REG-Global Opportunities Trust Plc: Annual Results
04/04/2025 07:02
Global Opportunities Trust plc
Legal Entity Identifier: 2138005T5CT5ITZ7ZX58
Annual Results for the year ended 31 December 2024
Financial Highlights
NET ASSET VALUE PER SHARE – cum inc. +2.7% NET ASSET VALUE TOTAL RETURN ( with dividends added back )* +4.1%
SHAREHOLDERS’ FUNDS £109.3 m share price DISCOUNT TO NET ASSET VALUE* -23.5%
31 December 2024 31 December 2023 % Change
Net assets/shareholders’ funds (£) 109,295,000 106,411,000 +2.7
Shares in issue 29,222,180 29,222,180 -
Net asset value per share – cum inc. (pence)* 374.0 364.1 +2.7
Net asset value total return (with dividends added back) (%)* 4.1 1.7 n/a
Share price (pence) 286.0 298.0 -4.0
Dividend per share (pence) 10.0 5.0 +100.0
Share price total return (with dividends added back) (%)* -2.4 -3.6 n/a
Share price discount to net asset value (%)* -23.5 -18.2 n/a
Ongoing charges ratio (%)* 0.8 0.9 n/a
* Alternative Performance Measure.
CHAIR’S STATEMENT
Introduction
I am pleased to present the Company’s Annual Report and Financial Statements
for the year ended 31 December 2024.
Investment performance
The Company’s Net Asset Value (‘NAV’) Total Return grew by 4.1% during
the year however its share price dropped by 4.0% reflecting a widening of the
discount to NAV. In comparison, the FTSE All-World Total Return Index rose by
19.8% and the Bloomberg Global Bond Index declined slightly. Equity markets
remained narrow in their returns with particular reference to a small number
of US technology companies where artificial intelligence became the central
theme.
Shareholders should note however that the Company has no stated benchmark
against which it seeks to outperform. Its objective is to achieve real
long-term total return through investing in undervalued global securities. In
this regard the Company’s NAV Total Return over the past three years has
averaged 6.8% despite the Company retaining a defensive investment posture,
achieved through a combination of high cash levels and the nature of the
equity holdings.
As at 31 December 2024 the Company had net assets of £109.3 million. The NAV
per ordinary share was 374.0p and the middle market price per share on the
London Stock Exchange was 286.0p, representing a discount to NAV of 23.5%. The
Company’s discount is discussed in more detail in the section that follows.
Further details on the investment performance of the Company during the year
under review are provided in the Executive Director’s Report.
Discount and appointment of broker
The Company’s discount to underlying NAV averaged 20.5% during the year, and
at the year end stood at 23.5%. The Board is very conscious of the level of
the discount and will look closely at a range of options for improving the
marketability of the Company. To this end Cavendish have been appointed as
company broker with effect from 3 February 2025 to assist with efforts to
improve demand for the Company’s shares. Further initiatives will be put in
place in the coming year.
Although there were no share buybacks conducted during the year, the Board
remains of the opinion that having the option to utilise share buybacks as a
discount control mechanism is important and is therefore requesting that
shareholders approve a renewal to this authority at the forthcoming Annual
General Meeting (‘AGM’).
Increased final dividend
The return per ordinary share for the year ended 31 December 2024 was 14.9p
(2023: 5.9p), comprising a revenue return of 7.4p per share and a capital
return of 7.5p per share. The Board is proposing a final dividend of 10.0p per
share, representing a doubling of the prior year’s dividend (2023: 5.0p).
Subject to the approval of the payment of the final dividend by shareholders
at the AGM, the dividend will be paid on 30 May 2025 to those shareholders on
the register at the close of business on 2 May 2025. This dividend is fully
covered by the Company’s revenue reserves and exceeds the minimum that the
Company is obliged to distribute under law to maintain its investment trust
status.
Board composition
The Board believes that its size and composition remain appropriate for the
activities of the Company and the Board retains a good balance of skills and
business experience to enable it to operate effectively. As such, all
Directors will be standing for re- election at the forthcoming AGM.
Annual General Meeting
This year’s AGM will be held on 15 May 2025 at the offices of Juniper
Partners Limited, 28 Walker Street, Edinburgh EH3 7HR at 12 noon.
In addition to the formal business of the meeting, Dr Nairn will provide a
short presentation to shareholders on the performance of the Company over the
past year as well as an outlook for the future.
The AGM is an opportunity for shareholders to ask questions of both the Board
and of the Executive Director, and as always, the Board would welcome your
attendance. If you are unable to attend the AGM in person, I would encourage
you to vote in favour of all resolutions by Form of Proxy and appointing me
(as Chair of the meeting) as your proxy to ensure your vote is registered.
Outlook
Whilst last year we thought that significant market rallies would be likely in
response to falling inflation, these rallies have been sustained longer than
we might have expected. The reason probably lies in the growth recorded in the
US which has given rise to the hope that there will be a ‘soft landing’
and a meaningful recession will be avoided. Should this occur, it is just
about possible to make an argument for the current extended equity valuations,
however this would not leave much room for significant returns. If the global
economy were to follow normal historic patterns, then there will be
significant scope for negative corporate profit outcomes which would quickly
puncture the current prevailing sanguine view of equity markets. Against this
backdrop the Company has retained a broadly similar structure to last year in
anticipation of new opportunities arising.
As noted earlier, whilst the Company’s NAV rose slightly over the year this
was not reflected in the share price such that the discount widened further.
To address this, efforts have begun to increase investors’ awareness of the
Company and these will be intensified during 2025.
Once again, we would like to thank our shareholders for their continued
support and look forward to the day when the investment landscape is more
attractive. Periodically, investment articles are posted on the Company’s
website when we encounter investment issues worthy of comment and we would
encourage shareholders to sign up to the website to receive such notifications
during the year.
Keep up to date
Shareholders can also keep up to date on the performance of the portfolio
through the Company’s website at www.globalopportunitiestrust.com where you
will find information on the Company, a monthly factsheet and regular updates
from Dr Nairn.
As always, the Board welcomes communication from shareholders and I can be
contacted directly through the Company Secretary at cosec@junipartners.com.
Cahal Dowds
Chair
3 April 2025
EXECUTIVE DIRECTOR’S REPORT
Background and context
The year was one where strong returns were delivered by global equities but
focussed on a narrow range of companies. Government bonds on the other hand
recorded a marginal decline. Sentiment on inflation and hence interest rates
fluctuated through the year as the US Federal Reserve painted a more positive
picture but with periodic reservations expressed. On the political side the
damage done by the post Covid inflationary jump could be seen in the
anti-incumbency voting patterns. In the UK this resulted in a Labour landslide
and the return of President Trump in the US. Hitherto governments have not had
to deal with the consequences of the post global financial crisis build up in
government debt and it is not a winning strategy when seeking votes to focus
on coming fiscal issues. Normal practice is that during the post-election
period the new government then resets expectations as the reality of dealing
with historic level fiscal overhangs are confronted. In the UK this has led to
a rapid change in sentiment to the new Labour government. In the US it is too
early to tell but the most likely outcome from President Trump will be to
continue with debt expansion and pressurise the Federal Reserve to cut rates.
There will be resistance which may lead to questioning of the Federal
Reserve’s independence. None of this is supportive for asset markets. On the
other hand, the US has continued to deliver economic growth which has
channelled into excitement largely focussed on artificial intelligence related
businesses. At an aggregate level this has left the US cyclically adjusted
price-earnings ratio at its second most expensive level in history, higher
than 1929 and only exceeded by the technology, media and telecommunications
peak of late 2000.
As many commentators have pointed out: a large part of global equity gains
flowed from a small number of technology companies, the so called
‘magnificent seven’ (Alphabet, Amazon, Apple, Meta, Microsoft, NVIDIA, and
Tesla). On the negative side, for the indices, this does pose some
considerable risk if expectations are not met. On the positive side, it means
that there have been different price experiences across sectors and market
capitalisation levels. Whilst we remain of the view that the aggregate
risk/reward on equities is not attractive, it is important to remember that in
a market which has displayed such narrowness, opportunities may exist in areas
where less attention has been directed. In anticipation of this, the
Company’s Sub-Advisor has added experienced research resources with a long
history in smaller and mid-cap equities. It is important to be ready to invest
when the opportunities arise.
The economic path is not entirely clear. Under normal circumstances the need
to address the debt overhang would cause the economy to slow and equity
markets to retrench accordingly. Inflation would continue on a downward path
and whilst recession would appear, the conditions for an upswing would begin
to form. However, it is unlikely that President Trump would willingly
countenance such an outcome. All that he has said suggests that there will
initially be little by the way of fiscal tightening and enormous pressure will
be exerted for monetary laxity. It is not clear what the initial market
reactions to this will be but ultimately it is a combination of policies which
would unsettle bond markets as funding requirements continue to grow. A
perception that control of inflation has been subordinated to presidential
whim is not an environment conducive to premium pricing of assets. We
therefore retain our caution with the caveat that there are some pockets of
attractive valuations.
The portfolio
The structure of the portfolio has changed somewhat from last year. Part of
this was driven by necessity and part by design.
The necessity element related to the Templeton European Long-Short fund
holding. Since we initiated the holding the fund had performed much as we had
hoped providing support in difficult markets and largely eking out gains in
more buoyant ones. However, the manager of the fund departed and as a
consequence we took the decision to exit our holding. The return for 2024
until the exit point was marginally positive. Since initiation, in December
2021, this fund investment has returned 53.9% and contributed a realised gain
of £5.3m.
The direct equity holdings were increased to about 45% of the Company’s net
assets from 40% at the end of 2023. The return over the period was
approximately 8%. Within this there were a number of changes. The first was
that positions in a number of Japanese companies were exited as price targets
were triggered. These included Sumitomo Mitsui Trust Bank, Daiwa House Murata,
and Nabtesco. The reverse of these trades was the investment in the AVI
Japanese Special Situations fund which afforded us access to attractively
priced smaller Japanese companies with inefficient balance sheets where there
was pressure for corporate change. Towards the end of 2024 we also invested in
a number of smaller European companies including Kalmar, the port equipment
company spun out from Cargotec, and the fish farming company Bakkafrost.
The Volunteer Park Capital Fund rose slightly over the year and as its
portfolio matures and their companies perform, we are beginning to see the
expected distributions occur.
Overall, the cash component remained high at 34.2% (combining liquidity funds
and net current assets). The high level of cash reflects the difficulty in
finding undervalued investments, but, when these appear,
cash will be reduced. Over the year, the cash return was 4.5% against the NAV
Total Return of 4.1%. For comparative purposes, the Bloomberg Global Bond
Index was marginally negative whilst the FTSE All-World Index Total Return was
19.8%. For the second year in a row the Company was short listed for the
Investment Week Investment Company of the year in the Flexible category.
Whilst the returns lagged those of the global equity index these have to be
viewed in the context of historically high equity valuations in a world of
meaningful economic risk. We are beginning to see some additional
opportunities and are confident that we have the additional resources to make
sure we exploit them as they arise.
Future prospects
Equity valuations remain stretched and the macro environment weighed down with
debt. Perversely, this is a positive for the Company. Cracks will begin to
appear and when they do the Company is well placed to take advantage of them.
The portfolio has been structured to try and give downside protection but
still provide positive returns whilst we wait for rationality to return. The
most exciting period will be when this happens and the portfolio can be
restructured into one with significantly higher upside. As previously
mentioned in the Chair’s Statement, the Company’s share price discount to
NAV widened during the year. I will be working with the Board and our newly
appointed broker, Cavendish, to address the discount during 2025. Through
positive investment performance, our aim is to continue to attract new
shareholders and grow the Company.
Dr Sandy Nairn
Executive Director
3 April 2025
PORTFOLIO OF INVESTMENTS
as at 31 December 2024
Company Sector Country of Incorporation Valuation £’000 % of Net assets
AVI Japanese Special Situations Fund 1 Financials Japan 12,987 11.9
Volunteer Park Capital Fund SCSp 2 Financials Luxembourg 8,130 7.4
Unilever Consumer Staples United Kingdom 3,501 3.2
TotalEnergies Energy France 3,133 2.9
Imperial Brands Consumer Staples United Kingdom 2,873 2.6
Jet2 Industrials United Kingdom 2,666 2.4
Tesco Consumer Staples United Kingdom 2,605 2.4
Alibaba Group Consumer Discretionary Hong Kong 2,595 2.4
Qinetiq Industrials United Kingdom 2,492 2.3
Lloyds Banking Group Financials United Kingdom 2,362 2.2
ENI Energy Italy 2,313 2.1
Panasonic Consumer Discretionary Japan 2,261 2.1
Dassault Aviation Industrials France 2,218 2.0
Orange Communication Services France 2,118 1.9
RTX Industrials United States 2,100 1.9
Sanofi Health Care France 1,845 1.7
General Dynamics Industrials United States 1,789 1.6
Samsung Electronics Information Technology South Korea 1,789 1.6
Breedon Group Materials United Kingdom 1,677 1.5
Whitbread Consumer Discretionary United Kingdom 1,618 1.5
Verizon Communications Communication Services United States 1,482 1.4
Intel Information Technology United States 1,281 1.2
Nestle Consumer Staples Switzerland 1,213 1.1
Philips Health Care Netherlands 942 0.9
Azelis Group Materials Belgium 927 0.9
Bakkafrost Consumer Staples Denmark 906 0.8
Kalmar Industrials Finland 838 0.8
Danieli Industrials Italy 816 0.7
Terveystalo Health Care Finland 422 0.4
Equity Investments 71,899 65.8
Liquidity Fund Investments 22,287 20.4
Total Investments 94,186 86.2
Cash and other net assets 15,109 13.8
Net Assets 109,295 100.0
1 Sub-Fund of Gateway UCITS Funds PLC
2 Luxembourg Special Limited Partnership
STRATEGIC REVIEW
Introduction
The purpose of this report is to provide shareholders with details of the
Company’s strategy, objectives and business model as well as the principal
and emerging risks and challenges the Company has faced during the year under
review. It should be read in conjunction with the Chair’s Statement, the
Executive Director’s Report and the portfolio information, which provide a
review of the Company’s investment activity and outlook.
The Board is responsible for the stewardship of the Company, including overall
strategy, investment policy, dividends, corporate governance procedures and
risk management. The Board assesses the performance of the Company against its
investment objective at each Board meeting by considering the key performance
indicators.
Business and Status
The principal activity of the Company is to carry on business as an investment
trust.
The Company is registered in Scotland as a public limited company and is an
investment company within the meaning of section 833 of the Companies Act
2006. The Company has been approved by HM Revenue & Customs as an authorised
investment trust under sections 1158 and 1159 of the Corporation Tax Act 2010
and the ongoing requirements for approved companies as detailed in Chapter 3
of Part 2 of the Investment Trust (Approved Company) (Tax) Regulations 2011.
In the opinion of the Directors, the Company has conducted its affairs so as
to enable it to continue to maintain its status as an investment trust.
The Company is a self-managed investment company run by its Board and is
authorised by the Financial Conduct Authority (‘FCA’) as a Small
Registered Alternative Investment Fund Manager.
The Company’s shares are listed on the closed-ended investment funds
category of the Official List and traded on the main market of the London
Stock Exchange.
The Company is a member of the Association of Investment Companies
(‘AIC’), a trade body which promotes investment companies and develops
best practice for its members.
Investment Objective
The Company’s investment objective is to provide shareholders with an
attractive real long-term total return by investing globally in undervalued
asset classes. The portfolio is managed without reference to the composition
of any stock market index.
Investment Policy
The Company invests in a range of assets across both public and private
markets throughout the world. These assets include both listed and unquoted
securities, investments and interests in other investment companies and
investment funds (including limited partnerships and offshore funds) as well
as bonds (including index-linked securities) and cash as appropriate.
Any single investment in the Company’s portfolio may not exceed 15% of the
Company’s total assets at the time of the relevant investment (the ‘Single
Investment Limit’).
The Company may invest in other investment companies or funds and may appoint
one or more sub-advisors to manage a portion of the portfolio if, in either
case, the Board believes that doing so will provide access to specialist
knowledge that is expected to enhance returns. The Company will gain exposure
to private markets directly and indirectly through investments and interest in
other investment companies and investment funds (including limited
partnerships and offshore funds). The Company’s investment directly and
indirectly in private markets (including through investment companies and
investment funds) shall not, in aggregate, exceed 30% of the Company’s total
assets, calculated at the time of the relevant investment.
The Company will invest no more than 15% of its total assets in other
closed-ended listed investment companies (including investment trusts).
The Company may also invest up to 50% of its total assets in bonds, debt
instruments, cash or cash equivalents when the Board believes extraordinary
market or economic conditions make equity investment unattractive or while
seeking appropriate investment opportunities for the portfolio or to maintain
liquidity. The Single Investment Limit does not apply to cash or cash
equivalents in such circumstances. In addition, the Company may purchase
derivatives for the purposes of efficient portfolio management.
From time to time, when deemed appropriate and only where permitted in
accordance with the UK Alternative Investment Fund Managers Regulations 2013,
the Company may borrow for investment purposes up to the equivalent of 25% of
its total assets. By contrast, the Company’s portfolio may from time to time
have substantial holdings of debt instruments, cash or short-term deposits.
The investment objective and policy are intended to ensure that the Company
has the flexibility to seek out value across asset classes rather than being
constrained by a relatively narrow investment objective. The objective and
policy allow the Company to be constrained in its investment selection only by
valuation and to be pragmatic in portfolio construction by only investing in
assets which the Executive Director considers to be undervalued on an absolute
basis.
Investment Strategy
The Company’s portfolio is managed without reference to any stock market
index. Investments are selected for the portfolio only after extensive
research by the Executive Director. The Executive Director’s approach is
long-term and focused on absolute valuation. Dr Nairn aims to identify and
invest in undervalued asset classes, and to have the patience to hold them
until they achieve their long-term earnings potential or valuation.
Dividend Policy
The Company does not have a stated dividend policy.
The Company’s investment objective is to provide real long-term total return
rather than income growth. As a result, the level of revenue generated from
the portfolio will vary from year to year, and any dividend paid to
shareholders is likely to fluctuate.
The Board is mindful that in order for the Company to continue to qualify as
an investment trust, the Company is not permitted to retain more than 15% of
eligible investment income arising during any accounting period. Accordingly,
the Board will ensure that any declared dividend is sufficient to enable the
Company to maintain its investment trust status.
Management Arrangements
As a self-managed investment trust, the Board is fully responsible for the
management of the Company and all required reporting to the FCA in respect of
the safeguarding of the Company’s assets.
The global listed equities portion of the portfolio is managed by Dr Nairn,
who is a full time Executive Director of the Company. In addition, the Company
entered into a strategic relationship with Goodhart Partners LLP
(‘Goodhart’) in 2023. Goodhart’s role is twofold, both to introduce
private market opportunities to the Company, and to provide investment
sub-advisory services to the Company to assist Dr Nairn in managing the global
listed equities mandate. Goodhart has added significant analytical resource to
assist with the management of the Company. This resource brings specialist
knowledge in a number of key investment areas including global technology and
small/mid cap stocks. Further information on Goodhart is available via their
website at www.goodhartpartners.com.
Portfolio Performance
Full details on the Company’s activities during the year under review are
contained in the Chair’s Statement and Executive Director’s Report. The
portfolio consisted of 29 investments, excluding cash and other net assets as
at 31 December 2024, thus ensuring that the Company has a suitable spread of
investment risk.
Key Performance Indicators
At each Board meeting, the Directors consider key performance indicators to
assess whether the Company is meeting its investment objective.
The key performance indicators used to measure the performance of the Company
over time are as follows:
Share price total return to 31 December 2024 1 year (%) 3 years (%) 5 years (%)
Global Opportunities Trust plc -2.4 3.2 1.9
AIC Flexible Investments peer group† 8.0 -5.7 15.9
FTSE All-World Total Return Index* 19.8 28.5 74.2
NAV Total Return to 31 December 2024 1 year (%) 3 years (%) 5 years (%)
Global Opportunities Trust plc 4.1 22.6 27.1
AIC Flexible Investments peer group† 7.9 6.2 39.1
FTSE All-World Total Return Index* 19.8 28.5 74.2
Share Price Discount to NAV as at 31 December 2024 (%) 2023 (%) 2022 (%)
Global Opportunities Trust plc 23.5 18.2 13.5
AIC Flexible Investments peer group† 22.0 18.3 14.4
Ongoing charges ratio to 31 December 2024 (%) 2023 (%) 2022 (%)
Global Opportunities Trust plc 0.8 0.9 0.9
AIC Flexible Investments peer group† 0.9 0.9 1.0
† Source: theaic.co.uk & Morningstar. The Company is classified by the
Association of Investment Companies in its Flexible Investment sector. This
sector’s performance indicators have been shown for comparative purposes
only.
* The Company does not formally benchmark its performance against a specific
index, the FTSE All-World Total Return Index (in sterling) has been shown for
comparative purposes only.
Gearing
The Company did not have any borrowings and did not use derivative instruments
for currency hedging during the year ended 31 December 2024. The Company’s
investment in the Templeton European Long-Short Equity Fund, which used
derivatives, was sold on 1 November 2024.
Principal Risks
The Board, in conjunction with the Audit and Management Engagement Committee,
has undertaken a robust annual assessment and review of all the risks facing
the Company, together with a review of any new and emerging risks which may
have arisen during the year. These risks are formalised within the Company’s
risk assessment matrix which is formally reviewed on a semi-annual basis by
the Audit and Management Engagement Committee. There have been no new risks
identified during the year, however, geopolitical risk has moved from being an
emerging risk and is now considered to be a principal risk.
The principal risks and any emerging risks and uncertainties facing the
Company, together with a summary of the mitigating actions and controls in
place to manage these risks, and how these risks have changed over the period
are set out below:
Principal Risks Mitigation and Controls
Geopolitical Risk Heightened geopolitical tensions, including the ongoing conflicts in Ukraine and the Middle East, coupled with potential new trade tariffs introduced by the US, could have an adverse impact on global markets and impact the Company’s portfolio. Now considered a principal risk, rather than an emerging risk The Board regularly reviews the Company’s portfolio, including geographical split, and its performance against its stated investment objective. Ongoing discussions between the Executive Director and Sub-Advisor ensures that the portfolio has exposure to
various geographies and sectors, in order to reduce risk relative to less-diversified portfolios.
Investment and Strategy Risk There can be no guarantee that the investment objective of the Company, to provide shareholders with an attractive real long-term total return by investing globally in undervalued asset classes, will be achieved. No change to this risk The Board meets regularly to discuss and challenge the portfolio performance and strategy and to receive investment updates from the Executive Director. The Board receives quarterly reports detailing all portfolio transactions and any other significant
changes in the market or stock outlooks.
Key Person Risk The Company’s ability to deliver its investment strategy is dependent on the Executive Director, Dr Nairn. A change in key investment management personnel who are involved in the management of the Company’s portfolio could impact on future performance and the Company’s ability to deliver on its investment strategy. No change to this risk The Board frequently considers succession planning. Dr Nairn has day-to-day responsibility for the investment management of the Company and the Sub-Advisor has a dedicated investment team supporting the Company. Dr Nairn and the Board are also in regular
contact with the Sub-Advisor (who attends Board meetings upon request), and underlying fund managers and would be informed of any proposed changes in their personnel.
Financial and Economic Risk The Company’s investments are impacted by financial and economic factors including market prices, interest rates, foreign exchange rates, liquidity and inflation, which could cause losses within the portfolio. No change to this risk The Board receives regular updates on the composition of the Company’s investment portfolio and market developments from the Executive Director. Investment performance is continually monitored specifically in the light of emerging risks throughout the
period. The Board regularly reviews and agrees policies for managing market price risk, interest rate risk, foreign exchange risk, liquidity risk and inflationary risk.
Discount Volatility Risk As referred to in the Chair’s Statement, the Company’s share price discount to NAV widened during the year. The Board recognises that it is in the long-term interests of shareholders to reduce discount volatility and believes that the prime driver of discounts over the longer term is investment performance. An inappropriate or unattractive objective and strategy may have an adverse effect on shareholder returns or cause a reduction in demand for the Company’s shares, both of which could lead to a widening of the discount. Risk has been heightened by a widening of the discount The Board actively monitors the discount at which the Company’s shares trade, and is committed to using its powers to allot or repurchase the Company’s shares. The Board may use share buybacks, when appropriate, to narrow the discount to NAV at which the
shares trade. This will be done in conjunction with creating new demand and being aware of the liquidity of the shares. The Board’s commitment to allot or repurchase shares is subject to it being satisfied that any offer to allot or purchase shares is in
the best interests of shareholders of the Company as a whole, the Board having the requisite authority pursuant to the Articles of Association and relevant legislation to allot or purchase shares, and all other applicable legislative and regulatory
provisions. The Board reviews changes to the shareholder register regularly and considers shareholder views and developments in the market place.
Regulatory Risk The Company operates in an evolving regulatory environment and faces a number of regulatory risks. Failure to qualify under the terms of sections 1158 and 1159 of the CTA may lead to the Company being subject to capital gains tax. A breach of the Listing Rules may result in censure by the FCA and/or the suspension of the Company’s shares from listing. If all price sensitive issues are not disclosed in a timely manner, this could create a misleading market in the Company’s shares. A Small Registered Alternative Investment Fund Manager does not carry on a regulated activity in respect of its activities as an Alternative Investment Fund Manager for an Alternative Investment Fund for which it is entitled to be registered. It is, however, required to comply with certain requirements under the Alternative Investment Fund Managers Directive (‘AIFMD’) (which mainly relate to reporting). No change to this risk Compliance with the Company’s regulatory obligations is monitored on an ongoing basis by the Company Secretary and other professional advisers as required who report to the Board regularly. The Directors note the corporate offence of failure to prevent
tax evasion and believe all necessary steps have been taken to prevent facilitation of tax evasion. The Directors are aware of their responsibilities relating to price sensitive information and would consult with their advisers if any potential issues
arose. This includes ensuring compliance with the Market Abuse Regulation. The Company Secretary would notify the Board immediately if it became aware of any disclosure issues. The Sub-Advisor has a comprehensive market abuse policy and any potential
breaches of this policy would be promptly reported to the Board. The Board has agreed service levels with the Company Secretary and Sub-Advisor which include active and regular review of compliance with these requirements.
Operational Risk There are a number of operational risks associated with the fact that third parties undertake the Company’s administration and custody functions. Operational risks include cyber security, IT systems failure, inadequacy of oversight and control and climate risk. The main risk is that third parties may fail to ensure that statutory requirements, such as compliance with the Companies Act 2006 and the FCA requirements, are met. No change to this risk The Board regularly receives and reviews management information on third parties which the Company Secretary compiles. In addition, each of the third parties, where available, provides a copy of its report on internal controls to the Board each year. Any
breaches in controls which have resulted in errors or incidents are required to be notified to the Board along with proposed remediation actions. The Company employs the Administrator to prepare all financial statements of the Company and meets with the
Auditor at least once a year to discuss all financial matters, including appropriate accounting policies. The Company is a member of the AIC, a trade body which promotes investment trusts and also develops best practice for its members. The Executive
Director and the Company’s third-party suppliers have contingency plans to ensure the continued operation of the business in the event of disruption.
Culture
The Chair leads the Board and is responsible for its overall effectiveness in
directing the Company. He demonstrates objective judgement, promotes a culture
of openness and debate, and facilitates effective contributions by all
Directors. In liaison with the Company Secretary, the Chair ensures that the
Directors receive accurate, timely and clear information. The Directors are
required to act with integrity, lead by example and promote this culture
within the Company.
The Board seeks to ensure the alignment of the Company’s purpose, values and
strategy with the culture of openness, debate and integrity through ongoing
dialogue, and engagement with shareholders, the Executive Director and the
Company’s other service providers. The Company has adopted a number of
policies, practices and behaviours to facilitate a culture of good governance
and ensure that this is maintained.
The culture of the Board is considered as part of the annual performance
evaluation process which is undertaken by each Director. The culture of the
Company’s service providers is also considered by the Board during the
annual review of their performance and while considering their continuing
appointment. In the context of the Executive Director and Sub-Advisor,
particular attention is paid to environmental, social and governance,
engagement and proxy voting policies.
Directors and Gender Representation
As at 31 December 2024, the Board of Directors of the Company comprised two
male and two female Directors. The appointment of any new Director is made in
accordance with the Company’s diversity policy.
Employees and Human Rights
The Board recognises the requirement under the Companies Act 2006 to detail
information about human rights, employees and community issues, including
information about any policies it has in relation to these matters and the
effectiveness of these policies. The Company has one employee, Executive
Director Dr Nairn. All the remaining Directors are Non-Executive. The Company
has outsourced all its functions to third-party service providers. The Company
has therefore not reported further in respect of these provisions.
Modern Slavery Statement
The Company is not within the scope of the Modern Slavery Act 2015 because it
has not exceeded the turnover threshold and therefore no further disclosure is
required in this regard.
Greenhouse Gas Emissions
The Company has no greenhouse gas emissions to report from its operations, nor
does it have responsibility for any other emission-producing sources under the
Companies Act 2006 (Strategic Report and Directors’ Report) Regulations
2013.
Environmental, Social and Governance (‘ESG’)
The Company seeks to invest in companies that are well managed with high
standards of corporate governance. The Board believes this creates the proper
conditions to enhance long-term value for shareholders. The Company adopts a
positive approach to corporate governance and engagement with companies in
which it invests.
In pursuit of the above objective, the Board believes that proxy voting is an
important part of the corporate governance process and considers seriously its
obligation to manage the voting rights of companies in which it is invested.
It is the policy of the Company to vote, as far as possible, at all
shareholder meetings of investee companies. The Company follows the relevant
applicable regulatory and legislative requirements in the UK, with the guiding
principles being to make proxy voting decisions which favour proposals that
will lead to maximising shareholder value while avoiding any conflicts of
interest. Voting decisions are taken on a case-by-case basis by the
Sub-Advisor on behalf of the Company. The key issues on which the Sub-Advisor
focuses are corporate governance, including disclosure and transparency, board
composition and independence, control structures, remuneration, and social and
environmental issues.
The Executive Director and Sub-Advisor consider a wide range of factors when
making investment decisions including an investee company’s ESG credentials.
In making fund investment decisions, the Executive Director’s assessment
includes analysing the fund manager’s ESG cultural buy-in, its ESG process,
procedures and reporting, its engagement with underlying portfolio companies
and an operational due diligence review of the relevant manager and fund.
Duty to Promote the Success of the Company
Under section 172 of the Companies Act 2006, the Directors have a duty to act
in the way they consider, in good faith, would be most likely to promote the
success of the Company for the benefit of its members as a whole, and in doing
so have regard (amongst other matters) to:
* the likely consequences of any decision they make in the long term;
* the need to foster the Company’s business relationships with its
stakeholders, which includes the shareholders, the Executive Director and
Sub-Advisor and other relevant parties as listed below;
* the need to act independently by exercising reasonable skill and judgement;
* the impact of the Company’s operations on the community and the
environment;
* the requirement to avoid a conflict of interests;
* the desirability of the Company maintaining a reputation for high standards
of business conduct;
* the need to act fairly between members of the Company; and
* the need to declare any interests in proposed transactions.
Stakeholder Engagement
The Company has one employee, its Executive Director, Dr Nairn. As an
investment trust, the Company has no customers or physical assets; the primary
stakeholders are the shareholders, the Executive Director, Sub-Advisor, and
other third-party service providers. The Company also engages with its
investee companies where appropriate.
Shareholders
Communication and regular engagement with shareholders are given a high
priority by the Board. The Executive Director seeks to maintain regular
contact with major shareholders and is always available to enter into dialogue
with all shareholders. A regular dialogue is also maintained with the
Company’s institutional shareholders and private client asset managers
through the Executive Director, who regularly reports to the Board on
significant contact, the views of shareholders and any changes to the
composition of the share register.
All shareholders are encouraged, if possible, to attend and vote at the AGM
and at any other general meetings of the Company (if any), during which the
Board is available to discuss issues affecting the Company. Shareholders
wishing to communicate directly with the Board should contact the Company
Secretary. The Chair is available throughout the year to respond to
shareholders, including those who wish to speak with him in person. Copies of
the Annual and Half-Yearly Reports are currently issued to shareholders and
are also available, along with the monthly factsheets for downloading from the
Company’s website at www.globalopportunitiestrust.com. The Company also
releases portfolio updates to the market on a monthly basis.
Executive Director and Sub-Advisor
The Non-Executive Directors believe that maintaining a close and constructive
working relationship with the Executive Director and Sub-Advisor is crucial to
promoting the long-term success of the Company in an effective and responsible
way. This ensures the interests of all current and potential stakeholders are
properly taken into account when decisions are made. The Executive Director
attends all Board meetings and provides reports on investments, performance,
marketing, operational and administrative matters. The Sub-Advisor is
available to attend Board meetings upon request. An open discussion regarding
such matters is encouraged, both at Board meetings and by way of ongoing
communication between the Board, the Executive Director and Sub-Advisor. Board
members are encouraged to share their knowledge and experience with the
Executive Director and Sub-Advisor, and where appropriate, the Board adopts a
tone of constructive challenge. The Board keeps the ongoing performance of the
Executive Director and Sub-Advisor under continual review and conducts an
annual appraisal of both the parties.
Service Providers
The Company’s day-to-day operational functions are delegated to several
third-party service providers, each engaged under separate contracts. In
addition to the Sub-Advisor, the Company’s principal third-party service
providers include the Administrator, Auditor, Company Secretary, Custodian and
Registrar. The Board engages with its service providers to develop and
maintain positive and productive relationships, and to ensure that they are
well informed in respect of all relevant information about the Company’s
business and activities. The Board, through its Audit and Management
Engagement Committee, keeps the ongoing performance, fees and continuing
appointment of these service providers under continual review and conducts an
annual appraisal of all third-party service providers.
Corporate Broker
The Company was pleased to announce the appointment of Cavendish Capital
Markets Limited (‘Cavendish’) as corporate broker and financial adviser to
the Company, with effect from 3 February 2025. Under this new appointment,
Cavendish will advise the Company on the trading of the Company’s shares and
the opportunity to build relationships with new retail investors and wealth
management clients.
The Board has requested a comprehensive marketing plan for the Company, from
the Sub-Advisor, and this will be progressed in 2025.
Investee Companies
The Sub-Advisor assists with the day-to-day management of the Company’s
equity investment portfolio. As such, the Sub-Advisor has responsibility for
engaging with investee companies on behalf of the Company. The Sub-Advisor
does so in consideration of the principles set out in the UK Stewardship Code
2020.
The Board recognises the importance of engagement with investee companies. The
Board is aware of evolving expectations in this regard and is committed to
working with the Executive Director and Sub-Advisor, in relation to future
engagement on behalf of the Company.
The above methods for engaging with stakeholders are kept under review by the
Directors and discussed on a regular basis at Board meetings to ensure that
they remain effective.
For and on behalf of the Board
Cahal Dowds
Chair
3 April 2025
STATEMENT OF DIRECTORS’ RESPONSIBILITIES
The Directors are responsible for preparing the Annual Report and the
Financial Statements in accordance with applicable UK law and regulations.
The Companies Act 2006 (the ‘Law’) requires the Directors to prepare
Financial Statements for each financial period. Under that Law, they have
elected to prepare the Financial Statements in accordance with UK Accounting
Standards (United Kingdom Generally Accepted Accounting Practice), including
FRS 102 “The Financial Reporting Standard applicable in the UK and Republic
of Ireland”.
Under the Law, the Directors must not approve the Financial Statements unless
they are satisfied that they give a true and fair view of the state of affairs
of the Company and of the profit or loss of the Company for that period.
In preparing these Financial Statements, the Directors are required to:
* select suitable accounting policies and then apply them consistently;
* make judgements and estimates that are reasonable and prudent;
* state whether applicable UK Accounting Standards have been followed, subject
to any material departures disclosed and explained in the Financial
Statements; and
* prepare the Financial Statements on the going concern basis unless it is
inappropriate to presume that the Company will continue in business.
The Directors are responsible for keeping adequate accounting records that are
sufficient to show and explain the Company’s transactions and disclose with
reasonable accuracy at any time the financial position of the Company and
enable them to ensure that its Financial Statements comply with the Law and
include the information required by the Listing Rules of the Financial Conduct
Authority. They are also responsible for safeguarding the assets of the
Company and hence for taking reasonable steps for the prevention and detection
of fraud and other irregularities.
Under applicable law and regulations, the Directors are also responsible for
preparing a Strategic Report, Directors’ Report, Remuneration Report and
Corporate Governance Statement that comply with that law and those
regulations.
The Directors are responsible for the maintenance and integrity of the
corporate and financial information included on the Company’s website,
www.globalopportunitiestrust.com. The work carried out by the Auditor does not
include consideration of these matters and, accordingly, the Auditor accepts
no responsibility for any changes that may have occurred to the Financial
Statements since they were initially presented on the website. Legislation in
the UK governing the preparation and dissemination of financial statements may
differ from legislation in other jurisdictions.
Each of the Directors confirm to the best of their knowledge that:
* the Financial Statements, prepared in accordance with the applicable set of
UK Accounting Standards, give a true and fair view of the assets, liabilities,
financial position and profit or loss of the Company;
* the Annual Report includes a fair view 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 the Company faces; and
* in the opinion of the Board, the Annual Report and Financial Statements
taken as a whole, is fair, balanced and understandable and provides the
information necessary to assess the Company’s performance, business model
and strategy.
On behalf of the Board
Cahal Dowds
Chairman
3 April 2025
INCOME STATEMENT
for the year ended 31 December 2024
2024 2023
Revenue £’000 Capital £’000 Total £’000 Revenue £’000 Capital £’000 Total £’000
Gains on investments at fair value through profit or loss – 2,123 2,123 – 2,271 2,271
Foreign exchange gains/(losses) on capital items – 136 136 – (1,974) (1,974)
Income 2,996 33 3,029 2,460 – 2,460
Investment management fee (42) (99) (141) (49) (114) (163)
Other expenses (591) – (591) (653) – (653)
Net return before finance costs and taxation 2,363 2,193 4,556 1,758 183 1,941
Finance costs
Interest payable and related charges (7) – (7) (21) – (21)
Net return before taxation 2,356 2,193 4,549 1,737 183 1,920
Taxation – overseas withholding tax (204) – (204) (192) – (192)
Net return after taxation 2,152 2,193 4,345 1,545 183 1,728
Return per ordinary share 7.4p 7.5p 14.9p 5.3p 0.6p 5.9p
All revenue and capital items in the above statement derive from continuing
operations.
The total column of this statement is the profit and loss account of the
Company.
The revenue and capital return columns are prepared under guidance issued by
the Association of Investment Companies Statement of Recommended Practice
(SORP 2022).
A separate Statement of Comprehensive Income has not been prepared as all
gains and losses are included in the Income Statement.
BALANCE SHEET
as at 31 December 2024
2024 £’000 2023 £’000
Fixed asset investments
Investments at fair value through profit or loss* 94,186 64,083
Current assets
Debtors 411 374
Cash at bank and short-term deposits 16,506 42,105
16,917 42,479
Current liabilities
Creditors (1,808) (151)
(1,808) (151)
Net current assets 15,109 42,328
Net assets 109,295 106,411
Capital and reserves
Called-up share capital 645 645
Share premium 1,597 1,597
Capital redemption reserve 14 14
Special reserve 9,760 9,760
Capital reserve 92,474 90,281
Revenue reserve 4,805 4,114
Total shareholders’ funds 109,295 106,411
Net asset value per ordinary share 374.0p 364.1p
* Investments at fair value through profit or loss includes liquidity fund
investments of £22,287,000 not previously held by the Company.
The Financial Statements were approved by the Board of Directors on 3 April
2025 and signed on its behalf by:
Cahal Dowds
Chairman
Registered in Scotland No. SC259207
STATEMENT OF CHANGES IN EQUITY
for the year ended 31 December 2024
Year ended 31 December 2024 Share capital £’000 Share premium £’000 Capital redemption reserve £’000 Special reserve 1 £’000 Capital reserve 1 £’000 Revenue reserve 1 £’000 Total £’000
At 1 January 2024 645 1,597 14 9,760 90,281 4,114 106,411
Net return after taxation – – – – 2,193 2,152 4,345
Dividends paid – – – – – (1,461) (1,461)
At 31 December 2024 645 1,597 14 9,760 92,474 4,805 109,295
Year ended 31 December 2023 Share capital £’000 Share premium £’000 Capital redemption reserve £’000 Special reserve 1 £’000 Capital reserve 1 £’000 Revenue reserve 1 £’000 Total £’000
At 1 January 2023 645 1,597 14 9,760 90,098 4,030 106,144
Net return after taxation – – – – 183 1,545 1,728
Dividends paid – – – – – (1,461) (1,461)
At 31 December 2023 645 1,597 14 9,760 90,281 4,114 106,411
1 Distributable reserves total £100,167,000 (2023: £94,170,000). The Capital
reserve comprises realised gains of £85,602,000 (2023: £80,296,000), which
are distributable, and unrealised gains of £6,872,000 (2023: £9,985,000),
which are not immediately distributable.
STATEMENT OF CASH FLOW
for the year ended 31 December 2024
Year ended 31 December 2024 Year ended 31 December 2023
£’000 £’000 £’000 £’000
Cash flows from operating activities
Net return on ordinary activities before taxation 4,549 1,920
Adjustments for:
Gains on investments (2,123) (2,271)
Interest payable 7 21
Purchases of investments* (60,433) (949)
Sales of investments* 34,122 8,420
Dividend income (1,601) (1,774)
Other income (1,428) (686)
Dividend income received 1,612 1,777
Other income received 1,335 723
Decrease in receivables 2 1
Increase/(decrease) in payables 1 (29)
Overseas withholding tax deducted (174) (195)
(28,680) 5,038
Net cash flows from operating activities (24,131) 6,958
Cash flows from financing activities
Equity dividends paid from revenue (1,461) (1,461)
Interest paid (7) (21)
Net cash flows from financing activities (1,468) (1,482)
Net (decrease)/increase in cash and cash equivalents (25,599) 5,476
Cash and cash equivalents at the start of the year 42,105 36,629
Cash and cash equivalents at the end of the year 16,506 42,105
* Receipts from the sale of, and payments to acquire, investment securities
have been classified as components of cash flows from operating activities
because they form part of the Company’s dealing operations. Amounts include
liquidity fund investment subscriptions and redemptions not previously dealt
by the Company.
NOTES TO THE FINANCIAL STATEMENTS
at 31 December 2024
1. Accounting policies
Statement of compliance
Global Opportunities Trust plc is a company incorporated in Scotland. The
Company is registered as a public limited company and is an investment company
within the terms of section 833 of the Companies Act 2006 (“the Act”). The
nature of the Company’s operations and its principal activities are set out
in the Strategic Review.
The Company’s Financial Statements have been prepared under FRS 102 “The
Financial Reporting Standard applicable in the UK and Republic of Ireland”
and in accordance with the Act and with the Statement of Recommended Practice
issued by the AIC (the “AIC SORP”).
The comparative figures for the Financial Statements are for the year ended 31
December 2023.
Going concern
The financial statements have been prepared on a going concern basis and on
the basis that approval as an investment trust company will continue to be
met.
The Directors have made an assessment of the Company’s ability to continue
as a going concern and are satisfied that the Company has adequate resources
to continue in operational existence for a period of at least 12 months from
the date when these financial statements were approved.
The Directors have noted that the Company, holding a portfolio consisting
principally of liquid listed investments and cash balances, is able to meet
the obligations of the Company as they fall due, any future funding
requirements and finance future additional investments. The Company is a
closed end fund, where assets are not required to be liquidated to meet
day-to-day redemptions.
The Directors have completed stress tests assessing the impact of changes and
scenario analysis to assist them in determination of going concern. In making
this assessment, the Directors have considered plausible downside scenarios
that have been financially modelled. These tests apply to any set of
circumstances in which asset value and income are significantly impaired. The
conclusion was that in a plausible downside scenario, the Company could
continue to meet its liabilities. Whilst the economic future is uncertain, and
the Directors believe that it is possible the Company could experience further
reductions in income and/or market value, the opinion of the Directors is that
this should not be to a level which would threaten the Company’s ability to
continue as a going concern.
The Directors are not aware of any material uncertainties that may cast
significant doubt on the Company’s ability to continue as a going concern,
having taken into account the liquidity of the Company’s investment
portfolio and the Company’s financial position in respect of its cash flows
and investment commitments. Therefore, the financial statements have been
prepared on the going concern basis.
Segmental reporting
The Directors are of the opinion that the Company is engaged in a single
segment of business, being investment business. The Company primarily invests
in listed companies.
Income recognition
Dividend and other investment income is included as revenue on the ex-dividend
date, the date the Company’s right to receive payment is established.
Dividends from overseas companies are shown gross of withholding tax. Where
the Company has elected to receive scrip dividends in the form of additional
shares rather than in cash, the amount of the cash dividend foregone is
recognised as income. Any excess or shortfall compared to the cash dividend is
recognised as capital. Special dividends are reviewed on an individual basis
to determine whether they should be accounted for as revenue or capital.
Income from private equity holdings is recognised upon notification of
irrevocable income distribution by the general partner. Interest income and
rebate income is included on an accruals basis.
Expenses and finance costs
All management expenses and finance costs are accounted for on an accruals
basis. The Company charges 30% of management fees and finance costs related to
borrowings to revenue in the Income Statement and 70% to capital in the Income
Statement. All other operating expenses and finance costs are charged to
revenue in the Income Statement, except costs that are incidental to the
acquisition or disposal of investments, which are charged to capital in the
Income Statement. Transaction costs are included within the gains and losses
on investments, as disclosed in the Income Statement.
Investments
In accordance with FRS 102, Sections 11 and 12, all investments held by the
Company are designated as held at fair value upon initial recognition and are
measured at fair value through profit or loss in subsequent accounting
periods. Investments are initially recognised at cost, being the fair value of
the consideration given.
After initial recognition, investments are measured at fair value, with
changes in the fair value of investments recognised in the Income Statement
and allocated to capital. Realised gains and losses on investments sold are
calculated as the difference between sales proceeds and cost.
For investments actively traded in organised financial markets, fair value is
generally determined by reference to Stock Exchange quoted market bid prices
at the close of business on the Balance Sheet date, without adjustment for
transaction costs necessary to realise the asset.
Unquoted investments are valued by the Directors at fair value, using the
guidelines on valuation published by the International Private Equity and
Venture Capital Association (“IPEV”). The fair value of the Company’s
investments in private equity funds is based on its share of the total net
asset value of the fund calculated on a quarterly basis, being the measurement
date. The fair value of the private equity funds is derived from the value of
its underlying investments using a methodology which is consistent with the
IPEV guidelines. The Company reviews the fair valuation methodology adopted
for the underlying investments of the private equity funds on a quarterly
basis and will adjust where it does not believe the valuations represent fair
value. Where formal valuations are not completed as at the Balance Sheet date,
the last available valuation is adjusted to reflect any changes in
circumstances from the last formal valuation date to arrive at the estimate of
fair value.
This represents the Directors’ view of the amount for which an asset could
be exchanged between knowledgeable willing parties in an arm’s length
transaction.
Foreign currency
The Financial Statements have been prepared in sterling, rounded to the
nearest £’000, which is the functional and reporting currency of the
Company. Sterling is the currency of the primary economic environment in which
the Company operates.
Transactions denominated in foreign currencies are converted to sterling at
the actual exchange rate as at the date of the transaction. Assets and
liabilities denominated in foreign currencies at the year end are reported at
the rate of exchange at the Balance Sheet date. Any gain or loss arising from
a change in exchange rates subsequent to the date of the transaction is
included as a gain or loss in the capital reserve or revenue reserve as
appropriate.
Taxation
The charge for taxation is based on the net revenue for the year and takes
into account taxation deferred or accelerated because of timing differences
between the treatment of certain items for accounting and taxation purposes.
Full provision for deferred taxation is made under the liability method,
without discounting, on all timing differences between taxable profits and
total comprehensive income that have arisen but not been reversed by the
Balance Sheet date, unless such provision is not permitted by FRS 102.
Deferred tax assets are only recognised if it is considered more likely than
not that there will be suitable profits from which the future reversal of the
underlying timing differences can be deducted. Timing differences are
differences arising between the Company’s taxable profits and its results as
stated in the Financial Statements which are capable of reversal in one or
more subsequent periods.
Cash at bank and short-term deposits
Cash at bank and short-term deposits comprise cash at bank and short-term
deposits with an original maturity date of three months or less.
Short-term debtors and creditors
Debtors and creditors with no stated interest rate and receivable within one
year are recorded at transaction price. Any losses arising from impairment are
recognised in the Income Statement in other operating expenses.
Dividends payable to Shareholders
Dividends payable are accounted for when they become a liability of the
Company. Final dividends are recognised in the period in which they have been
approved by Shareholders in a general meeting. Interim dividends are
recognised in the period in which they have been declared and paid.
Own shares held in Treasury
From time to time, the Company buys back shares and holds them in Treasury for
potential sale at a later date or for cancellation. The consideration paid and
received for these shares is accounted for in Shareholders’ funds and, in
accordance with the AIC SORP, the cost has been allocated to the Company’s
special reserve. The cost of shares sold from Treasury is calculated by taking
the average cost of shares held in Treasury at the time of sale. Any
difference between the proceeds from shares sold from Treasury and above
average cost is taken to share premium.
Judgements and key sources of estimation uncertainty
The preparation of the Financial Statements requires the Company to make
judgements, estimates and assumptions that affect the application of policies
and reported amounts in the financial statements. The estimates and associated
assumptions are based on historical experience and various other factors that
are believed to be reasonable under the circumstances, the results of which
form the basis of making judgements about carrying values of assets and
liabilities that are not readily apparent from other sources. Actual results
may differ from these estimates.
The areas requiring judgement and estimation in the preparation of the
financial statements are: the valuation of unquoted investments; and
recognising and classifying unusual or special dividends received as either
revenue or capital in nature. The policy for the valuation of unquoted
investments is detailed in the investments section of Note 1. The accounting
policy for special dividends is detailed in the income recognition section of
Note 1.
The estimates and underlying assumptions are reviewed on an ongoing basis.
Revisions to accounting estimates are recognised in the period in which the
estimate is revised if the revision affects only that period, or in the period
of the revision and future period if the revision affects both current and
future periods.
Reserves
Share premium
The share premium account represents the accumulated premium paid for shares
issued in previous periods above their nominal value less issue expenses. This
is a reserve forming part of the non-distributable reserves.
The following items are taken to this reserve:
* costs associated with the issue of equity; and
* premium on the issue of shares.
Capital redemption reserve
The capital redemption reserve represents non-distributable reserves that
arise from the purchase and cancellation of shares.
Special reserve
The special reserve was created by a reduction in the share premium account by
order of the High Court. The costs of share buy backs, including shares
acquired through the tender offer, and any related stamp duty and transaction
costs, if applicable, are charged to the special reserve. The special reserve
is distributable.
Capital reserve
The following are taken to the capital reserve through the capital column in
the Income Statement:
Capital reserve – other, forming part of the distributable reserves:
* gains and losses on the realisation of investments;
* realised exchange differences of a capital nature;
* 70% of management fees and finance costs related to borrowings; and
* expenses, together with related taxation effect, charged to this account in
accordance with the above policies.
Capital reserve – not distributable:
* net movement arising from changes in the fair value of investments; and
* unrealised exchange differences of capital nature.
Revenue reserve
The revenue reserve represents the surplus of accumulated profits and is
distributable.
2. Income
2024 2023
Revenue £’000 Capital £’000 Total £’000 Revenue £’000 Capital £’000 Total £’000
Income from investments
UK dividend income 573 – 573 464 – 464
Overseas dividend income 1,008 20 1,028 1,310 – 1,310
Liquidity fund income 711 – 711 – – –
Income from investments 2,292 20 2,312 1,774 – 1,774
Total income comprises
Income from investments 2,292 20 2,312 1,774 – 1,774
Bank interest 662 – 662 619 – 619
Rebate income 1 42 13 55 67 – 67
2,996 33 3,029 2,460 – 2,460
1 Rebates of management fee from managed investment funds held in the
investment portfolio.
3. Management fee
2024 2023
Revenue £’000 Capital £’000 Total £’000 Revenue £’000 Capital £’000 Total £’000
Management fee 42 99 141 49 114 163
42 99 141 49 114 163
With effect from 31 May 2023, the Company appointed Goodhart Partners LLP
(“Goodhart”), replacing Franklin Templeton Investment Management Limited
(“FTIML”), as the Company’s Sub-Advisor. Under the Investment Management
Agreement, Goodhart is entitled to a fee paid quarterly in arrears at the rate
of 0.12% per annum of the market value of equity securities, and 0.12% of the
value of cash and other current assets. No performance fee will be paid.
The Company’s investment in the Volunteer Park Capital Fund SCSp is excluded
from the market value of equity securities, prior to calculation of the
management fees payable by the Company to Goodhart, being an investment in
private markets, as prescribed by the sub-advisory agreement.
Prior to the appointment of Goodhart as Sub-Advisor, FTIML was entitled to a
management fee paid quarterly in arrears at the rate of 0.35% per annum of the
market value of listed equity securities, 0.05% per annum of the market value
of bonds and other debt instruments and 0.02% of the value of cash and cash
equivalents.
During the year ended 31 December 2024, the management fees payable totalled
£141,000 (2023: £163,000). At 31 December 2024, there was £32,000
outstanding payable (2023: £31,000) in relation to management fees.
During the year ended 31 December 2024, the administration fees payable to the
Administrator totalled £185,000 (2023: £177,000). At 31 December 2024, there
was £16,000 outstanding payable to the Administrator (2023: £15,000) in
relation to administration fees.
4. Dividends
2024 £’000 2023 £’000
Declared and paid
Amounts recognised as distributions to Ordinary Shareholders in the year.
2023 final dividend of 5.0p per share paid on 31 May 2024 (2023: year ended 31 December 2022 final dividend of 5.0p paid on 31 May 2023). 1,461 1,461
1,461 1,461
2024 £’000 2023 £’000
Proposed
Detailed below is the proposed final dividend per share in respect of the year ended 31 December 2024, which is the basis on which the requirements of section 1159 of the Corporation Act 2010 are considered. 2024 final dividend of 10.0p per share (2023 final dividend of 5.0p per share paid on 31 May 2024). 2,922 1,461
The Directors recommend a final dividend of 10.0p per share for the year ended
31 December 2024 (2023: final dividend of 5.0p per share, paid on 31 May
2024). Subject to Shareholder approval at the Annual General Meeting to be
held on 15 May 2025, the dividend will be payable on 30 May 2025 to
Shareholders on the register at the close of business on 2 May 2025. The
ex-dividend date will be 1 May 2025. Based on 29,222,180 shares, being the
number of shares in issue (excluding shares held in Treasury) at 2 April 2025,
being the latest practical date prior to the publication of this report, the
total dividend payment will amount to £2,922,000. The proposed dividend will
be paid from the revenue reserve.
5. Return per share
2024 2023
Net return £’000 Number of shares 1 Per share pence Net return £’000 Number of shares 1 Per share pence
Revenue return after taxation 2,152 29,222,180 7.4 1,545 29,222,180 5.3
Capital return after taxation 2,193 29,222,180 7.5 183 29,222,180 0.6
Total return after taxation 4,345 29,222,180 14.9 1,728 29,222,180 5.9
1 Weighted average number of ordinary shares, excluding shares held in
Treasury, in issue during the year.
6. Net asset value per share
The NAV, calculated in accordance with the Articles of Association, is as
follows:
2024 pence 2023 Pence
Share 374.0 364.1
The NAV is based on net assets of £109,295,000 (2023: £106,411,000) and on
29,222,180 (2023: 29,222,180) shares, being the number of shares, excluding
shares held in Treasury, in issue at the year end.
7. Significant holdings
As at 31 December 2024, the Company owned 25% (2023: 25%) of the net assets of
the Volunteer Park Capital Fund SCSp, a Luxembourg Special Limited
Partnership. The registered office of Volunteer Park Capital Fund SCSp is
412F, route d’Esch, L-1471 Luxembourg, Grand Duchy of Luxembourg.
As at 31 December 2024, the Company owned 50.9% (2023: nil) of the AVI
Japanese Special Situations Fund, a Sub-Fund of Gateway UCITS Funds PLC, whose
registered office is 33 Sir John Rogerson’s Quay, Dublin 2, Ireland.
The Company had no other holdings of 3.0% or more of the share capital of any
portfolio companies.
8. Related party transactions
Dr Sandy Nairn is the Executive Director of the Company and is a substantial
shareholder.
The Company has invested in Volunteer Park Capital Fund SCSp (“VPC”). The
Alternative Investment Fund Manager of VPC is Goodhart Partners LLP
(“Goodhart”). Goodhart Partners S.a.r.l. is the general partner to VPC and
is 100% owned by Goodhart.
The Company has invested in AVI Japanese Special Situations Fund (“AVI
JSS”). The sub-investment manager of AVI JSS is Asset Value Investors Ltd.
(“AVI”). AVI is an affiliate of Goodhart which maintains a minority
interest in AVI of less than 25%.
Goodhart was appointed to provide sub-investment management services to the
Company with effect from 31 May 2023.
Dr Nairn is the sole controller of a company which holds a significant
shareholding of more than 25% but not more than 50% in Goodhart and may be a
beneficiary of the management fees and carried interest payable to
Goodhart-related companies, with respect to the investments noted above. Given
Dr Nairn’s interests in Goodhart, it was agreed with him, in March 2023,
that his salary would be reduced (such reduction equalling the entire salary,
if necessary) by his share (through his minority interest in Goodhart) of
amounts credited in the same period in respect of (i) any carried interest on
co-investments made by the Company alongside Goodhart and (ii) any partnership
profit allocations attributable to Goodhart’s net profits on fees earned
with respect to the investments noted above.
9. Availability of Annual Report and Financial Statements
The Annual Report and Financial Statements will shortly be available to view
on the Company's website at www.globalopportunitiestrust.com. where up to date
information on the Company, including daily NAV and share prices, factsheets
and portfolio information can also be found.
A copy of the Annual Report and Financial Statements will shortly be submitted
to the Financial Conduct Authority’s National Storage Mechanism and will be
available for inspection at:
https://data.fca.org.uk/#/nsm/nationalstoragemechanism
For further information please contact:
Juniper Partners Limited
Company Secretary
e-mail: cosec@junipartners.com
3 April 2025
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