TOPICS OF ENGAGEMENT? WHAT ACTIONS WERE TAKEN, INCLUDING
PRINCIPAL DECISIONS?
• The Portfolio Manager, Frostrow and
the joint brokers meet regularly with
shareholders and potential investors to
discuss the Company’s strategy,
Key topics of engagement with investors performance and portfolio. These
meetings take place with and without the
Ongoing dialogue with shareholders Portfolio Manager.
concerning the strategy of the Company,
performance, the portfolio, the share • The Chairman and the Senior
price discount to NAV and the structure Independent Director met with several
of management arrangements. shareholders on a wide range of matters
including strategy, performance, the
discount and management arrangements.
• The discussions informed Board
decisions in a number of related areas
Key topics of engagement with the
Portfolio Manager
On an ongoing basis the Board engages • The portfolio manager reports
on portfolio composition, performance, regularly any ESG issues in the
outlook and business updates. portfolio companies to the Board. Please
see pages 30 to 32 for further details
Additional topics included: of AFML’s ESG policies.
• The impact of market conditions upon • The structure of management
their business and the portfolio. arrangements continued to be an area of
focus during the year. A shareholder
• The structure of management circular in respect of these has been
arrangements. published and a general meeting has been
convened for 24 July 2025 .
• The discount at which the Company’s
shares have been trading and thoughts
on possible mitigations.
Approach to Responsible Investing
Five-Stage Approach to Future-Proofing the Portfolio
ESG principles adapted from the
1. Screening
An Exclusion List is used to screen out companies incompatible with AFML’s corporate values (sub-sectors and types of business). AFML also commits to being satisfied that the investors they invest alongside are of good standing.
2. Due Diligence
An ESG Due Diligence “DD” survey is completed by teams from companies in the later stages of the investment process. An ESG scorecard is completed for each potential investment, in which potential ESG risks and opportunities are identified, and discussed with the investment committee. Where necessary, an action plan is agreed with the management team on areas for improvement and commitments are incorporated into the Term Sheet.
3. Post-Investment Monitoring and Engagement
An annual survey is completed by portfolio companies and areas for improvement are discussed with management teams, with commitments agreed and revisited as appropriate.
4. Follow On Investments
ESG risks and opportunities are assessed when making follow-on investment decisions, with an ESG scorecard completed and co-investors taken into consideration. Follow on investments are only made into companies that continue to meet AFML’s ESG criteria.
5.
Internally at
AFML has continued to identify priority areas in which to make suitable ESG-related advancements across fund operations. Key progress areas include:
• Tracking the gender diversity of founders/CEOs of companies in our dealflow;
• Continuing to embrace diversity and inclusion through inclusive hiring and professional development practices and Female Founder Office Hours;
•
Building on our programme of CSR initiatives through supporting
ESG Focus Areas
AFML has identified eight key areas for consideration, across the three ESG categories, which best align with its values and are most relevant for companies operating in the fintech industry.
The key environmental consideration as identified by the AFML is the potential impact of business operations on the global issue of climate change. Social factors include the risks and opportunities associated with data security, privacy and ethical use, consumer protection, diversity and financial inclusion. Governance considerations include anti-bribery and corruption, board structure and independence and compliance.
AFML is committed to:
• Incorporating ESG and sustainability considerations into its investment analysis, diligence, and operating practices.
• Providing ESG training and support to the AFML employees involved in the investment process, so that they may perform their work in accordance with AFML’s policy.
• Actively engaging with portfolio companies to encourage improvement in key ESG areas.
• Annual reporting on progress to stakeholders.
ESG in Action
Company Initiatives
Investing in Women Code (ESG Focus Area – Social: Diversity)
As a signatory to the Investing in Women Code, the Company is committed to a culture of inclusion and to advance access to capital for female entrepreneurs. As a signatory, the Company will:
• Have a nominated member of the senior leadership team who is responsible for supporting equality in all its interactions with entrepreneurs.
•
Provide
• Adopt internal practices which aim to improve the potential for female entrepreneurs to successfully access the tools, resources, investment and finance they need to build and grow their businesses, working with relevant players in the ecosystem. The Company will review these actions annually and make this commitment publicly available.
The Lord Mayor’s Appeal (Environmental: climate/carbon footprint and Social: Diversity)
AFML participated in The Lord Mayor’s Appeal’s ‘We Can Be’ initiative for the third time, hosting a group of school girls, introducing them to a career in the City and the inner workings of an investment trust. AFML also participated in a charity day with a central
Female Founders in Fintech Office Hours (Social: Diversity)
AFML team members participated in a number of female founder focused initiatives across the year, with the aim of meeting and supporting more diverse founders. We have supported the Innovate Finance Women in Fintech Powerlist for several years, hosted the launch for this year’s power list and AFML's Chief of Staff is on the judging panel.
Portfolio Business Models
Anyfin: Consumer Financial Education (Social: Consumer protection)
A core element of Anyfin’s mission is to help get people out of debt and to date the company has helped customers save millions of Euros in credit costs. They are proactive with consumer financial education; earlier this year they released the third edition of the Anyfin Report, a financial health study conducted by YouGov. The report focused on the ways in which people are planning to deal with their debts (and finances more broadly. The company hosts regular ‘Anyfin House’ sessions, open to the public, and covering topics such as financial management, financial stress and the economy.
Grover: Circular Economy Model (Environmental: Climate/carbon footprint)
Grover provides a sophisticated solution for the increasing number of consumers who value access over ownership via their circular economy tech-rental model. By replacing the highly wasteful linear product ownership approach (take -> make -> dispose), Grover’s model extends the lifecycle of a product by re-using, repairing and redistributing. A device rented from Grover is circulated 2-6 times on average.
Wayhome: Gradual Home Ownership Model (Social: Financial inclusion)
Wayhome’s ‘Gradual Homeownership’ model aims to help aspiring homeowners who are unable to obtain a traditional mortgage to buy a home get on the housing ladder. With the average home now costing 9 times average income and the average first time buyer only able to borrow 3.55 times income, millions of hardworking families are locked out of homeownership. Wayhome customers own the share of the home they paid for and rent the remainder, gradually buying more and renting less over time.
Portfolio Initiatives
Tide: Removing Emissions (Environmental: Climate/carbon footprint)
In 2023, Tide became the first fintech globally to remove 100% of its emissions with durable carbon removals as of 2022 onwards. The business has also committed to becoming fully
Tide made three climate-focused pledges which included committing to removing 100% of their emissions with durable carbon removal from 2022 onwards and reducing 90% of their 2021 emissions per employee by 2030. These would make Tide fully Net Zero by 2030. The organisation also committed to making Net Zero simpler for their Members by developing the support on offer.
Tide and Transcorp announced the launch of India’s-first recycled PVC RuPay Card. Made from 99% recycled plastic, this is a first for fintechs in
Led by
Volt: Partnership with Ekko (Environmental: ocean plastic removal)
Volt partnered with sustainability fintech ekko to integrate environmental action directly into the payment process. By selecting Volt at checkout, consumers can contribute to preventing plastic from entering the ocean.
This Strategic Report was approved by the Board of Directors and signed on its behalf by:
Chairman
.
STATEMENT OF DIRECTORS’ RESPONSIBILITIES IN RESPECT OF THE ANNUAL REPORT, THE DIRECTORS’ REMUNERATION REPORT AND THE FINANCIAL STATEMENTS
The directors are responsible for preparing the annual report and financial statements in accordance with
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have prepared the Group and Company financial statements in accordance with
In preparing these group financial statements, the directors are required to:
• Select suitable accounting policies and then apply them consistently;
• Make judgements and accounting estimates that are reasonable and prudent;
•
State whether they have been prepared in accordance with
• Prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business; and
• Prepare a directors’ report, a strategic report and directors’ remuneration report which comply with the requirements of the Companies Act 2006.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Group and Company’s transactions and disclose with reasonable accuracy at any time the financial position of the Group and Company and enable them to ensure that the financial statements comply with the Companies Act 2006.
They are also responsible for safeguarding the assets of the Group and the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Responsibility Statement
The Directors consider that this annual report and financial statements, taken as a whole, is fair, balanced, and understandable and provides the information necessary for shareholders to assess the Group and Company’s position and performance, business model and strategy.
Each of the Directors, whose names and functions are listed under the ‘Board of Directors’ on page 33 confirm that, to the best of their knowledge:
• The financial statements, prepared in accordance with applicable accounting standards, give a true and fair view of the assets, liabilities, financial position and profit of the Group and Company;
• The annual report includes a fair review of the development and performance of the business and the financial position of the Group and Company, together with a description of the principal risks and uncertainties that they face.
Chairman
.
CONSOLIDATED INCOME STATEMENT
Year ended 31 March 2025 Year ended 31 March
2024
Revenue Capital Total Revenue Capital Total
Notes £’000 £’000 £’000 £’000 £’000 £’000
(Losses)/gains on 8 – (11,082) (11,082) – 17,602 17,602
Investments
Interest Income 1,575 – 1,575 1,681 – 1,681
Expenses 2 (5,553) (165) (5,718) (5,432) (49) (5,481)
(Loss)/Return before (3,978) (11,247) (15,225) (3,751) 17,553 13,802
Taxation
Taxation 6 – – – – – –
(Loss)/Return for the (3,978) (11,247) (15,225) (3,751) 17,553 13,802
year
(Loss)/Return per Share 7 (2.4) (6.7) (9.1) (2.2)p 10.3p 8.1p
(pence)
The total column of this statement represents the Group’s Consolidated Income Statement, prepared in accordance with IFRS as adopted by the
The revenue and capital columns are supplementary to this and are prepared under guidance published by the
The Group does not have any other comprehensive income and hence the total return, as disclosed above, is the same as the Group’s total comprehensive income.
All items in the above statement derive from continuing operations.
All returns are attributable to the equity holders of
The notes on pages 59 to 69 are integral to and form part of these Financial Statements.
.
CONSOLIDATED AND COMPANY STATEMENTS OF CHANGES IN EQUITY
Year ended 31 March 2025
Ordinary Share Other
Group share premium Special capital Revenue
capital account reserve reserve reserve Total
£’000 £’000 £’000 £’000 £’000 £’000
Opening Shareholders’ funds 1,810 105,383 80,609 135,293 (19,778) 303,317
Purchase of own shares into – – (2,676) – – (2,676)
treasury
Loss for the year – – – (11,247) (3,978) (15,225)
At 31 March 2025 1,810 105,383 77,933 124,046 (23,756) 285,416
Year ended 31 March 2024
Ordinary Share Other
Group share premium Special capital Revenue
capital account reserve reserve reserve Total
£’000 £’000 £’000 £’000 £’000 £’000
Opening Shareholders’ funds 1,810 105,383 85218 117,740 (16,027) 294,124
Purchase of own shares into – – (4,609) – – (4,609)
treasury
Return/(loss) for the year – – – 17,553 (3,751) 13,802
At 31 March 2024 1,810 105,383 80,609 135,293 (19,778) 303,317
Year ended 31 March 2025
Ordinary Share Other
Company share premium Special capital Revenue
capital account reserve reserve reserve Total
£’000 £’000 £’000 £’000 £’000 £’000
Opening Shareholders’ funds 1,810 105,383 80,609 116,311 (21,381) 282,732
Purchase of own shares into – – (2,676) – – (2,676)
treasury
Loss for the year – – – (7,511) (3,988) (11,499)
At 31 March 2025 1,810 105,383 77,933 108,800 (25,369) 268,557
Year ended 31 March 2024
Ordinary Share Other
Company share premium Special capital Revenue
capital account reserve reserve reserve Total
£’000 £’000 £’000 £’000 £’000 £’000
Opening Shareholders’ funds 1,810 105,383 85,218 100,919 (17,576) 275,754
Purchase of own shares into – – (4,609) – – (4,609)
treasury
Return/(loss) for the year – – – 15,392 (3,805) 11,587
At 31 March 2024 1,810 105,383 80,609 116,311 (21,381) 282,732
The notes on pages 59 to 69 are integral to and form part of these Financial Statements.
.
CONSOLIDATED BALANCE SHEET
as at
2025 2024
Note £’000 £’000
Non-Current Assets
Investments held at fair value 8 255,997 265,083
Property, plant & equipment 155 219
Current Assets
Right-of-use asset 5 288 438
Other receivables 10 218 245
Cash and cash equivalents 32,256 38,505
Total Assets 288,914 304,490
Current Liabilities
Other payables 11 (3,161) (699)
Lease liability 5 (337) (474)
Total Assets less Current Liabilities 285,416 303,317
Net Assets 285,416 303,317
Capital and Reserves
Called up share capital 14 1,810 1,810
Share premium 105,383 105,383
Special reserve 77,933 80,609
Retained earnings:
Capital reserves 124,046 135,293
Revenue reserve (23,756) (19,778)
Total Equity 285,416 303,317
Net Asset Value per share (pence) 15 170.6p 178.6p
Net Asset Value per share after performance fee (pence)* 15 161.5p 167.4p
The Financial Statements on pages 53 to 69 were approved by the Board of Directors on
Chairman
The notes on pages 59 to 69 are integral to and form part of these Financial Statements.
Company Registration Number: 11118262
* Considered to be Alternative Performance Measure. Please see the Glossary and Alternative Performance Measures on page 79.
.
COMPANY BALANCE SHEET
as at
2025 2024
Note £’000 £’000
Non-Current Assets
Investments held at fair value 8 255,997 265,083
Investment in subsidiary undertakings 9 750 750
Current Assets
Other receivables 10 263 196
Cash and cash equivalents 29,929 36,052
Total Assets 286,939 302,081
Current Liabilities
Other payables 11 (3,138) (369)
Provisions 12 (15,244) (18,980)
Total Assets less Current Liabilities 268,557 282,732
Net Assets 268,557 282,732
Capital and Reserves
Called up share capital 14 1,810 1,810
Share premium 105,383 105,383
Special reserve 77,933 80,609
Retained earnings:
Capital reserves 108,800 116,311
Revenue reserve (25,369) (21,381)
Total Equity 268,557 282,732
The Company’s loss for the year was £(11,499,000) (2024: return of £11,587,000). The Directors have taken advantage of the exemption under s408 of the Companies Act and not presented an income statement or a statement of comprehensive income for the Company alone.
The Financial Statements on pages 53 to 69 were approved by the Board of Directors on
Chairman
The notes on pages 59 to 69 are integral to and form part of these Financial Statements.
Company Registration Number: 11118262
.
CONSOLIDATED CASH FLOW STATEMENT
Year Year
ended ended
31 March 31 March
2025 2024
£’000 £’000
Operating activities
Sales of investments 16,882 22,790
Purchases of investments (15,945) (15,976)
Acquisition of property, plant and equipment (10) (8)
Interest income received 1,632 1,608
Expenses paid (5,834) (4,552)
Lease payments (181) (221)
Net cash (outflow)/inflow from operating activities (3,456) 3,641
Purchase of own shares into treasury (2,793) (5,151)
Net cash used in financing activities (2,793) (5,151)
Net decrease in cash and cash equivalents (6,249) (1,510)
Cash and cash equivalents at start of year 38,505 40,015
Cash and cash equivalents at end of year 32,256 38,505
The notes on pages 59 to 69 are integral to and form part of these Financial Statements.
.
COMPANY CASH FLOW STATEMENT
Year Year
ended ended
31 March 31 March
2025 2024
£’000 £’000
Operating activities
Sales of investments 16,882 22,790
Purchases of investments (15,945) (16,226)
Interest income received 1,580 1,563
Expenses paid (5,848) (5,494)
Net cash (outflow)/inflow from operating activities (3,331) 2,733
Purchase of own shares into treasury (2,793) (5,151)
Net cash used in financing activities (2,793) (5,151)
Net decrease in cash and cash equivalents (6,124) (2,418)
Cash and cash equivalents at start of year 36,052 38,470
Cash and cash equivalents at end of year 29,928 36,052
The notes on pages 59 to 69 are integral to and form part of these Financial Statements.
.
NOTES TO THE FINANCIAL STATEMENTS
1 Segmental Analysis
The Group operates a single business segment for reporting purposes and is managed as a single investment company. Reporting is provided to the Board of Directors on an aggregated basis. The investments are located in the
2 Expenses
2025 2024
Revenue Capital Total Revenue Capital Total
£’000 £’000 £’000 £’000 £’000 £’000
AIFM fees 593 – 593 582 – 582
Administrative expenses 1,664 165 1,829 1,706 49 1,755
Directors’ fees* 192 – 192 186 – 186
Performance fee (see note 4)^ – – – – – –
Staff costs (see note 4) 2,923 – 2,923 2,793 – 2,793
Auditor’s remuneration 181 – 181 165 – 165
Total expenses 5,553 165 5,718 5,432 49 5,481
£175,000 of interest and depreciation relating to a lease (2024: £169,000) is included in administrative expenses. See note 5 for further details.
* Details of the amounts paid to Directors are included in the Directors Remuneration Report on page 46.
^ See note 4 for further details of the performance fee arrangements. Non-executive Directors of the Company are not eligible to participate in any allocation of the performance fee.
Auditor’s Remuneration
2025 2024
Group Company Group Company
£’000 £’000 £’000 £’000
Audit of Group accounts pursuant to legislation 117 117 110 110
Audit of subsidiaries accounts pursuant to 25 – 19 –
legislation
Audit related assurance services 28 28 26 26
Non-audit related assurance services 11 – 10 –
Total auditors’ remuneration 181 145 165 136
Non-audit services
It is the Group’s practice to employ
3 Key Management Personnel Remuneration
The Directors of the Company are considered to be the Key Management Personnel along with the directors of the Company’s subsidiary.
2025 2024
Salary Other Total Salary Other Total
/Fees benefits £’000 /Fees benefits £’000
£’000 £’000 £’000 £’000
Directors of the Company's 1,111 102 1,213 1,158 125 1,283
Subsidiary
Non-executive Directors 192 – 192 186 – 186
1,303 102 1,405 1,344 125 1,469
Other benefits include pension and social security contributions relating to the directors of the Company’s subsidiary.
4 Staff Costs
The monthly average number of employees for the Group during the year was fourteen (2024: eleven). All employees are within the investment and administration function and employed by the Company's subsidiary.
2025 2024
£’000 £’000
Wages and salaries 2,401 2,264
Social security costs 328 318
Other pension costs 116 119
Other staff benefits 78 92
Staff costs 2,923 2,793
Performance fee (charged to capital)* – –
Total 2,923 2,793
*
The performance fee arrangements were set up to provide a long-term employee benefit plan to incentivise employees of AFML and align them with shareholders through participation in the realised investment profits of the Group. Any performance fee paid by the Company to AFML is allocated to employees of AFML on a discretionary basis and overseen by the
The performance fee is payable by the Company to AFML when the Company has realised an aggregate annualised 10% return on investments (the ‘hurdle’) in each basket of investments. Based on the investment valuations and the hurdle level as at
5 Leases
Leasing activities
The Group, through its subsidiary AFML, has leased an office in the
Right-of-Use Asset
2025 2024
Group Group
Office Premises Office Premises
£’000 £’000
As at 1 April 438 588
Depreciation (150) (150)
At 31 March 288 438
Lease Liability
2025 2024
Group Group
Office Premises Office Premises
£’000 £’000
As at 1 April 474 678
Rent free period amendment 19 (21)
Interest Expense 25 38
Lease Payments (181) (221)
At 31 March 337 474
Maturity Analysis
Group
Between Between
At 31 March 2025 Up to 3 months 3 – 12 months 1 – 2 years 2 – 5 years
£’000 £’000 £’000 £’000
Lease payments – 181 181 –
6 Taxation Expense
2025 2024
For the year ended 31 March Revenue Capital Total Revenue Capital Total
£’000 £’000 £’000 £’000 £’000 £’000
Current tax:
UK corporate tax on (Loss)/Return – – – – – –
for the year
The difference between the income tax expense shown above and the amount calculated by applying the effective rate of
2025 2024
For the year ended 31 March Revenue Capital Total Revenue Capital Total
£’000 £’000 £’000 £’000 £’000 £’000
(Loss)/return before taxation (3,978) (11,247) (15,225) (3,751) 17,553 13,802
(Loss)/return before tax
multiplied by the effective (995) (2,811) (3,806) (938) 4,388 3,450
rate of UK corporation tax of
25% (2024: 25%)
Effects of:
Non-taxable capital returns – 2,770 2,770 – (4,400) (4,400)
Unutilised management expenses 995 41 1,036 938 12 950
Total tax expense – – – – – –
No provision for deferred taxation has been made in the current year. The Group has not provided for deferred tax on capital profits arising on the revaluation of investments, as it is exempt from tax on these items because of its status as an investment trust company.
The Company has not recognised a deferred tax asset on the excess management expenses of £39,085,000 (2024: £34,932,000). It is not anticipated that these excess expenses will be utilised in the foreseeable future.
7 (Loss)/Return per Share
The (loss)/return per share figures are based on the following figures:
2025 2024
£’000 £’000
Net revenue loss (3,978) (3,751)
Net capital (loss)/return (11,247) 17,553
Net total (loss)/return (15,225) 13,802
Weighted average number of ordinary shares in issue 168,371,133 170,877,294
Pence Pence
Revenue loss per share (2.4) (2.2)
Capital (loss)/return per share (6.7) 10.3
Total (loss)/return per share (9.1) 8.1
8 Investments Held at Fair Value
Non-current Investments Held at Fair Value
2025 2024
As at 31 March Group and Group and
Company Company
£’000 £’000
Unlisted at fair value 255,997 265,083
Reconciliation of movements on investments held at fair value are as follows:
2025 2024
Group and Group and
Company Company
£’000 £’000
As at 1 April 265,083 254,295
Purchases at cost 18,878 15,976
Realisation proceeds (16,882) (22,790)
(Losses)/gains on investments (11,082) 17,602
As at 31 March 255,997 265,083
9 Subsidiary undertakings
The Company has an investment of £750,000 (2024: £750,000) in the issued ordinary share capital of its wholly owned subsidiary undertaking,
10 Other Receivables
2025 2025 2024 2024
As at 31 March Group Company Group Company
£’000 £’000 £’000 £’000
Other receivables 218 263 245 196
11 Other Payables
2025 2025 2024 2024
As at 31 March Group Company Group Company
£’000 £’000 £’000 £’000
Other payables 229 206 699 369
Amounts due to investments 2,932 2,932 - -
12 Provisions
2025 2024
As at 31 March Company Company
£’000 £’000
Performance fee provision* 15,244 18,980
* See page 25 and notes 4 and 18.9 for further details.
13 Financial Instruments
(i) Management of Risk
As an investment trust, the Group’s investment objective is to seek capital growth from a portfolio of securities. The holding of these financial instruments to meet this objective results in certain risks.
The Group’s financial instruments comprise securities in unlisted companies, partnership interests, trade receivables, trade payables, and cash and cash equivalents.
The main risks arising from the Group’s financial instruments are fluctuations in market price, and credit and liquidity risk. The policies for managing each of these risks are summarised below. These policies have remained constant throughout the year under review. The financial risks of the Company are aligned to the Group’s financial risks.
Market Price Risk
Market price risk arises mainly from uncertainty about future prices of financial instruments in the Group’s portfolio. It represents the potential loss the Group might suffer through holding market positions in the face of price movements, mitigated by stock diversification.
The Group is exposed to the risk of the change in value of its unlisted equity and non-equity investments. For unlisted equity and non-equity investments the market risk is principally deemed to be the assumptions used in the valuation methodology as set out in the accounting policies.
Liquidity Risk
The Group’s assets comprise unlisted equity and non-equity investments. Whilst unlisted equity is illiquid, short-term flexibility is achieved through cash and cash equivalents.
Credit Risk
The Group’s exposure to credit risk principally arises from cash and cash equivalents. Only highly rated banks or liquidity funds (with credit ratings above A3, based on S&P’s ratings or the equivalent from another ratings agency) are used for cash deposits and the level of cash is reviewed on a regular basis. The components of cash and cash equivalents are shown in the table below.
(ii) Financial Assets and Liabilities
Group Company Group Company
Fair value Fair value Fair value Fair value
2025 2025 2024 2024
£’000 £’000 £’000 £’000
Financial Assets
Unlisted equity shares 245,563 245,563 259,015 259,015
Unlisted convertible loan notes 8,756 8,756 6,068 6,068
Deferred consideration 948 948 - -
Cash at bank 1,559 329 2,460 1,052
Cash Equivalents – Liquidity Funds 30,697 29,600 36,045 35,000
Other assets 506 263 683 196
Financial Liabilities
Other payables and lease liabilities (3,498) (3,138) (1,173) (369)
Cash and other receivables and payables are measured at amortised cost and the rest of the financial assets in the table above are held at approximate to fair value. The carrying values of the financial assets and liabilities measured at amortised cost are equal to the fair value.
The unlisted financial assets held at fair value are valued in accordance with the IPEV Guidelines as detailed within note 18.4.
(iii) Fair Value Hierarchy
Fair value is the amount for which an asset could be exchanged, or a liability settled, between knowledgeable willing parties in an arm’s length transaction.
The Group complies with IFRS 13 in respect of disclosures about the degree of reliability of fair value measurements. This requires the Group to classify, for disclosure purposes, fair value measurements using a fair value hierarchy that reflects the significance of the inputs used in making the measurements.
The levels of fair value measurement bases are defined as follows:
Level 1: fair values measured using quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2: fair values measured using valuation techniques for all inputs significant to the measurement other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
Level 3: fair values measured using valuation techniques for which any significant input to the valuation is not based on observable market data (unobservable inputs).
Cash equivalents are classified as Level 1.
Following a share-for-share acquisition, one investment was reclassified from Level 3 to Level 1 and was valued at £1,413,000 as at
When using the price of a recent transaction in the valuations, the Company looks to ‘re-calibrate’ this price at each valuation point by reviewing progress within the investment, comparing against the initial investment thesis, assessing if there are any significant events or milestones that would indicate the value of the investment has changed and considering whether a market-based methodology (ie. using multiples from comparable public companies) or a discounted cashflow forecast would be more appropriate.
The main inputs into the calibration exercise, and for the valuation models using multiples, are revenue, EBITDA, AuM, and P/E multiples (based on the most recent revenue, EBITDA, AuM, or earnings achieved and equivalent corresponding revenue, EBITDA, AuM, or earnings multiples of comparable public companies), quality of earnings assessments and comparability difference adjustments. Revenue multiples are often used, rather than EBITDA or earnings, due to the nature of the Group’s investments, being in fast-growing, small financial services companies which are not normally expected to achieve profitability or scale for a number of years. Where an investment has achieved scale and profitability the Group would normally then expect to switch to using an EBITDA or earnings multiple methodology.
The main input into the PWERM (‘Probability Weighed Expected Return Methodology’) is the probability of conversion. This method is used for the convertible loan notes held by the Company.
The fair valuation of private company investments is influenced by the estimates, assumptions and judgements made in the fair valuation process (see Note 18.12 on page 69). A sensitivity analysis is provided below which recognises that the valuation methodologies employed involve subjectivity in their significant unobservable inputs and illustrates the sensitivity of the valuations to these inputs. The inputs have been flexed with the exception of the Sales Price valuation approach as it does not involve significant subjectivity. The table also provides the range of values for the key unobservable inputs.
___________________________________________________________________________________________ |Asat31March2025 | |___________________________________________________________________________________________| | | | | | |Weighted| |Change in| | |Fairvalueof|Key |Other |Applied |average | |Valuation| |Valuation |investments|unobservable|Unobservable|Multiple |multiple|Sensitivity|+/- | |approach |£’000 |inputs |inputs |Range |applied#|+/- |£’000 | | | | | | | |% | | |___________|___________|____________|____________|__________|________|___________|_________| | | |Revenue |a, b, c, g |0.8x-18.4x|6.2x |10% |21,398 / | | | |Multiple‡ | | | | |(21,812) | | | |____________|____________|__________|________|___________|_________| | | |Earnings |a, b, c, g |5.6x-15.8x|9.8x |10% |3,659 / | |Market | |Multiple | | | | |(3,659) | |approach | |____________|____________|__________|________|___________|_________| |using | |AUM Multiple|a, b, c, g |- |- |- |- | |comparable |222,019 |____________|____________|__________|________|___________|_________| |traded | |Illiquidity |d, g |7% - 80% |21.1% |30% |26,080 / | |multiples | |discount | | | | |(22,988) | | | |____________|____________|__________|________|___________|_________| | | |Transaction | | | | | | | | |implied |e, g |20% - 180%|62.4% |30% |7,209 / | | | |premiums and| | | | |(8,393) | | | |discounts | | | | | | |___________|___________|____________|____________|__________|________|___________|_________| |Net Asset |6,509 |Discount to |a |n/a |n/a |10% |(650) | |Value** | |NAV | | | | | | |___________|___________|____________|____________|__________|________|___________|_________| | | |Probability | | | | | | |PWERM* |8,756 |of |a |n/a |n/a |25% |319/(399)| | | |conversion | | | | | | |___________|___________|____________|____________|__________|________|___________|_________| |Expected | |Execution | | | | | | |transaction|- | |a, f |n/a |n/a |n/a |n/a | |price | |risk | | | | | | | | |discount | | | | | | |___________|___________|____________|____________|__________|________|___________|_________| |CPORT^ |16,351 |Transaction |a, e, g |n/a |n/a |10% |1,710 / | | | |Price | | | | |(1,710) | |___________|___________|____________|____________|__________|________|___________|_________| |Sales Price|2,361 |n/a |n/a |n/a |n/a |n/a |n/a | |___________|___________|____________|____________|__________|________|___________|_________|
# Weighted average is calculated by reference to the fair value of holdings as at the respective year-end. This therefore gives a clearer indication of the typical multiple or adjustment being applied across the portfolio.
**LP (‘Limited Partnership’) investments are held at net asset values provided by the relevant LP fund administrators. These are adjusted by benchmark movements as appropriate.
^ Whilst a recent or expected transaction price may be the most appropriate basis for a valuation, it will be corroborated by other techniques which factor in the unobservable inputs noted below.
___________________________________________________________________________________________ |Asat31March2024 | |___________________________________________________________________________________________| | | | | | |Weighted| |Change in| | |Fairvalueof|Key |Other |Applied |average | |Valuation| |Valuation |investments|unobservable|Unobservable|Multiple |multiple|Sensitivity|+/- | |approach |£’000 |inputs |inputs |Range |applied#|+/- |£’000 | | | | | | | |% | | |___________|___________|____________|____________|__________|________|___________|_________| | | |Revenue |a, b, c, g |2.3x – |6.0x |10% |17,564 / | | | |Multiple‡ | |28.0x | | |(17,554) | | | |____________|____________|__________|________|___________|_________| | | |Earnings |a, b, c, g |6.3x-18.6x|11.0x |10% |3,146 / | |Market | |Multiple | | | | |(2,423) | |approach | |____________|____________|__________|________|___________|_________| |using | |AUM Multiple|a, b, c, g |0.1x |0.1x |10% |264 / - | |comparable |217,054 |____________|____________|__________|________|___________|_________| |traded | |Illiquidity |d, g |0% - 50% |32.3% |30% |12,558 / | |multiples | |discount | | | | |(10,920) | | | |____________|____________|__________|________|___________|_________| | | |Transaction | | | | | | | | |implied |e, g |0% - 630% |109.3% |30% |17,063 / | | | |premiums and| | | | |(18,023) | | | |discounts | | | | | | |___________|___________|____________|____________|__________|________|___________|_________| |Net Asset |8,264 |Discount to |a |n/a |n/a |10% |(826) | |Value** | |NAV | | | | | | |___________|___________|____________|____________|__________|________|___________|_________| | | |Probability | | | | | | |PWERM* |6,068 |of |a |n/a |n/a |25% |248/(248)| | | |conversion | | | | | | |___________|___________|____________|____________|__________|________|___________|_________| |Expected | |Execution | | | | | | |transaction|7,135 | |a, f |n/a |n/a |10% |713 / | |price | |risk | | | | |(713) | | | |discount | | | | | | |___________|___________|____________|____________|__________|________|___________|_________| |CPORT^ |16,414 |Transaction |a, e, g |n/a |n/a |10% |1,641 / | | | |Price | | | | |(1,641) | |___________|___________|____________|____________|__________|________|___________|_________| |Sales Price|10,148 |n/a |n/a |n/a |n/a |n/a |n/a | |___________|___________|____________|____________|__________|________|___________|_________|
* Significant unobservable inputs
The variable inputs applicable to each broad category of valuation basis will vary dependent on the particular circumstances of each private company valuation. An explanation of each of the key variable inputs is provided below. The assumptions and decisions process in relation to the inputs is described in note 18.12 on page 69.
(a) Application of valuation basis
Each investment is assessed independently, and the valuation basis applied will vary depending on the circumstances of each investment. When an investment is pre-revenue, the focus of the valuation will be on assessing the recent transaction and the achievement of key milestones since investment. Adjustments may also be made depending on the performance of comparable benchmarks and companies. For those investments where a trading multiples approach can be taken, the methodology will factor in revenue, earnings or assets under management as appropriate for the investment.
(b) Selection of comparable companies
The selection of comparable companies is assessed individually for each investment and the relevance of the comparable companies is continually evaluated at each valuation date. Key criteria used in selecting appropriate comparable companies are the industry sector in which they operate, the geography of the company’s operations, the respective revenue and earnings growth rates, operating margins, company size and development stage. Typically, between 4 and 10 comparable companies will be selected for each investment, but this can vary depending on how many relevant comparable companies are identified. The resultant revenue or earnings multiples or share price movements derived will vary depending on the companies selected and the industries they operate in. Given the nature of the investments the Company makes there are not always directly comparable listed companies, in such cases comparables will be selected whose businesses bear similarity to the relevant investment, in such cases the need for an additional discount / premium to the comparables will be assessed at each valuation date.
(c) Estimated sustainable revenue or earnings
The selection of sustainable revenue or earnings will depend on whether the company is sustainably profitable or not, and where it is not then revenues will be used in the valuation. The valuation approach will typically assess companies based on the last twelve months of revenue or earnings, as they are the most recent available and therefore viewed as the most reliable. Where a business has volatile earnings on a year-on-year basis, revenue or earnings may be assessed over a longer period. Where a company has reliably forecasted earnings previously or there is a change in circumstance at the business which will impact earnings going forward, then forward estimated revenue or earnings may be used instead.
(d) Application of illiquidity discount
An illiquidity discount may be applied either through the calibration of a valuation against the most recent transaction, or by application of a specific discount. The discount applied where a calibration (see (e) below) is not appropriate is dependent on factors specific to each investment, such as quality of earnings or revenues and potential exit scenarios.
(e) Transaction implied premium and discount
Where there is an implied company valuation available as a result of an external arm's length transaction, the ongoing valuation will be calibrated to this by deriving a company valuation with reference to the average multiple from a set of comparable companies and comparing this to a transaction implied valuation. This can result in an implied premium or discount compared to comparable companies at the point of transaction. This discount or premium will be considered in future valuations and may be reduced due to factors such as the time since the transaction and company performance. Where a calibrated approach is not appropriate, a discount for illiquidity may be applied as noted in (d) above.
(f) Execution risk
An execution risk discount is applied to all investments where an arm’s-length transaction is due to take place but hasn’t closed prior to the reporting period end. The discount applied is dependent on the progress of the negotiations and outstanding matters that may impact on the expected price. When valuing in line with an expected transaction the arm’s-length nature of the deal will be assessed, and term sheets will have been received.
(g) Liquidity preference
The company’s investments are typically venture investments with downside protections such as liquidation preference and anti-dilution provisions. Unlike ordinary share structures typically seen in the public or private markets, these structures protect the value of the Company’s position in the event of a reduction in the enterprise value of an investee company from the price paid. Where a valuation indicates the enterprise value of an investment has fallen the enterprise value will be fed into the investee companies’ ‘waterfall’ (which ranks shares by seniority/preference in the event of a liquidation event) to calculate the value of the Company’s position.
14 Called up Share Capital
2025 2024
Ordinary Shares Ordinary Shares
No. £’000 No. £’000
Opening issued and fully paid ordinary 169,831,285 1,810 174,518,852 1,810
shares of 1p each
Ordinary shares purchased into treasury (2,550,383) – (4,687,567) –
Closing issued and fully paid ordinary 167,280,902 1,810 169,831,285 1,810
shares of 1p each
No shares were issued during the years ended
2,550,383 shares were bought back into treasury during the year at an average price, including ancillary costs, of 104.9p per share. In the year ended
At
15 Net Asset Value per Share
The net asset value per share is based on the Group net assets attributable to the equity shareholders of £285,416,000 (2024: £303,317,000) and167,280,902 (2024: 169,831,285) shares in issue at the year end excluding shares held in treasury.
The net asset value per share after performance fee* is based on the Group net assets attributable to the equity shareholders of £ 285,416,000 (2024: £303,317,000), less the performance fee provision made by the Company of £15,244,000 (2024: £18,980,000), and 167,280,902 (2024: 169,831,285) shares in issue at the year end (excluding shares held in treasury).
* Alternative Performance Measure
16 Related Party Transactions
Balances and transactions between the Company and its subsidiaries are eliminated on consolidation. Details of transactions between the Group and Company and other related parties are disclosed below.
The following are considered to be related parties:
•
•
The Directors of the Company and the Company’s subsidiary,
•
•
Details of the relationship between the Company and
Details of the remuneration of all Directors can be found on page 46. Details of the Directors’ interests in the capital of the Company can be found on page 47.
17 Capital Risk Management
Group Group
2025 2024
£’000 £’000
Equity
Equity share capital 1,810 1,810
Retained earnings and other reserves 283,606 301,507
Total capital and reserves 285,416 303,317
The Group’s objective in the management of capital risk is to safeguard its liquidity in order to provide returns for shareholders and to maintain an optimal capital structure. In doing so the Group may adjust the amount of dividends paid to shareholders or issue new shares or debt.
The Group manages the levels of cash deposits held whilst maintaining sufficient liquidity for investments and operating expenses.
There are no externally imposed restrictions on the Company’s capital.
18 Basis of Accounting and Significant Accounting Policies
18.1 Basis of preparation
The Group and Company Financial Statements for the year ended
The Financial Statements have been prepared on a going concern basis and under the historical cost basis of accounting, modified to include the revaluation of certain assets at fair value, as disclosed in note 18.4. The Board has considered a detailed assessment of the Group and Company’s ability to meet their liabilities as they fall due, including stress tests which modelled the effects of a fall in portfolio valuations and liquidity constraints on the Group and Company’s financial position and cash flows. The results of the tests showed that the Group and Company would have sufficient cash to meet their liabilities as they fall due. Based on the information available to the Directors at the time of this report, including the results of the stress tests, and the Group and Company’s cash balances, the Directors are satisfied that the Group and Company have adequate financial resources to continue in operation for at least the next 12 months from the date of signing of these financial statements and that, accordingly, it is appropriate to adopt the going concern basis in preparing these financial statements.
In order to reflect the activities of an investment trust company, supplementary information which analyses the Consolidated Income Statement between items of a revenue and capital nature has been presented alongside the Consolidated Income Statement. In analysing total income between capital and revenue returns, the Directors have followed the guidance contained in the Statement of Recommended Practice for investment companies issued by the
The recommendations of the SORP which have been followed include:
• Realised and unrealised profits or losses arising on the revaluation or disposal of investments classified as held at fair value through profit or loss should be shown in the capital column of the Consolidated Income Statement. Realised gains are taken to the realised reserves in equity and unrealised gains are transferred to the unrealised reserves in equity.
• Other returns on any investment (whether in respect of dividends, interest or otherwise) should be shown in the revenue column of the Consolidated Income Statement. The total of the revenue column of the Consolidated Income Statement is taken to the revenue reserve in equity.
• The Board should determine whether the indirect costs of generating capital returns should be allocated to capital as well as the direct costs incurred in generating capital profits. In this regard the Board has decided to follow a non-allocation approach to indirect costs, which will therefore be charged in full to the revenue column of the Consolidated Income Statement.
18.2 Basis of Consolidation
The Consolidated Financial Statements include the Company and certain subsidiary undertakings.
IFRS 10 and IFRS 12 define an investment entity and include an exemption from the consolidation requirements for investment entities.
The Company has been deemed to meet the definition of an investment entity per IFRS 10 as the following conditions exist:
• The Company has multiple unrelated investors which are not related parties, and holds multiple investments
• Ownership interests in the Company are exposed to variable returns from changes in the fair value of the Company’s net assets
• The Company has obtained funds for the purpose of providing investors with investment management services
• The Company’s business purpose is investing solely for returns from capital appreciation and investment income
• The performance of investments is measured and evaluated on a fair value basis.
The Company will not consolidate the portfolio companies or other investment entities it controls. The principal subsidiary
The Company also owns 100% of the interests in
18.3 Application of New Standards
(i)
New standards, interpretations and amendments effective from
There were no new standards or interpretations effective for the first time for periods beginning on or after
(ii) New standards, interpretations and amendments not yet effective
There are a number of standards and interpretations which have been issued by the
18.4 Investments
All investments are defined by IFRS as fair value through profit or loss (described in the Financial Statements as Investments held at fair value) and are subsequently measured at reporting dates at fair value. The fair value of direct unquoted investments is calculated in accordance with the Principles of Valuation of Investments below. Purchases and sales of unlisted investments are recognised when the contract for acquisition or sale becomes unconditional.
Increases or decreases in valuation are recognised as part of gains on investments at fair value in the Consolidated Income Statement.
Principles of Valuation of Investments
(i) General
The Group estimates the fair value of each investment at the reporting date in accordance with IFRS 13 and the International Private Equity and Venture Capital Valuation (“IPEV”) Guidelines.
Fair value is the price for which an asset could be exchanged between knowledgeable, willing parties in an arm’s length transaction. In estimating fair value, the AIFM and Board apply valuation techniques which are appropriate in light of the nature, facts and circumstances of the investment and use reasonable current market data and inputs combined with judgement and assumptions. Valuation techniques are applied consistently from one reporting date to another except where a change in technique results in a better estimate of fair value.
In general, the enterprise value of the investee company in question will be determined using one of a range of valuation techniques. The enterprise value is adjusted for factors such as surplus assets, excess liabilities or other contingencies or relevant factors; the resulting amount is apportioned between the investee company’s relevant financial instruments according to their ranking and the effect of any instrument that may dilute economic entitlements.
(ii) Unlisted Equity Investments
In respect of each unlisted investment one or more of the following valuation techniques is used:
• A market approach, based on the price of the recent investment, market multiples or industry valuation benchmarks.
• A probability-weighted expected returns methodology. Under the PWERM fair value is based on consideration of values for the investment under different scenarios. This will primarily be used where there is a convertible element to the investment.
• A net assets based approach based on the value of the underlying assets of the investment.
In assessing whether a methodology is appropriate techniques that use observable market data are preferred.
Price of
Where the investment being valued was itself made recently, or there has been a third party transaction in the investment, the price of the transaction may provide a good indication of fair value. Using the Price of
Multiple
Under the multiple methodology a revenue, EBITDA, AuM or earnings multiple technique is used. This involves the application of an appropriate and reasonable multiple to the maintainable earnings or revenue of an investee company.
Further details on the multiple based methodology are provided in note 13 (iii).
PWERM (‘Probability-Weighted Expected Returns Methodology’)
Under the PWERM potential scenarios are identified. Under each scenario the value of the investment is estimated and a probability for each scenario is selected. The fair value is then calculated as the sum of the value under each scenario multiplied by its probability.
Net Assets
For the net asset approach the fair value estimate is based on the attributable proportion of the reported net asset value of the investment derived from the fair value of underlying assets / investments. Valuation reports provided by the manager or general partner of the investments are used to calculate fair value where there is evidence that the valuation is derived using fair value principles that are consistent with the Company’s accounting policies and valuation methods. Such valuation reports may be adjusted to take account of changes or events to the reporting date, or other facts and circumstances which might impact the underlying value.
18.5 Cash and Cash Equivalents
Cash comprises cash at bank and short-term deposits with an original maturity of less than 3 months and subject to minimal risk of changes in value. Cash equivalents are carried at fair value through profit or loss.
18.6 Presentation and Functional Currency
The Group’s and Company’s presentation and functional currency is Pounds Sterling (“Sterling”), since that is the currency of the primary economic environment in which the Group operates.
18.7 Other income
Interest income received from cash equivalents is accounted for on an accruals basis.
18.8 Expenses
Expenses are accounted for on an accruals basis, and are charged through the revenue column of the Consolidated Income Statement except for transaction costs and the performance fee as noted below.
Transaction costs are legal and professional fees incurred when undertaking due diligence on investment transactions. Transaction costs, when incurred, are recognised in the Income Statement. If a transaction successfully completes, as a direct cost of an investment, the related transaction cost is charged to the capital column of the Income Statement. If the transaction does not complete the related cost is charged to the revenue column of the Income Statement.
18.9 Performance Fee
As set out in prior annual reports the performance fee arrangements were set up to provide a long-term employee benefit plan to incentivise employees of AFML and align them with shareholders through participation in the realised investment profits of the Group. AFML is entitled to a performance fee, and any performance fee paid by the Company to AFML is allocated to employees of AFML on a discretionary basis by the
The Company provides for the performance fee in full. A performance fee is provided for if its performance conditions would be achieved if the remaining assets in that basket were realised at fair value, at the Statement of Financial Position date. The performance fee is equal to the share of profits in excess of the performance conditions in the basket. On consolidation the performance fee is eliminated since it is payable to the Company’s subsidiary, AFML.
Performance fees are charged to the capital column of the Income Statement and taken to the Capital Reserve.
18.10 Share Premium and Special Reserve
The share premium account arose following the Company’s admission to listing in 2018 and represented the difference between the proceeds raised and the par value of the shares issued. Costs of the share issuance were offset against the proceeds of the relevant share issue and also taken to the share premium account.
Subsequent to admission and following the approval of the Court, the initial share premium account was cancelled and the balance of the account was transferred to the Special Reserve. The purpose of this was to enable the Company to increase the distributable reserves available to facilitate the payment of future dividends or with which to make share repurchases.
18.11 Revenue and Capital Reserves
Net capital return is added to the Capital Reserve in the Consolidated Statement of Financial Position, while the net revenue return is added to the Revenue Reserve. When positive, the revenue reserve is distributable by way of dividend, as is any realised portion of the capital reserve. The realised portion of the capital reserve is £57,877,000 (2024: £52,491,000) representing realised capital profits less costs charged to capital.
18.12 Critical Accounting Judgements and Key Sources of Estimation Uncertainty
Critical accounting judgements and key sources of estimation uncertainty used in preparing the financial information are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable. The resulting judgements and estimates will, by definition, seldom equal the related actual results.
Key sources of estimation uncertainty
The key assumptions concerning the future, and other key sources of estimation uncertainty in the reporting year, that may have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are discussed below.
Fair value measurements and valuation processes
Unquoted assets are measured at fair value in accordance with IFRS 13 and the IPEV Valuation Guidelines. Decisions are required in order to determine the appropriate valuation methodology and subsequently in determining the inputs into the valuation model used. These decisions include selecting appropriate quoted company comparables, appropriate multiples to apply, adjustments to comparable multiples and estimating future cash flows of investee companies. In estimating the fair value of an asset, market-observable data is used, to the extent it is available.
The Valuations Committee, which is chaired by a Director, determines the appropriate valuation techniques and inputs for the model. The Audit Committee considers the work of the Valuations Committee and the results of their discussion with the AIFM, Portfolio Manager and the external auditor and works closely with the AIFM and Portfolio Manager to review the appropriate valuation techniques and inputs to the model. The Chair of the Audit Committee reports its findings to the Board of Directors of the Group every six months to explain the cause of fluctuations in the fair value of the investments.
Information about the valuation techniques and inputs used in determining the fair value of various assets and liabilities are disclosed in notes 18.4 and 13(iii).
As set out in note 18.9 a performance fee is calculated which is based on the valuation of the investments and as such is considered a significant accounting estimate.
19 Post Balance Sheet Events
No post balance sheet events have occurred since
.
2025 Accounts
The figures and financial information for 2025 are extracted from the annual report and financial statements for the year ended
2024 Accounts
The figures and financial information for 2024 are extracted from the published annual report and financial statements for the year ended
Annual report and financial statements
Copies of the annual report and financial statements will be posted to shareholders shortly and will be available on the Company’s website ( www.augmentum.vc ) or in hard copy format from the Company Secretary.
The Company's annual
report for the year ended
The Annual General Meeting will be held on Wednesday,
Neither the contents of the Company's website nor the contents of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated into, or forms part of, this announcement.
