RNS Number : 3459F
CT UK Capital and Income Investment
22 May 2026
CT UK Capital and Income Investment Trust PLC
Unaudited Statement of Results
for the half-year ended 31 March 2026
Date: 22 May 2026
LEI: 21380052ETTRKV2A6Y19
Highlights for the half-year ended 31 March 2026:
· Income Growth - dividend increase of 5.1%, ahead of Consumer Price Inflation and the 33rd consecutive year of dividend growth. The Board fully expect this to continue.
· Refreshed investment approach - implemented under new leadership, adopting a value contrarian approach to enhance income generation and deliver sustained capital and income growth over the long term.
· Investment backdrop - despite a challenging investment backdrop, we remain positive for the long-term return prospects for your company.
"The Board recognises the immense power of dividends in driving investment returns for Shareholders, most of all when income is reinvested to maximise total returns. Despite a challenging investment backdrop, the combined dividend for the six-month period of 6.2 pence per share is an increase of 5.1% in comparison to the same period last year. This is ahead of the rate of Consumer Price Inflation and represents an annual dividend yield of 4.1% (1)."
Nicky McCabe
Chair
SUMMARY OF RESULTS
Half-year ended 31 March 2026
Half-year ended 31 March 2025
Share price total return(3)
-1.2%
-2.7%
Net Asset Value total return(3)
+0.6%
-1.6%
FTSE All-Share Index total return
+8.9%
+4.1%
Dividends per ordinary share
First interim dividend in respect of year to 30 September 2026
(2)3.10p
-
30 September 2025
-
2.95p
Second interim dividend in respect of year to 30 September 2026
(2)3.10p
-
30 September 2025
-
2.95p
Total interim dividends relating to the period
6.20p
5.90p
(1) Calculated as the total of the four most recent quarterly dividends declared divided by the period end share price.
(2) The first interim dividend of 3.10 pence per share was paid on 31 March 2026 and the second interim dividend of 3.10 pence per share is payable on 30 June 2026 to Shareholders registered on 12 June 2026 with an ex-dividend date of 11 June 2026.
(3) Total Return - the return to Shareholders calculated on a per share basis by adding dividends paid in the period to the increase or decrease in the Share Price or Net Asset Value in the period. The dividends are assumed to have been re-invested in the form of shares or net assets, respectively, on the date on which the shares were quoted ex-dividend.
Chair's Statement
Dear Shareholder,
Income Growth - dividend increase of 5.1%, ahead of Consumer Price Inflation and 33 consecutive years of dividend growth
On 31 March 2026, the Company paid a dividend of 3.1 pence per share to Shareholders and with these results the Board are announcing a further dividend of 3.1 pence per share to be paid on 30 June 2026 to Shareholders registered on 12 June 2026∞.
The combined dividend of 6.2 pence per share represents an increase of 5.1% in comparison to the same period last year. This is ahead of the rate of Consumer Price Inflation of 3.4% to March 2026 and represents a yield of 4.1%. Recent activity has strengthened the Company's revenue generation, and the Fund Manager is seeing reasonable levels of underlying dividend growth from most investee companies.
The Power of Income - driving half the UK market's total return over the last century
The Board recognises the immense power of dividends in driving investment returns for Shareholders, most of all when income is reinvested to maximise total returns.
By way of illustration, over the last 100 years the UK equity market has delivered an average price return of 5.3% when dividends are not reinvested. By contrast, investors who reinvested their dividends received an average total return of 10.2% per year over the same period*.
Many share investment platforms, including the CT Savings Plans, allow Shareholders to reinvest their dividends automatically. Shareholders who invest in the Company through the CT Savings Plans and would like to reinvest their dividends automatically but currently do not, can do so by contacting the administrator on 0345 600 3030.
The Board anticipates being well placed to deliver a 33rd annual increase in the dividend paid to Shareholders, extending its unbroken record since inception.
The revenue return per share for the six months ended 31 March 2026 was 5.58 pence per share with the result that the dividend was 90% covered by earnings. The Fund Manager's forecast anticipates a higher level of income receipts in the second half of the financial year.
The Board understands that Shareholders want the Company to pay regular, reliable and increasing dividends. We have done that every year since launch in 1992, resulting in your Company being an AIC Dividend Hero. It remains the Board's firm intention to build on this record of dividend growth, which is now supported both by the strength of the Revenue Reserve and the Distributable Reserve created last year from the cancellation of the Share Premium Account. Together, these two reserves amount to £150.2 million.
Refreshed investment approach - delivering sustained income generation and long-term capital growth through a value contrarian approach to investments.
Since taking over as fund manager on 1 January 2026, Dominic Younger has overseen an evolution of your portfolio which seeks to enhance income generation and deliver sustained capital and income growth over the long term.
Dominic aims to achieve this through a value contrarian approach, long championed by the UK Equities team at Columbia Threadneedle Investments. The deep resources and extensive experience of the team provide a solid foundation for weathering such bouts of market turbulence as we are now experiencing.
Under this refreshed approach, Shareholders should expect the portfolio to be balanced across stocks at varying stages of their strategic turnarounds. In seeking out new portfolio holdings, Dominic and the team focus on names that are out of favour with the market and have typically underperformed materially. This can occur for a range of reasons, often leading to 'change situations' where the market is far less efficient in pricing future cashflows effectively. This is where self-help is key, interrogating the financial statements through cycles is critical and immersion in the web of personalities involved is essential.
The Investment Backdrop - technology stock valuations and Middle East conflict
The first six months of the Company's financial year saw the UK equity market perform robustly, with the Company's benchmark FTSE All-Share Index returning 8.9%, faring better than global equity markets.
The final quarter of 2025 was marked by a rotation to less richly valued stocks, driven by a sell-off in large-cap technology stocks amid concerns about stretched valuations and excessive capital expenditure related to AI. This proved beneficial for both the Company and the FTSE All-Share Index, which have less exposure to technology. The FTSE All-Share Index was also aided by its sizeable weightings in miners, as prices of gold and certain industrial metals rose.
This momentum continued until the start of March 2026 when markets stalled markedly after the US and Israel attacked Iran, who retaliated by strikes on energy facilities in other Gulf countries. This, along with the effective closure of the Strait of Hormuz (a key shipping lane for oil exports) led to a surge in oil and gas prices. Equities outside the energy sector sold off sharply amid fears of a pickup in inflation and a slowdown in economic growth on the back of higher costs and lower consumer spending. The prospect of higher inflation raised further fears that the Bank of England might be forced to raise interest rates, placing additional pressure on the UK economy.
The Company's Investment Performance
Against this volatile market backdrop, the Company's Net Asset Value total return per share rose by 0.6% during the six months to 31 March 2026, trailing the benchmark index.
Digging deeper into the reasons, resilient UK market performance at a headline level over the six months to 31 March 2026 belied a high degree of turbulence beneath the surface. Positive performance was heavily concentrated in some of the large index constituents, including HSBC (+21%) and AstraZeneca (+33%), as well as latterly BP (+46%) and Shell (+38%), the benchmark's two mega-cap oil & gas constituents. While the Company has substantial positions in both Shell and AstraZeneca, the portfolio's overall underweight exposure to these names has been the primary headwind for the Company's relative underperformance.
Additionally, an adverse outcome for the Company's holding in litigation finance firm Burford Capital resulted in Burford shares falling 65% in the period.
Investment Outlook - ongoing valuation opportunity
While the relative underperformance in the first six months of the year represents a disappointing outcome for Shareholders, this has been an extra-ordinary investing backdrop and the Board and your Fund Manager remain constructive about the scope for future investment returns.
Performance in the period reflects a moment of acute geopolitical uncertainty which has resulted in extreme outperformance from the UK's sizeable oil & gas sector. Past iterations of such events support the view that performance is likely to normalise given the global economic imperative to resolve the closure of the Strait of Hormuz and thereby restore access to the approximately 12 million barrels of oil per day taken out of global supply.
Moreover, with a longstanding fundamental, bottom-up approach your Fund Manager continues to hold conviction in the under-recognised value in the investee companies held across your portfolio. Our contrarian theses in positions like specialty chemicals company Croda, pest control business Rentokil, drug company GSK and beverages leader Diageo are showing promising signs of progress.
We also continue to see an ongoing valuation opportunity in the domestically focussed companies within the portfolio. This is a segment of the market where there continues to be a profound disconnect with underlying business fundamentals, lately becoming even more pronounced by the Iran-induced lurch in the market's interest rate expectations for this year from gradual cuts to possible rate hikes. It is your Fund Manager's view that full realisation of UK base rate rises currently priced by gilt markets seems unlikely given the prevailing condition of the UK economy, namely muted wage growth, a soft labour market and the absence of government stimulus.
Share Buy-backs
The Board maintains its belief that the share price should not become too dislocated from the underlying NAV per share and to that end the Board is willing and able to buy and sell the Company's own shares when they are too far adrift from that reference point.
In the first six months of this financial year, the Company bought back approximately 1.3 million of its own shares. These buybacks were transacted at an average discount to NAV of 4.0% and added marginally to NAV for remaining Shareholders while also helping to provide some liquidity to the stock market.
It is notable that this is the lowest number of shares repurchased during a half year period since 2023, while open market volumes have risen appreciably over the same period.
Share Price Rating
During the six months under review the Company's share price traded at an average discount to NAV of around 4.0% and, with the outbreak of hostilities in the Middle East, this discount level experienced a higher-than-average level of volatility. As such, having started the period at a discount of 2.9%, the shares ended the period at a discount of 5.8%, which then reverted to below 4.0% the following day. The result was that the share price total return of -1.2% to end of March lagged the NAV performance of +0.6%.
Balance Sheet and Gearing
The Company has a loan facility with The Royal Bank of Scotland International that was renewed in March 2026. At the start of the financial year, the Company's borrowings were £15 million. Following a slightly more positive view of equity markets by the Fund Manager, as well as an intent to more fully harness the unique advantages of the investment trust structure for Shareholders' benefit, the facility was extended with the amount drawn increased to £23 million as at 31 March 2026 and the size of the renewed facility increased from £20 million to £30 million.
Outlook
Recent markets have been dominated by the conflict in Iran and the resulting implications on global growth and inflation. While this is driving near term volatility, it is worth emphasising the shock absorbing qualities of the UK market versus other developed market peers. Its high quotient of defensive businesses, inflation-hedging commodities, and profusion of hard assets have historically stood it in reasonable stead during such bouts of global risk aversion.
It is therefore your Fund Manager's view that UK equities still represent a compelling place to invest, for both income-seekers and total-return focussed savers alike.
The Company retains its investment focus on long-term ownership and quality stewardship of the companies in which we invest. As patient conviction investors, we will continue to avoid short-term trends and concentrate on company fundamentals with a view of targeting strong risk-adjusted returns to you, our shareholders.
* Global Financial Data, DataStream, Morgan Stanley Research 31 December 2025. Returns given are stated in nominal terms.
∞ Ex-dividend date 11 June 2026
On behalf of the Board
Nicky McCabe
21 May 2026
Forward -looking statements
This half-year report may contain forward-looking statements with respect to the financial condition, results of operations and business of the Company. Such statements involve risk and uncertainty because they relate to future events and circumstances that could cause actual results to differ materially from those expressed or implied by forward-looking statements. The forward-looking statements are based on the Directors' current view and on information known to them at the date of this report. Nothing should be construed as a profit forecast.
Directors' Statement of Principal Risks and Uncertainties
Most of the Company's principal risks and uncertainties are market related and no different from those of other investment trusts investing primarily in listed equities. They are described in more detail under the heading "Principal Risks and Future Prospects" within the Strategic Report in the Company's Annual Report for the year ended 30 September 2025.
The principal risks identified in the Annual Report were:
· Market and Political Risks
· Investment Performance Risks
· Legal, Regulatory and Governance Risks
· Product Strategy Risks
· Cyber Risks
· Third Party Service Provider Risks
At present the global economy continues to suffer disruption due to the effects of the war in Ukraine, events in the Middle East and the uncertainty surrounding the imposition of US trade tariffs. The Directors continue to review the key risk register for the Company which identifies the risks that the Company is exposed to, including those that are considered to be emerging, the controls in place and the actions being taken to mitigate them.
The Board considers that the principal risks have not changed materially since 3 December 2025, the date of the Company's Annual Report. The Board has also considered these principal risks in relation to going concern.
Directors' Statement of Responsibilities in Respect of the Half-Yearly Financial Report
We confirm that to the best of our knowledge:
· the condensed set of financial statements have been prepared in accordance with applicable UK Accounting Standards on a going concern basis and give a true and fair view of the assets, liabilities, financial position and return of the Company;
· the Chair's Statement and the Directors' Statement of Principal Risks and Uncertainties (together constituting the Interim Management Report) include a fair review of the information required by the Disclosure Guidance and Transparency Rule ('DTR') 4.2.7R, being an indication of important events that have occurred during the first six months of the financial year and their impact on the financial statements;
· the Directors' Statement of Principal Risks and Uncertainties is a fair review of the principal risks and uncertainties for the remainder of the financial year; and
· the half-yearly report includes a fair review of the information required by DTR 4.2.8R, being related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the Company during the period, and any changes in the related party transactions described in the last Annual Report that could do so.
On behalf of the Board
Nicky McCabe
Chair
21 May 2026
Condensed Income Statement
Half-year ended 31 March 2026 (Unaudited)
Half-year ended 31 March 2025 (Unaudited)
Note
Revenue
Capital
Total
Revenue
Capital
Total
£'000s
£'000s
£'000s
£'000s
£'000s
£'000s
Losses on investments
-
(2,581)
(2,581)
-
(9,950)
(9,950)
Foreign exchange (losses)/gains
(1)
(7)
(8)
2
(12)
(10)
Income
6,070
210
6,280
6,164
-
6,164
Management fee
(210)
(491)
(701)
(346)
(346)
(692)
Other expenses
(436)
-
(436)
(448)
-
(448)
Net return before finance costs and Taxation
5,423
(2,869)
2,554
5,372
(10,308)
(4,936)
Finance costs
(128)
(299)
(427)
(355)
(355)
(710)
Net return before taxation
5,295
(3,168)
2,127
5,017
(10,663)
(5,646)
Taxation
-
-
-
(30)
-
(30)
Net return attributable to Shareholders
5,295
(3,168)
2,127
4,987
(10,663)
(5,676)
2
Return per share - basic and diluted
5.58p
(3.34p)
2.24p
5.01p
(10.72p)
(5.71p)
The total column of this statement is the profit and loss account of the Company. 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.
A Statement of Comprehensive Income is not required as all gains and losses of the Company have been reflected in the above statement.
Condensed Statement of Changes in Equity
Share
Capital
Total
Share
premium
Distributable
redemption
Special
Capital
Revenue
Shareholders'
Half-year ended 31 March 2026 (Unaudited)
Capital
account
reserve
reserve
Reserve
Reserves
reserve
Funds
£'000s
£'000s
£'000s
£'000s
£'000s
£'000s
£'000s
£'000s
Balance at 30 September 2025
26,822
-
141,367
4,146
-
153,541
10,443
336,319
Movements during the half-year ended 31 March 2026
Dividends paid
-
-
-
-
-
-
(6,869)
(6,869)
Ordinary shares bought back and held in treasury
-
-
-
-
-
(5,226)
-
(5,226)
Costs relating to broker
-
-
-
-
-
(4)
-
(4)
Net return attributable to Shareholders
-
-
-
-
-
(3,168)
5,295
2,127
Balance at 31 March 2026
26,822
-
141,367
4,146
-
145,143
8,869
326,347
Half-year ended 31 March 2025 (Unaudited)
Balance at 30 September 2024
26,822
141,367
-
4,146
-
160,600
11,059
343,994
Movements during the half-year ended 31 March 2025
Dividends paid
-
-
-
-
-
-
(6,844)
(6,844)
Ordinary shares bought back and held in treasury
-
-
-
-
-
(5,050)
-
(5,050)
Costs relating to broker
-
-
-
-
-
(5)
-
(5)
Net return attributable to Shareholders
-
-
-
-
-
(10,663)
4,987
(5,676)
Balance at 31 March 2025
26,822
141,367
-
4,146
-
144,882
9,202
326,419
Year ended 30 September 2025 (Audited)
Balance at 30 September 2024
26,822
141,367
-
4,146
-
160,600
11,059
343,994
Movements during the year ended 30 September 2025
Dividends paid
-
-
-
-
-
-
(12,569)
(12,569)
Ordinary shares bought back and held in treasury
-
-
-
-
-
(13,965)
-
(13,965)
Costs relating to broker
-
-
-
-
-
(10)
-
(10)
Share premium cancellation
-
(141,367)
141,367
-
-
-
-
Net return attributable to Shareholders
-
-
-
-
-
6,916
11,953
18,869
Balance at 30 September 2025
26,822
-
141,367
4,146
-
153,541
10,443
336,319
Condensed Balance Sheet
31 March 2026
31 March 2025
30 September 2025
(Unaudited)
(Unaudited)
(Audited)
£'000s
£'000s
£'000s
Fixed assets
Investments
345,369
343,470
348,455
Current assets
Debtors
3,394
4,266
1,181
Cash and cash equivalents
1,148
711
2,235
Total current assets
4,542
4,977
3,416
Current liabilities
Creditors: amounts falling within one year
(564)
(2,028)
(552)
Loan
(23,000)
(20,000)
(15,000)
Total current liabilities
(23,564)
(22,028)
(15,552)
Net current liabilities
(19,022)
(17,051)
(12,136)
Net assets
326,347
326,419
336,319
Capital and reserves
Share capital
26,822
26,822
26,822
Share premium account
-
141,367
-
Distributable reserve
141,367
-
141,367
Capital redemption reserve
4,146
4,146
4,146
Special reserve
-
-
-
Capital reserves
145,143
144,882
153,541
Revenue reserve
8,869
9,202
10,443
Total Shareholders' funds
326,347
326,419
336,319
Net Asset Value per ordinary share
345.94p
331.45p
350.92p
Condensed Statement of Cash Flows
Half-year ended
Half-year ended
31 March 2026 (Unaudited)
31 March 2025 (Unaudited)
£'000s
£'000s
Cash flows from operating activities before interest and dividends received and interest paid
(1,862)
(1,256)
Dividends received
4,618
4,398
Interest and underwriting commission received Interest paid
30 (419)
85 (716)
Cash flows from operating activities
2,367
2,511
Investing activities
Purchase of investments
(197,072)
(16,580)
Sale of investments
197,725
34,370
Cash flows from investing activities
653
17,790
Cash flows before financing activities
3,020
20,301
Financing activities
Equity dividends paid
(6,869)
(6,844)
Costs associated with share issues and buybacks
(4)
(5)
Costs of shares bought back and held in treasury
(5,226)
(5,050)
Drawdown of bank loan
8,000
-
Repayment of bank loan
-
(8,000)
Cash flows from financing activities
(4,099)
(19,899)
Net movement in cash and cash equivalents
(1,079)
402
Cash and cash equivalents at the beginning of the period
2,235
319
Effect of movement in foreign exchange
(8)
(10)
Cash and cash equivalents at the end of the period
1,148
711
Represented by:
Cash at bank
178
361
Short term deposits
970
350
1,148
711
Notes
1 Basis of preparation
These condensed financial statements, which are unaudited, have been prepared on a going concern basis in accordance with the Companies Act 2006, FRS 102, Interim Financial Reporting (FRS104) and the Statement of Recommended Practice "Financial Statements of Investment Trust Companies and Venture Capital Trusts" ("SORP") issued by the AIC.
The accounting policies applied in the condensed set of financial statements are set out in the Company's Annual Report for the year ended 30 September 2025.
With effect from 1 October 2025, the management fees and finance costs have been allocated 70% to the capital reserve and 30% to the revenue reserve.
2 Earnings per ordinary share
Earnings per ordinary share attributable to Shareholders reflects the overall performance of the Company in the period. Net revenue recognised in the first six months is not necessarily indicative of the total likely to be received in the full accounting year.
Half-year ended 31 March 2026 £'000s
Half-year ended 31 March 2025 £'000s
Revenue return
5,295
4,987
Capital return
(3,168)
(10,663)
Total return
2,127
(5,676)
Number
Number
Weighted average ordinary shares in issue
94,960,141
99,451,204
Total return per share
2.24p
(5.71p)
3 Dividend
The second interim dividend of 3.10 pence per share in respect of the year ending 30 September 2026 will be paid on 30 June 2026 to all Shareholders on the register at close of business on 12 June 2026, with an ex-dividend date of 11 June 2026. The total cost of this dividend, based on 93,940,470 shares in issue, and entitled to the dividend on 19 May 2026, being the last practicable date before publication, is £2.9 million.
4 Going concern
In assessing the going concern basis of accounting the Directors have had regard to the guidance issued by the Financial Reporting Council. They have also considered the Company's objective, strategy and policy, the current cash position of the Company, the availability of the loan facility and compliance with its covenants and the operational resilience of the Company and its service providers.
At present, the global economy continues to suffer disruption due to the effects of the war in Ukraine, events in the Middle East and the uncertainty surrounding the imposition of US trade tariffs and the Directors have given careful consideration to the consequences for the Company. The Company has a number of banking covenants and at present the Company's financial position does not suggest that any of these are close to being breached.
The primary risk is that there is a very substantial decrease in the Net Asset Value of the Company in the short to medium term. The Directors have considered the remedial measures that are open to the Company if such a covenant breach appears possible. As at 19 May 2026, the last practicable date before publication of this report, borrowings amounted to £27 million. This is in comparison to a Net Asset Value of £335.9 million. In accordance with its investment policy the Company is mainly invested in readily realisable, FTSE All-Share listed securities. These can be realised, if necessary, to repay the loan facility and fund the cash requirements for future dividend payments.
The Company operates within a robust regulatory environment. The Company retains title to all assets held by the Custodian. Cash is held with banks approved and regularly reviewed by the Manager and the Board.
Based on this information the Directors believe that the Company has the ability to meet its financial obligations as they fall due for a period of at least twelve months from the date of approval of these financial statements. Accordingly, these financial statements have been prepared on a going concern basis.
5 Results
The results for the half-year ended 31 March 2026 and 31 March 2025, which are unaudited, constitute non-statutory accounts within the meaning of Section 434 of the Companies Act 2006. The latest published accounts which have been delivered to the Registrar of Companies are for the year ended 30 September 2025; the report of the Independent Auditors thereon was unqualified and did not contain a statement under Section 498 of the Companies Act 2006. The abridged financial statements shown on prior pages for the year ended 30 September 2025 are an extract from those accounts.
6 Half-Year Report
The Company's Half-Year Report is available on the internet at www.ctcapitalandincome.co.uk.
Printed copies may be obtained by contacting the Company Secretary at the Company's Registered Office, Cannon Place, 78 Cannon Street, London EC4N 6AG.
By order of the Board
Columbia Threadneedle Investment Business Limited, Secretary
21 May 2026
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