TwentyFour Select Monthly Income Fund Limited - Interim results for the six months ended 31 March 2026
Interim results for the six months ended
The
Over the period, the Portfolio Manager has rotated the portfolio into higher quality assets, reporting its highest ever average credit quality, whilst continuing to deliver income ahead of its target return. At the same time, the Company continued to grow through tap issuance in response to investor demand.
Financial highlights
-- NAV per Ordinary Share 82.51p (30 September 2025 : 86.06p)
-- NAV total return per Ordinary Share 0.24% (30 September 2025 : 12.22%)
-- Dividend paid per Ordinary Share of 3.25p at the half year, including
an additional 0.25p payment and ahead of the target 6p per annum
-- Total net assets increased to £289.14m (30 September 2025 : £272.72m)
-- Shares in issue increased to 350.44m (30 September 2025 : 316.89m)
through tap issuance
-- Despite market volatility, SMIF traded at an average premium of 1.67%
during the period (year ended 30 September 2025 : 2.09%)
Portfolio Highlights
-- The portfolio delivered a total return of 0.24% (31 March 2025 : 4.93%),
with positive returns in Q1 partially retraced in Q2 as credit spreads
widened
-- The best performers in the portfolio were Asset-Backed Securities
(“ABS”), non-Additional Tier 1 (“AT1”) banks andEuropean High Yield
Credit returning 2.95%, 2.21% and 1.75%, respectively
-- Income remained the strongest driver of returns, as the portfolio
benefitted from attractive starting yields
-- The portfolio maintained its highest average credit exposure, reducing
risk whilst delivering income
Outlook
The Portfolio Manager remains cautious yet constructive on credit, cognisant of market volatility in an uncertain geopolitical environment, and the impact that may have on certain borrowers and default rates.
However, with active management and a selective approach to investing, the Board is confident the Company is well placed to continue to deliver a sustainable income to investors by allocating to higher quality assets that can be underwritten throughout the cycle and deliver an attractive yield. As such, the full year dividend is expected to be in excess of the 6p target, and above 6.5p per Ordinary Share.
Commenting on the results,
Looking forward, the Board believes the Company is well positioned to continue to deliver on its investment objective for shareholders.”
Whilst we remain cautious in our approach, our size means we can adapt quickly to changing market conditions, rotating between sectors to take advantage of market volatility.”
ENDS
For further information please contact:
Deutsche Numis
The Company’s LEI is 549300P9Q5O2B3RDNF78.
About SMIF
SMIF is a
Visit the Company’s website at www.selectmonthlyincomefund.com for more information.
INTERIM MANAGEMENT REPORT AND UNAUDITED CONDENSED INTERIM FINANCIAL STATEMENTS
For the period from
(Classified Regulated Information, under DTR 6 Annex 1 section 1.2)
CORPORATE INFORMATION
Directors Receiving AgentAshley Paxton (Chair)Computershare Investor Services PLC Sharon Parr (Senior Independent The Pavilions Director)Wendy Dorey Bridgewater Road Richard Class Bristol , BS13 8AE Registered OfficeUK Legal Adviser to the Company PO Box 255Eversheds Sutherland (International) LLP Trafalgar CourtOne Wood Street Les BanquesLondon , EC2V 7WSSt Peter Port Guernsey, GY1 3QL Portfolio Manager Guernsey Legal Adviser to the CompanyTwentyFour Asset Management LLP Carey Olsen (Guernsey) LLP 8th Floor,The Monument Building Carey House 11 Monument Street Les BanquesLondon , EC3R 8AFSt Peter Port Guernsey , GY1 4BZAlternative Investment Fund Manager Independent AuditorWaystone Management Company (IE)PricewaterhouseCoopers CI LLP Limited 35 Shelbourne Road PO Box 321 BallsbridgeRoyal Bank Place Dublin 4 Glategny EsplanadeIreland , D04 A4EOSt Peter Port Custodian, Principal Banker andGuernsey , GY1 4ND DepositaryNorthern Trust (Guernsey) Limited PO Box 71 Registrar Trafalgar CourtComputershare Investor Services Les Banques (Guernsey ) LimitedSt Peter Port 1st FloorGuernsey , GY1 3DATudor House Le BordageSt Peter Port Administrator and Company SecretaryGuernsey , GY1 1DBNorthern Trust International Fund Administration Financial Adviser and Corporate BrokerServices (Guernsey) Limited Deutsche Bank AG (London Branch) PO Box 255 (trading as “Deutsche Numis”) Trafalgar Court 21 Moorfields Les BanquesLondon , EC2Y 9DBSt Peter Port Guernsey, GY1 3QL
FINANCIAL HIGHLIGHTS
Net Asset Value per Ordinary Share As at 31 March 2026 As at 30 September 2025 As at 31 March 2025 82.51p 86.06p 83.87p Share Price As at 31 March 2026 As at 30 September 2025 As at 31 March 2025 78.80p 87.80p 86.00p Total Net Assets As at 31 March 2026 As at 30 September 2025 As at 31 March 2025 £289.14 million £272.72 million £234.38 million NAV Total Return per Ordinary Share For the period ended 31 For the year ended 30 For the period ended 31 March March 2026 September 2025 2025 0.24% 12.22% 4.93% Dividends Declared per Ordinary Share For the period ended 31 For the year ended 30 For the period ended 31 March March 2026 September 2025 2025 3.25p 7.30p 3.25p Average Premium For the period ended 31 For the year ended 30 For the period ended 31 March March 2026 September 2025 2025 1.67% 2.09% 2.09% Ordinary Shares in Issue As at 31 March 2026 As at 30 September 2025 As at 31 March 2025 350.44 million 316.89 million 279.47 million Number of Positions in Portfolio As at 31 March 2026 As at 30 September 2025 As at 31 March 2025 162 156 153
Definitions of the above measures can be found in the Glossary of Terms and Alternative Performance Measures.
As at
Ongoing Charges
Ongoing charges have been calculated in accordance with the
SUMMARY INFORMATION
The Company
Investment Objective and Investment Policy
The Company’s investment objective is to generate attractive risk adjusted returns, principally through income distributions.
The Company’s investment policy is to invest in a diversified portfolio of credit securities.
The portfolio can be comprised of any category of credit security, including, without prejudice to the generality of the foregoing, bank capital, corporate bonds, high yield bonds, leveraged loans, payment-in-kind notes and asset-backed securities and can include securities of a less liquid nature. The portfolio is dynamically managed by
The Company maintains a portfolio diversified by issuer and comprises at least 50 credit securities. No more than 5% of the portfolio value will be invested in any single credit security or issuer of credit securities, tested at the time of making or adding to an investment in the relevant credit security. The Company may hold up to 10% in cash but works on the basis of an operational threshold of 5% and any uninvested cash, surplus capital or assets may be invested on a temporary basis in:
-- cash or cash equivalents, money market instruments, bonds, commercial
paper or other debt obligations with banks or other counterparties
having a “single A” or higher credit rating as determined by any
internationally recognised rating agency which may or may not be
registered in the EU; and
-- any “government and public securities” as defined for the purposes of
the FCA Rules.
Efficient portfolio management techniques are employed by the Company, and may include currency and interest rate hedging and the use of other derivatives to manage key risks such as foreign exchange movements, interest rate sensitivity and to mitigate market volatility. The Company’s currency hedging policy will only be used for efficient portfolio management.
The Company does not employ gearing or derivatives for investment purposes. The Company may use borrowing for short-term liquidity purposes, which could be achieved through arranging a loan facility or other types of collateralised borrowing instruments, including repurchase transactions and stock lending. The articles of incorporation of the Company (the “Articles”) restrict the borrowings of the Company to 10% of the Company’s NAV at the time of drawdown. No arrangements for borrowing are currently in place.
At launch, the Company had a target net total return on the original issue price of between 8% and 10% per annum. This comprised a target dividend payment of 6p per Ordinary Share per annum (“Dividend Target”) and a target capital return of 2p-4p per annum, both based on the original issue amount of 100p. Whilst there is no guarantee that this can or will be achieved, the Dividend Target has consistently been met since the Company’s launch in 2014. Refer to note 18 to the Unaudited Condensed Interim Financial Statements for details of the Company’s dividend policy.
In accordance with the
Shareholder Information
The unaudited NAV per Ordinary Share is calculated as at the close of business on every Wednesday that is also a business day, as well as the last business day of every month and announced by the
CHAIR’S STATEMENT
For the period from
I am delighted to present my report on the Company’s performance for the six month period ended
Market Overview
The six months to
While the first quarter of the period was challenging, it is important to recognise that global economies entered 2026 from a position of relative strength. Growth had improved following a tariff
-
related slowdown in 2025, and inflation across most developed markets had continued to ease towards central bank targets. Monetary policy was also becoming more accommodative, with the
This backdrop changed materially as the conflict in
Within this context, the Board has been encouraged by how the Company has traded. Over the period, the Company’s shares traded mostly at a premium, in contrast to the wider investment company sector, reflecting continued investor demand for the Company’s income focused strategy and the attractiveness of its yield, albeit sentiment did temporarily drive the Company’s share price to a discount of approximately 4.50% as at
Trading at a premium, coupled with ongoing investor demand, provides a healthy environment to enable the Company to issue new shares through tap issuance, allowing it to grow prudently. The Board believes this disciplined approach to capital management is in the best interests of both existing and new shareholders.
Although market conditions remain challenging, the Company’s portfolio, diversified across less liquid credit, remains well placed to deliver sustainable income over the medium term, benefitting from higher underlying yields and active portfolio management.
Share Activity
In contrast to the wider investment company market, which saw many companies on the Main Market of the LSE trading at large discounts, save for the temporary impact of the
Due to the availability of accretive assets for purchase, and because of shareholder demand, the Company was able to issue 33,550,000 new Ordinary Shares during the period, at a premium of 2.00% (prior to issue costs) to the NAV at issue date. A further 3,666,829 new Ordinary Shares have been issued post period end (as at 9 June 2026).
This additional share activity has been a positive result for the Company and its shareholders and led to it again being one of the strongest issuers in the investment company market during the period.
A total of 422,837 Ordinary Shares were submitted for tender during the period, comprising 119,559 in respect of the quarter ended
It is pleasing to note that the Company’s shareholder base continues to diversify with an ongoing increase in retail investors investing via platforms.
Dividend Policy
On formation, the Company’s objective was to generate a net total return of 8-10% with a
Consistent with the year ended
The Board will continue to monitor the position carefully for the remainder of the year and, where possible to do so, will provide updates on dividend expectations.
Return
During the period, the NAV per Ordinary Share decreased from
Outlook
Market volatility has reduced since the beginning of April, but looking ahead, geopolitical risks persist, energy markets remain sensitive, and there is potential for renewed inflationary pressure should supply disruptions endure. Central banks, particularly in the
A further area of focus will be the evolution of monetary policy in
Within credit markets, the Board expects investors to remain selective. Whilst the Company does not invest in private credit, concerns around parts of the private credit market and ongoing structural change within certain sectors, including technology and software, are likely to increase differentiation between issuers. In this environment, the Board believes that a disciplined and active approach to credit selection, diversification and risk management remains essential.
In summary, while the near-term outlook remains uncertain, the Board believes that the Company is well positioned. With attractive underlying yields, an active and selective investment approach, and continued strong support from shareholders, as evidenced by the return of the Company’s premium to NAV, the Company remains focused on delivering its objective of sustainable monthly income for shareholders over the medium and long term.
Environmental, Social and Governance Approach
The Board recognises the importance of Environmental, Social and Governance (“ESG”) factors in both investment management and across society in general and has worked closely with the Portfolio Manager in relation to all aspects relevant to the Company’s portfolio. Throughout the period, the Portfolio Manager has continued to work extensively on engaging with issuers to improve disclosures, through TwentyFour’s proprietary ESG scoring model, which includes coverage of asset-backed securities (“ABS”) specific metrics, meaning ESG data is factored in to every level of the investment process. The Board and the Portfolio Manager believe this proprietary ESG work is unique in the European ABS space. The Portfolio Manager strongly believes that ESG factors have a material impact on the creditworthiness of the underlying assets.
Annual General Meeting
The Company’s 2026 Annual General Meeting will be held on
On behalf of the Board, I would like to thank all Shareholders for their continued support.
Chair
PORTFOLIO MANAGER’S REPORT
For the period from
As Portfolio Manager to the
Market Environment
The market environment in the first half of the financial year was defined by a transition from supportive conditions for carry (the return on the asset) into thematic and geopolitical instability. The final quarter of 2025 initially benefitted from a risk-on sentiment, despite a prolonged US government shutdown that temporarily withheld critical economic data. During this period, investors focused heavily on the health of the labour market, and the
Fiscal policy also played a major role in market sentiment in the
By December, both the
The narrative shifted abruptly in the first quarter of 2026. January delivered heightened volatility in global bond markets, led by a historic sell-off in Japanese Government Bonds ("JGBs"). Yields on 10-year JGBs surged to multi-decade highs of ~2.35%, while 30-year yields peaked at 3.85%, driven by election-related domestic uncertainty, weak bond auctions, and continued speculation around the implementation of further monetary policy tightening by the Bank of Japan. These moves spilled over into other developed market sovereign bonds, elevating global rate volatility. With February came a new thematic risk known as the "Saaspocalypse," a sharp sell-off in software driven by fears of artificial intelligence-driven disruption which evolved into a broad widening of credit spreads across risk assets.
The period concluded with a severe geopolitical shock, as the escalation of the conflict between
Primary issuance was very limited in the High Yield space in particular, though the small number of deals we saw were digested well; Electronic Arts tested market appetite as it brought its
Portfolio Performance
The Company’s portfolio was in a strong position to mitigate the impact of the challenging macroeconomic backdrop, aided by its high average credit quality compared to historical levels. It benefitted from the breakeven protection provided by the combination of managed duration exposure, and a portfolio of assets at compelling yields, and delivered a positive total return of 0.24% (NAV Total Return per Ordinary Share) for the period (versus a 4.93% return in the prior comparative period).
Performance varied significantly by sector in line with the higher levels of market dispersion that we saw over the period. Positive returns were heavily skewed towards the first quarter which benefitted from more supportive conditions, and were partly retraced amid weakness in the second quarter.
The best performers were Asset-Backed Securities (“ABS”), non-Additional Tier 1 (“AT1”) banks, and European High Yield Credit which returned 2.95%, 2.21% and 1.75%, respectively. Collateralised Loan Obligations (“CLOs”) were the largest detractor with a negative return of 1.0%, impacted by the shift towards a risk-off sentiment, and broader nervousness around software and private credit. There has been a recovery in the European loan market following the onset of the war in the
The main driver of returns in the period was income, as the portfolio benefitted from attractive starting yields which offset decrease in prices in response to the volatile macroeconomic environment and weaker sentiment.
The Company's NAV, after modestly increasing over the course of January, declined towards the end of February in line with the broader market sell-off driven by the
Portfolio Strategy
We take a “bottom-up” approach to credit investing for the Company, finding value in the markets through rigorous fundamental analysis and a cross-sector approach to relative value. The Company remained overweight in two sectors in particular, subordinated financials and ABS, which offered a combination of attractive pricing of individual bonds, and a compelling risk reward from a “top-down” perspective.
Higher all-in yields across credit markets, as a result of the normalisation of interest rates in
The conflict in the
As credit spreads continued to prove reasonably resilient overall through the conflict in the
Our direct exposure to the key pressure points in the market remains very low, for example we have limited exposure to software. However, we retain the liquidity and flexibility to take advantage of any credit spread volatility if the economic environment were to deteriorate.
Outlook
The macroeconomic and geopolitical outlooks remain highly uncertain, and we expect elevated volatility as the market continues to react to news that impacts the likely duration of the conflict. Inflation remains a key area of focus alongside how central banks will respond. However, we would expect the narrative to shift gradually towards growth and how weaker sentiment will weigh on economic activity.
Rate volatility is likely to remain elevated amid the challenging geopolitical backdrop, as we have seen since the beginning of the conflict in the
The bond market will be ready to scrutinise any comments on fiscal responsibility from
Overall, we remain constructive on credit while maintaining a cautious approach, and note the strong demand for primary bond issuance in weeks following the period end which suggests confidence from markets in the fundamental picture and a willingness to look through the uncertainty. Amid the turbulence, we take comfort in downside protection offered by our portfolio of high quality assets at compelling yields. Meanwhile, active management of portfolios remains vital to adapt to the swiftly evolving market backdrop.
TOP TWENTY HOLDINGS
As at
Security Nominal/ Credit Fair Percentage of
Security Value * Net Asset Value
Shares Sector # £ %
UniCredit F2V perp 9,700,000 Financial - Banks 8,030,356 2.78
Barclays F2V perp 6,000,000 Financial - Banks 5,009,823 1.75
VSK Holdings ‘4 C7 519,500 ABS 4,892,706 1.69
- 1’ VAR
Credit Agricole 5,000,000 Financial - Banks 4,321,628 1.49
F2V
Intesa Sanpaolo
SpA 5.875% 31 Dec 5,200,000 Financial - Banks 4,317,210 1.49
2049 5.87% perp
Deutsche Bank AG 5,000,000 Financial - Banks 4,311,357 1.49
6.75% perp
Ageas 5.875% 31 Financial -
Dec 2049 5.87% 5,000,000 Insurance 4,244,538 1.47
perp
Nationwide
Building Society 32,960 Financial - Banks 4,239,003 1.47
10.25% 29/06/2049
CaixaBank SA
5.875% 31 Dec 2049 5,000,000 Financial - Banks 4,236,221 1.47
5.87% perp
Banco Bilbao
Vizcaya Argentaria 5,000,000 Financial - Banks 4,191,244 1.45
5.625% 5.62% perp
Achmea F2V 4,700,000 Financial - 4,088,532 1.41
Insurance
Shawbrook Group. 3,762,000 Financial - Banks 4,021,896 1.39
F2V perp
Bank of Ireland 4,600,000 Financial - Banks 3,986,914 1.38
Group 6.12% perp
NatWest Group plc 4,000,000 Financial - Banks 3,963,555 1.37
F2V perp
Société Générale
6.125% 31 Dec 2049 4,600,000 Financial - Banks 3,945,853 1.36
6.12% perp
Scor F2V 4,500,000 Financial - 3,913,845 1.35
Insurance
Banco de Sabadell 4,400,000 Financial - Banks 3,888,455 1.34
6.5% perp
Banco Santander 4,400,000 Financial - Banks 3,600,158 1.25
F2V perp
La Mondiale SAM 4,000,000 Financial - 3,580,339 1.24
F2V Insurance
Nationwide
Building Society 3,400,000 Financial - Banks 3,423,951 1.18
F2V perp
Total 86,207,584 29.82
* Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.
#
Asset-backed securities (“ABS”). All other securities are
The full portfolio listing of bonds and ABS as at
BOARD MEMBERS
Biographical details of the Directors as at date of signing are as follows:
Mr Class’s career spans more than thirty years in the financial services sector. During more than a decade at Morgan Stanley, he was Managing Director and Head of EMEA Business Development for Fixed Income, and a portfolio manager for fixed income portfolios with assets totalling €7 billion. Prior to that, he worked for nine years at
STATEMENT OF PRINCIPAL RISKS AND UNCERTAINTIES
The principal risks assessed by the Board relating to the Company were disclosed in the Annual Report and Audited Financial Statements for the year ended
The Board and Portfolio Manager consider these risk categories remain relevant for the six months covered by this report as well as the remaining six months of the financial year.
Market risk
The Company invests in credit securities which are subject to market risk, including the potential for both losses and gains from price risk, reinvestment risk, interest rate risk, and foreign currency risk. These are discussed in detail in note 16 to the Company’s Annual Report and Audited Financial Statements for the year ended
The Board recognises that geopolitical uncertainty remains an ongoing risk to global financial markets. Recent conflicts, trade and tariff developments, and broader political uncertainty may contribute to increased market volatility, inflationary pressures and changes in interest rate expectations.
The Portfolio Manager continues to monitor the indirect impact of geopolitical developments on credit markets, liquidity and refinancing conditions. While the Company has limited direct exposure to affected regions, geopolitical events may influence portfolio valuations and investor sentiment through wider macroeconomic effects. The Board believes that the diversified nature of the portfolio and the Portfolio Manager’s active approach assist in mitigating these risks.
The underlying investments comprised in the portfolio are subject to price risk. The Company is therefore at risk that market events may affect performance, and in particular, may affect the value of the Company’s investments, which are valued on a mark to market and mark to model basis. Price risk is risk associated with changes in market prices or rates, including interest rates, availability of credit, inflation rates, economic uncertainty, changes in laws, national and international political circumstances. The Company’s policy is to manage price risk by holding a diversified portfolio of assets, through its investments in credit securities.
The Company’s continuing position in relation to interest rate and duration risk is monitored on a weekly basis by the Portfolio Manager as part of its review of the weekly NAV calculations prepared by the Company’s Administrator. The Company may also use swap contracts to mitigate the effects of market volatility on interest rate risk.
Given the Company’s holdings in investments denominated in currencies other than Sterling, the Company is exposed to foreign currency risk. The Company manages its exposure to currency movements by using spot and forward foreign exchange contracts which are rolled forward periodically and typically for a period of one month.
Each quarter, the Board formally reviews the investment performance reports and amortisation schedules (setting out upcoming maturities for monitoring cashflow available for reinvestment) provided by the Portfolio Manager. The Board also considers the impact of economic volatility and of heightened geopolitical tensions on the Company’s performance.
Credit risk
The Company invests in credit securities issued by other companies, trusts or other investment vehicles which, compared to bonds issued or guaranteed by governments, are generally exposed to greater risk of default in the repayment of the capital provided to the issuer or interest payments due to the Company and may also expose the Company to more structural risk. These are discussed in detail in note 16 to the Company's Annual Report and Audited Financial Statements for the year ended
Each quarter, the Board formally considers portfolio credit analysis presented to it by the Portfolio Manager. The Company may also use swap contracts to hedge some of the Company’s credit exposure and mitigate the impact of a potential further deterioration in the geopolitical environment.
Liquidity risk
All of the assets of the Company are invested in credit securities. These may be illiquid, and this may limit the ability of the Company to realise its investments for the purposes of cash management, including any needs arising for dividend payments or buying back Ordinary Shares either in the quarterly tender process or in the market. There may be no active market in the Company’s holdings in credit securities, and the Company may be required to provide liquidity to fund tender requests or repay any borrowings. The Company does not have redemption rights in relation to any of its investments. Consequently, the value of the Company’s investments may be materially adversely affected. This is discussed in detail in note 16 to the Company's Annual Report and Audited Financial Statements for the year ended
The Company has the authority to arrange a Revolving Credit Facility of up to 10% of NAV to fund short-term liquidity requirements. This arrangement has been provided in the past by
Each quarter, the Board formally reviews documentation provided by the Portfolio Manager pertaining to liquidity risk and assesses any action which may be required.
Valuation of investments
The Company’s investments had a fair value of £287,519,320 as at
Income recognition risk
Interest income is recognised on a time-proportionate basis using the effective interest rate method. Discounts received or premiums paid in connection with the acquisition of credit securities are amortised into interest income using the effective interest rate method over the expected life of the related security.
When calculating the effective interest rate, the Portfolio Manager estimates cash flows considering the expected life of the financial instrument, including future credit losses and deferred interest payments. The calculation includes all fees paid or received between parties to the contract that are an integral part of the effective interest rate and all other premiums or discounts.
Revenue estimations are sensitive to changes in interest income resulting from financial instruments defaulting. Interest income represents the Portfolio Manager’s best estimate having regard to historical volatility and looking forward at the global environment.
Dividends
The Company has a Dividend Target of 6p per Ordinary Share for each financial year, and the Board consequently targets a minimum monthly dividend of 0.5p per Ordinary Share. If the Dividend Target was not able to be met in a year or the Board considers that it should be reduced, a Continuation Resolution would be put to Shareholders.
In addition to the Dividend Target the Board intends, with the final monthly dividend for each financial year, to distribute an amount equal to the value of any unaudited excess income of the Company for that financial year remaining after payment of the monthly dividends. The Board may also elect during the year to approve an additional interim amount per Ordinary Share if the Company is exceeding its Dividend Target.
The Board meets each month to consider the approval of a monthly interim dividend and post year end in respect of the final monthly dividend for each financial year.
As the Dividend Target is central to the Company’s purpose, the Board and the Portfolio Manager are very focused on the sustainability of the dividend and regularly monitor and review the position. The Portfolio Manager is confident that the Dividend Target remains achievable in the current yield environment, even with forecast interest rate cuts priced in.
The Company’s ability to pay dividends is governed by The Companies (
Quarterly tenders
In order to minimise the risk of the Ordinary Shares trading at a significant discount to NAV, the Company has incorporated into its structure a mechanism for a quarterly tender. The Company offers Shareholders a quarterly opportunity to a tender up to 20% of the Ordinary Shares in issue as at the relevant quarter record date, subject to an aggregate limit of 50% of the Ordinary Shares in issue in any twelve-month period ending on the relevant quarter record date. In the event that quarterly tender applications on any tender submission deadline exceed the 50% limit, the Board will convene a General Meeting in accordance with the Continuation Vote requirements set out in note 16 to the Company’s Annual Report and Audited Financial Statements for the year ended
A key consideration for the ongoing viability of the Company is therefore its liquidity assessment, which is considered on an ongoing basis by the Board. No liquidity concerns were identified for the period ended
During the period, 422,837 shares were tendered. The shares were initially purchased by the Corporate Broker and subsequently placed with investors. On
Shareholder base
The Corporate Broker has limited ability to engage with all investor types and non-institutional investors now form a large shareholder group.
This group is often more active on a daily basis than passive institutional holders, and with turnover in the shares relatively low, has an important marginal price impact. This could cause the price to be especially volatile during periods when market maker capital is constrained, and information flow is poor. As engagement with this group of shareholders is difficult, the Company’s shares could suffer from periods of short-term market volatility. Post period end, the Company has continued to experience strong demand for its shares and, as a result, a total of 4,000,000 Ordinary Shares had been issued by
The Board utilises the Corporate Broker and media to monitor Shareholders’ opinions and identify potential issues. The Board has retained the services of
The Board’s assessment of the above risks has not changed during the period.
Other risks and uncertainties
The Board has identified the following other risks and uncertainties along with steps taken to monitor (and mitigate where appropriate/possible):
Operational risks
The Company does not have executive directors or employees. It has entered into contractual arrangements with a network of third parties (the “Service Providers”) who provide services to it. The Board, through the Management Engagement Committee, undertakes annual due diligence on, and ongoing monitoring of all such Service Providers, including obtaining confirmation that each such Service Provider complies with relevant laws and regulations, good practice, delivers value for money and has environmental, social and governance policies in place.
The Company is exposed to the risk arising from any failures of systems and controls in the operations of the Service Providers. The Board and its
The Company is exposed to cyber-attack risk through its Service Providers. Through the Management Engagement Committee, the Company asks its Service Providers to confirm that they have appropriate safeguards in place to mitigate the risk of cyber-attacks and remote working (including minimising the adverse consequences arising from any such attack), that they provide regular updates to the Board on cyber security, and conduct ongoing monitoring of industry developments in this area. No Service Provider has reported any problems regarding cyber security when questioned by the Management Engagement Committee.
Accounting, legal and regulatory risks
The Company is exposed to the risk that it may fail to maintain accurate accounting records, fail to comply with requirements of its Admission document and fail to meet listing obligations. The accounting records prepared by the Administrator are reviewed by the Portfolio Manager.
The Portfolio Manager, Administrator, AIFM, Custodian and Depositary, and the Financial Adviser and Corporate Broker provide regular updates to the Board on compliance with the Admission document and changes in any relevant regulations. Changes in legal or regulatory environments can have a major impact on some classes of debt. The Portfolio Manager and Board monitor this and take appropriate action where needed.
Climate risk
The Financial Stability Board (“FSB”) formed the
The Portfolio Manager considers ESG factors in the investment process, utilising an integrated approach. Additional information is detailed in the Strategic Report included in the Company’s Annual Report and Audited Financial Statements for the year ended
Environmental, social and governance
The Board recognises the importance of ESG factors in the investment management industry and the wider economy as whole. The Company is a closed-ended investment company with a limited purpose and without employees. As such, it is the view of the Board that the direct environmental and social impact of the Company is limited, and that ESG considerations are most applicable in respect of the asset allocation and security selection decisions made for its portfolio.
The Company has appointed the Portfolio Manager to advise it in relation to all aspects relevant to the Investment Portfolio. Whilst the Company was not established with explicit ESG targets and does not have any ESG objectives, the Portfolio Manager includes ESG factors in its investment appraisal and approach and has a formal ESG framework. The Portfolio Manager has an active ESG Committee representing all areas of its business. The Board receives regular updates from the Portfolio Manager on its ESG processes and assesses their suitability for the Company. ESG factors are automatically assessed by the Portfolio Manager for every transaction as part of their investment process.
Additional information is detailed in the Chair’s Statement.
Going concern
Under the 2024 UK Corporate Governance Code and applicable regulations, the Board are required to satisfy themselves that it is reasonable to assume that the Company is a going concern and to identify any material uncertainties to the Company’s ability to continue as a going concern for at least 12 months from the date of approving these Unaudited Condensed Interim Financial Statements.
The Board believes that it is appropriate to adopt the going concern basis in preparing the Unaudited Condensed Interim Financial Statements in view of its holding in cash and cash equivalents and certain more liquid investments within the portfolio and the income deriving from those investments, meaning the Company has adequate financial resources to meet its liabilities as they fall due.
Related parties
Related party balances and transactions are disclosed in note 13 of these Unaudited Condensed Interim Financial Statements.
RESPONSIBILITY STATEMENT
The Board confirms that to the best of their knowledge:
-- These Unaudited Condensed Interim Financial Statements have been
prepared in accordance with International Accounting Standard 34,
"Interim Financial Reporting" and give a true and fair view of the
assets, liabilities, equity and profit or loss of the Company as
required by the Financial Conduct Authority’s Disclosure and
Transparency Rule (“DTR”) 4.2.4R.
-- This interim management report includes a fair review of the
information required by:
(a) DTR 4.2.7R of the Disclosure and Transparency Rules, being an indication of important events that have occurred during the period from
(b) DTR 4.2.8R of the Disclosure and Transparency Rules, being related party transactions that have taken place during the period from
By order of the Board,
Chair Senior Independent Director
INDEPENDENT REVIEW REPORT
TO
Report on the unaudited condensed interim financial statements
Our conclusion
We have reviewed
Based on our review, nothing has come to our attention that causes us to believe that the interim financial statements are not prepared, in all material respects, in accordance with International Accounting Standard 34, ‘Interim Financial Reporting’, and the Disclosure Guidance and Transparency Rules sourcebook of the United Kingdom’s
The interim financial statements comprise:
·
the condensed statement of financial position as at
· the condensed statement of comprehensive income for the period then ended;
· the condensed statement of cash flows for the period then ended;
· the condensed statement of changes in equity for the period then ended; and
· the explanatory notes to the interim financial statements.
The interim financial statements included in the Interim Management Report and Unaudited Condensed Interim Financial Statements have been prepared in accordance with International Accounting Standard 34, ‘Interim Financial Reporting’, and the Disclosure Guidance and Transparency Rules sourcebook of the United Kingdom’s
Basis for conclusion
We conducted our review in accordance with International Standard on Review Engagements 2410, ‘Review of Interim Financial Information Performed by the Independent Auditor of the Entity’ issued by the
A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and, consequently, does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
We have read the other information contained in the Interim Management Report and Unaudited Condensed Interim Financial Statements and considered whether it contains any apparent misstatements or material inconsistencies with the information in the interim financial statements.
Responsibilities for the interim financial statements and the review
Our responsibilities and those of the Directors
The Interim Management Report and Unaudited Condensed Interim Financial Statements, including the interim financial statements, is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the Interim Management Report and Unaudited Condensed Interim Financial Statements in accordance with International Accounting Standard 34, ‘Interim Financial Reporting’, and the Disclosure Guidance and Transparency Rules sourcebook of the United Kingdom’s
Our responsibility is to express a conclusion on the interim financial statements in the Interim Management Report and Unaudited Condensed Interim Financial Statements based on our review. This report, including the conclusion, has been prepared for and only for the company for the purpose of complying with the Disclosure Guidance and Transparency Rules sourcebook of the United Kingdom’s
Chartered Accountants
9
(a)
The Directors of
(b)
Legislation in
CONDENSED
STATEMENT OF COMPREHENSIVE INCOME
For the period from
For the period from For the period from
01.10.25 to 31.03.26 01.10.24 to 31.03.25
Notes (Unaudited) (Unaudited)
Income £ £
Interest income on 11,058,319 9,684,088
financial assets
Net foreign currency 7 774,262 (224,017)
gains/(losses)
Net (losses)/gains on
financial assets at fair 8 (9,957,933) 2,766,289
value through profit or
loss
Net losses on swaps (76,840) (132,924)
Net investment income 1,797,808 12,093,436
Expenses
Portfolio management fees 13 (1,072,969) (856,770)
Directors' fees 13 (89,500) (78,500)
Administration fees 14 (75,003) (73,118)
AIFM management fees 14 (41,999) (34,271)
Audit fees (79,863) (72,438)
Custody fees 14 (14,306) (11,424)
Broker fees 14 (25,486) (25,774)
Depositary fees 14 (20,539) (18,019)
Legal and other (50,825) (41,659)
professional fees
Other expenses (155,964) (116,397)
Total expenses (1,626,454) (1,328,370)
Total comprehensive 171,354 10,765,066
income for the period*
Earnings per Ordinary
Share -
Basic & Diluted 3 0.0005 0.0400
All items in the above statement derive from continuing operations.
The accompanying notes are an integral part of these Unaudited Condensed Interim Financial Statements.
*There was no other comprehensive income during the period.
CONDENSED STATEMENT OF FINANCIAL POSITION
As at
31.03.26 30.09.25
(Unaudited) (Audited)
Assets Notes £ £
Current assets
Financial assets at fair value through profit
or loss
- Investments 8 287,519,320 266,874,240
- Derivative assets: Forward currency 16 11,651 63,189
contracts
Shares issued receivable - 438,350
Amounts due from brokers 638,116 696,436
Other receivables 9 4,543,103 4,127,642
Cash and cash equivalents 6,379,017 6,268,742
Total current assets 299,091,207 278,468,599
Liabilities
Current liabilities
Amounts due to brokers 5,407,379 5,417,873
Other payables 10 608,031 329,504
Financial liabilities at fair value through
profit or loss
- Derivative liabilities: Forward currency 16 2,290,492 3,029
contracts
- Derivative liabilities: Swap contracts 16 1,645,084 -
Total current liabilities 9,950,986 5,750,406
Total net assets 289,140,221 272,718,193
Equity
Share capital account 11 312,057,881 283,400,353
Retained deficits (22,917,660) (10,682,160)
Total equity 289,140,221 272,718,193
Ordinary Shares in issue 11 350,439,197 316,889,197
Net Asset Value per Ordinary Share (pence) 5 82.51 86.06
The Unaudited Condensed Interim Financial Statements were approved by the Board of Directors on
Chair Senior Independent Director
The accompanying notes are an integral part of these Unaudited Condensed Interim Financial Statements.
CONDENSED STATEMENT OF CHANGES IN EQUITY
For the period from
Share capital Retained
account deficits Total
(Unaudited) (Unaudited) (Unaudited)
Note £ £ £
Balance at 1 October 2025 283,400,353 (10,682,160) 272,718,193
Issue of Ordinary Shares 29,237,895 - 29,237,895
Share issue costs (343,551) - (343,551)
Income equalisation on new 4 (236,816) 236,816 -
issues
Dividends paid - (12,643,670) (12,643,670)
Total comprehensive income for - 171,354 171,354
the period
Balance at 31 March 2026 312,057,881 (22,917,660) 289,140,221
Share capital Retained
account deficits Total
(Unaudited) (Unaudited) (Unaudited)
Note £ £ £
Balance at 1 October 2024 237,596,788 (17,829,418) 219,767,370
Issue of Ordinary Shares 14,479,780 - 14,479,780
Share issue costs (170,137) - (170,137)
Income equalisation on new 4 (113,178) 113,178 -
issues
Dividends paid - (10,460,513) (10,460,513)
Total comprehensive income for - 10,765,066 10,765,066
the period
Balance at 31 March 2025 251,793,253 (17,411,687) 234,381,566
The accompanying notes are an integral part of these Unaudited Condensed Interim Financial Statements.
CONDENSED STATEMENT OF
CASH FLOWS
For the period from
For the period from For the period from
01.10.25 to 31.03.26 01.10.24 to 31.03.25
(Unaudited) (Unaudited)
Notes £ £
Cash flows from operating
activities
Total comprehensive income 171,354 10,765,066
for the period
Adjustments for:
Net losses/(gains) on
financial assets at fair 8 9,957,933 (2,766,289)
value through profit or loss
Net losses on swaps 76,840 132,924
Amortisation adjustment
under effective interest 8 (785,186) (910,862)
rate method
Movement in net unrealised
losses on forward currency 7 2,339,000 662,755
contracts
Exchange loss on cash and 6,772 6,222
cash equivalents
Increase in other 9 (415,461) (316,521)
receivables
Increase/(decrease) in other 10 278,527 (110,058)
payables
Purchase of investments (104,894,654) (61,056,864)
Sale of investments 75,304,931 45,300,500
Movement in swap contracts 1,387,967 -
Net cash used in operating (16,571,977) (8,293,127)
activities
Cash flows from financing
activities
Proceeds from issue of 29,676,245 15,330,580
Ordinary Shares
Share issue costs 11 (343,551) (170,137)
Dividends paid (12,643,670) (11,763,385)
Net cash generated from 16,689,024 3,397,058
financing activities
Increase/(decrease) in cash 117,047 (4,896,069)
and cash equivalents
Cash and cash equivalents at 6,268,742 7,589,458
beginning of the period
Exchange loss on cash and (6,772) (6,222)
cash equivalents
Cash and cash equivalents 6,379,017 2,687,167
at end of the period
The accompanying notes are an integral part of these Unaudited Condensed Interim Financial Statements.
NOTES TO THE UNAUDITED CONDENSED INTERIM FINANCIAL STATEMENTS
For the period from
1. General information
The investment objective and policy is set out in the Summary Information.
The Portfolio Manager of the Company is
2. Material accounting policies
a) Basis of preparation and statement of compliance
The Unaudited Condensed Interim Financial Statements for the period from
The Unaudited Condensed Interim Financial Statements should be read in conjunction with the Audited Annual Financial Statements for the year ended
b) Changes in accounting policy
There have been no changes to the accounting policies from those applied in the most recent Audited Annual Financial Statements.
c) Significant judgements and estimates
In the current financial period, there have been no changes to the significant accounting judgements, estimates and assumptions from those applied in the most recent Audited Annual Financial Statements.
d) Standards, amendments and interpretations effective during the period
The following standards, interpretations and amendments were adopted (where applicable) for the period ended
Lack of Exchangeability (Amendments to IAS 21) (applicable to accounting periods beginning on or after 1 January 2025).
The adoption of the above standard did not have a material impact on the Unaudited Condensed Interim Financial Statements of the Company. There are no other standards, amendments and interpretations effective during the period that are deemed material to the Company.
e) Standards, amendments and interpretations issued but not yet effective
At the reporting date of these Financial Statements, the following standards, interpretations and amendments, which have not been applied to these Financial Statements, were in issue but not yet effective:
Classification and Measurement of Financial Instruments (Amendments to IFRS 7 and IFRS 9) (applicable to periods beginning on or after
Presentation and Disclosures in Financial Statements (IFRS 18) (applicable to accounting periods beginning on or after 1 January 2027).
The Board is in the process of assessing the impact of the new accounting standards.
3. Earnings per Ordinary Share – basic & diluted
The earnings per Ordinary Share basic and diluted of 0.05p (period ended
4. Income on equalisation of new issues/tendered shares repurchased
In order to ensure there were no dilutive effects on earnings per share for current Shareholders when issuing new shares, or when repurchasing tendered shares, earnings have been calculated in respect of the accrued income at the time of purchase of new shares/repurchase of tendered shares and a transfer has been made from share capital to income to reflect this. The transfer for the period amounted to £236,816 (
5. Net asset value per Ordinary Share
The NAV of each Ordinary Share of 82.51p (
6. Taxation
The Company has been granted Exempt Status under the terms of The Income Tax (Exempt Bodies) (
7. Net foreign currency gains/(losses)
For the period from For the period from
01.10.25 to 31.03.26 01.10.24 to 31.03.25
(Unaudited) (Unaudited)
£ £
Movement in net unrealised losses
on forward currency (2,339,000) (662,755)
contracts
Realised gains/(losses) on 4,388,074 (85,508)
forward currency contracts
Realised currency (losses)/gains (1,256,510) 506,149
on receivables/payables
Unrealised currency
(losses)/gains on (8,713) 18,097
receivables/payables
Unrealised currency
losses on swap (9,589) -
contracts
774,262 (224,017)
8. Investments
As at 31.03.26 As at 30.09.25
(Unaudited) (Audited)
£ £
Financial
assets at fair
value through
profit or loss:
Opening amortised 260,202,772 203,435,303
cost
Purchases at cost 106,003,248 133,260,690
Proceeds on
sale/principal (76,185,421) (88,263,017)
repayment
Amortisation adjustment under 785,186 1,998,693
effective interest rate method
Realised gain on 4,397,549 11,259,673
sale/principal repayment
Realised loss on (1,064,587) (1,488,570)
sale/principal repayment
Closing amortised 294,138,747 260,202,772
cost
Unrealised gain on investments 2,311,971 8,931,803
Unrealised loss on investments (8,931,398) (2,260,335)
Fair value 287,519,320 266,874,240
For the period from For the period
01.10.25 to 31.03.26 from 01.10.24 to
31.03.25
(Unaudited) (Unaudited)
£ £
Realised gain on 4,397,549 4,389,212
sale/principal repayment
Realised loss on (1,064,587) (1,243,831)
sale/principal repayment
Decrease in (6,619,832) (327,577)
unrealised gain
Increase in (6,671,063) (51,515)
unrealised loss
Net (loss)/gain on financial
assets at fair value through (9,957,933) 2,766,289
profit or loss
The Company does not experience any seasonality or cyclicality in its investing activities.
9. Other receivables
As at 31.03.26 As at 30.09.25
(Unaudited) (Audited)
£ £
Interest income receivable 4,366,633 4,007,050
Prepaid expenses 76,140 20,244
Dividends receivable 100,330 100,348
4,543,103 4,127,642
The Board does not anticipate any material expected credit losses (“ECL”) for interest income receivable as at
10. Other payables
As at 31.03.26 As at 30.09.25
(Unaudited) (Audited)
£ £
Portfolio management fees payable 366,735 176,247
Administration fees payable 75,189 31,543
AIFM management fees payable 3,669 4,357
Audit fees payable 93,633 38,636
Other expenses payable 52,583 61,650
Depositary fees payable 3,683 2,984
Custody fees payable 5,474 2,804
Share issue costs payable 7,065 11,283
608,031 329,504
11. Share capital account
Authorised share capital
The Board may issue Ordinary Shares at a par value of 1p per share up to a certain maximum aggregate amount approved by the Shareholders at the Annual General Meeting.
Issued share capital
31.03.26 30.09.25
(Unaudited) (Audited)
£ £
Ordinary Shares
Share capital account at the beginning of the 283,400,353 237,596,788
period/year
Issue of shares 29,237,895 46,915,800
Share issue costs (343,551) (552,749)
Income equalisation on new issues (236,816) (559,486)
Total share capital account at the end of the 312,057,881 283,400,353
period/year
Reconciliation of number of Shares
31.03.26 30.09.25
Number of Number of Ordinary
Ordinary Shares Shares
(Unaudited) (Audited)
Ordinary Shares
Shares at the beginning of the 316,889,197 262,574,331
period/year
Issue of shares 33,550,000 54,314,866
Total Shares in issue at the end of the 350,439,197 316,889,197
period/year
The Ordinary Shares carry the following rights:
a) The Ordinary Shares carry the right to receive all income of the Company attributable to the Ordinary Shares.
b) The Shareholders present in person or by proxy or present by a duly authorised representative at a general meeting have, on a show of hands, one vote and, on a poll, one vote for each Share held.
The Company has the right to issue and purchase up to 14.99% of the total number of its own shares at £0.01 each, to be classed as Treasury Shares and may cancel those Shares or hold any such Shares as Treasury Shares, provided that the number of Shares held as Treasury Shares shall not at any time exceed 100% of the total number of Shares of that class in issue at that time or such amount as provided in The Companies (Treasury Shares) Regulations, 2016.
The Company held no shares in
12. Analysis of financial assets and liabilities by measurement basis as per Statement of Financial Position
Financial
assets at
fair
value Amortised
through
profit or cost Total
loss
£ £ £
31 March 2026 (Unaudited)
Financial Assets
Financial assets at fair
value through profit or loss
-
Investments
- Corporate bonds 187,624,622 - 187,624,622
- Asset-backed 99,894,698 - 99,894,698
securities
- Derivative assets: Forward 11,651 - 11,651
currency contracts
Amounts due from - 638,116 638,116
brokers
Other receivables (excluding - 4,466,963 4,466,963
prepaid expenses)
Cash and cash - 6,379,017 6,379,017
equivalents
287,530,971 11,484,096 299,015,067
Financial
liabilities
at fair
value Amortised
through
profit or cost Total
loss
£ £ £
31 March 2026 (Unaudited)
Financial Liabilities
Amounts due to - 5,407,379 5,407,379
brokers
Other - 608,031 608,031
payables
Financial liabilities at fair
value through profit or loss
- Derivative
liabilities: Swap 1,645,084 - 1,645,084
contracts
- Derivative liabilities: 2,290,492 - 2,290,492
Forward currency contracts
3,935,576 6,015,410 9,950,986
Financial
assets at
fair
value Amortised
through
profit or cost Total
loss
£ £ £
30 September
2025 (Audited)
Financial Assets
Financial assets at fair
value through profit or
loss
-
Investments
- Corporate bonds 173,526,131 - 173,526,131
- Asset-backed 93,348,109 - 93,348,109
securities
- Derivative assets:
Forward currency 63,189 - 63,189
contracts
Shares issued - 438,350 438,350
receivable
Amounts due from - 696,436 696,436
brokers
Other receivables
(excluding prepaid - 4,107,398 4,107,398
expenses)
Cash and cash - 6,268,742 6,268,742
equivalents
266,937,429 11,510,926 278,448,355
Financial
liabilities
at fair
value Amortised
through
profit or cost Total
loss
£ £ £
30 September
2025 (Audited)
Financial Liabilities
Amounts due to - 5,417,873 5,417,873
brokers
Other - 329,504 329,504
payables
Financial liabilities at fair
value through profit or loss
- Derivative
liabilities: Forward 3,029 - 3,029
currency contracts
3,029 5,747,377 5,750,406
13. Related parties
a) Directors’ remuneration
The Directors of the Company are remunerated for their services at such a rate as the Directors determine. As per the Articles, the aggregate fees of the Directors will not exceed £250,000.
The Directors’ fees for the period/year are as follows:
31.03.26 30.09.25
(Unaudited) (Audited)
£ £
Ashley Paxton 26,500 49,000
Sharon Parr 23,000 43,000
Wendy Dorey 20,000 38,500
Richard Class 20,000 37,500
89,500 168,000
No Directors’ fees were outstanding as at
b) Shares held by related parties
The Directors of the Company held the following shares beneficially:
As at 31.03.26 As at 30.09.25
(Unaudited) (Audited)
Number of Ordinary Shares Number of Ordinary Shares
Ashley Paxton¹ 130,000 120,000
Sharon Parr 2 108,004 98,004
Wendy Dorey 38,505 38,505
Richard Class 3 100,000 75,000
1
On
2
On
3
On
Directors are entitled to receive the dividends on any shares held by them during the period/year. Dividends declared by the Company are set out in note 18.
As at
The Ordinary Shares held by Directors and by partners and employees of the Portfolio Manager are purchased in their own right on the open market and do not form part of their remuneration paid by the Company.
The Portfolio Manager, partner and employee amounts therefore exclude Ordinary Shares held under any long-term incentive plan (“LTIP”) which have not yet vested. Shares that are held in employee and partner LTIPs total 535,969 (
The amounts for the Portfolio Manager, its partners and employees and LTIP are shown for transparency purposes and are not considered transactions with related parties.
c) Portfolio Manager
The portfolio management fee is payable to the Portfolio Manager monthly in arrears at a rate of 0.75% per annum of the lower of NAV, which is calculated weekly on each valuation day, or market capitalisation of each class of shares.
Total portfolio management fees for the period amounted to £1,072,969 (
The Portfolio Manager is also entitled to a commission of 0.175% of the aggregate gross offering proceeds in relation to any issue of new Shares,
following admission, in consideration of marketing services that it provides to the Company. During the period, the Portfolio Manager earned £51,166 (
14. Material agreements
a)
The Company’s AIFM is
During the period, AIFM fees of £41,999 (
b) Administrator and Secretary
With effect until
With effect from
In addition, an annual fee of £25,000 will be charged for corporate governance and company secretarial services. Administration fees are payable monthly in arrears.
During the period, administration and secretarial fees of £75,003 (
c) Broker
For its services as the Company’s Corporate Broker, Deutsche Numis is entitled to receive a retainer fee of £50,000 per annum and also a commission of 1% on all tap issues. Total broker fees for the period amounted to £25,486 (
d) Depositary
With effect until
During the period, depositary fees of £20,539 (
The Depositary is also entitled to a Global Custody fee of a minimum of £8,500 per annum plus transaction fees. Total Global Custody fees and charges for the period amounted to £14,306 (
15. Financial risk management
The Company’s activities expose it to a variety of financial risks: market risk (including price risk, reinvestment risk, interest rate risk and foreign currency risk), credit risk, liquidity risk and capital risk. Please refer to the Statement of Principal Risks and Uncertainties.
These Unaudited Condensed Interim Financial Statements may not include all the financial risk management information and disclosures required in the Annual Financial Statements; they should be read in conjunction with the Company’s Annual Report and Audited Financial Statements for the year ended
16. Fair value measurement
All assets and liabilities are carried at fair value or at carrying value which equates to fair value.
IFRS 13 requires the Company to classify fair value measurements using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The fair value hierarchy has the following levels:
(i) Quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1).
(ii) Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices including interest rates, yield curves, volatilities, prepayment speeds, credit risks and default rates) or other market corroborated inputs (Level 2).
(iii) Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (Level 3).
The following table analyses within the fair value hierarchy the Company’s financial assets and liabilities (by class) measured at fair value as at
Level 1 Level 2 Level 3 Total
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
£ £ £ £
Assets
Financial assets at fair
value
through profit or loss
- Investments
- Corporate bonds - 187,624,622 - 187,624,622
- Asset-backed - 93,717,314 6,177,384 99,894,698
securities
- Derivative assets:
Forward currency
contracts - 11,651 - 11,651
Total assets as at 31 - 281,353,587 6,177,384 287,530,971
March 2026
Liabilities
Financial liabilities at
fair value
through profit or loss
- Derivative
liabilities: Swap - 1,645,084 - 1,645,084
contracts
- Derivative
liabilities: Forward
currency
contracts - 2,290,492 - 2,290,492
Total liabilities as - 3,935,576 - 3,935,576
at 31 March 2026
The following table analyses within the fair value hierarchy the Company’s financial assets and liabilities (by class) measured at fair value as at
Level 1 Level 2 Level 3 Total
(Audited) (Audited) (Audited) (Audited)
£ £ £ £
Assets
Financial assets at fair
value
through profit or loss
- Investments
- Corporate bonds - 173,526,131 - 173,526,131
- Asset-backed - 87,224,619 6,123,490 93,348,109
securities
- Derivative assets:
Forward currency
contracts - 63,189 - 63,189
Total assets as at 30 - 260,813,939 6,123,490 266,937,429
September 2025
Liabilities
Financial liabilities at
fair value
through profit or loss
- Derivative
liabilities: Forward
currency
contracts - 3,029 - 3,029
Total liabilities as - 3,029 - 3,029
at 30 September 2025
Credit securities which have a value based on quoted market prices in active markets are classified as Level 1. At the end of the period, no credit securities held by the Company are classified as Level 1.
Credit securities which are not traded or dealt on organised markets or exchanges are classified as Level 2 or Level 3. Credit securities with prices obtained from independent price vendors, where the Portfolio Manager is able to assess whether the observable inputs used for their modelling of prices are accurate, and the Portfolio Manager has the ability to challenge these vendors with further observable inputs, are classified as Level 2. Prices obtained from vendors who are not easily challengeable or transparent in showing their assumptions for the method of pricing, or where an independent value is sought from an external provider based on an appropriate valuation model, are classified as Level 3. Credit securities priced at an average of two vendors’ prices are classified as Level 2.
Where the Portfolio Manager determines that the price obtained from an independent price vendor is not an accurate representation of the fair value of the credit security, the Portfolio Manager may source prices from third party dealer quotes and if the price represents a reliable and an observable price, the credit security is classified as Level 2.
Any dealer quote that is over 20 days old is considered stale and is classified as Level 3. Furthermore, the Portfolio Manager may determine that the application of a mark-to-model basis may be appropriate where they believe such a model will result in more reliable information with regards to the fair value of any specific investments and are also classified as Level 3 investments. During the period, there were no transfers between Level 2 and Level 3 (
The Portfolio Manager also took advantage of engaging a third-party valuer to value certain investments (primarily residential mortgage-backed security assets). The valuation of these assets and others that the Portfolio Manager may deem appropriate to provide fair value, primarily use discounted cash flow analysis but may also include the use of a comparable arm's length transaction, reference to other securities that are substantially the same, and other valuation techniques commonly used by market participants making the maximum use of market inputs and relying as little as possible on entity-specific inputs. As at
Although the models used utilise other unobservable inputs in addition to the discount margins such as constant default rate and constant prepayment rate, it is the Board’s and Portfolio Manager’s views that any reasonable movement in these unobservable inputs would not yield a significant change in fair value to the portfolio. The following table summarises the quantitative information about the significant unobservable inputs used in Level 3 fair value measurements and how a reasonable possible change in the input would affect the fair values:
31 March Fair Financial Unobservable Sensitivity Effect on Fair
2026 Value (£) Assets Input Used Value (£)
(Unaudited) /Liabilities
Financial Discount
Dutch RMBS 6,177,384 Asset Margin -1% / +1% 70,257 / (67,957)
(1035 bps)
30 Financial
September Fair Assets Unobservable Sensitivity Effect on Fair
2025 Value (£) /Liabilities Input Used Value (£)
(Audited)
Financial Discount
Dutch RMBS 6,123,490 Asset Margin -1% / +1% 108,232 / (103,655)
(1000 bps)
The following table presents the movement in Level 3 instruments for the period ended
Bonds Asset-backed securities Total
31 March 2026 (Unaudited) £ £ £
Opening balance - 6,123,490 6,123,490
Net disposals - (167,967) (167,967)
Net realised gains for the period - 145,846 145,846
Net unrealised gains for the - 76,015 76,015
period
Closing balance - 6,177,384 6,177,384
The following table presents the movement in Level 3 instruments for the year ended
Bonds Asset-backed securities Total
30 September 2025 (Audited) £ £ £
Opening balance - 6,382,998 6,382,998
Net disposals - (728,779) (728,779)
Net realised gains for the year - 502,889 502,889
Net unrealised losses for the - (33,618) (33,618)
year
Closing balance - 6,123,490 6,123,490
The following tables analyse within the fair value hierarchy the Company’s assets and liabilities not measured at fair value at
Level 1 Level 2 Level 3 Total
31 March 2026 (Unaudited) £ £ £ £
Assets
Amounts due from brokers - 638,116 - 638,116
Other receivables excluding - 4,466,963 - 4,466,963
prepaid expenses
Cash and cash equivalents 6,379,017 - - 6,379,017
Total 6,379,017 5,105,079 - 11,484,096
Liabilities
Amounts due to brokers - 5,407,379 - 5,407,379
Other - 608,031 - 608,031
payables
Total - 6,015,410 - 6,015,410
Level 1 Level 2 Level 3 Total
30 September 2025 £ £ £ £
(Audited)
Assets
Amounts due from brokers - 696,436 - 696,436
Shares issued receivable - 438,350 - 438,350
Other receivables excluding - 4,107,398 - 4,107,398
prepaid expenses
Cash and cash equivalents 6,268,742 - - 6,268,742
Total 6,268,742 5,242,184 - 11,510,926
Level 1 Level 2 Level 3 Total
30 September 2025 £ £ £ £
(Audited)
Liabilities
Amounts due to brokers - 5,417,873 - 5,417,873
Other - 329,504 - 329,504
payables
Total - 5,747,377 - 5,747,377
The assets and liabilities included in the above tables are carried at amortised cost; due to their short-term nature, their carrying values are a reasonable approximation of fair value.
Cash and cash equivalents include deposits held with banks.
Amounts due to brokers and other payables represent the contractual amounts and obligations due by the Company for settlement of trades and expenses.
Amounts due from brokers, shares issued receivable and other receivables represent the contractual amounts and rights due to the Company for settlement of trades and income.
17. Segmental reporting
The Board is responsible for reviewing the Company’s entire portfolio and considers the business to have a single operating segment. The Board’s asset allocation decisions are based on a single, integrated investment strategy, and the Company’s performance is evaluated on an overall basis.
Revenue earned is reported separately on the face of the Condensed Statement of Comprehensive Income as interest income on financial assets at fair value through profit and loss being interest income received from credit securities.
18. Dividend policy
The Board intends to distribute an amount at least equal to the value of the Company’s excess income, as defined below, arising each financial year to the holders of Ordinary Shares. However, there is no guarantee that the Dividend Target of
Excess income is defined as the distributions made with respect to any income period, which comprise (a) the accrued income of the portfolio for the period (for these purposes, the Company’s income will include the interest payable by the credit securities in the portfolio and amortisation of any discount or premium to par at which a credit security is purchased over its remaining expected life); (b) an additional amount to reflect any income purchased in the course of any share subscriptions that took place during the period, including purchased income. In this way, it ensures that the income yield of the shares is not diluted as a consequence of the issue of new shares during an income period; (c) any relevant expenses less 50% of the portfolio management fees for the period; and (d) any gain/(loss) on the foreign exchange contracts caused by the interest rate differentials between each foreign exchange currency pair which is reflected in each pair’s forward foreign exchange rate. This definition differs from the IFRS Accounting Standards “net income” definition which also recognises gains and losses on financial assets.
During the period ended
Dividend Net
Period to per Ordinary dividend Ex-dividend Record date Pay date
Share payable (£) date
(pence)
30 September 1.30 4,158,690 16 October 17 October 31 October
2025* 2025 2025 2025
31 October 0.50 1,628,196 20 November 21 November 5 December
2025 2025 2025 2025
28 November 0.50 1,663,196 18 December 19 December 5 January
2025 2025 2025 2026
31 December 0.50 1,699,196 22 January 23 January 6 February
2025 2026 2026 2026
31 January 0.50 1,742,196 19 February 20 February 6 March 2026
2026 2026 2026
28 February 0.50 1,752,196 19 March 20 March 7 April 2026
2026 2026 2026
12,643,670
31 March 0.75 2,637,045 23 April 24 April 8 May 2026
2026 2026 2026
* This dividend was declared in respect of distributable profit for the year ended
During the year ended
Dividend Net
Period to per Ordinary dividend Ex-dividend Record date Pay date
Share payable (£) date
(pence)
30 September 1.38 3,624,403 17 October 18 October 1 November
2024* 2024 2024 2024
31 October 0.50 1,345,372 21 November 22 November 6 December
2024 2024 2024 2024
29 November 0.50 1,350,372 19 December 20 December 3 January
2024 2024 2024 2025
31 December 0.50 1,360,372 16 January 17 January 31 January
2024 2025 2025 2025
31 January 0.50 1,382,622 20 February 21 February 7 March 2025
2025 2025 2025
28 February 0.50 1,397,372 20 March 21 March 4 April 2025
2025 2025 2025
31 March 0.75 2,096,057 17 April 22 April 6 May 2025
2025 2025 2025
30 April 0.50 1,416,872 22 May 2025 23 May 2025 6 June 2025
2025
31 May 2025 0.50 1,439,372 19 June 2025 20 June 2025 4 July 2025
30 June 2025 0.75 2,211,557 17 July 2025 18 July 2025 1 August
2025
31 July 2025 0.50 1,521,946 21 August 22 August 5 September
2025 2025 2025
31 August 0.50 1,561,947 18 September 19 September 30 September
2025 2025 2025 2025
20,708,264
30 September 1.30 4,158,690 16 October 17 October 31 October
2025 2025 2025 2025
* This dividend was declared in respect of distributable profit for the year ended
Under The Companies (
19. Ultimate controlling party
In the opinion of the Board on the basis of shareholdings advised to them, the Company has no ultimate controlling party.
20. Subsequent events
These Unaudited Condensed Interim Financial Statements were approved for issuance by the Board on
Subsequent to the period end and up to the date of signing of the Unaudited Condensed Interim Financial Statements, the following events took place:
Dividend declarations
Dividend rate per Net dividend
Declaration date Ordinary Share (pence)
payable (£)
Thursday, 16 April 2026 0.75 2,637,045
Thursday, 14 May 2026 0.50 1,758,030
Tenders and repurchases
On
Share issues
Issue date Ordinary Price (pence) Total proceeds (£)
Shares issued
Friday, 17 April 2026 1,166,829 85.31 995,422
Friday, 22 May 2026 1,500,000 85.13 1,276,950
Friday, 5 June 2026 1,000,000 85.99 859,900
Treasury Shares
Issue date Price (pence) Total proceeds (£)
re-issued
Friday, 17 April 2026 333,171 85.31 284,228
GLOSSARY OF TERMS AND ALTERNATIVE PERFORMANCE MEASURES
Alternative Performance Measures (“APMs”)
In accordance with ESMA Guidelines on APMs, the Board has considered what APMs are included in the Unaudited Condensed Interim Financial Statements which require further clarification. APMs are defined as a financial measure of historical or future financial performance, financial position or cash flows, other than a financial measure defined or specified in the applicable financial reporting framework. The APMs included in the Interim Management Report and Unaudited Condensed Interim Financial Statements are unaudited and outside the scope of IFRS Accounting Standards.
Dividends Declared per Ordinary Share
Dividends declared per Ordinary Share are the dividends that are announced in respect of the current accounting period.
Dividend Target
The Company maintains an annual minimum dividend target of at least 6p per Ordinary Share.
Net Asset Value (“NAV”)
NAV is the assets attributable to Shareholders. NAV is calculated using the accounting standards specified by IFRS Accounting Standards and consists of total assets, less total liabilities.
NAV per Ordinary Share
NAV per Ordinary Share is calculated by dividing the total NAV of £289,140,221 (
NAV Total Return per Ordinary Share
NAV total return per Ordinary Share is the percentage increase or decrease in NAV, inclusive of dividends paid and reinvested, in the reporting period. It is calculated by adding the increase or decrease in NAV per Ordinary Share to the dividends paid per Ordinary Share and dividing it by the NAV per Ordinary Share at the start of the period/year.
Ongoing Charges
The ongoing charges represent the Company’s management fee and all other operating expenses, excluding finance costs, expressed as a percentage of the average of the daily net assets during the period/year. The Board continues to be conscious of expenses and works hard to maintain a sensible balance between good quality service and cost.
Premium/Discount
If the share price is higher than the NAV per Ordinary Share, the shares are said to be trading at a premium. The size of the premium is calculated by subtracting the NAV per Ordinary Share from the share price and is usually expressed as a percentage of the NAV per Ordinary Share. If the share price of an investment company is lower than the NAV per Ordinary Share, the shares are said to be trading at a discount.
Average Premium
The premium is calculated as described above at the close of business on every Wednesday that is also a business day, as well as the last business day of every month, and an average taken for the period.
