REG - City of London IT - Annual Financial Report
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RNS Number : 5960Z City of London Investment Trust PLC 17 September 2025
Legal Entity Identifier: 213800F3NOTF47H6AO55
THE CITY OF LONDON INVESTMENT TRUST PLC
("the Company" or "City of London")
Annual financial results for the year ended 30 June 2025
This announcement contains regulated information
CHAIRMAN'S COMMENT
"City of London's net asset value total return of 16.8% outperformed the FTSE
All-Share Index return of 11.2%. The dividend was increased for the 59(th)
consecutive year and fully covered by earnings per share."
INVESTMENT OBJECTIVE
The Company's objective is to provide long-term growth in income and capital,
principally by investment in equities listed on the London Stock Exchange. The
Board fully recognises the importance of dividend income to shareholders.
PERFORMANCE AT 30 JUNE
2025 2024
Total Return Performance:
Net asset value ("NAV") per ordinary share(1, 5) 16.8% 15.6%
Share price(2, 5) 21.8% 11.3%
FTSE All-Share Index (Benchmark) 11.2% 13.0%
AIC UK Equity Income sector(3) 12.6% 12.6%
IA UK Equity Income OEIC sector 10.5% 14.6%
2025 2024
NAV per ordinary share(5) 472.5p 424.3p
NAV per ordinary share (debt at fair value)(5) 478.1p 429.6p
Share price 487.5p 420.0p
Premium/(discount)(5) 3.2% (1.0)%
Premium/(discount) (debt at fair value)(5) 2.0% (2.2)%
Gearing at year end(5) 5.3% 7.1%
Revenue earnings per share 21.6p 20.9p
Dividends per share 21.3p 20.6p
Ongoing charge for the year(4, 5) 0.36% 0.37%
Revenue reserve per share(,5) 9.9p 9.4p
1 NAV per ordinary share total return with debt at fair value (including
dividends reinvested)
2 Share price total return using mid-market closing price
3 Association of Investment Companies ("AIC") UK Equity Income sector
size-weighted average NAV total return (shareholders' funds)
4 Calculated using the methodology prescribed by the AIC
5 See alternative performance measures in the Annual Report
A glossary of terms and explanations of alternative performance measures are
included in the Annual Report.
Sources: Morningstar Direct, Janus Henderson, LSEG Datastream
DIVIDEND YIELDS AT 30 JUNE
2025 2024
City of London 4.4 4.9
FTSE All-Share Index (Benchmark) 3.5 3.7
AIC UK Equity Income sector 4.1 4.2
IA UK Equity Income OEIC sector 4.1 4.3
CHAIRMAN'S STATEMENT
City of London produced a net asset value ("NAV") total return of 16.8%,
outperforming the FTSE All-Share Index total return of 11.2%. City of London's
NAV total return has exceeded the FTSE All-Share Index over 1, 3, 5 and 10
years. The dividend was increased for the 59(th) consecutive year and fully
covered by earnings per share.
The Markets
The inauguration of Donald Trump as President of the USA for a second term in
January 2025 has had a significant impact on markets. One of his key election
campaign pledges was to increase tariffs substantially in order to return
manufacturing industry to the US and to raise revenue for the government.
During the following months, world equity markets reacted to a series of
announcements imposing tariffs at varying levels on particular countries
depending on the state of negotiation of specific trade agreements. This made
economic data, including forecasts, difficult to interpret, with evidence of
some stockpiling of goods ahead of tariffs taking effect. The US dollar was
notably weak, reflecting the consequent policy uncertainty. Despite these
upheavals, the strongest area of US growth continued to be in artificial
intelligence and data centres, with a positive effect on the value of a small
number of very large US technology companies.
Another of Mr Trump's policies was to encourage allies to pay more for their
defence. There was a step change in Europe, with the UK, Germany and some
other European countries announcing plans to increase significantly their
defence spending.
Concerns over increasing government borrowing caused markets to take a
cautious view of the prospects for interest rates, particularly in the USA and
the UK where 10-year government bond yields gave up earlier declines. The
European Central Bank was more aggressive than the US Federal Reserve and the
Bank of England in cutting lending rates.
In the UK, the new Labour government's first Budget, which significantly
increased public spending, had a negative effect on sentiment in the private
sector. The rise in the Employer's National Insurance tax rate hit hard those
companies with large labour costs, such as in the hospitality sector. The
combination of increasing energy and food prices, together with wage cost
pressure, led to UK CPI inflation rising above 3% again in April 2025. Over
the 12 months to 30 June 2025, the Bank of England responded to the weakness
in economic growth by cutting its base rate to 4.25% through four cuts of 25
basis points.
The UK stock market benefited from a return to confidence in the UK banks,
which delivered good profit and dividend growth. Life insurance had a good
year, as did the tobacco industry where profits were more resilient than in
most other consumer staples sectors. Takeovers of UK companies by overseas
companies and private equity firms continued at a pace, demonstrating the
value in the UK equity market.
Performance
Earnings and Dividends
City of London's earnings per share increased by 3.4% to 21.6p. The growth in
dividends from the banks sector was the most important positive contributor
for the second year in a row. Special dividends accounted as revenue amounted
to £0.6 million, down from £1.0 million the previous year and reflecting the
corporate trend for effecting shareholder distributions through share buybacks
rather than dividend payments.
City of London's annual dividend grew by 3.4% to 21.3p, marginally behind UK
CPI inflation of 3.6%. Over ten years, City of London's dividend has grown by
39.2%, slightly ahead of UK CPI inflation of 38.6%. This has been achieved
during a difficult period for real dividend growth, which has included both
the widespread cuts during the Covid pandemic and a period when, mainly
because of rising energy costs, the annual rate of inflation exceeded 10%.
Over 20 years, City of London's dividend has risen by 147.1%, compared to UK
CPI inflation of 77.7%. The Board understands the importance of growing the
dividend in real terms through the economic cycle and over the long term.
Expenses remained under tight control, with City of London's ongoing charge
ratio, which declined from 0.37% to 0.36%, remaining very competitive compared
with other actively managed funds. The reduction in the management fee rate
from 0.325% to 0.300%, which the Board agreed with the Company's Manager,
Janus Henderson, took effect from 1 January 2024 and had a positive effect on
the ongoing charge ratio over the 12 months to 30 June 2025.
The revenue reserve increased by £2.1 million to £48.7 million with revenue
reserves per share rising by 5.3% to 9.9p. The Board is firmly of the view
that dividend payments should, other than in very exceptional circumstances,
be covered by revenue alone and not be supplemented by distribution from
realised capital profits. Whilst the Company's capital reserves arising from
gains on investments sold (which rose by £52.1 million and £398.4 million)
could help fund dividend payments, the Board considers that a healthy revenue
reserve surplus provides an important underpinning for dividend payments drawn
from earnings alone. Revenue reserves can be particularly useful given the
varied timing of dividend receipts throughout the year from investee
companies. They also provide a facility to cover dividend payments to
shareholders at a time of sudden dividend cuts and surprises, such as occurred
during the Covid pandemic.
NAV Total Return
City of London's NAV total return of 16.8% was 5.6% ahead of the FTSE
All-Share Index. Gearing, which contributed positively by 0.4%, was financed
mainly by secured debt. The £30 million 2.67% secured notes (maturing in
2046) and the £50 million 2.94% secured notes (maturing in 2049) will provide
low-cost debt financing over the next quarter of a century for investment in
equities.
Stock selection contributed by 5.5%. The biggest stock contributor relative to
the FTSE All-Share Index was AstraZeneca, the pharmaceutical company, despite
the portfolio being underweight compared with the index. The second biggest
contributor was NatWest, the banking group, followed by Imperial Brands, the
tobacco company. The biggest detractor to relative performance was not owning
Rolls Royce, the aero engine manufacturer. The second biggest detractor was
Merck, the US-listed pharmaceutical company, followed by not owning Standard
Chartered, the bank. Overall, we benefited from overweight positions in the
banks, financial services and life insurance sectors. More detail on our
investment performance can be found in our Fund Managers' Report.
As mentioned in the introduction, City of London's NAV total return was ahead
of the FTSE All-Share Index over 1, 3, 5 and 10 years. City of London was also
ahead of the AIC UK Equity Income and IA UK Equity Income OEIC sector averages
over 1, 3, 5 and 10 years.
Share Issues and Buybacks
During the first half of the year, City of London's share price traded close
to its net asset value, except briefly in July 2024 when 28,278 shares were
bought back into treasury at a small discount, costing £119,000. From the
start of 2025 until 11 April, 2.5 million shares, costing £11.0 million, were
bought back at a small discount, to be held in treasury. Since 11 April 2025
to 30 June 2025, 1.7 million shares, raising proceeds of £7.9 million, have
been sold from treasury at a small premium. Since 1 July 2025 to 12 September
2025, with the share price continuing to trade at a premium to NAV, a further
1,950,000 shares have been sold from treasury for total proceeds of £9.8
million.
The Board's policy, subject to prevailing market conditions, is for the
Company's share price to reflect closely its underlying NAV while smoothing
volatility and encouraging a liquid market in the shares. The ability to do
this is underpinned by the liquidity of the Company's portfolio, all of which
is listed and readily marketable, in contrast to the position of some other
investment trusts. The Board's adherence to a policy of issuing shares at a
premium and buying back at a discount over the last 15 years has enhanced NAV
and, of particular note, kept the prevailing premium and discount to NAV
within narrow bands rarely exceeding 3%.
Environmental, Social and Governance
The Fund Manager and Deputy Fund Manager, supported by specialists at Janus
Henderson, give careful consideration to environmental, social and governance
("ESG") related risks and opportunities when selecting stocks for the
portfolio. The Board recognises that these risks are highly relevant to the
long-term performance of City of London and of increasing interest to
shareholders and commentators. An analysis by MSCI, a company widely used in
the review of ESG factors, shows that City of London's portfolio as at 30 June
2025 had a lower weighted score for ESG risks than the FTSE All-Share Index.
ESG related issues receive careful consideration at each Board meeting,
including how shareholdings have been voted at investee company meetings.
Further details on how the Fund Managers take ESG consideration into account
in their investment decision-making process are provided in the Annual Report.
Annual General Meeting
The 2025 Annual General Meeting ("AGM") will be held at the offices of Janus
Henderson, 201 Bishopsgate, London EC2M 3AE on Thursday, 30 October at 1.00pm.
The meeting will include a presentation by our Fund Manager, Job Curtis, and
Deputy Fund Manager, David Smith. Any shareholder who is unable to travel is
encouraged to join virtually by Zoom, the conference software provider. We
therefore request all shareholders and particularly those who cannot attend
physically, to submit their votes by proxy to ensure their vote counts at the
AGM.
Outlook
The tariffs imposed by the Trump administration mark a seismic break from the
post Second World War international trading system. They are likely to raise
the costs of imported goods for US consumers and reduce demand for exporters
to the USA. The UK, whose economy is predominantly services based, is less
exposed to these tariffs than most other countries, particularly after
reaching a trade agreement for a relatively low, general tariff of 10% with
the US government.
The economic outlook for the UK has become more uncertain, with business
confidence dented by the government's imposition of higher payroll taxes, more
restrictive labour regulations and the continuing threat of further tax rises
in the Autumn Budget targeted at investors and entrepreneurs. The
deterioration in the overall UK government fiscal position remains a concern,
particularly the implications for interest rates as the associated government
debt issues are absorbed by international bond markets. With inflation having
increased above 3%, significantly in excess of its 2% target, the Bank of
England faces a difficult choice on further cutting interest rates following
the 25-basis point cut in August 2025 to 4%. There is a high risk that
inflation becomes persistent as expectations for pay increases, particularly
in the public sector, remain elevated.
City of London is significantly shielded from the fortunes of the UK domestic
economy given that the revenues of many UK-listed investee companies in its
portfolio are predominantly from overseas. It can reasonably be claimed that
UK-listed shares "offer global growth at a discount", given their attractive
share price valuations compared with similar overseas companies. It can also
be expected that the flow of takeovers for UK companies will continue, given
this relative valuation discount and the open system for corporate control on
the London stock market.
Many UK-listed companies are buying back their own shares, enhancing earnings
per share for remaining shareholders. Some companies in which City of London
has a large shareholding, such as Shell and Imperial Brands, have bought back
shares and, given the resulting lower number of shares in issue, grown their
dividends at a reduced total cost. The Board remains confident that the
companies in City of London's portfolio can help to achieve its objective of
long-term growth in capital and income.
Sir Laurie Magnus CBE
Chairman
16 September 2025
FUND MANAGERS' REPORT
Investment Background
The UK equity market, as measured by the FTSE All-Share Index, produced a
total return of 11.2% over the 12 months. In July 2024, Labour returned to
government after 14 years in opposition. The Budget in October raised public
spending and increased the Employer's National Insurance tax rate. In the US,
Donald Trump won the presidential election, returning to the White House, in
January 2025, after a gap of four years. In early April, the new US
administration announced tariffs against its trading partners, which triggered
a brief correction in equity markets across the world. Stocks quickly
rebounded as Washington announced a partial suspension of some of these
levies. In May, the US and UK agreed a trade deal, with a 10% tariff for most
British products.
During the 12 months, the Bank of England made four 25 basis point cuts in the
base rate, taking it from 5.25% to 4.25%. CPI inflation rose above 3% in the
first half of 2025, in response to wage cost pressure and rising utility and
food prices. UK economic growth was weak, except for an uptick in the first
quarter of 2025, when there was increased factory production ahead of the
tariff announcements. The 10-year gilt yield rose from 4.2% to 4.5% over the
12 months reflecting the move in inflation to above 3% and concerns about the
sustainability of the UK's budget deficit. The dividend yield of the FTSE
All-Share Index was 3.5% at the end of June 2025, below the 10-year gilt yield
and base rate, but with equities offering the prospect of dividend growth.
In 2017 and 2021, low interest rates were exceptionally low, the Company was
able to fix cheap rates of borrowing for long periods using the following
secured notes: £30 million 2.67% and £50 million 2.94% 2049. In addition,
there is also one secured note with four years until maturity: £35 million
4.53% 2029. These borrowings remained invested in equities throughout the
year. The HSBC borrowing facility, which is priced off the base rate, was used
opportunistically. £41 million was drawn down at the start of the 12-month
period, falling to £3 million at 31 October 2024, rising to £76 million at
28 February 2025, and falling to £17 million at 30 June 2025.
The key feature in the foreign exchange market was the weakening of the US
dollar, which reflected investors' concerns about the size of the US federal
budget deficit and the effect of tariffs on US inflation and growth. Against
sterling, the US dollar fell from an exchange rate of 1.26 to 1.37. Against
the Euro, sterling was more stable, with the exchange rate moving from 1.18 to
1.17.
The oil price weakened over the 12 months, falling from $86/bbl to $68/bbl,
despite continuing conflicts in Ukraine and the Middle East. Russian oil
continued to be bought, mainly by China and India. The Twelve-Day War between
Israel and Iran had little impact on the oil price, with Iran not attempting
to interrupt the flow of oil shipments through the Strait of Hormuz. Overall,
the growth in the non-OPEC supply of oil, including from the US, along with
slower growth in demand from China, put downward pressure on the oil price.
Iron ore, a key ingredient in steel production, had a subdued year, with
prices falling by around 10%. This reflected the pattern of demand from China,
the world's dominant consumer of iron ore. In general, base commodities had a
weak year.
Performance Review
Estimated performance attribution (relative to FTSE All-Share Index total
return)
2025 2024
% %
Stock selection +5.54 +2.64
Gearing +0.39 +0.25
Expenses -0.36 -0.37
Share issues/buybacks +0.02 +0.07
Total +5.59 +2.59
Source: Janus Henderson
The Company produced a net asset value total return of 16.75%, which was 5.59
percentage points ("pp") better than the FTSE All-Share Index total return of
11.16%. Gearing contributed to performance by 0.39pp and stock selection by
5.54pp.
The biggest stock contributor to performance relative to the FTSE All-Share
Index was AstraZeneca, the pharmaceutical company, which is held in the
portfolio but at a much smaller position size than the index weight.
AstraZeneca and other pharmaceutical stocks suffered from uncertainty relating
to the Trump administration's policies on the pricing of medicines in the US.
The second biggest contributor was NatWest, which benefited from the higher
interest rate environment. Hedges of cash balances, which had been taken out
over five years ago at low interest rates, were rolled over at much higher
interest rates with a favourable effect on NatWest's profitability. The third
biggest contributor was Imperial Brands, the tobacco company, where the large
share buyback proved accretive for the remaining shareholders. The fourth
biggest contributor was BAE Systems, which continued to experience strong
demand from many countries for defence equipment given the external threats.
The fifth biggest contributor was M&G, the fund manager and life assurer,
which announced a long-term strategic partnership with Japanese insurer
Dai-Ichi Life, which is expected to deliver new business flows for M&G
while Dai-Ichi will also acquire a 15% stake in the company.
In contrast, the biggest stock detractor to performance relative to the FTSE
All-Share Index was not holding Rolls Royce, the aero engine manufacturer,
which started paying a dividend again but at a low level relative to its share
price. The second biggest detractor was Merck, the US-listed pharmaceutical
company, which suffered from the same adverse sector influences that affected
AstraZeneca. The third and fourth biggest detractors were not holding Standard
Chartered and being underweight HSBC compared with the index. Both these
banks' operations are predominantly in Asia Pacific. The fifth biggest
detractor was TotalEnergies, which was adversely affected by the weakness in
the oil price.
Large companies, as represented by the FTSE 100 Index, produced a total return
of 11.3%, which was slightly ahead of the 10.2% return for medium-sized
companies, as represented by the FTSE 250 Index. The FTSE Small Cap return was
11.1%, in line with the FTSE 100 return. The FTSE 100 benefited from its large
weighting in banks, which was the best performing sector. On the other hand,
healthcare, which is also well represented in the FTSE 100, was a drag on
performance.
Higher and lower-yielding shares produced similar returns. The FTSE 350 High
Yield Index (the higher dividend-yielding half of the largest 350 companies
listed in the UK) returned 11.4%. The FTSE 350 Lower Yield Index (the
lower-yielding half of the largest 350 companies listed in the UK) returned
11.0%.
Portfolio Changes
In our view, UK shares continued to provide better value than overseas
equivalents, possibly due to lack of demand from domestic institutional and
retail investors. UK companies received a steady flow of takeover bids from
overseas companies and private equity firms, indicating the value on offer.
The proportion of the portfolio invested in overseas- listed companies was
reduced from 10% to 8% over the 12 months and compares with 15% at 30 June
2023. The portfolio remained predominantly invested in large companies with
the amount invested in FTSE 100 companies increasing slightly from 78% to 81%,
with a decline from 12% to 11% in medium-sized and small companies.
Distribution of the portfolio as at 30 June 2025
% of the portfolio
Large UK-listed companies (constituents of the FTSE 100 Index) 81
Medium-sized and small UK-listed companies 11
Overseas-listed companies 8
Source: LSEG Datastream, as at 30 June 2025
There were three new holdings bought during the 12 months. Admiral's main
business is UK motor insurance with 5.7 million customers. It also has much
smaller businesses in UK household insurance and motor insurance in France,
Italy and Spain. It has a good underwriting record and has consistently
outperformed peers on profit margins. It uses reinsurance to operate a
capital-efficient business model. The purchase of Admiral was funded by the
sale of Direct Line, which was in the process of being taken over by Aviva,
which was already held in the portfolio.
A new holding was bought in TP ICAP, which is the world's largest inter-dealer
broker between investment banks in interest rates, foreign exchange, money
market and credit products. It also has smaller operations in executing trades
in equities, energy and commodities broking and OTC data analytics. The group
converts a high percentage of its profits into cash and is expected to be a
good dividend payer.
A small, new holding was bought in Harbour Energy, the oil and gas exploration
and production company. Harbour's production is split 61% gas and 39% oil.
Geographically, production is split 35% Norway, 32% UK and 33% rest of the
world (including Latin America, North Africa and Germany). It has proven oil
and gas reserves worth nine years of production. Harbour's UK North Sea
production is expected to decline, with little incentive to invest due to high
taxation. This will be offset by growth in other countries where they operate,
which are more welcoming to oil and gas investment. Also in the oil sector,
significant additions were made to the holding in Shell, which was valued at a
large discount to its US peers, Exxon and Chevron. Shell is engaged in a very
substantial share buyback programme, worth $14 billion over 12 months, some 6%
of its market capitalisation. It has a strong balance sheet, with a low level
of debt, and has set out impressive targets for free cash flow over the next
five years. The increased investment in Shell was partly funded by the sale of
ENI, the international oil company with its head office in Italy.
Significant additions were made to the holdings in diversified Real Estate
Investment Trusts ("REITs"), Land Securities and British Land, against a
backdrop of evidence of a bottoming of value for high-quality office and
retail property, and growth in rental income. The two REITs have a similar
split between retail (British Land 36%, Land Securities 32%) and London
offices (British Land 53%, Land Securities 52%). Within retail, there is a
difference, with British Land being mainly invested in retail warehouses and
Land Securities large shopping centres. Within London offices, British Land's
biggest asset is its 50% stake in Broadgate, while Land Securities' main focus
is Victoria. Additions were made to both REITs on discounts to their net asset
values of over 30% and dividend yields of over 6%.
Two other stocks left the portfolio through takeovers. Britvic, the Pepsi
bottler and soft drinks company, was bought by Carlsberg. Britvic had been in
the portfolio since its IPO in 2005, during which time it achieved an annual
share price total return of 13.2%. DS Smith, a paper and packaging company,
was taken over by International Paper of the US. Some of the proceeds from DS
Smith were reinvested in the paper and packaging sector by adding to the
holding in Mondi.
In utilities, the holding in Pennon, the water company covering Southwest
England, was sold with the proceeds reinvested in additions to the holding in
Severn Trent, the water company covering the West Midlands, which has a
superior record. The water sector benefited from the conclusion of the
five-yearly regulatory review, ending the uncertainty over regulated returns,
even though press coverage was still negative. In electricity, SSE was reduced
given the lower yield after its dividend cut and with some uncertainty
regarding the funding of its ambitious investment plans.
Significant profits were also taken in the successful holding in 3i, the
investor in private companies. 3i's portfolio is dominated by its holding in
Action, the fast-growing European discount retailer. 3i's investments
performed well but its share price was standing at a large premium to its NAV
and therefore it seemed prudent to reduce the size of the holding.
Some large profits were also taken in BAE Systems, the leading defence
company, whose shares have performed very well since the start of the war in
Ukraine. Less successful were two small holdings in the consumer discretionary
area, DFS Furniture and Burberry. Against a tough backdrop for consumer
spending for large ticket items, both companies omitted their dividends and
were sold.
Portfolio Outlook
Revenue exposure
% of the portfolio
United Kingdom 40
North America 22
Europe ex UK 13
Asia Pacific (inc Japan) 15
Emerging Markets 10
Source: Factset, as at 30 June 2025
The portfolio remains well diversified, with 60% of investee companies'
revenues coming from overseas. The detailed split of revenue is UK 40%, North
America 22%, Asia Pacific 15%, Europe 13% and Emerging Markets 10%.
Largest sector weightings
Portfolio FTSE All-Share Index Relative to the FTSE All-Share Index
% % %
Banks 14.0 13.0 +1.0
Investment Banking and Brokerage Services 9.0 3.5 +5.5
Personal Care, Drug and Grocery Stores 7.8 7.5 +0.3
Oil and Gas 7.6 8.7 -1.1
Tobacco 7.1 3.6 +3.5
Life Insurance 7.0 2.5 +4.5
The largest sector exposure is banks at 14.0% of the portfolio, one percentage
point higher than the FTSE All-Share Index weight, with four large bank
holdings: HSBC (4.8% of the portfolio), NatWest (3.7%), Lloyds (2.9%) and
Barclays (2.2%). City of London moved overweight in the banks sector at the
start of 2024 for the first time since before the Global Financial Crisis
("GFC") of 2007 to 2009. During the years following the GFC, banks were
required by regulators to increase capital, leading to limited or, in some
cases, no dividend payments. In addition, low interest rates and bond yields
had an adverse impact on bank profitability because it was harder to earn the
net interest margin (the difference between what banks pay on deposits and
earn on loans). In addition, balances that were hedged out ("structural
hedges") earned a lower interest rate than had historically been the case.
By the start of 2024, it was clear that the banks had sufficient capital and
the mood from politicians was shifting towards wanting banks to lend more to
stimulate economic growth. In addition, the rise in interest rates eased
pressure on net interest margins and the rise in gilt yields meant that the
structural hedges, typically lasting five to seven years, would sharply
improve in profitability as old hedges rolled from lower to higher yields. A
further favourable factor was the consolidation that took place with Barclays
buying Tesco's retail banking operations and NatWest buying Sainsburys'. We
believe it is right to remain overweight in the sector given the continuing
beneficial effect of the structural hedge, our view that dividend payout
ratios can increase and the undervaluation compared with previous periods of
elevated banking profitability.
The second largest sector weighting is investment banking and brokerage
services (9.0% of the portfolio), which would better be described as financial
services. This is a strong part of the UK economy and there are holdings in
seven companies in the portfolio. The three largest holdings are: M&G, the
fund manager and life assurer; IG, the online financial trading company; and
3i, the investor in private companies. In our view, M&G (2.7% of the
portfolio) offers a compelling dividend yield backed by the cash flow from its
life assurance business and growth potential from its leading position in
private credit. IG (1.7% of the portfolio) has been reinvigorated by its new
management, with potential to grow its share of the large and growing markets
for investing and trading of financial instruments. As discussed earlier, some
profits have been taken in 3i (reducing the position over the 12 months from
3.3% to 1.1% of the portfolio) on valuation grounds, but its holding in
Action, the European discount retailer which forms some 70% of its portfolio,
is producing exceptional growth.
A third financial sector, life insurance (7.0% of the portfolio), is among the
largest six sectors in the portfolio. Attractive dividend yields are offered
by Phoenix, Aviva and Legal & General, which are respectively 2.3%, 2.3%
and 2.0% of the portfolio. Phoenix benefits from the cash generation of its
life insurance operations that are closed to new business and growth from its
workplace pensions and retirement income units. Aviva is expected to continue
to produce competitive earnings growth and shareholder returns from its
general insurance businesses in the UK and Canada and its life insurance and
pensions operations in the UK. Legal & General has the leading UK business
in bulk pension annuities, which helps companies de-risk defined benefit
pensions and is a growing market. It is also a leading asset manager and has a
strong record of shareholder returns.
The third and fifth largest sector weightings are both in the consumer staples
area. Personal care, drug and grocery stores is 7.8% of the portfolio and
includes Unilever and Tesco, respectively 3.4% and 3.2% of the portfolio.
Unilever, the consumer products and food group, has been focusing its
portfolio of businesses in recent years and is set to spin out its ice cream
division. Unilever has over half of its sales in emerging markets, with
long-term growth opportunities for the type of product it sells. Tesco, the
UK's largest food retailer, remains price competitive and a substantial cash
generator. The other consumer staples sector among the six largest sectors is
tobacco, which is 7.1% of the portfolio. British American Tobacco and Imperial
Brands, which are respectively 3.7% and 3.4% of the portfolio, offer
attractive dividend yields supported by strong cash generation.
Oil and gas is the fourth largest sector, but the portfolio's weighting of
7.6% is less than the FTSE All-Share Index's 8.7% weighting. The oil price
outlook seems subdued. Russian oil continues to be bought on world markets,
while Saudi Arabia restricts some of its production and non-OPEC supply,
especially from the US, continues to rise. Chinese demand for oil is being
adversely affected by the rise in sales of electric vehicles. Shell (4.5% of
the portfolio) should be defensive if the oil price weakens, given its strong
balance sheet and large share buyback programme.
The high dividend yields from companies in sectors, such as life insurance and
tobacco, enables some low-yielding stocks with exceptional growth potential to
be held. BAE Systems (4.3% of the portfolio) is benefiting from the major
uplift in defence spending, in response both to rising external threats and
pressure from the US on its allies to do more. BAE's biggest market is the US
followed by the UK and Saudi Arabia. It also has smaller but fast-growing
sales with countries, such as Japan and Australia and in Eastern Europe. As
mentioned earlier in this report, some profits have been taken in BAE after
its very strong share price performance, but we have retained a large position
given the robust outlook for the company. RELX (4.1% of the portfolio) enjoys
structural growth characteristics as the provider of information and analytics
for businesses, professionals and scientists, with an increasing artificial
intelligence capability incorporated in many of its products.
Overall, the portfolio is designed to continue growing City of London's
dividend and provide a competitive total return, including capital
appreciation. It has a tilt towards stocks with above average-dividend yield,
but some lower-yielding stocks are included within the mix for their growth
potential. The portfolio is diversified both by geography and by sector. We
believe the companies in the portfolio offer good value relative to our view
of the prospects for earnings and dividend growth and compared with
equivalents overseas.
Job Curtis
David Smith
Fund Manager Deputy
Fund Manager
16 September 2025
FORTY LARGEST INVESTMENTS AS AT 30 JUNE 2025
The 40 largest investments, representing 82.66% of the portfolio, are listed
below.
Market value Portfolio
Position Company Sector £'000 %
1 HSBC Banks 118,148 4.81
2 Shell Oil and Gas 109,801 4.47
3 BAE Systems Aerospace and Defence 105,145 4.28
4 RELX Software and Computer Services 100,305 4.08
5 British American Tobacco Tobacco 91,716 3.74
6 NatWest Banks 90,773 3.70
7 Unilever Personal Care, Drug and Grocery Stores 82,950 3.38
8 Imperial Brands Tobacco 82,685 3.37
9 Tesco Personal Care, Drug and Grocery Stores 79,438 3.23
10 Lloyds Banking Banks 72,079 2.94
Top 10 933,040 38.00
11 M&G Investment Banking and Brokerage Services 66,820 2.72
12 AstraZeneca Pharmaceuticals and Biotechnology 62,238 2.53
13 Phoenix Life Insurance 56,874 2.32
14 Aviva Life Insurance 55,710 2.27
15 Barclays Banks 54,466 2.22
16 National Grid Gas, Water and Multi-utilities 53,075 2.16
17 Land Securities Real Estate Investment Trusts 49,494 2.01
18 Legal & General Life Insurance 48,355 1.97
19 Rio Tinto Industrial Metals and Mining 46,271 1.88
20 BP Oil and Gas 46,078 1.88
Top 20 1,472,421 59.96
21 IG Investment Banking and Brokerage Services 42,520 1.73
22 GSK Pharmaceuticals and Biotechnology 41,685 1.70
23 British Land Real Estate Investment Trusts 40,651 1.65
24 Diageo Beverages 35,819 1.46
25 Munich Re Non-life Insurance 34,033 1.39
26 Severn Trent Gas, Water and Multi-utilities 32,796 1.33
27 Reckitt Benckiser Personal Care, Drug and Grocery Stores 29,730 1.21
28 SSE Electricity 27,457 1.12
29 3i Investment Banking and Brokerage Services 27,398 1.12
30 TotalEnergies Oil and Gas 26,777 1.09
Top 30 1,811,287 73.76
31 Schroders Investment Banking and Brokerage Services 26,744 1.09
32 St. James's Place Investment Banking and Brokerage Services 26,629 1.08
33 Beazley Non-life Insurance 23,375 0.95
34 Deutsche Telekom Telecommunications Service Providers 21,929 0.89
35 Sage Software and Computer Services 21,384 0.87
36 Novartis Pharmaceuticals and Biotechnology 21,153 0.86
37 BT Telecommunications Service Providers 19,859 0.81
38 Nestlé Food Producers 19,510 0.80
39 Swire Pacific General Industrials 19,366 0.79
40 Persimmon Household Goods and Home Construction 18,533 0.76
Top 40 2,029,769 82.66
All classes of equity in any one company are treated as one investment.
PRINCIPAL RISKS
The Board, with the assistance of the Manager, has carried out a robust
assessment of the principal and emerging risks and uncertainties facing the
Company, including those that would threaten its business model, future
performance, solvency or liquidity and reputation.
The Board regularly considers the principal and emerging risks facing the
Company and has drawn up a register of these risks. The Board has also put in
place a schedule of investment limits and restrictions, appropriate to the
Company's investment objective and policy. Emerging risks are defined as
potential trends, sudden events or changing risks which are characterised by a
high degree of uncertainty in terms of the probability of them happening and
the possible effects on the Company. Should an emerging risk become
sufficiently clear, it may be moved to a significant risk. During the year
under review, the Board did not identify any emerging risks which are not
already encompassed within the existing principal risks.
The principal risks which have been identified and the steps taken by the
Board to mitigate these are set out in the table below. The principal
financial risks are detailed in note 16 to the financial statements in the
Annual Report. Details of how the Board monitors the services provided by
Janus Henderson and its other suppliers, and the key elements designed to
provide effective internal control, are explained further in the internal
controls section of the Corporate Governance Report in the Annual Report.
Principal risks Trend Mitigating measure
Portfolio and market price ↔ The Board reviews the portfolio at the seven Board meetings held each year and
receives regular reports from the Company's brokers. A detailed liquidity
Although the Company invests almost entirely in securities that are listed on report is considered on a regular basis.
recognised markets, share prices may move rapidly. The companies in which
investments are made may operate unsuccessfully, or fail entirely. A fall in
the market value of the Company's portfolio would have an adverse effect on
equity shareholders' funds. The Fund Managers closely monitor the portfolio between meetings and mitigate
this risk through diversification of investments. The Fund Managers
periodically present the Company's investment strategy in respect of current
market conditions to the Board. Performance relative to the FTSE All-Share
Index, other UK equity income trusts and IA UK Equity Income OEICs is also
monitored.
The majority of the Company's investments are multi-national companies with
operations in local markets and are therefore not dependent on the UK economy.
Dividend income ↔ The Board reviews income forecasts at each meeting. The Company has revenue
reserves of £48.7 million (before payment of the fourth interim dividend) and
A reduction in dividend income from investee companies could adversely affect distributable capital reserves of £398.4 million.
the Company's ability to maintain its record of paying a growing dividend to
shareholders each year.
Investment activity, gearing and performance ↔ At each meeting, the Board reviews investment performance, the level of
gearing, the level of premium/discount, income forecasts and a schedule of
An inappropriate investment strategy (for example, in terms of asset expenses. It also has an annual meeting focused on strategy at which these
allocation or the level of gearing) may result in underperformance against the matters are considered in more depth.
Company's benchmark.
Investment performance could be affected over the longer term by the impact of
sudden potentially catastrophic events, whether man-made (for example extreme
political tensions, conflict, poor trade relations, wide-scale financial
market disruption), or natural disasters, whether arising from climate change,
adverse weather events or disease.
Tax and regulatory ↔ The Manager provides its services, inter alia, through suitably qualified
professionals and the Board receives internal control reports produced by the
Changes in the tax and regulatory environment, including the Company failing Manager on a quarterly basis, which confirm legal and regulatory compliance.
to identify and implement any necessary regulatory change, could adversely The Fund Managers also consider tax and regulatory change in their monitoring
affect the Company's financial performance, including the return on equity. of the Company's underlying investments.
These may also include government measures which damage the market appeal of
investment trusts for investors.
A breach of Section 1158/9 could lead to a loss of investment trust status,
resulting in capital gains realised within the portfolio being subject to
corporation tax. A breach of the UK Listing Rules could result in suspension
of the Company's shares, while a breach of the Companies Act 2006 could lead
to criminal proceedings, or financial or reputational damage.
Operational ↔ The Board monitors the services provided by the Manager and its other
suppliers and receives reports on the key elements in place to provide
The disruption or failure of technology systems used by the Manager or its effective internal control.
Administrator (BNP Paribas), whether through inter alia, cyber attacks, failed
software updates or data breaches, could profoundly impact the accurate
reporting and monitoring of the Company's financial position. The Company is
also exposed to the operational risk that one or more of its suppliers may not Cyber security is closely monitored and the Audit and Risk Committee receives
provide the required level of service. regular updates from Janus Henderson's Chief Information Security Officer.
The Board considers the loss of the Fund Manager as a risk but this is
mitigated by the experience of the team at Janus Henderson as detailed in the
Annual Report.
BORROWINGS
The Company has a borrowing facility of £120.0 million (2024: £120.0
million) with HSBC Bank plc, of which £17.0 million was drawn at the year
end (2024: £41.0 million).
The Company has £114.3 million (2024: £114.3 million) of secured notes in
issue (fair value of the loan notes: £85.5 million (2024: £83.3 million)).
The level of borrowing at 30 June 2025 was 5.8% of NAV with debt at par (2024:
7.5%) and 4.5% with debt at fair value (2024: 6.2%).
VIABILITY STATEMENT
The AIC Code of Corporate Governance includes a requirement for the Board to
assess the future prospects for the Company, and to report on the assessment
within the Annual Report. The Directors have completed their assessment for
the year under review and report as set out below.
The Board considers that certain characteristics of the Company's business
model and strategy are relevant to this assessment:
• The Board seeks to deliver long-term performance by the Company.
• The Company's investment objective, strategy and policy, which are subject to
regular Board monitoring, mean that the Company is invested mainly in readily
realisable, UK-listed securities and that the level of borrowings is
restricted.
• The Company is a closed end investment company and therefore does not suffer
from the liquidity issues arising from unexpected redemptions.
• The Company has an ongoing charge of 0.36%, which is lower than other
comparable investment trusts.
Also relevant are a number of aspects of the Company's operational agreements:
• The Company retains title to all assets held by the Custodian under the terms
of formal agreements with the Custodian and Depositary.
• Long-term borrowing is in place, being 4.53% secured notes 2029, 2.94% secured
notes 2049 and 2.67% secured notes 2046 which are subject to financial
covenants with which the Company complied in full during the year. The value
of long-term borrowing is relatively small in comparison to the value of net
assets, being 4.9%.
• Revenue and expenditure forecasts are reviewed by the Directors at each Board
meeting. This includes stress testing of the forecast under different
scenarios.
• Cash is held with approved banks.
Three model scenarios are considered which evaluate the impact on revenue
reserves. These range from a worst-case scenario which includes low consensus
dividend estimates and significant dividend cuts of up to 50% from specific
sectors and investee companies, to a best-case scenario with high consensus
dividend estimates, no dividend cuts in any specific sector and limited
dividend cuts in specific investee companies. Increasing dividend payments to
shareholders could continue under all three scenarios whether through revenue,
or supported by distributable capital reserves. None of the results from the
three scenarios would therefore threaten the viability of the Company.
Covenant limits are tested to ascertain the level that net assets would need
to fall by to breach any covenant conditions. Net assets would need to fall by
amounts in excess of £1.9 billion to breach covenants, with all other factors
remaining constant. The Board considers this to be highly unlikely and
therefore does not threaten the viability of the Company.
In addition, the Directors carried out a robust assessment of the principal
risks and uncertainties which could threaten the Company's business model,
including future performance, liquidity and solvency and considered emerging
risks that could have a future impact on the Company.
The principal risks identified as relevant to the viability assessment were
those relating to investment portfolio performance, including climate change,
and its effect on the NAV, share price and dividends, and threats to security
over the Company's assets. The Board took into account: the liquidity of the
Company's portfolio; the existence of the long-term fixed rate borrowings; the
effects of any significant future falls in investment values and income
receipts on the ability to repay and renegotiate borrowings, grow dividend
payments and retain investors; and the potential need for share buybacks to
maintain a narrow share price discount.
The Directors assess viability over five-year rolling periods, taking account
of foreseeable severe but plausible scenarios. The Directors believe that a
rolling five-year period best balances the Company's long-term objective, its
financial flexibility and scope with the difficulty in forecasting economic
conditions affecting the Company and its shareholders. The Directors have
considered the current geopolitical and macroeconomic uncertainties and the
potential for sudden catastrophic events such as pandemics, conflict and
climate events, in particular the impact on income and the Company's ability
to meet its investment objective. The Directors do not believe that they will
have a terminal impact on the viability of the Company and its ability to
continue in operation, notwithstanding the short-term uncertainty these events
could cause in the markets and specific short-term issues such as energy,
supply chain disruption, inflation and labour shortages.
Based on their assessment, and in the context of the Company's business model,
strategy and operational arrangements set out above, the Directors have a
reasonable expectation that the Company will be able to continue in operation
and meet its liabilities as they fall due over the five-year period.
RELATED PARTY TRANSACTIONS
The Company's transactions with related parties in the year were with the
Directors and the Manager. There were no material transactions between the
Company and its Directors during the year and the only amounts paid to them
were in respect of expenses and remuneration for which there were no
outstanding amounts payable at the year end. Directors' shareholdings are
disclosed in the Annual Report.
In relation to the provision of services by the Manager, other than fees
payable by the Company in the ordinary course of business and the provision of
marketing services, there were no material transactions with the Manager
affecting the financial position of the Company during the year under review.
More details on transactions with the Manager, including amounts outstanding
at the year end, are given in the Annual Report.
STATEMENT OF DIRECTORS' RESPONSIBILITIES
Each of the Directors, who are listed below, confirms that, to the best of his
or her knowledge:
• the Company's financial statements, which have been prepared in accordance
with UK Accounting Standards on a going concern basis, give a true and fair
view of the assets, liabilities, financial position and return of the Company;
and
• the Strategic Report and financial statements include a fair review of the
development and performance of the business and the position of the Company,
together with a description of the principal risks and uncertainties that it
faces.
On behalf of the Board
Sir Laurie Magnus CBE
Chairman
16 September 2025
INCOME STATEMENT
Year ended 30 June 2025 Year ended 30 June 2024
Notes Revenue Capital Total Revenue Capital Total
return
return
return
return
return
£'000
£'000 return
£'000
£'000
£'000
£'000
Gains on investments held at fair value through profit or loss - 244,522 244,522 - 200,864 200,864
2 Income from investments held at fair value through profit or loss 112,223 - 112,223 109,335 - 109,335
3 Other interest receivable and similar income 242 - 242 371 - 371
Gross revenue and capital gains 112,465 244,522 109,706 200,864 310,570
356,987
4 Management fee (2,006) (4,680) (6,686) (1,927) (4,497) (6,424)
Other administrative expenses (1,228) - (1,228) (1,009) - (1,009)
Net return before finance costs and taxation 109,231 239,842 349,073 106,770 196,367 303,137
Finance costs (1,954) (4,191) (6,145) (1,666) (3,520) (5,186)
Net return before taxation 107,277 235,651 342,928 105,104 192,847 297,951
Taxation (812) - (812) (533) - (533)
Net return after taxation 106,465 235,651 342,116 104,571 192,847 297,418
5 Return per ordinary share - basic and diluted 21.57p 20.87p 38.48p 59.35p
47.74p 69.31p
The total columns of this statement represent the Company's Income Statement.
The revenue return and capital return columns are supplementary to this and
are prepared under guidance published by the Association of Investment
Companies. All revenue and capital items in the above statement derive from
continuing operations. The Company has no recognised gains or losses other
than those recognised in the Income Statement.
STATEMENT OF CHANGES IN EQUITY
Notes Year ended Called up share capital £'000 Share premium account £'000 Capital redemption reserve £'000 Other capital reserves £'000 Revenue reserve £'000 Total
30 June 2025 £'000
At 1 July 2024 125,666 1,072,624 2,707 849,910 46,621 2,097,528
Net return after taxation - - - 235,651 106,465 342,116
8 Buyback of 2,530,895 ordinary shares for treasury - - - (11,154) - (11,154)
8 Sale of 1,685,000 ordinary shares from treasury - 855 - 7,086 - 7,941
7 Dividends paid - - - - (104,392) (104,392)
At 30 June 2025 125,666 1,073,479 2,707 1,081,493 48,694 2,332,039
Notes Year ended Called up share capital £'000 Share premium account £'000 Capital redemption reserve £'000 Other capital reserves £'000 Revenue reserve £'000 Total
30 June 2024 £'000
At 1 July 2023 124,339 1,053,061 2,707 691,463 44,322 1,915,892
Net return after taxation - - - 192,847 104,571 297,418
8 Buyback of 8,301,867 ordinary shares for treasury - - - (34,400) - (34,400)
8 Issue of 5,310,000 new ordinary shares 1,327 19,563 - - - 20,890
7 Dividends paid - - - - (102,272) (102,272)
At 30 June 2024 125,666 1,072,624 2,707 849,910 46,621 2,097,528
STATEMENT OF FINANCIAL POSITION
Notes 30 June 2025 30 June 2024
£'000 £'000
Fixed assets
Investments held at fair value through profit or loss
Listed at market value in the United Kingdom 2,163,235 1,657,638
Listed at market value overseas 190,162 216,147
Investments on loan 102,131 372,460
Investment in subsidiary undertakings 347 347
2,455,875 2,246,592
Current assets
Debtors 14,443 12,911
14,443 12,911
Creditors: amounts falling due within one year (22,552) (46,307)
Net current liabilities (8,109) (33,396)
Total assets less current liabilities 2,447,766 2,213,196
Creditors: amounts falling due after more than one year (115,727) (115,668)
Net assets 2,332,039 2,097,528
Capital and reserves
8 Called up share capital 125,666 125,666
Share premium account 1,073,479 1,072,624
Capital redemption reserve 2,707 2,707
Other capital reserves 1,081,493 849,910
Revenue reserve 48,694 46,621
6 Total shareholders' funds 2,332,039 2,097,528
6 Net asset value per ordinary share - basic and diluted 472.53p 424.29p
NOTES TO THE FINANCIAL STATEMENTS
1. Accounting policies
Basis of accounting
The Company is a registered investment company as defined in Section 833 of
the Companies Act 2006 and is incorporated in the UK. It operates in the UK
and is registered at the address below.
The financial statements have been prepared in accordance with the Companies
Act 2006, FRS 102, the Financial Reporting Standard applicable in the UK and
Republic of Ireland, and with the Statement of Recommended Practice: Financial
Statements of Investment Trust Companies and Venture Capital Trusts ("the
SORP") issued in July 2022 by the Association of Investment Companies.
The principal accounting policies applied in the presentation of these
financial statements are set out below. These policies have been consistently
applied to all the years presented.
As an investment fund the Company has the option, which it has taken, not to
present a cash flow statement. A cash flow statement is not required when an
investment fund meets all the following conditions: substantially all of the
entity's investments are highly liquid, substantially all of the entity's
investments are carried at market value, and the entity provides a Statement
of Changes in Equity. The Directors have assessed that the Company meets all
of these conditions.
The financial statements have been prepared under the historical cost basis
except for the measurement at fair value of investments. In applying FRS 102,
financial instruments have been accounted for in accordance with Section 11
and 12 of the standard. All of the Company's operations are of a continuing
nature.
The financial statements of the Company's three subsidiaries have not been
consolidated on the basis of immateriality. Consequently, the financial
statements present information about the Company as an individual entity. The
Directors consider that the values of the subsidiary undertakings are not less
than the amounts at which they are included in the financial statements.
The preparation of the Company's financial statements on occasion requires the
Directors 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.
The decision to allocate special dividends as income or capital and the
allocation of expenses to income or capital are judgements taken by the
Directors. Neither of these have any impact on net assets but do impact the
net revenue return that is available to pay dividends from current year
revenue in any specific year. The Directors believe that any accounting
judgements or estimates applied to this set of financial statements do not
create significant risk of material adjustments in the future to the carrying
amount of assets and liabilities.
Going concern
The assets of the Company consist of securities that are readily realisable.
As set out in the Viability Statement, the Directors consider three model
scenarios that stress test the revenue reserves. None of the results from
these scenarios would threaten the viability of the Company and its ability to
continue as a going concern. The Directors have also considered the current
geopolitical and macroeconomic uncertainties and the potential for sudden
catastrophic events such as pandemics, conflict and climate events, including
cash flow forecasting, a review of covenant compliance including the headroom
above the most restrictive covenants and an assessment of the liquidity of the
portfolio. They have concluded that the Company is able to meet its financial
obligations, including the repayment of the bank overdraft, as they fall due
for a period to 16 September 2026, which is at least 12 months from the date
of approval of the financial statements. Having assessed these factors, the
principal risks and other matters discussed in connection with the viability
statement, the Board has determined that it is appropriate for the financial
statements to be prepared on a going concern basis.
2. Income from investments held at fair value through profit or loss
2025 2024
£'000 £'000
UK dividends:
Listed - ordinary dividends 97,526 94,307
Listed - special dividends 616 985
98,142 95,292
Other dividends:
Dividend income - overseas investments 8,665 10,678
Dividend income - overseas special dividends - 59
Dividend income - UK REIT 5,416 3,306
14,081 14,043
112,223 109,335
3. Other interest receivable and similar income
2025 2024
£'000 £'000
Bank interest 1 84
Underwriting commission (allocated to revenue)(1) 5 45
Stock lending revenue 236 242
242 371
(1) During the year the Company was not required to take up shares in respect
of its underwriting (2024: none)
Stock lending revenue has been shown net of brokerage fees of £59,000 (2024:
£61,000).
4. Management fee
2025 2024
Revenue return Capital return Total return Revenue return Capital return Total return
£'000 £'000 £'000 £'000 £'000 £'000
Management fee 2,006 4,680 6,686 1,927 4,497 6,424
A summary of the terms of the Management Agreement is given in the Annual
Report.
Details of apportionment between revenue and capital can be found in the
Annual Report.
5. Return per ordinary share - basic and diluted
The return per ordinary share is based on the net return attributable to the
ordinary shares of £342,116,000 (2024: £297,418,000) and on 493,599,088
ordinary shares (2024: 501,134,608), being the weighted average number of
ordinary shares in issue during the year, excluding treasury shares.
The return per ordinary share is analysed between revenue and capital as
below:
2025 2024
£'000 £'000
Net revenue return 106,465 104,571
Net capital return 235,651 192,847
Net total return 342,116 297,418
Weighted average number of ordinary shares in issue during the year 493,599,088 501,134,608
2025 2024
Pence Pence
Revenue return per ordinary share 21.57 20.87
Capital return per ordinary share 47.74 38.48
Total return per ordinary share 69.31 59.35
The Company does not have any dilutive securities, therefore the basic and
diluted returns per share are the same.
6. Net asset value per ordinary share - basic and diluted
The net asset value per ordinary share of 472.53p (2024: 424.29p) is based on
the net assets attributable to the ordinary shares of £2,332,039,000 (2024:
£2,097,528,000) and on 493,517,106 (2024: 494,363,001) shares in issue on
30 June 2025, excluding treasury shares.
An alternative net asset value per ordinary share can be calculated by
deducting from the total assets less current liabilities of the Company the
preference and preferred ordinary stocks and secured notes at their market (or
fair) values rather than at their par (or book) values. The net asset value
per ordinary share at 30 June 2025 calculated on this basis was 478.14p (2024:
429.57p). See the Annual Report for further details of the Alternative
Performance Measure and how it is calculated.
The movements during the year of the assets attributable to the ordinary
shares were as follows:
£'000
Total net assets attributable to the ordinary shares at 30 June 2024 2,097,528
Total net return after taxation 342,116
Dividends paid on ordinary shares in the year (104,392)
Buyback of shares (11,154)
Sale of shares from treasury 7,941
Total net assets attributable to the ordinary shares at 30 June 2025 2,332,039
The Company does not have any dilutive securities.
7. Dividends paid on ordinary shares
Record date Payment date 2025 2024
£'000 £'000
Fourth interim dividend (5.05p) for the year ended 30 June 2023 27 July 2023 31 August 2023 - 25,374
First interim dividend (5.05p) for the year ended 30 June 2024 26 October 2023 30 November 2023 - 25,385
Second interim dividend (5.05p) for the year ended 30 June 2024 25 January 2024 29 February 2024 - 25,385
Third interim dividend (5.25p) for the year ended 30 June 2024 25 April 2024 31 May 2024 - 26,200
Fourth interim dividend (5.25p) for the year ended 30 June 2024 26 July 2024 30 August 2024 25,953 -
First interim dividend (5.25p) for the year ended 30 June 2025 25 October 2024 29 November 2024 25,953 -
Second interim dividend (5.25p) for the year ended 30 June 2025 24 January 2025 28 February 2025 25,953 -
Third interim dividend (5.40p) for the year ended 30 June 2025 25 April 2025 30 May 2025 26,580 -
Unclaimed dividends over 12 years old (47) (72)
104,392 102,272( )
In accordance with FRS 102, interim dividends payable to equity shareholders
are recognised in the Statement of Changes in Equity when they have been paid
to shareholders.
All dividends have been paid or will be paid out of revenue reserves or
current year revenue profits and at no point during the year did the revenue
reserve move to a negative position.
The total dividends payable in respect of the financial year which form the
basis of the test under Section 1158 of the Corporation Tax Act 2010 are set
out below.
2025 2024
£'000 £'000
Revenue available for distribution by way of dividend for the year 106,465 104,571
First interim dividend of 5.25p (2024: 5.05p) (25,953) (25,385)
Second interim dividend of 5.25p (2024: 5.05p) (25,953) (25,385)
Third interim dividend of 5.40p (2024: 5.25p) (26,580) (26,200)
Fourth interim dividend of 5.40p (2024: 5.25p) paid on 29 August 2025¹ (26,650) (25,953)
Transfer to revenue reserve² 1,329 1,648
1 Based on 493,517,106 ordinary shares in issue at 24 July 2025 (the
ex-dividend date) (2024: 494,334,723)
2 The surplus of £1,329,000 (2024: deficit of £1,648,000) has been taken to
the revenue reserve
Since the year end, the Board has announced a first interim dividend of 5.40p
per ordinary share, in respect of the year ending 30 June 2026. This will be
paid on 28 November 2025 to holders registered at the close of business on 24
October 2025. The Company's shares will be quoted ex-dividend on 23 October
2025.
8. Called up share capital
Number of Total number of shares in issue Nominal value of total shares in issue
£'000
Number of shares
shares held entitled to
in treasury dividend
Allotted and issued ordinary shares of 25p each
At 1 July 2024 8,301,867 494,363,001 502,664,868 125,666
Buyback of shares for treasury 2,530,895 (2,530,895) - -
Sale of shares from treasury (1,685,000) 1,685,000 - -
At 30 June 2025 9,147,762 493,517,106 502,664,868 125,666
Number of Number of Total number of shares in issue Nominal value of total shares in issue
£'000
shares held shares entitled
in treasury to dividend
Allotted and issued ordinary shares of 25p each
At 1 July 2023 - 497,354,868 497,354,868 124,339
Buyback of shares for treasury 8,301,867 (8,301,867) - -
Issue of new ordinary shares - 5,310,000 5,310,000 1,327
At 30 June 2024 8,301,867 494,363,001 502,664,868 125,666
The Company sold 1,685,000 (2024: 5,310,000) ordinary shares from treasury
with total proceeds of £7,941,000 (2024: £20,890,000) after deduction of
issue costs of £12,000 (2024: £31,000). The average price of the ordinary
shares that were issued was 468.5p (2024: 396.5p). During the year 2,530,895
shares were bought back into treasury (2024: 8,301,867) for a net payment of
£11,154,000 (2024: £34,400,000).
9. 2025 financial information
The figures and financial information for the year ended 30 June 2025 are
extracted from the Company's annual financial statements for that period and
do not constitute statutory accounts. The Company's annual financial
statements for the year to 30 June 2025 have been audited but have not yet
been delivered to the Registrar of Companies. The Independent Auditor's Report
on the 2025 annual financial statements was unqualified, did not include a
reference to any matter to which the Auditor drew attention without qualifying
the report, and did not contain any statements under Sections 498(2) or 498(3)
of the Companies Act 2006.
10. 2024 financial information
The figures and financial information for the year ended 30 June 2024 are
compiled from an extract of the published financial statements for that year
and do not constitute statutory accounts. Those financial statements have been
delivered to the Registrar of Companies. The Independent Auditor's Report on
the 2024 annual financial statements was unqualified, did not include a
reference to any matter to which the Auditor drew attention without qualifying
the report, and did not contain any statements under Sections 498(2) or 498(3)
of the Companies Act 2006.
11. Annual Report
The Annual Report will be posted to shareholders in late September 2025 and
will be available on the Company's website www.cityinvestmenttrust.com
(http://www.cityinvestmenttrust.com) . Hard copies of the Annual Report will
thereafter be available at the Company's registered office, 201 Bishopsgate,
London, EC2M 3AE.
12. Annual General Meeting
The Annual General Meeting will be held at 1.00pm on Thursday, 30 October 2025
at the Company's registered office. Instructions on attending the meeting in
person or virtually, and details of resolutions to be put to the AGM, are
included in the Notice of AGM in the Annual Report and will be available at
www.cityinvestmenttrust.com (http://www.cityinvestmenttrust.com) . If
shareholders would like to submit any questions in advance of the AGM, they
are welcome to send these to the corporate secretary at
itsecretariat@janushenderson.com (mailto:itsecretariat@janushenderson.com) .
13. General Information
Company Status
The City of London Investment Trust plc is a UK domiciled investment trust
company.
ISIN number / SEDOL: ordinary shares: GB0001990497 / 0199049
London Stock Exchange (TIDM) Code: CTY
Global Intermediary Identification Number (GIIN): S55HF7.99999.SL.826
Legal Entity Identifier (LEI): 213800F3NOTF47H6AO55
Company Registration Number
00034871
Registered Office
201 Bishopsgate, London EC2M 3AE
Directors and Secretary
The Directors of the Company are Sir Laurie Magnus CBE (Chairman), Sally Lake
(Audit and Risk Committee Chair), Clare Wardle (Senior Independent Director),
Ominder Dhillon and Robert (Ted) Holmes.
The Corporate Secretary is Janus Henderson Secretarial Services UK Limited,
represented by Sally Porter, ACG.
Website
Details of the Company's share price and net asset value, together with
general information about the Company, monthly factsheets and data, copies of
announcements, reports and details of general meetings can be found at
www.cityinvestmenttrust.com (http://www.cityinvestmenttrust.com) .
For further information please contact:
Job Curtis
Fund Manager
The City of London Investment Trust plc
Telephone: 020 7818 4367
Dan Howe
Head of Investment Trusts
Janus Henderson Investors
Telephone: 020 7818 1818
Harriet Hall
PR Director, Investment Trusts
Janus Henderson Investors
Telephone: 020 7818 2919
Neither the contents of the Company's website nor the contents of any website
accessible from hyperlinks on the Company's website (or any other website) are
incorporated into, or form part of, this announcement.
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