REG - Brown Advisory US - Annual Financial Report
30/09/2025 07:00
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RNS Number : 2868B Brown Advisory US Smaller Cos. PLC 30 September 2025
Brown Advisory US Smaller Companies PLC
Annual Report and Financial Statements for the year ended 30 June 2025
Financial Highlights for the year ended 30 June 2025
Ordinary Share Performance
Net asset value (pence)*
1,416.7
(3.7)% (2024: 1,471.4)
Russell 2000 Total Return Index
(sterling adjusted)
8,637.0
(0.7)% (2024: 8,699.0)
Ongoing charges ratio (%)*
1.01
(2024: 1.05)
Closing price (pence)
1,270.0
(1.0)% (2024: 1,282.5)
Discount to net asset value (%)*
(10.4)
(2024: (12.8))
Year ended Net assets Net asset Year-on-year change in Year-on-year change in
30 June
£'000
value per
net asset value per
Benchmark Index
Ordinary share
Ordinary share
%
p
%
2016 174,163 787.3 +8.7 +9.7
2017 181,687 911.1 +15.7 +28.2
2018 163,339 1,103.4 +21.1 +15.7
2019 161,520 1,152.7 +4.5 +0.3
2020 145,011 1,116.3 (3.2) (3.8)
2021 181,426 1,516.3 +35.8 +45.1
2022 155,840 1,303.9 (14.0) (15.2)
2023 171,147 1,431.9 +9.8 +7.5
2024 174,544 1,471.4 +2.8 +10.7
2025 163,399 1,416.7 (3.7) (0.7)
========= ========= ========= =========
* For definitions of the above Alternative Performance Measures please
refer to the Glossary of Terms within the Annual Report.
Stephen White, Chairman, Brown Advisory US Smaller Companies, said:
"Our past financial year can be described truly as 'a year of two halves',
with a gentle run up in markets ahead of the presidential election in the
first half and a more volatile and unsettled period in the second as the newly
elected administration under President Trump laid out its programme of change
and the geopolitical background deteriorated.
US smaller companies were eclipsed once again by the performance of the
large cap stocks, particularly those in the technology sector, known as the
'Magnificent Seven'. At the same time, returns for UK investors were largely
eroded by the weakening in the US dollar against sterling, notably in the
period following the presidential election.
Returns lagged our benchmark during this challenging period as within the US
smaller company sector market conditions favoured the unprofitable and more
speculative companies. Going forward, however, we believe US smaller companies
should continue to draw support from the economy staying in reasonable shape
and from expectations of a steady cutting in interest rates. The weaker dollar
is also less of a negative factor for the latter given their greater domestic
exposure. We continue to believe that Brown Advisory's proven philosophy,
robust process and focus on high-quality, well-managed businesses is in the
best interests of shareholders."
Contact:
Brown Advisory US Smaller Companies InvestmentTrustEnquiries@brownadvisory.com
(mailto:InvestmentTrustEnquiries@brownadvisory.com)
FundRock Partners Limited, ukfundcosec@apexgroup.com (mailto:ukfundcosec@apexgroup.com)
Company Secretary
Singer Capital Markets, Broker to the Company + 44 207 496 3000
Chairman's Statement
Stephen White
Chairman of the Board
Dear Fellow Shareholder,
Helped by a favourable economic background, positive earnings development and
attractive valuations, US smaller companies performed reasonably well over the
past twelve months, with the Russell 2000 in US dollar terms returning 7.7%.
That said, smaller companies were eclipsed once again by the performance of
the large cap stocks, particularly those in the technology sector, known as
the 'Magnificent Seven'. At the same time, returns for UK investors in US
smaller companies were largely eroded by the weakening in the US dollar
against sterling, notably in the period following the presidential election,
as President Trump's erratic tariff announcements encouraged fears of
prolonged inflation, lower US growth and potential trade wars.
For the twelve months ended 30 June 2025, your Company's net asset value (NAV)
per share in sterling fell from 1471.4p to 1416.7p, a decline of 3.7%. This
was behind our benchmark, the sterling adjusted Russell 2000 Total Return
index, which fell by 0.7% over the same period. An explanation of specific
portfolio factors in relation to performance can be found in this statement
within the Annual Report as well as in the Portfolio Manager's review within
the Annual Report.
Over the twelve-month period, the Company's share price fell from 1282.5p to
1270.0p, a decline of 1.0%. This resulted in a small narrowing of the discount
to NAV from 12.8% on 30 June 2024 to 10.4% on 30 June 2025. A small number of
shares were bought in over the course of the year in accordance with our
established buyback policy.
Market Review
Our past financial year can be described truly as 'a year of two halves', with
a gentle run up in markets ahead of the presidential election in the first
half and a more volatile and unsettled period in the second as the newly
elected administration under President Trump laid out its programme of change
and the geo-political background deteriorated.
US equity markets began our financial year in good shape. While the
geopolitical background remained unsettled, with the growing tensions in the
Middle East and lack of resolution to the war in Ukraine, business activity in
the US remained resilient. Furthermore, better‑than‑expected inflation
numbers boosted hopes that September 2024 would finally see the Fed begin its
much-awaited programme of interest rate cuts.
In the event, the Fed went further in September than expected, cutting
interest rates by 50 basis points, rather than the 25 generally forecast, in
its first rate cut since March 2020. This more dovish move, coupled with
generally steady economic commentary, left investors feeling relatively
comfortable that monetary policy was not too restrictive, and that the Fed
would act again to prevent any further labour market weakness if necessary.
Markets responded positively and pushed steadily ahead through the autumn to
reach new all-time highs. They received a further boost towards the end of
November as Donald Trump won a resounding victory in the presidential
election, and the Republican party won control in a clean sweep of both the
Senate and the House of Representatives. Investors responded positively to the
decisive result given earlier fears of a drawn-out contested outcome and the
likely future government pro-business/anti-regulatory policy agenda.
The post-election period of Trump euphoria continued briefly into the New Year
as the new president's 'America First' policy agenda initially curried favour
with investors. Its focus on business and growth, lower taxes and deregulation
and above all on incentivising domestic manufacturing were well received. Only
at the very end of January, however, did the President confirm the imposition
within days of tariffs, initially in Mexico (25%), Canada (25%) and China
(10%). Even though the terms were then modified, markets noted the shift in
mood as tariffs were introduced steadily elsewhere, and they became more
volatile as fears grew of rising inflation, lower US growth and a potential
global trade war. This culminated in a major sell-off in markets in early
April on the President's infamous 'Liberation Day' Executive Order as further
tariffs were introduced across the board and many at higher rates than
expected. Fortunately, unsettling moves in the bond market and concerned
commentary from the head of JPMorgan persuaded the President to pause his
higher tariff rates for 90 days. This prompted a major rally in the equity
markets and gave renewed support to enable them to recapture much of the
ground lost since the beginning of the year.
Politics thus became the main driver of equity markets in the second half of
our financial year, rather than Federal Reserve policy and changes in interest
rate expectations, as had been the case before. Indeed, throughout this latter
period the Fed showed itself very keen to be following its own agenda and not
to be a lackey of government policy. With the economy still robust and
inflation on its favoured Personal Consumption Expenditure index uncomfortably
above its 2% target level, the Fed continued to make it clear that it was in
no hurry to lower interest rates further. This prompted a war of words between
the President and the chair of the Federal Reserve, Jerome Powell, as the
latter held his ground.
Within the US markets, the leaders in the first half were again the
'Magnificent Seven', as well as other technology stocks linked to AI where
news flow remained upbeat, earnings continued to surprise positively, and
valuations seemed not unreasonable. Smaller companies also performed well in
this period as investors looked to pick up stocks that had lagged, and where
fundamentals remained sound and valuations attractive. It also encouraged a
heavy wave of speculative buying of smaller companies with poorer
fundamentals, largely unrepresented in the Company's portfolio. However,
smaller companies soon started to lose momentum again in the second half as
investors worried that smaller companies would be more negatively affected by
the arbitrary introduction of tariffs and a likely slowing in the domestic
economy.
Over the year, in US dollar terms, the Russell 2000 returned 7.7%, the S&P
Composite returned 15.2% and the Nasdaq returned 15.7%. The pound gained
ground against the US dollar, moving from 1.264 to 1.370, as a result of which
sterling-based shareholders in US smaller companies suffered a currency loss
which eroded wholly the stock gains.
As mentioned at the beginning of my statement, the Company's performance this
year was somewhat disappointing. Overall returns to UK investors in US smaller
companies were negative as the weakening in the US dollar more than offset the
gains in share prices, while at the same time, in relative terms, our
portfolio of US smaller companies marginally underperformed its benchmark.
Most of the underperformance arose in the first half of the year when the
Company suffered from its lack of exposure to the more speculative situations
that did well then. The portfolio also suffered throughout the year from its
being underweight the financial sector which performed relatively well given
the underlying strength of the US economy. Our managers have tended
historically to underweight the sector, preferring companies with more
sustainable and less volatile earnings. Otherwise, the Company benefitted from
being overweight industrials and information technology, while underweight
energy, and from good stock selection in healthcare, even though the latter
sector remained somewhat out of favour.
Positive contributors to return over the year were Curtiss-Wright Corp.,
SiTime Corp., Inari Medical, Mirion Technologies, and Encompass Health Corp,
while the main detractors were Entegis, Bruker Corp, Bio-Techne Corp,
ChampionX Corp. and KinderCare Learning Companies.
A more detailed coverage on the development of the US smaller company sector
over the past twelve months and our activity and performance are included in
the Portfolio Manager's Review within the Annual Report.
Portfolio Manager Oversight
The Board monitors closely investment performance and, in accordance with the
Portfolio Management Agreement, carries out a detailed formal appraisal of the
Portfolio Manager annually, as well as regular portfolio reviews at its
quarterly investment meetings. In its reviews this year, the Board noted the
relative underperformance of the Company for the year as a whole and
recognised that Brown Advisory had consistently applied a disciplined
long-term investment approach, supported by a highly experienced and skilled
investment team. While returns lagged as market conditions temporarily
favoured unprofitable and more speculative companies, the Board observed that
Brown Advisory's focus remains on high-quality, well-managed businesses. Given
the Portfolio Manager's proven philosophy, robust process, and the current
market environment, the Board continues to believe that Brown Advisory's
approach is in the best interests of shareholders.
The Board also noted again that the Company's performance relative to other
funds with a similar remit, both closed-end and open-end, was also
satisfactory.
The Board will continue to monitor closely investment performance, both
absolute and relative, to ensure that the Company's offering remains
attractive.
Conditional Tender Offer
That said, we announced in February this year that the Board had decided that
should long-term performance not be satisfactory for shareholders there should
be a mechanism for them to realise up to 100% of the issued share capital in
the Company at close to the prevailing NAV of the Company. Accordingly, should
the NAV performance of the Company not outperform the Company's benchmark
(Sterling-adjusted Russell 2000 Total Return Index) for the period 1 July 2023
to 30 June 2028 (i.e. a total period of five years with three and a half
remaining), the Board intends to offer shareholders a one-off opportunity to
tender some or all their shares at close to the prevailing NAV, less costs.
The Board believes that such a Conditional Tender Offer will allow the Company
and its Portfolio Manager appropriate time to outperform against the Company's
benchmark and, in the event it does not, to offer shareholders a liquidity
event.
This redemption option will sit alongside the existing triennial continuation
vote, see below.
Continuation Vote
The next continuation vote, in accordance with the three-year cycle prescribed
in the Company's Articles of Association, will be held at our Annual General
Meeting (AGM) in November 2026. At the last vote in November 2023 the
resolution in favour of continuation was passed with 3,885,193 proxy votes or
90.5% percent in favour.
Management Fee
The Board reviews the total costs of the Company on a regular basis to ensure
that they continue to represent good value to shareholders, that they are
competitive with similar investment products and consider the quality and
experience of the teams involved.
Following engagement with Brown Advisory, we were pleased to report in
February this year that they had agreed to a reduced tiered management fee
replacing the current fee arrangements, effective from and backdated to 1
January 2025.
Details of the amendments to the management fee arrangements are set out
below.
New Management Fee Arrangements
· The management fee will be calculated based on the lower of
the Company's market capitalisation and net asset value (NAV), rather than NAV
as is currently the case; and
· The management fee on the first £200m will be reduced to
0.65%, from 0.7%, and will continue to be calculated on a tiered basis.
From 1 January 2025, the management fee is therefore calculated at an annual
rate of:
· 0.65% on the first £200m:
· 0.6% on the next £300m; and
· 0.5% thereafter,
in each case of the lower of the Company's market capitalisation and the
Company's NAV.
The new fee arrangements do not introduce any performance fee or
performance-related elements.
As mentioned before, the Board believes that the changes have the potential to
reduce costs in both the short and long term and ensure stronger alignment
between the Portfolio Manager and investors. It should be noted that the
current year's Ongoing Charges Ratio (OCR) of 1.01% reflects only six months
of this revised fee arrangement, with the full effect coming through next
year.
The Portfolio Management Agreement between the Company, FundRock Partners
Limited (as the Company's AIFM) and the Portfolio Manager has been amended to
reflect the new management fee. No other significant changes have been made to
the agreement.
Revenue and Capital Returns
The net loss per Ordinary share was (57.7)p, allocated (6.0)p to Revenue and
(51.7)p to Capital. Dividend income was lower, despite some companies raising
pay-outs, due to the weakening of the US dollar against sterling. With
Management expenses broadly unchanged, the net revenue loss was marginally
greater than the previous year. The Board still believes it appropriate to
allocate all expenses to the Revenue account. No distributable revenue is
available for the payment of dividends.
Share Price and Discount
The Board has continued with its buyback policy established a couple of years
ago and is committed to using share buybacks with the aim of reducing discount
volatility and working to reduce any discount to the extent that it is
significantly wider than those of similar investment trusts. It believes this
to be in shareholders' interests. In determining whether to buy back shares,
the Board considers, amongst other factors, and at its discretion, the size of
the Company, general market conditions and sentiment, the liquidity in the
shares and discounts in the investment trust sector overall.
Alongside this share buyback policy, the Board believes that the Company's
discount will also be driven by demand for the Company's shares, reflecting
its long-term investment performance, its relevance to investors, the
appropriate marketing of the Company and general market conditions.
Over the period under review, the Company's share price fell 1.0% from 1282.5p
to 1270.0p. This helped narrow the discount to NAV over the year from 12.8% on
30 June 2024 to 10.4% on 30 June 2025. During the year, we repurchased 328,372
shares. They were bought at an average price of £13.2 per share and at an
average discount of 11.3%.
As of 30 June 2025, the number of shares held in Treasury was 6,689,626 (2024:
6,361,254) and the number in public hands was 11,533,787 (2024: 11,862,159).
Gearing
With interest rates holding firm, an unsettled political background and
limited investor interest in small cap, neither the Board nor the Portfolio
Manager saw good reason to deploy any gearing over the year and indeed
preferred to hold some cash in hand in case of market setbacks. However, going
forward, should prospects for the smaller company sector improve and investor
interest return, the Board will review its decision to gear, mindful that the
ability to do so to enhance returns is one of the key advantages of a
closed-end structure.
Board Composition
Lisa Booth retired at the last AGM and Ruth Beechey joined the Board on 1 July
2024. The Board has now been fully refreshed since I took over as chair in
October 2021, and all four directors will be presenting themselves for
re-election at the AGM in November. As we have noted before, we are a small
Board, but we believe appropriate for the size and complexity of our Company
with all the necessary skill sets represented.
As mentioned before, the Board is aware of the FCA's Diversity and Inclusion
Policy and notes and supports their targets. Accordingly, two of the four
non-executive directors and one of the senior positions (the SID) are occupied
by females. With only four directors, it is not always straightforward to meet
ethnic diversity targets as well, but the Board remains committed to continue
to ensure it reflects a diversity of thought and skills drawn from as wide a
pool as possible.
Directors' Fees
The Board undertakes an annual fee review to ensure that the remuneration paid
to directors remains attractive, competitive and in line with its peers in
order to attract and retain the best candidates. With effect from 1 January
2025, the Directors' base remuneration is £30,700 and the remuneration of the
chair £40,200. The supplement for the Chair of the Audit and Risk Committee
is £5,800.
The maximum level currently provided for in the Company's Articles of
Association for total Directors' fees is £185,000 which provides headroom for
succession planning and appointment overlap should it be necessary.
Annual General Meeting
This year's AGM will be held on Monday, 10 November 2025 at 2.00pm at the
offices of Brown Advisory, 18 Hanover Square, London W1S 1JY. It will include
a short presentation which will be delivered in person by Chris Berrier,
Portfolio Manager, covering the performance of the Company over the past year
as well as his outlook for the future. The Board and Portfolio Manager would
welcome questions which shareholders may submit to:
InvestmentTrustEnquiries@brownadvisory.com. Subject to confidentiality, we
will respond to any questions submitted either directly or by publishing our
response on the Company website.
Electronic proxy voting is now available, and shareholders are encouraged to
submit voting instructions using the web-based voting facility
www.eproxyappointment.com (http://www.eproxyappointment.com/) and
www.proxymity.io (http://www.proxymity.io/) for institutional shareholders. In
order to use electronic proxy voting, shareholders will require their
shareholder registration number, control number and pin. If you do not have
access to these details please contact the Company's Registrar, Computershare,
whose details can be found within the Annual Report.
Notice of the AGM, containing full details of the business to be conducted at
the meeting, is set out within the Annual Report.
Shareholder Communications
The Board encourages shareholders to visit the Company's website
(www.brownadvisory.com/basc (http://www.brownadvisory.com/basc) ) for the
latest information, including thought leadership and monthly factsheets.
Investors can also sign up for email communications via the link on the
website.
Outlook
The US economy has continued to perform well in 2025. Consumer spending
remains the principal driver even if of late there have been some signs of
consumers starting to trade down as they wonder how the tariffs will affect
them going forward. Investment spending has also held up well due to
government incentives and the move towards reshoring given the rising
geopolitical and supply chain risks. While we are not expecting a recession
next year, we do anticipate a period of slower growth in 2026 as the negative
effects of the tariffs are worked through, even if the impact has so far been
less severe than originally feared. Indeed, we have noticed that a number of
analysts have been revising up their earnings forecasts for next year in the
belief that the earlier downgrades were excessive.
Investors are also still hoping that the Federal Reserve will be cutting
interest rates further this autumn. Consensus is for two cuts of 25 basis
points each this year, and a steady continuation in 2026. However, there is a
risk that the Federal Reserve continues to take a more cautious view on the
inflation outlook given the underlying strength of the US economy and the
impact on import prices which has still to be factored in from the
introduction of tariffs. Any delays in cutting rates are likely to be attacked
by the President and rekindle the animosity between the President and the
chair of the Federal Reserve given their differing views on the outlook for
the economy and the inflationary risks. This could put renewed pressure on the
dollar.
The geopolitical background remains a major challenge, albeit largely known,
with hostilities this year between Israel and Iran and the war in Ukraine
seeming to be moving in Moscow's favour. However, of more concern to investors
is the unpredictable political situation at home. President Trump is pursuing
his tariff agenda while also making unexpected and extensive use of executive
orders to push through his own legislation, not all of it popular. Indeed, his
attacking institutions such as the Federal Reserve and the courts, threatening
to add massively to the national debt and deficits through his 'One Big,
Beautiful Bill Act', as well as being an unreliable partner to the US's allies
and partners, have only served to undermine the dollar and the US Treasury
market.
Putting all this together, we believe US equity markets should continue to
draw support from the economy staying in reasonable shape and from
expectations of a steady cutting in interest rates. Smaller companies should
also benefit from a return of investor interest given their relative
underperformance of late versus the large caps and their attractive
valuations. The weaker dollar is also less of a negative factor for the latter
given their greater domestic exposure. That said, markets are likely to remain
volatile as they have been these past months as they are shaken from time to
time by unpredictable geopolitical squalls, from both home and abroad.
STEPHEN WHITE
Chairman of the Board
29 September 2025
Portfolio Manager's Review
Chris Berrier
Portfolio Manager
Performance review
For the 12 months ending 30 June 2025, our portfolio underperformed its
benchmark, the Sterling-adjusted Russell 2000 Total Return index. During the
year, the Company's NAV declined by 3.7% compared to a benchmark fall of 0.7%.
Several factors contributed to this underperformance, which we will explain in
this review.
Market Overview
It is important to keep in mind that our relative performance has become more
volatile since Covid-19. The structure and nature of the market has changed.
Index and other passive alternatives have grown significantly and retail
participation in the market has ballooned.
In the last 12 months, corporate fundamentals have had far less of an
influence on market returns, with investors seeming to ignore, for example, a
company's earnings, debt levels or long-term growth prospects. Instead,
momentum has driven share prices higher, with investors following trends and
market sentiment, detaching some stocks from their true worth.
We believe our preference for higher-quality companies and our focus on
valuation should pay dividends over the long term. Lately though, in a market
driven by momentum, it may have caused us to miss some of the few
opportunities for gains in small-cap stocks.
The Trump administration's economic and trade policy agenda largely dictated
the narrative during the second half of the reporting period. We witnessed a
small-cap bear market from the peak on 4 December 2024 to the post-Liberation
Day trough on 8 April 2025 as initial economic optimism quickly gave way to
uncertainty. Trump's second term commenced with a flurry of policy
announcements, including the Department of Government Efficiency (DOGE), tax
cuts and, most significantly, tariffs. The Liberation Day tariff announcements
accelerated the equity sell-off that was only reversed by the president
pausing his international trade plans.
Equity markets tend to dislike instability. However, investor hopes that
Trump's proposed punitive tariffs were merely an opening salvo rather than the
end game saw equities recover and end the reporting period on a high note.
This rebound was especially driven by lower-quality stocks, which were boosted
by passive and retail investor activity as well as short covering, when short
sellers buy back shares to avoid further losses.
Our Strategy's Performance
At times, our strategy tends to trail the benchmark - for example during
momentum markets, as explained above. At others, it performs better, such as
during periods when markets are more balanced and in tune with corporate and
economic fundamentals, and more challenging environments. While we are
disappointed with the portfolio's underperformance, it does not come as a
surprise to us considering the market's behaviour during much of the period.
Our strategy did well during the downturn but lost ground when the market
quickly bounced back, and investors once again chose to ignore company
fundamentals in favour of riskier, shorter-term bets. At times like these,
valuation and quality tend to be of little concern to investors.
It is also worth remembering that returns have become increasingly
concentrated in a handful of companies. This phenomenon is more apparent in
the dominance of the so-called 'Magnificent Seven' although we are also
starting to see the same pattern emerge with smaller companies, where a few
are doing really well, while many others are struggling.
Our pursuit of continuous improvement means we regularly analyse all aspects
of our performance - philosophy, people and process - as we strive to learn
and adapt without compromising the core principles that have driven our
historical success. The result is a portfolio with slightly more concentration
in the top half, which are our highest conviction positions; a new analyst
hire focused solely on the technology sector; and a larger-than-average list
of potential new ideas.
We continue to actively manage the portfolio as the opportunity set changes,
with the express intention of not only driving better returns in the short
term but also building value over the long term.
Key Factors Impacting Performance
The paramount factor driving recent underperformance has been our sector skew.
We have focused on driving and preserving portfolio value in a slowing
economy. While large-cap earnings have been reasonably good due to a handful
of very large technology companies, small‑cap earnings recently finished
their third down year in a row. We believe this is a component driving the
strong momentum bias in the space - namely, to own 'what is working', since
fundamentals are so erratic. More specifically in the period, financials was
the best performing sector in the benchmark, and this is the area where we
have the biggest underweight. It is difficult for us to find banks that
clearly meet our '3G' investment characteristics and our examination of the
sector has uncovered many lower-quality businesses. Although this was a
headwind in the short term, we do not believe our positioning will prove to be
one in the long term.
At the individual company level, the contributors were diverse. SiTime is a
leading semiconductor company specialising in timing applications. Its
compute/data centre end market is benefiting from growth in key AI platforms,
and the company confirmed it will provide content for the iPhone, which will
buoy revenue gains in the next few years. Take-Two Interactive Software, a
leading video game developer, also performed well as it builds towards the
launch of the next instalment of its Grand Theft Auto franchise. Mirion
Technologies, a leader in nuclear test and measurement, rallied after
delivering accelerating revenue growth thanks to improved results in both its
health care and commercial segments. Curtiss-Wright Corp, which provides
engineered products, solutions and services mainly to aerospace and defence,
and commercial nuclear services, was the portfolio's biggest individual
contributor, reflecting strong organic revenue growth and high earnings
visibility. Inari Medical, an innovative medical device company, was acquired
by Stryker Medical in a deal completed in the second quarter of 2025 and a
highlight in the health care space.
Additions and Disposals
The market volatility over the 12-month period made this an active time in the
portfolio. We sold several positions, with exits prompted by a combination of
merger and acquisition (M&A) activity or stocks achieving their price
potential, as well as action taken when our investment thesis was no longer
valid or we saw poor risk/reward dynamics.
On the acquisition side, we added a diverse array of companies to the
portfolio that we believe have the potential to compound nicely over time. We
also used the technology/industrial/AI-driven sell-off in early 2025 to add to
a number of existing positions. In addition, we initiated new positions in a
few companies on which we had previously completed our due diligence but
passed on at the time due to a poor risk/reward ratio.
Examples include the heating, ventilation and air conditioning equipment
manufacturer AAON, Inc., whose stock price dropped from roughly $140 to $70.
The sell-off in AI-related names drove the move down as optimism over its
emerging data centre cooling segment collapsed. We viewed this price decline
as an opportunity to buy into the company's solid core business at a
reasonable price, with the added bonus of potential long-term success from its
data centre operations.
We have known OneStream, a leading software-as-a-service company focused on
the office of the CFO, since it was private. We passed on the initial public
offering as we wanted to better understand its go-to-market strategy, but we
have tracked the business closely. Our view is that the general trend of
vendor consolidation amongst enterprises will continue, and OneStream will be
a long-term beneficiary. Although our first nibble on the stock was not at a
perfect price, recent volatility has enabled us to build out our position at
more attractive levels.
Clearwater Analytics, the leader in portfolio accounting and reporting for
asset management and insurance companies, is a similar story to OneStream. We
previously owned the stock until its valuation surged last year, forcing us to
sell. Recently, the stock has declined to a more compelling valuation, giving
us the opportunity to invest in the company again. Our view is that its legacy
competitors are ill-equipped to handle the technological changes sweeping over
the industry. This should enable Clearwater to gain meaningful market share on
a global basis. At scale, this will be a high-margin business with the ability
to produce substantial free cash flow. The company's recent acquisitions are
not without risk, but we believe its three-to-five-year vision is promising.
Other notable additions include BWX Technologies, Mirion Technologies,
AppFolio, Openlane, Simpson Manufacturing, Universal Display Technologies, and
StandardAero.
Outlook
Small-cap relative returns compared to large-cap peers have been historically
poor over the last decade. Capital continues to flow into the United States'
largest and most dominant technology businesses, pushing their share prices
up. Combined with the poor earnings growth from smaller companies over the
last few years, this dominance has produced half a decade of low, volatile
returns.
Our strategy has consistently performed well during moments of 'risk-off' and
less well during moments of 'risk-on'. We believe that when equity markets
strongly gravitate towards certain factors or trends and momentum takes hold,
we need to be even more focused on our style of fundamental, bottom-up
investing. Since we continue to see solid results from many of our larger
holdings, our portfolio has grown slightly more concentrated in the top half.
A core of approximately 40 holdings represents most of the capital in the
portfolio and is complemented by a list of smaller new or emerging holdings
poised for repositioning when the time is right.
We remain confident in our valuation-conscious, high-quality and long-term
approach to bottom-up investing. We have found the current nature of the
equity market to be extraordinary - most notably, its concentration on certain
companies and sectors. Our goal is to exploit this phenomenon to build
enduring value in the portfolio over time.
PORTFOLIO MANAGER
Brown Advisory LLC
29 September 2025
Key Performance Indicators
At Board meetings, the Directors consider a number of performance indicators
to assess the extent to which the Company is meeting its objective. The key
performance indicators used to measure the performance of the Company over
time are as follows:
· Net Asset Value changes;
· The discount or premium of share price to Net Asset Value;
· A comparison of the absolute and relative performance of the
Ordinary share price and the Net Asset Value per share relative to the return
on the Company's Benchmark Index and of its peers;
· Ordinary share price movement; and
· The Company's ongoing charges ratio.
A history of the Net Asset Value, Ordinary share price and Benchmark Index are
shown on the monthly factsheets which can be viewed on the Portfolio Manager
website www.brownadvisory.com/basc (http://www.brownadvisory.com/basc)
Information on performance against Key Performance Indicators can also be
found within the Annual Report and within the Chairman's Statement within the
Annual Report.
Viability Statement
In accordance with Provision 36 of the Code of Corporate Governance as issued
by the Association of Investment Companies in February 2019 (the 'AIC Code'),
the Board has assessed the prospects of the Company over a longer period than
the twelve months required by the 'Going Concern' provision, by reviewing the
next three years.
The Board has considered the Company's business model, including its
investment objective and investment policy, the principal and emerging risks
and uncertainties that may affect the Company, as detailed within the Annual
Report, the size threshold below which the Company would be considered
uneconomic or unviable, and the Company's performance and attractiveness to
investors in the current environment. The Board has noted that:
· the Company holds a liquid portfolio invested predominantly
in US listed equities;
· the Company is not geared;
· the Company has maintained a steady discount to NAV and has
introduced a performance-based tender mechanism for the 5-year period to 30
June 2028 (see below);
· the portfolio management fee is the most significant expense
of the Company. It is now charged as a percentage of the Company's market
capitalisation and so would reduce if the market capitalisation of the Company
were to fall. The remaining expenses are modest in value and predictable
in nature;
· no significant increase to ongoing charges or operational
expenses is anticipated; and
· it is satisfied that Brown Advisory LLC and the Company's
other key third-party suppliers maintain suitable processes and controls to
ensure that they can continue to provide their services to the Company.
The Board recognises that a continuation vote is scheduled for November 2026
but has no reason to believe that shareholders have a current intention to
vote against the continuation of the Company. It also recognises that the
Company has introduced a conditional tender offer should long-term performance
not be satisfactory for shareholders. There is now a mechanism for
shareholders to realise up to 100% of the issued share capital in the Company
at close to the prevailing NAV of the Company should the NAV performance of
the Company not outperform the Company's benchmark for the period 1 July 2023
to 30 June 2028.
The Board has also considered the market outlook, both for US smaller company
equities and for investment trusts, and has concluded that these remain an
attractive opportunity for investors.
The Board has therefore concluded that there is a reasonable expectation that
the Company will be able to continue in operation and meet its liabilities as
they fall due over the next three years.
Principal and Emerging Risks and Uncertainties
The Board, through the Audit and Risk Committee, carries out a regular review
of the risk environment in which the Company operates, changes to the
environment and individual risks. The Board also considers emerging risks
which might affect the Company.
In addition to those principal risks and uncertainties, the Board considers
that the development of artificial intelligence (AI) presents potential risks
to businesses in almost every sector. The extent of the risk presented by AI
is extremely hard to assess at this point but the Board considers that it is
an emerging risk and, together with the Manager, will monitor developments in
this area.
During the year, geopolitical uncertainties caused mainly by continuing wars
and conflicts around the world and the new administration in the US have
remained a threat and have increased market risk and volatility. There are a
number of other risks which, if realised, could have a material adverse effect
on the Company and its financial condition, performance and prospects. The
Board has carried out a robust assessment of the Company's principal and
emerging risks, which include those that would threaten its business model,
future performance, solvency, liquidity or reputation.
The principal risks and uncertainties facing the Company at the current time,
together with a description of the mitigating actions the Board has taken, are
set out in the table below.
Risk Mitigating Action
Investment performance: the appointment or continuing appointment of a Monitoring of performance: the Portfolio Manager reports to the Board on a
portfolio manager with inadequate resources, skills or expertise, or which quarterly basis and the Board and the Portfolio Manager discuss potential
makes poor investment decisions could result in poor investment performance, a causes for over or under-performance at every Board meeting. The Board keeps
loss of value for shareholders and a widening discount. under review (inter alia) the resources of the Portfolio Manager and its
adherence to investment guidelines.
A detailed formal appraisal of the Portfolio Manager is carried out annually
by the Board. The Board also keeps under review the adequacy of risk controls.
Investment strategies: the Company adopts inappropriate investment strategies Adherence to investment guidelines: the Board sets investment guidelines and
in pursuit of its objective which could result in decreased demand for the restrictions which the Portfolio Manager follows, covering matters such as
Company's shares, leading to a widening of the discount and poor investment asset allocation, diversification, gearing and currency exposure. These
performance. guidelines are reviewed regularly and reports on compliance with them are
reviewed at Board meetings. In order to ensure adequate diversification, the
Board has set absolute limits on minimum holdings and maximum exposures in the
portfolio at the time of investment, which are set out on within the Annual
Report.
Investment objective: the Company's objective becomes unattractive to Board review: the Board formally reviews the Company's objective and related
investors which could result in a lack of demand for the Company's shares. strategies on an annual basis, or more regularly if appropriate.
Share price trading at a discount to NAV: a protracted discount to NAV could Discount monitoring: the Board, through the Portfolio Manager and AIFM, keeps
reduce the attractiveness of the Company's shares. the level of discount under constant review. The Board is responsible for the
Company's share buyback policy and is prepared to authorise the use of share
buybacks to provide liquidity to the market and to try to limit any widening
of the discount, to the extent that it is wider than those of similar
investment trusts.
Shareholder communication: insufficient or inappropriate marketing of the Proactive engagement: the Board is cognisant of the importance of regular
Company's shares, and liaison between the Company and shareholders is weak. communication with shareholders. The Chairman offers meetings with the
Company's largest shareholders, and the Board meets with shareholders at the
Annual General Meeting. Additionally, a shareholder presentation with
questions and answers is available at the AGM. The Board reviews shareholder
correspondence and investor relations reports and also receives feedback from
the Company's broker.
Financial/market: insufficient oversight or controls over financial risks, Management controls: the Portfolio Manager has a range of procedures and
including foreign currency risk, market price risk, interest rate risk, controls relating to the Company's financial instruments and maintains a
liquidity risk, credit and counterparty risk, and insufficient revenue closed 'approved broker' list.
forecasting and monitoring, could result in losses to the Company.
Board review: as stated above, the Board sets investment guidelines and
restrictions which are reviewed regularly, and the Portfolio Manager reports
on compliance with them at Board meetings.
Revenue forecasting and monitoring: the AIFM presents detailed forecasts of
income and expenditure covering both the current and subsequent financial
years at all Board meetings. Further details of the Company's financial
instruments and associated risk management are included in Note 13 to the
Financial Statements.
Regulatory compliance: failure to comply with relevant regulations (including Board awareness: the Directors have an awareness of the more important
the Companies Act, the Financial Services and Markets Act, the Alternative regulations and are provided with information on changes both through its
Investment Fund Managers Directive, accounting standards, investment trust six-monthly teach-ins with its legal counsel and by the Association of
regulations, the FCA Listing Rules, Disclosure Guidance and Transparency Rules Investment Companies. In terms of day-to-day compliance with regulations, the
and Prospectus Rules) could result in fines, loss of reputation, reduced Board is reliant on the knowledge and expertise of the AIFM and Company
demand for the Company's shares and potentially the loss of an advantageous Secretary. However, where necessary, the Board engages the services of
tax regime. external advisers.
Management controls: the Company Secretary and accounting teams use checklists
to aid compliance and these are supported by the AIFM's compliance monitoring
programme and risk-based internal audit investigations.
Operational: the Company is reliant on services provided by third parties (in Agreements: written agreements are in place defining the roles and
particular those of the Portfolio Manager, AIFM, custodian and depositary) and responsibilities of all third-party service providers.
any control gaps and failures in their operations could expose the Company to
loss or damage. Internal control systems of the AIFM and Portfolio Manager: the Board receives
reports on the operation and efficacy of IT and control systems, including
those relating to internal audit and compliance functions.
Safekeeping of assets: the depositary is ultimately responsible for the
safekeeping of the Company's assets and holds cash and securities in
segregated accounts with J.P. Morgan Chase Bank N.A. The depositary reconciles
these accounts daily against the records of the Portfolio Manager.
Monitoring of other third-party service providers: the AIFM closely monitors
the control environments and quality of services provided by third parties,
including those of the depositary. This is conducted through service level
agreements, regular meetings and key performance indicators. The Directors
review reports on the AIFM's monitoring of third-party service providers on a
periodic basis. There are coded limits within the Portfolio Manager's dealing
systems. A detailed formal appraisal of the AIFM, Portfolio Manager and other
key third party providers is carried out annually by the Board.
Cyber security: Malicious or unauthorised attempts may be made to access the Internal control systems of the AIFM and Portfolio Manager: the Portfolio
IT systems and data used by the Portfolio Manager, AIFM, Administrator, Manager, J.P. Morgan and the Company's AIFM use cyber security tools.
Custodian, Registrar and other service providers resulting in financial loss
and/or a negative impact on the Company's reputation. Monitoring of other third-party service providers: the Company's AIFM conducts
ongoing reviews of service providers include assessment of cyber risk and
security.
Liquidity: the Company's shares become insufficiently liquid which could Internal control systems of the AIFM and Portfolio Manager: liquidity and
result in a lack of demand for the Company's shares. trading volumes are monitored on a daily basis by the Portfolio Manager and
the company's Broker. The AIFM carries out regular liquidity stress testing.
Geopolitical: the impact of geopolitical events (including the new Board and Portfolio Manager awareness: geopolitical events over which the
administration in the US, climate change, wars or pandemic) could result in Company has no control are always a risk. The Board and Portfolio Manager
losses to the Company. regularly horizon scan and consider what they can do to address these risks.
Going Concern
The Financial Statements have been prepared on a going concern basis. The
Directors consider that this is the appropriate basis as they have a
reasonable expectation that the Company has adequate resources to continue in
operational existence for the foreseeable future. In considering this, the
Directors took into account the Company's investment objective, risk
management policies and capital management policies, the diversified portfolio
of readily realisable securities which can be used to meet short-term funding
commitments and the ability of the Company to meet all of its liabilities and
ongoing expenses.
In determining the appropriateness of the going concern basis, the Directors
gave particular focus to the operational resilience and ongoing viability of
the Portfolio Manager, the AIFM and other key third-party suppliers.
STATEMENT OF DIRECTORS' RESPONSIBILITIES
The Directors are responsible for preparing the Annual Report and Financial
Statements in accordance with applicable law and regulation.
Company law requires the Directors to prepare financial statements for each
financial year. Under that law the Directors have elected to prepare financial
statements in accordance with United Kingdom Generally Accepted Accounting
Practice (United Kingdom Accounting Standards and applicable laws) including
Financial Reporting Standard 102, the financial reporting standard applicable
in the UK and the Republic of Ireland.
Under company law the Directors must not approve the financial statements
unless they are satisfied that they give a true and fair view of the state of
affairs of the Company and of the return or loss of the Company for that
period. In preparing those financial statements, the Directors are required
to:
(a) select suitable accounting policies and then apply them
consistently;
(b) make judgements and accounting estimates that are reasonable and
prudent;
(c) state whether applicable UK Accounting Standards have been
followed, subject to any material departures disclosed and explained in the
financial statements; and
(d) prepare the financial statements on the going concern basis unless
it is inappropriate to presume that the Company will continue in business.
The Directors are responsible for keeping adequate accounting records that are
sufficient to show and explain the Company's transactions and disclose with
reasonable accuracy at any time the financial position of the Company and
enable them to ensure that the financial statements comply with the Companies
Act 2006. They are also responsible for safeguarding the assets of the Company
and hence for taking reasonable steps for the prevention and detection of
fraud and other irregularities.
Under applicable law and regulations, the Directors are also responsible for
preparing a Strategic Report, Report of the Directors, Directors' Remuneration
Report and Statement of Corporate Governance that comply with that law and
those regulations.
The Directors are responsible for the maintenance and integrity of the
corporate and financial information included on the Company website
www.brownadvisory.com/basc (http://www.brownadvisory.com/basc) which is a
website maintained by Brown Advisory LLP. Visitors to the website need to be
aware that legislation in the United Kingdom governing the preparation and
dissemination of financial statements may differ from legislation in other
jurisdictions.
Each of the Directors, who are listed within this Annual Report, confirms to
the best of their knowledge that:
1. the financial statements, prepared in accordance with the
applicable set of accounting standards, give a true and fair view of the
assets, liabilities, financial position and profit or loss of the Company; and
2. the Strategic Report includes a fair review of the development
and performance of the Company, together with a description of the principal
risks and uncertainties that the Company faces; and
3. in their opinion the Annual Report and Financial Statements,
taken as a whole, are fair, balanced and understandable and provide the
information necessary to assess the Company's position and performance,
business model and strategy.
So far as each Director is aware at the time the report is approved:
1. there is no relevant audit information of which the Company's
Auditor is unaware; and
2. the Directors have taken all steps required of a company director
to make themselves aware of any relevant audit information and to establish
that the Company's Auditor has been made aware of that information.
BY ORDER OF THE BOARD
STEPHEN WHITE
Chairman
29 September 2025
STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 30 JUNE 2025
2025 2024
Revenue Capital Revenue Capital
Return
Return
Total
Return
Return
Total
Note
£'000
£'000
£'000
£'000
£'000
£'000
(Losses)/gains from investments held at fair value through profit or loss 8 - (5,178) (5,178) - 5,391 5,391
Foreign exchange loss - (880) (880) - (65) (65)
Investment income 3 962 - 962 1,018 - 1,018
Other Income 3 225 - 225 180 - 180
--------------- --------------- --------------- --------------- --------------- ---------------
Total income 1,187 (6,058) (4,871) 1,198 5,326 6,524
========= ========= ========= ========= ========= =========
Management fee 4 (1,152) - (1,152) (1,222) - (1,222)
Other expenses 5 (605) (3) (608) (578) (2) (580)
--------------- --------------- --------------- --------------- --------------- ---------------
Total expenses (1,757) (3) (1,760) (1,800) (2) (1,802)
========= ========= ========= ========= ========= =========
(Loss)/return before taxation (570) (6,061) (6,631) (602) 5,324 4,722
Taxation 6 (132) - (132) (126) - (126)
--------------- --------------- --------------- --------------- --------------- ---------------
Net (loss)/return after taxation (702) (6,061) (6,763) (728) 5,324 4,596
--------------- --------------- --------------- --------------- --------------- ---------------
Net (loss)/return per Ordinary share 7 (5.99)p (51.67)p (57.66)p (6.11)p 44.68p 38.57p
========= ========= ========= ========= ========= =========
The total column of this statement is the profit and loss account of the
Company.
The 'Revenue' and 'Capital' columns represent supplementary information
prepared under guidance issued by The Association of Investment Companies. The
Company has no other comprehensive income, and therefore the net return after
taxation is also the total comprehensive income for the year.
All revenue and capital items in the above statement derive from continuing
operations. No operations were acquired or discontinued in the year.
These Notes within the Annual Report form part of these Financial Statements.
STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2025
2025 2024
Note
£'000
£'000
Fixed assets 8 155,440 165,925
Investments at fair value through profit or loss
Current assets
Debtors 10 455 79
Cash at bank and in hand and cash equivalents 11 7,970 9,722
--------------- ---------------
8,425 9,801
========= =========
Creditors: amounts falling due within one year 12 (466) (1,182)
--------------- ---------------
Net current assets 7,959 8,619
--------------- ---------------
Total assets less current liabilities 163,399 174,544
========= =========
Capital and reserves
Called up share capital 14 4,555 4,555
Share premium account 19,550 19,550
Non-distributable reserve 841 841
Capital redemption reserve 9,628 9,628
Retained earnings - capital reserve 139,530 149,973
Retained earnings - revenue reserve (10,705) (10,003)
--------------- ---------------
Total shareholders' funds 163,399 174,544
========= =========
Net asset value per Ordinary share (pence) 15 1,416.7p 1,471.4p
========= =========
The Financial Statements within the Annual Report were approved by the Board
of Directors and signed on its behalf on 29 September 2025.
STEPHEN WHITE
Chairman
Company Registration Number 02781968
The Notes within the Annual Report form part of these Financial Statements.
STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 30 JUNE 2025
for the year ended 30 June 2025 Called up Non- Capital
Share
Share
distributable
Redemption
Capital
Revenue
Capital
Premium
Reserve
Reserve
Reserve(†)
Reserve(*†)
Total
£'000
£'000
£'000
£'000
£'000
£'000
£'000
1 July 2024 4,555 19,550 841 9,628 149,973 (10,003) 174,544
Repurchase of Ordinary shares to be held in treasury - - - - (4,382) - (4,382)
Net return for the year - - - - (6,061) (702) (6,763)
--------------- --------------- --------------- --------------- --------------- --------------- ---------------
Balance at 30 June 2025 4,555 19,550 841 9,628 139,530 (10,705) 163,399
========= ========= ========= ========= ========= ========= =========
for the year ended 30 June 2024 Called up Non- Capital
Share
Share
distributable
Redemption
Capital
Revenue
Capital
Premium
Reserve
Reserve
Reserve(†)
Reserve(*†)
Total
£'000
£'000
£'000
£'000
£'000
£'000
£'000
1 July 2023 4,555 19,550 841 9,628 145,848 (9,275) 171,147
Repurchase of Ordinary shares to be held in treasury - - - - (1,199) - (1,199)
Net return for the year - - - - 5,324 (728) 4,596
--------------- --------------- --------------- --------------- --------------- --------------- ---------------
Balance at 30 June 2024 4,555 19,550 841 9,628 149,973 (10,003) 174,544
========= ========= ========= ========= ========= ========= =========
* Dividends are only payable from the revenue reserve element of
retained earnings.
† Retained earnings comprise the total of Capital reserve and
Revenue reserve.
The Notes within the Annual Report form part of these Financial Statements.
STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 30 JUNE 2025
2025 2024
Note
£'000
£'000
Cash flows from operating activities
Investment income received (gross) 940 1,018
Deposit interest received 225 180
Investment management fee paid (1,193) (1,217)
Other cash expenses (531) (568)
Net cash outflow from operating activities before taxation (559) (587)
Taxation 6 (132) (126)
--------------- ---------------
Net cash outflow from operating activities (691) (713)
========= =========
Cash flows from investing activities
Purchases of investments (57,620) (42,125)
Sales of investments 61,821 41,380
--------------- ---------------
Net cash inflow/(outflow) from investing activities 4,201 (745)
Cash flows from financing activities ========= =========
Repurchase of ordinary shares into Treasury (4,382) (1,199)
--------------- ---------------
Net cash outflow from financing activities (4,382) (1,199)
========= =========
(Decrease) in cash (872) (2,657)
Cash and cash equivalents at the start of the year Realised loss on foreign 9,722 12,444
currency
Realised loss on foreign currency (880) (65)
--------------- ---------------
Cash and cash equivalents at end of the year 7,970 9,722
========= =========
The Notes within the Annual Report form part of these Financial Statements.
RECONCILIATION OF NET CASH OUTFLOW FROM OPERATING ACTIVITIES
2025 2024
£'000
£'000
Net return before taxation (6,631) 4,722
Gain on investments 5,178 (5,391)
Realised loss on foreign currency 880 65
(Increase) in Debtors (26) (12)
Increase in other creditors and accruals 40 29
--------------- ---------------
Net cash outflow from operating activities before taxation (559) (587)
========= =========
ANALYSIS OF CHANGES IN NET DEBT
At 30 June At 30 June
2024
Cash Flow
Non-cash
2025
£'000
£'000
movements
£'000
Cash at bank and cash equivalents 9,722 (872) (880) 7,970
--------------- --------------- --------------- ---------------
9,722 (872) (880) 7,970
========= ========= ========= =========
The Notes within the Annual Report form part of these Financial Statements.
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2025
1. GENERAL INFORMATION
Brown Advisory US Smaller Companies PLC (a Public Company Limited by shares)
is an investment Company incorporated in the United Kingdom with a premium
listing on the London Stock Exchange. The Company registration number is
02781968 and the registered office is 4th Floor, 140 Aldersgate Street, London
EC1A 4HY.
The Company conducts its affairs so as to qualify as an investment trust under
the provisions of section 1158 of the Corporation Tax Act 2010. The Company
has qualified as an investment trust in respect of all relevant years up to
and including the year ended 30 June 2025. Section 1158 was amended to allow
companies to seek approval of compliance in advance and for all subsequent
financial years. The Company received such advance approval subject to it
continuing to meet the relevant eligible conditions and ongoing requirements.
The Company intends to conduct its affairs so as to enable it to comply with
the requirements. Such approval exempts the Company from UK corporation tax on
gains realised in the relevant year on its portfolio of fixed asset
investments.
A summary of the accounting policies, all of which have been applied
consistently throughout the period is set out below.
2. ACCOUNTING POLICIES
(a) Basis of preparation
The Financial Statements for the year ended 30 June 2025 have been prepared in
accordance with UK Generally Accepted Accounting Practice ('UK GAAP')
including Financial Reporting Standard 102 ('FRS 102'), the financial
reporting standard applicable in the UK and Republic of Ireland and with the
Statement of Recommended Practice ('SORP') for Investment Trust Companies and
Venture Capital Trusts issued by the Association of Investment Companies
('AIC') in July 2022.
The Company continues to adopt the going concern basis in the preparation of
the Financial Statements. The Financial Statements have been prepared in
accordance with the Company's accounting policies as set out below. They are
presented in accordance with the Companies Act 2006 (the 'Act') and the
requirements of the SORP 'Financial Statements of Investment Trust Companies
and Venture Capital Trusts' issued in July 2022.
In accordance with FRS 102, the Company is required to identify its functional
reporting currency in which the Company predominantly operates. Having regard
to the Company's share capital and the predominant currency in which its
shareholders operate, pounds sterling, is the identified functional and
presentation reporting currency of the Company.
The Directors are of the opinion that the Company is engaged in a single
segment of business activity, being investment business. Consequently, no
business segmental reporting is required.
STATEMENT OF COMPLIANCE
The Financial Statements of the Company have been prepared in compliance with
United Kingdom Accounting Standards, including FRS 102 and the Companies Act
2006.
(b) Principal accounting policies
(i) Financial instruments
Financial instruments include fixed asset investments and derivative assets
and liabilities.
Accounting standards recognise a hierarchy of fair value measurements for
financial instruments which gives the highest priority to unadjusted quoted
prices in active markets for identical assets or liabilities (level 1) and the
lowest priority to unobservable inputs (level 3). The classification of
financial instruments depends on the lowest significant applicable input, as
follows:
Level 1 - Unadjusted, fully accessible and current quoted prices in active
markets for identical assets or liabilities. Included within this category are
investments listed on any recognised stock exchange.
Level 2 - Quoted prices for similar assets or liabilities, or other directly
or indirectly observable inputs which exist for the duration of the period of
investment. Examples of such instruments would be those for which the quoted
price has been recently suspended, forward exchange contracts and certain
other derivative instruments.
Level 3 - External inputs are unobservable.
Value is the Directors' best estimate, based on advice from relevant
knowledgeable experts, use of recognised valuation techniques and on
assumptions as to what inputs other market participants would apply in pricing
the same or similar instruments. Included within this category are unquoted
investments.
(ii) Fixed asset investments
As an investment trust, the Company measures its fixed asset investments at
"fair value through profit or loss" and treats all transactions on the
realisation and revaluation of investments as transactions on the capital
account. Purchases are recognised on the relevant trade date, inclusive of
expenses which are incidental to their acquisition. Sales are also recognised
on the trade date, after deducting expenses incidental to the sales.
Quoted investments are valued at bid value at the close of business on the
relevant date on the exchange on which the investment is quoted.
(iii) Foreign currency
Monetary assets, monetary liabilities and equity investments denominated in a
foreign currency are expressed in sterling at rates of exchange ruling at the
Statement of Financial Position date. Purchases and sales of investment
securities, dividend income, interest income and expenses are translated at
the rates of exchange prevailing at the respective dates of such transactions.
Foreign exchange profits and losses on fixed asset investments are included
within the changes in fair value in the capital account. Foreign exchange
profits and losses on other currency balances are separately credited or
charged to the capital account except where they relate to revenue items when
they are credited or charged to the revenue account.
(iv) Income
Income from equity shares is brought into the revenue account (except where,
in the opinion of the Directors, its nature indicates it should be recognised
within the capital account) on the ex-dividend date or, where no ex-dividend
date is quoted, when the Company's right to receive payment is established.
Dividends from overseas companies are shown gross of withholding tax.
Where the Company has elected to receive its dividends in the form of
additional shares rather than in cash (scrip dividends), the amount of the
cash dividend foregone is recognised as income. Any excess in the value of the
shares received over the amount of the cash dividend foregone is recognised in
the capital account.
Deposit interest income and interest from cash equivalents is accounted for on
an accruals basis and recognised in the period the interest is earned.
(v) Expenses, including finance charges
Expenses are charged to the revenue account of the Income Statement, except as
noted below:
- expenses incidental to the or disposal of fixed asset
investments are included within the cost of the investments or deducted from
the disposal proceeds of investments and are thus charged to the capital
element of retained earnings - arising on investments sold via the capital
account;
and
- all expenses are accounted for on an accruals basis. Finance
charges are accrued using the effective interest rate method.
(vi) Taxation
Withholding tax deducted at source from income received is treated as part of
the taxation charge in the income account, in instances where it cannot be
recovered.
Deferred tax is provided in accordance with FRS 102, on an undiscounted basis,
on all timing differences that have originated but not reversed by the
Statement of Financial Position date, based on the tax rates that are expected
to apply in the period when the liability is settled or the asset realised.
Deferred tax assets are only recognised if it is considered more likely than
not that there will be suitable profits from which the future reversal of
timing differences can be deducted. In line with the recommendations of the
SORP, the allocation method used to calculate the tax relief on expenses
charged to capital is the "marginal" basis. Under this basis, if taxable
income is capable of being offset entirely by expenses charged through the
revenue account, then no tax relief is transferred to the capital account.
(vii) Capital redemption reserve
The nominal value of Ordinary share capital purchased and cancelled is
transferred out of called-up share capital and into the capital redemption
reserve.
Capital redemption reserve is not available for the payment of dividends.
(viii) Retained earnings
This consists of the following:
Capital return
The following are accounted for in this reserve:
· gains and losses on the realisation of fixed asset
investments;
· increases and decreases in the valuation of fixed asset
investments held at the year end;
· realised and unrealised foreign exchange differences of a
capital nature;
· tax charges associated with transactions of a capital nature;
· costs of professional advice, including related irrecoverable
VAT, relating to the capital structure of the Company;
· other capital charges and credits charged or credited to this
account in accordance with the above policies; and
· the costs of purchasing Ordinary share capital.
Revenue return
· the income return or loss for the year is taken to the income
element of this reserve.
This element of the retained earnings reserve may be used to fund the
distribution of profits to investors via dividend payments only when this is
in a surplus position. Currently there is an accumulated loss and therefore no
distributions can be paid.
(ix) Borrowing and finance costs
Interest-bearing bank loans and overdrafts are recorded at the proceeds
received, net of direct issue costs and subsequently measured at amortised
cost. Finance charges, including premiums payable on settlement or redemption
and direct issue costs, are accounted for on an accruals basis in the Income
Statement using the effective interest method and are added to the carrying
amount of the instrument to the extent that they are not settled in the period
in which they arise.
Finance costs are recognised in the Income Statement in the period in which
they are incurred. All finance costs are directly charged to the revenue
column of the Income Account.
(x) Cash and cash equivalents
Cash and cash equivalents comprise cash on hand, demand deposits and short
term highly liquid investment that are readily convertible to known amounts of
cash and are subject to an insignificant risk of changes in value.
Recognition - cash and cash equivalents are recognised at the time funds are
received into the company bank accounts, settlement accounts, or custodial
accounts. Similarly, withdrawals or transfers are recognised when payments are
initiated or cleared.
Measurement - Cash and cash equivalents are measured at amortised cost, which
approximates fair value due to their short- term nature. Cash and cash
equivalents typically include balances with banks and custodians, including
current accounts and overnight deposits, short term investments, margin cash
balances held with brokers and demand deposits.
(xi) Securities sold awaiting settlement
Securities sold awaiting settlement represent proceeds due from the sale of
investments which have been contracted for but not yet settled as at the
reporting date.
Under FRS 102, these balances are recognised when the contractual obligation
for the sale has been established (i.e. trade date accounting is applied), and
are measured initially at fair value, which is typically the transaction
price.
Receivables arising from securities sold are presented within current assets
on the Statement of Financial Position.
(c) Significant accounting judgements, estimates and assumptions
The preparation of the Company's Financial Statements on occasion requires
management to make judgements, estimates and assumptions that affect the
reported amounts in the primary financial statements and the accompanying
disclosures. These assumptions and estimates could result in outcomes that
require a material adjustment to the carrying amount of assets or liabilities
affected in the current and future periods, depending on circumstance.
Management do not believe that any significant accounting judgements have been
applied to these Financial Statements other than the allocations between
capital and revenue shown in Notes 4 and 5.
3. INCOME
Investment Income 2025 2024
£'000
£'000
Dividends from United Kingdom companies 50 45
Dividends from overseas companies 912 973
----------------- -----------------
962 1,018
========= =========
Other income
Deposit interest 51 180
Interest from liquidity fund (cash equivalents) 174 -
----------------- -----------------
225 180
----------------- -----------------
Total income 1,187 1,198
========= =========
4. MANAGEMENT FEE
2025 2024
Revenue Capital Revenue Capital
Return
Return
Total
Return
Return
Total
£'000
£'000
£'000
£'000
£'000
£'000
Management fee 1,152 - 1,152 1,222 - 1,222
--------------- --------------- --------------- --------------- --------------- ---------------
1,152 - 1,152 1,222 - 1,222
========= ========= ========= ========= ========= =========
Details of the calculation of the management fee are given in Note 16.
5. OTHER EXPENSES
2025 2024
Revenue Capital Revenue Capital
Return
Return
Total
Return
Return
Total
£'000
£'000
£'000
£'000
£'000
£'000
Directors' remuneration 147 - 147 160 - 160
Auditor's remuneration - audit of the Company Financial Statements 56 - 56 53 - 53
Other expenses 402 3 405 365 2 367
--------------- --------------- --------------- --------------- --------------- ---------------
605 3 608 578 2 580
========= ========= ========= ========= ========= =========
6. TAXATION
(a) Analysis of tax charge in the year
2025 2024
Revenue Capital Revenue Capital
Return
Return
Total
Return
Return
Total
£'000
£'000
£'000
£'000
£'000
£'000
Overseas tax charge relating to the current year 132 - 132 126 - 126
--------------- --------------- --------------- --------------- --------------- ---------------
Total tax (see Note 6b) 132 - 132 126 - 126
========= ========= ========= ========= ========= =========
(b) Factors affecting current tax charge for the year
The tax assessed for the year is higher than (2024: lower) the Company's
applicable rate of corporation tax of 25% (2024: 25%). The differences are
explained below:
2025 2024
Revenue Capital Revenue Capital
Return
Return
Total
Return
Return
Total
£'000
£'000
£'000
£'000
£'000
£'000
Net (loss)/return before taxation (570) (6,061) (6,631) (602) 5,324 4,722
Corporation tax at 25.00% (2024: 25.00%) (142) (1,515) (1,657) (151) 1,331 1,180
---------------- ---------------- ---------------- ---------------- ---------------- ----------------
Effects of:
Tax free gain/(loss) on investments - 1,514 1,514 - (1,332) (1,332)
Non-taxable income received (222) - (222) (234) - (234)
Capital expenses deductible for tax purposes - 1 1 - 1 1
Overseas tax relating to the current year 132 - 132 126 - 126
Double taxation relief expensed (3) - (3) - - -
Unutilised management expenses for the year 367 - 367 385 - 385
---------------- ---------------- ---------------- ---------------- ---------------- ----------------
Total tax charge for the year 132 - 132 126 - 126
========= ========= ========= ========= ========= =========
Due to the Company's status as an investment trust and the intention to
continue meeting the conditions required to obtain approval in the foreseeable
future, the Company has not provided deferred tax on any capital gains and
losses arising on the revaluation or disposal of investments.
There is an unrecognised deferred tax asset of £6,210,000 (2024: £5,841,000)
which relates to unutilised excess expenses. The deferred tax asset would only
be recovered if the Company were to generate sufficient profits to utilise
these expenses. It is considered too uncertain that this will occur and
therefore, no deferred tax asset has been recognised.
7. NET (LOSS)/RETURN PER ORDINARY SHARE
The return per Ordinary share figure is based on the net loss for the year of
£6,762,857 (2024: Profit £4,596,536), and on 11,728,907 (2024: 11,918,279)
Ordinary shares, being the weighted average number of Ordinary shares in issue
during the year.
The return per Ordinary share figure detailed above can be further analysed
between revenue and capital, as below.
2025 2024
£'000
£'000
Net revenue loss (702) (728)
Net capital (loss)/return (6,061) 5,324
--------------- ---------------
Net total (loss)/return (6,763) 4,596
========= =========
Weighted average number of Ordinary shares in issue during the year 11,728,907 11,918,279
Revenue loss per Ordinary share (5.99)p (6.11)p
Capital (loss)/return per Ordinary share (51.67)p 44.68p
--------------- ---------------
Total (loss)/return per Ordinary share (57.66)p 38.57p
========= =========
8. Investments held as at fair value through profit or loss
(a) Portfolio investments
2025 2024
£'000
£'000
Valuation at beginning of year 165,925 159,134
Investment holding (losses)/gains at beginning of year (5,983) 2,809
--------------- ---------------
Cost at beginning of year 159,942 161,943
======== ========
Purchases at cost 56,864 42,780
Sales at cost (63,504) (44,781)
Cost at end of year 153,302 159,942
Investment holding gains at end of year 2,138 5,983
--------------- ---------------
Valuation at end of year 155,440 165,925
======== ========
Investments listed overseas included above 155,440 165,925
(b) (Losses)/gains on investments
2025 2024
£'000
£'000
Net losses on sale of investments (1,333) (3,401)
Movement in investment holding (losses)/gains (3,845) 8,792
--------------- ---------------
(Losses)/gains on investments (5,178) 5,391
========= =========
9. Transaction costs
During the year expenses were incurred in acquiring or disposing of
investments classified as fair value through profit or loss. These have been
expensed through capital and are included within losses (2024: gains) on
investments in the Income Statement. The total costs were as follows:
2025 2024
£'000
£'000
Purchases 49 32
Sales 33 34
--------------- ---------------
Total 82 66
========= =========
10. Debtors
2025 2024
£'000
£'000
Prepayments and accrued income 26 22
Dividends receivable 79 57
Securities sold awaiting settlement 350 -
--------------- ---------------
455 79
========= =========
11. Cash and cash equivalents
2025 2024
£'000
£'000
Cash at bank and in hand 1,133 9,722
Cash equivalents 6,837 -
--------------- ---------------
7,970 9,722
========= =========
Cash equivalents comprise liquidity holdings in the Blackrock ICS US Treasury
Open-Ended Fund and in the GSLN LQ TR US Open-end fund.
12. Creditors: amounts falling due within one year
2025 2024
£'000
£'000
Management fee 262 303
Other creditors and accruals 204 123
Purchases awaiting settlement - 756
--------------- ---------------
466 1,182
========= =========
13. FINANCIAL INSTRUMENTS
Background
The Company's financial instruments comprise securities and other investments,
cash balances and term loans, debtors and creditors that arise directly from
its operations, for example, in respect of sales and purchases of investments
awaiting settlement and debtors for accrued income. The numerical disclosures
below exclude short-term debtors and creditors which are denominated in
sterling and do not incur interest and therefore are not subject to foreign
currency risk or interest rate risk.
The principal risks the Company faces in its portfolio management activities
are:
· foreign currency risk
· market price risk
· interest rate risk
· liquidity risk
· credit and counterparty risk
The Portfolio Manager's policies for managing these risks are summarised below
and have been applied throughout the year.
(a) Foreign currency risk
A substantial portion of the financial assets of the Company are denominated
in US Dollars with the result that the Statement of Financial Position and
Income Statement can be significantly affected by currency movements.
The Company normally takes account of this risk when making investment
decisions although it could hedge against foreign currency movements affecting
the value of the investment portfolio where adverse movements are anticipated.
Foreign currency sensitivity
The principal currency to which the Company was exposed during the year was
the US Dollar as all investments are quoted in that currency. The exchange
rates applying against sterling at 30 June and the average rates during the
year ended 30 June were as follows:
2025 2024
At Average At Average
30 June
for the year
30 June
for the year
US Dollar 1.3704 1.2943 1.2641 1.2594
--------------- --------------- --------------- ---------------
1.3704 1.2943 1.2641 1.2594
========= ========= ========= =========
The following tables illustrate the sensitivity of the profit after tax for
the year and net assets to exchange rates for sterling against the US Dollar.
It assumes the following changes in exchange rates:
£/US Dollar +/- 5% (2024: +/- 5%)
These percentages have been determined based on market volatility in exchange
rates over the previous twelve months. The sensitivity analysis is based on
the company's foreign currency financial instruments held at the date of each
Statement of Financial Position.
If sterling had weakened by 5% (2024: 5%) against the currencies this would
have had the following effect on revenue, capital, total return and,
accordingly, net assets:
2025 2024
Impact on Impact on Total Impact on Impact on Total
revenue
capital
£'000
revenue
capital
£'000
return
return
return
return
£'000
£'000
£'000
£'000
US Dollar (51) 7,772 7,721 (58) 8,296 8,238
--------------- --------------- --------------- --------------- --------------- ---------------
(51) 7,772 7,721 (58) 8,296 8,238
========= ========= ========= ========= ========= =========
If sterling had strengthened by 5% (2024: 5%) against the currencies below
this would have had the following effect:
2025 2024
Impact on Impact on Total Impact on Impact on Total
revenue
capital
£'000
revenue
capital
£'000
return
return
return
return
£'000
£'000
£'000
£'000
US Dollar 51 (7,772) (7,721) 58 (8,296) (8,238)
--------------- --------------- --------------- --------------- --------------- ---------------
51 (7,772) (7,721) 58 (8,296) (8,238)
========= ========= ========= ========= ========= =========
(b) Market price risk
By the very nature of its activities, the Company's investments are exposed to
market price fluctuations.
The board reviews and agrees policies for managing this risk. The investment
adviser assesses the exposure to market price risk when making each investment
decision, and monitors the overall level of market price risk on the whole of
the investment portfolio on an ongoing basis. Further information on the
investment portfolio and investment policy is set out in the Portfolio
Manager's Review within the Annual report.
Other price risk sensitivity
The following illustrates the sensitivity of the profit after taxation for the
year and the total equity to an increase or decrease of 20% (2024: 20%) in the
fair value of the Company's equities. This level of change is considered to be
reasonably possible based on observation of market conditions during the year.
The sensitivity analysis is based on the Company's equities at each reporting
date, with all other variables held constant.
The impact of a 20% increase in the value of investments on the revenue loss
for the year to 30 June 2025 is a decrease of £202,000 (2024: £232,000) and
on the capital return is an increase of £31,088,000 (2024: £33,185,000).
The impact of a 20% fall in the value of investments on the revenue loss for
the year to 30 June 2025 is an increase of £202,000 (2024: £232,000) and on
the capital return is a decrease of £31,088,000 (2024: £33,185,000).
(c) Interest rate risk
Interest rate movements may affect:
· the fair value of investments of fixed interest securities,
· the level of income receivable from any floating
interest-bearing securities and cash at bank and on deposit, and
· the interest payable on floating interest term loans.
The financial assets (excluding short-term debtors) consist of:
2025 2024
Cash flow No Total Cash flow No Total
interest
interest
£'000
interest
interest
£'000
rate risk
rate risk
rate risk
rate risk
£'000
£'000
£'000
£'000
GBP 1,287 - 1,287 2,853 - 2,853
US Dollar 6,683 - 6,683 6,869 - 6,869
--------------- --------------- --------------- --------------- --------------- ---------------
7,970 - 7,970 9,722 - 9,722
========= ========= ========= ========= ========= =========
The floating interest rate risk assets consist of cash deposits at call.
The financial liabilities consist of:
2025 2024
Fixed rate Non-interest Total Fixed rate Non-interest Total
£'000
bearing
£'000
£'000
bearing
£'000
£'000
£'000
US Dollar - 466 466 - 426 426
GBP - - - - 756 756
--------------- --------------- --------------- --------------- --------------- ---------------
- 466 466 - 1,182 1,182
========= ========= ========= ========= ========= =========
(d) Liquidity risk
Liquidity risk is not considered significant. All liabilities are payable
within three months. The Company's assets comprise mainly readily realisable
securities which can be sold to meet funding requirements if necessary.
(e) Credit and counterparty risk
Credit risk is the exposure to loss from the failure of a counterparty to
deliver securities or cash for acquisitions or disposals of investments or to
repay deposits. The Company manages credit risk by using brokers from a
database of approved brokers who have undergone due diligence tests by the
Portfolio Manager's Best Execution Committee and by dealing through JPMCB with
banks authorised by the Financial Conduct Authority. Any derivative positions
are marked to market and exposure to counterparties is monitored on a daily
basis by the Portfolio Manager; the Board reviews it on a quarterly basis. The
maximum exposure to credit risk at 30 June 2025 was £8,425,000 (2024:
£9,801,000).
The calculation is based on the Company's credit exposure as at 30 June 2025
and may not be representative of the year as a whole.
(f) Fair value of financial assets and financial liabilities
The financial assets and financial liabilities are carried in the Statement of
Financial Position at their fair value or the statement amount is a reasonable
approximation of fair value (due from brokers, dividends and interest
receivable, due to brokers, accruals and cash at bank).
Fair Value hierarchy
FRS102 - section 34.22 on Financial Instruments requires financial
institutions, such as investment trusts, to classify fair value measurements
using fair value hierarchy that reflects the significance of the inputs used
in making the measurements. The fair value hierarchy shall have the following
levels:
Level 1 reflects financial instruments quoted in an active market.
Level 2 reflects financial instruments whose fair value is evidenced by
comparison with other observable current market transactions in the same
instrument or based on a valuation technique whose variables includes only
data from observable markets.
Level 3 reflects financial instruments whose fair value is determined in whole
or in part using a valuation technique based on assumptions that are not
supported by prices from observable market transactions in the instrument and
not based on available observable market data. The financial assets measured
at fair value in the Statement of Financial Position are grouped into the fair
value hierarchy as follows:
2025 2024
Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total
£'000
£'000
£'000
£'000
£'000
£'000
£'000
£'000
Investments 155,440 - - 155,440 165,925 - - 165,925
========= ========= ========= ========= ========= ========= ========= =========
(g) Use of derivatives
In order to enhance returns, the Company may take short positions (using
contracts for difference) in respect of a small number of larger capital
securities. There were no derivative positions held at the year end (2024:
nil).
14. PAID-UP SHARE CAPITAL
2025 2024
Number £'000 Number £'000
Ordinary shares of 25p each
Balance brought forward 11,862,159 2,964 11,952,159 2,987
Ordinary shares repurchased into treasury (328,372) (82) (90,000) (23)
--------------- --------------- --------------- ---------------
Closing balance of Ordinary shares 11,533,787 2,882 11,862,159 2,964
========= ========= ========= =========
Treasury shares
Balance brought forward 6,361,254 1,591 6,271,254 1,568
Repurchase of Ordinary shares into treasury 328,372 82 90,000 23
--------------- --------------- --------------- ---------------
Closing balance of Ordinary shares held in treasury 6,689,626 1,673 6,361,254 1,591
========= ========= ========= =========
Total 4,555 4,555
========= =========
328,372 shares were bought back in the year for holding in treasury (2024:
90,000) for a total consideration of £4.38m (2024: £1.20m). 6,689,626 shares
were held in Treasury during the year (2024: 6,361,254). Therefore the Company
has bought back 2.8% of its shares in the year (2024: 0.8%).
Since the year end, 82,762 further shares were bought back for holding in
treasury.
The reasons for the repurchases of the Company's shares are provided in the
Chairman's Statement within the Annual Report.
15. NET ASSET VALUE PER ORDINARY SHARE
The net asset value per Ordinary share is based on the net assets attributable
to the equity shareholders of £163,399,000 (2024: £174,544,000) and on
11,533,787 (2024: 11,862,159) Ordinary shares, being the number of Ordinary
shares in issue at the year end.
16. RELATED PARTIES AND TRANSACTIONS WITH THE PORTFOLIO MANAGER AND THE AIFM
Directors
There are no transactions with the Directors other than aggregated
remuneration for services as Directors as disclosed in the Directors'
Remuneration Report within the Annual Report and as set out in Note 5 to the
Financial Statements and the beneficial interests of the Directors in the
Ordinary shares of the company as disclosed within the Annual report.
Transactions with the Portfolio Manager and the AIFM
FundRock Partners Limited (FundRock) has been appointed as AIFM to the Company
pursuant to an Alternative Investment Fund Management Agreement between
FundRock and the Company. FundRock has also been appointed to provide company
secretarial services to the Company.
Brown Advisory has been appointed to provide portfolio management services
pursuant to a Portfolio Management Agreement between the Company, FundRock and
Brown Advisory.
Up until 31 December 2024 the management fee has been calculated at an annual
rate of 0.7% on the first £200 million; 0.6% of the next £300 million; and
0.5% thereafter of the Company's adjusted net assets.
With effect from 1 January 2025, the revised management fee has been
calculated at an annual rate of 0.65% on the first £200 million; 0.6% of the
next £300 million; and 0.5% thereafter of the Company's adjusted net assets.
The management fee is payable by the Company to FundRock, who shall deduct
from the management fee the amounts due to it as AIFM and for company
secretarial services and shall pay the balance to Brown Advisory.
The management fee is calculated and payable on a quarterly basis.
The management fee payable to FundRock for the period from 1 July 2024 to 30
June 2025 was £1,152,000 (payable to FundRock for the period from 1 July 2023
to 30 June 2024: £1,222,000) with £262,000 outstanding as at 30 June 2025
(2024: £303,000).
The appointment of Brown Advisory and FundRock may be terminated by not less
than six months' notice.
17. CONTINGENT LIABILITIES AND CAPITAL COMMITMENTS
There were no contingent liabilities or capital commitments outstanding at 30
June 2025 (2024: nil).
18. Annual results
This Annual Results announcement does not constitute the Company's statutory
accounts for the years ended 30 June 2024 and 30 June 2025 but is derived from
those accounts. Statutory accounts for the year ended 30 June 2024 have been
delivered to the Registrar of Companies. The statutory accounts for the year
ended 30 June 2024 and the year ended 30 June 2025 both received an audit
report which was unqualified and did not include a reference to any matters to
which the auditor drew attention by way of emphasis without qualifying the
report and did not include statements under Section 498 of the Companies Act
2006 respectively. The statutory accounts for the year ended 30 June 2025 will
be delivered to the Registrar of Companies.
19. Other information
The Annual General Meeting of the Company will be held on 10 November 2025.
A copy of the Annual Report & Accounts for the year ended 30 June 2025
will shortly be submitted to the National Storage Mechanism and will be
available for inspection at
https://data.fca.org.uk/#/nsm/nationalstoragemechanism
The Annual Report & Accounts will also be available for download from the
Company's website www.brownadvisory.com/basc
Enquiries:
FundRock Partners Limited, Company Secretary
ukfundscosec@apexgroup.com
Neither the contents of the Company's website nor the contents of any website
accessible from hyperlinks on this announcement (or any other website) is
incorporated into, or forms part of, this announcement.
END
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