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Golden Prospect Precious MetalsAnnouncement

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RNS Number : 0828A  Golden Prospect Precious Metals Ltd  13 April 2026

13 April 2026

 

Golden Prospect Precious Metals Limited

(the "Company")

 

 

Annual Report and Audited Financial Statements

 

 

The Company is pleased to announce its final results for the year ended 31
December 2025.

For the full report, please click the link below:

 

http://www.rns-pdf.londonstockexchange.com/rns/0828A_1-2026-4-12.pdf
(http://www.rns-pdf.londonstockexchange.com/rns/0828A_1-2026-4-12.pdf)

 

Year End Highlights:

·    Net asset value (NAV) per share total return of 170.5%;

·    Share price increase of 164.8% from 35.5p to 94p;

·    Named the top performing investment trust of the year by the
Association of Investment Companies (AIC);

·   Performance recognised by two awards: Citywire Investment Trust
Insider Specialist Equities Category Award and Investment Week's Investment
Company of the Year Awards within the Specialist category;

·     Appointment of Helen Green as Non-Executive Director and Chair of
the Audit Committee;

·  Appointment of Chris Waldron as Non-Executive Director and member of the
Company's Audit, Management Engagement, and Remuneration & Nomination
Committees, effective from March 2026.

 

Chairman's Statement

 

Post period end significant developments

Before moving on to reporting on the financial year ended 31 December 2025, we
must highlight the Company's announcement of 9 March 2026, stating that the
Board had been informed that the Company's portfolio managers, Keith Watson
and Robert Crayfourd had resigned from Manulife CQS Investment Management
("CQS" or "The Manager"), the Company's investment manager. Keith and Robert
are each subject to a three-month notice period and they have continued to
manage the Company's portfolio. In order to best protect the Company's
interests, the Board has served protective notice to CQS while it considers
the options for the future management of the Company. The notice period
between the Company and CQS is 12 months. Further announcements shall be made
in due course.

Foreword

Notwithstanding the aforementioned developments, I would like to congratulate
the investment managers on their spectacular performance in 2025. The
Association of Investment Companies (AIC) has confirmed that Golden Prospect
Precious Metals was the top performing investment trust of the year. It is a
tribute to their talents that they delivered a NAV total return of 170.5% in
the context of the gold price rising 52.8% in Sterling, while also
outperforming the main gold mining ETFs.

This is both a proud and poignant time for me personally as I will be stepping
down as Chairman at the coming AGM. It is, however, reassuring to hand over
the reins of a Company in fine fettle after such a successful run, with likely
more to follow.

Recent market developments

This time last year we noted the decoupling of the US bond market from gold
which has not been witnessed since the 1970's. As the last vestiges of the
Gold Exchange Standard were abandoned, it led to further devaluation and
inflation. Precious metal mining stocks performed very well in that decade
while other sectors of the stock market stagnated.

The breakdown in correlation with US Treasuries has liberated gold and silver,
allowing them to undertake an exercise in price discovery. While some may view
record highs as a reason to take profits, seasoned investors know that
breakouts can go much farther and faster than expected. There is a degree of
academic snobbery when referring to speculators but ultimately, they are like
pioneers and prospectors who take great risk to achieve great rewards with no
guarantee of success. They blaze a trail for others to follow as the price
action establishes a more comfortable path for future investors.

While silver has surged, followed by a fast and furious correction, it is in
complete contrast to the episode in 1980 where a small group tried to corner
the market and drive prices higher for their own gain. Instead, the latest
trend is underpinned by fundamentals and industrial demand. As central banks
continue to accumulate precious metals the US dollar has fallen to 40% share
of their global reserves, while gold is now at 30%, on the back of its higher
price.

We previously highlighted that the miners were in a stealth bull market. While
the spotlight has certainly returned to the metals, mainstream investor
participation remains surprisingly light. The best-known gold mining Exchange
Traded Fund, the VanEck Gold Miners ETF (or GDX index) witnessed widespread
liquidation of its shares until mid-2025. While the selling has stabilised,
there is little in the way of fresh investment. It is a very strong indication
that we are far from anything approaching a classic bubble in the sector as
the degree of participation, especially in the more risk-on mining shares,
remains minimal.

We are witnessing a denouement of the 'Magnificent Seven' technology names as
the bull market is at last broadening away from this narrow range of shares.
Evidence of this is apparent as value-orientated markets in Europe performed
very well, especially the FTSE-100 which was once mockingly described as the
'Jurassic Index' by a US hedge fund manager.

Performance

I am pleased to report on an outstanding year for the Company. Following a
20.4% gain in 2024, over the course of 2025 the NAV rose by 170.5% from 43.1p
to 116.60p with a peak value of 117.4p. The share price likewise rose
substantially from 35.5p to 94.0p, gaining 164.8%, with highs in early October
at 103.3p. Gearing contributed 7.3%, essentially offsetting the 6.7% NAV
dilution from the annual subscription right exercise.

Compared with equivalent Exchange Traded Funds, performance continued to
outpace the VanEck Gold Miners ETF (GDX) which rose 137.1% and the VanEck
Junior Gold Miners ETF (GDXJ) which rose 153.4% in Sterling terms. This once
again shows the benefits of active management at a time when so many have been
lured into taking a passive approach to investing. Although much has been made
of the recent volatility in January 2026, at the time of writing the share
price is close to where it was at the end of 2025 while the NAV has risen.

Having been in the doldrums for some time, we are at last witnessing a return
to normality where precious metal mining shares outperform the underlying
metals. Gold rose by 64.6% in US Dollar terms and 52.8% in Sterling,
highlighting an unusual period of strength in the Pound. For UK-based
investors the asset gains have more than offset the currency loss. Should we
see further Dollar weakness then this would likely be a potent support for
further precious metal price appreciation, given the historic inverse
relationship.

Gearing

As mentioned above, given the strong portfolio returns over the period,
gearing has served its purpose and contributed 7.3% to NAV returns. The
Company's investment manager (MCQS) has proved to be prudent over many years
in their use of leverage, by reducing borrowings, and therefore risk, when the
market outlook is uncertain. At the close of the year, the gearing level stood
at 2.4% of NAV, having been as high as 11.1% in July (the maximum permissible
is 20%).

Subscription Rights

In November, under the Company's annual subscription rights programme,
shareholders had the right to subscribe for 1 new share for every 5 shares
held at a price of 48p (being the Net Asset Value of the Company on the 2024
subscription date). The position was well 'in the money' by the time the
exercise was undertaken.

Given that there was a cap of €8m on the value of capital that could be
raised, allotments had to be scaled down to 78.21%. Applications from
Shareholders amounted to 13,895,183 shares which were pared back to
10,867,374. Those who decided not to participate saw their rights snapped up
by other investors. The so-called 'rump' of unexercised subscription rights
allowed 3,718,555 new Ordinary Shares to be placed by our brokers in the
market. This meant that 14,585,929 new Ordinary Shares were issued growing the
overall total to 107,834,428, providing the fund managers with fresh assets to
grow. The fourth Subscription Rights Price for 2026 has been set at 104.63
pence which was the fully diluted NAV of the Company on 1 December 2025.
Hopefully the share price will be well in excess of this target by November
2026, allowing further capital to be raised. At the time of writing the
Company's net assets stood at c.£134 million.

Discount, marketing and awards

There was some improvement in the discount over the year. In 2024 it averaged
20.0% while 2025 saw an average of 17.1%. Following the share price surge in
August and September we enjoyed a short-lived premium of 0.9%. However, by the
end of the year the discount had widened again to 18.0%.

As ever we continue to refresh our marketing initiatives to target an extended
audience outside of traditional wealth managers to generate further demand for
the Company's shares. Tavistock, a leading London-based press and investor
relations firm, was once again retained to support us in these endeavours. We
had strong media coverage during the course the year, particularly in
November, when the Company was recommended by Jeff Prestridge in his weekly
column in the Mail on Sunday. This was a powerful endorsement, given his
strong following and more than 30 years' experience, first as personal finance
editor of The Mail on Sunday and latterly, group wealth and personal finance
editor at the publication. The Company also featured in Joanne Hart's MIDAS
column in The Sunday Times.

The Trust's performance was recognised with two awards towards the end of 2025
- first, Golden Prospect Precious Metals won the Citywire Investment Trust
Insider Specialist Equities Category Award, and soon after we were crowned the
winners of Investment Week's Investment Company of the Year Awards within the
Specialist category.

Ongoing Charges Ratio (OCR)

The Company uses the AIC's methodology for calculating the Ongoing Charges
Ratio (OCR). In 2024 the OCR stood at 2.21% and by the close of 2025 it was
reduced to 1.99% as the Company's fixed costs were spread across a much larger
asset base. With the on-going growth in the NAV we hope to see a further
reduction in the coming year below the 2% level.

Saba standstill agreement

Shareholders may be aware of Saba Capital, a US activist investor which has
targeted the UK closed end fund sector since 2024. Although the Board is not
aware of Saba Capital ever being on its share register, as announced on 1 July
2025, the Company had the opportunity to negotiate and enter into a standstill
agreement with Saba, which will be in effect until the Company's AGM in 2028.
Under the terms of the agreement, Saba has agreed not to call any general
meetings or vote against the recommendation of the Board on specified ordinary
course resolutions proposed at a general meeting of the Company.

Board changes

At the Annual General Meeting last May, Rob King retired from the Board having
been in situ since the Company's launch in 2006. Graeme Ross also stepped down
from the Board, having been Chair of the Audit Committee since he joined the
Board in 2018. He was ably replaced by Guernsey-based Chartered Accountant
Helen Green. Helen has a background in audit from her time working for Saffery
in London which culminated with her being an audit partner before her move to
Guernsey. Since her move in 2000 and until her retirement on 31 March 2026,
she was an executive director of Saffery Trust, a GFSC regulated fiduciary
business. She has extensive experience in corporate governance through her
roles as non-executive director of listed investment companies (including as
audit committee chair and chair) over the last 15 years.

I will be stepping down as Chairman at the forthcoming AGM, having joined the
Board in 2014 and been Chairman since 2023. I am leaving the role in the very
capable hands of Monica Tepes, subject of course to Shareholder approval.

Since joining the Board in 2024, Monica has made an immediate and meaningful
impact. Her deep understanding of the investment trust sector - the trusts,
the investors and the service providers - together with her judgement and
clarity of thought, have been evident in her many valuable contributions to
the Board. I and fellow director Helen Green are confident that the Company
will be in excellent hands under her leadership.

Underpinning Monica's contributions is deep specialist experience in the
investment trust sector. She began her career as a fund analyst and assistant
portfolio manager at a wealth manager before moving to the sell-side, where
she held senior roles across research, investor relations, corporate broking,
corporate advisory, and marketing and product development.

In December, with the help of an independent recruitment consultant, we
initiated a search for a new director as I shall be stepping down from the
Board at the end of this year. We have since concluded the search and
appointed Mr. Chris Waldron as a director with effect from 26 March 2026,
allowing sufficient time for a smooth handover and transition before my
departure.

Chris brings a wealth of relevant experience and expertise and we are
delighted to welcome him to the Board. He is Chair of Crystal Amber Fund
Limited and a director of Bluefield Solar Income Fund as well as a number of
unlisted companies. He has over 35 years' experience as an investment manager
and until 2013 was Chief Executive of the Edmond de Rothschild Group in the
Channel Islands. He previously held investment management positions with James
Capel, Bank of Bermuda, the Jardine Matheson Group and Fortis. A graduate of
the University of London and Cranfield University, he is a Fellow of the
Chartered Institute of Securities and Investment.

Outlook and closing remarks

In the Interim Report I stated that I didn't believe this was the end of the
bull market, but likely the end of the beginning. The short space of time
since then has shown these words to be prophetic. The surge in precious
metals, especially silver, gives an indication that we are entering the middle
phase. As is often the case in a booming market (rather than a bubble), the
narrative outpaces the price and inevitably there is a high degree of
excitability. The 30% sell-off in silver at the end of January 2026 was
particularly brutal but proved to be a taste of things to come. A further
downturn was experienced in March as conflict escalated with Iran and the
Strait of Hormuz was effectively closed to shipping. However, by early April
the NAV and share price had recently started to rally so hopefully this is the
beginning of a recovery rather than a false dawn.

The upside of such corrections is that it allows institutions to enter the
market, especially as many have been caught short with painfully low
weightings. Gold miners' valuations are still priced below 2020 levels,
relative to the bullion price so some catch-up is warranted. The case is even
more extreme for the silver miners which the fund managers have been steadily
increasing. History would tend to suggest that the biggest parabolic surge is
yet to come, albeit in the years ahead as we enter the final phase of the bull
market.

In this, my final report, I hope shareholders will indulge me with a personal
reflection. The timing of my exit in late 2026 will coincide with my 60th
birthday. In the Chinese Lunar cycle, 2026 is the Year of the Horse as was my
birth year 1966. The latter saw the release of the spaghetti Western, The
Good, the Bad and the Ugly, where three gunslingers hunt for a cache of
Confederate gold. Featuring arduous journeys and episodes of violence it is a
metaphor for the history of precious metals down the ages. One of its moving
musical compositions was the aptly named Ecstasy of Gold which was a fitting
tune for last year. However, longer term investors may find another movie
title more pertinent, namely, The Agony and the Ecstasy.

In closing, we thank shareholders for their continued support and invite them
to study the Investment Manager's report for their economic assessment and
coverage of the portfolio holdings. We will soon be in touch with details of
the forthcoming Annual General Meeting.

Toby Birch

Chairman

April 2026

Investment Manager's Report

 

Performance

The trust's NAV gained 170.5% for 2025, after the 6.7% dilution from
subscription share issuance in November/December. The drivers of performance
were broad and across almost every name in the fund.

GPM Net Asset Value, Gold Spot Price, GDX Index and GDXJ Index (Jan 2025 - Dec
2025) (in GBP)

 

The GDX Index represents the VanEck Gold Miners ETF and the GDXJ Index
represents the VanEck Junior Gold Miners ETF.

Summary

2025 marked a record-breaking year for precious metals that ultimately lifted
metals more broadly. Gold posted gains of 52.8%, whilst Silver gained 130.2%
and lesser precious metals like Platinum and Palladium saw gains of 104.9% and
64.8% respectively (all quoted in Sterling).

 The key drivers of precious metal gains were;

·    Geopolitical uncertainty

·    Central Bank demand

·    Bar and coin demand

·    Debasement fears

·    Inflation

Geopolitical uncertainty

Centre to this has been US policy on tariffs and trade protectionism, which
has been the primary driver, but it also included the ongoing
Russian/Ukrainian war and the rising tensions between the US and Iran. Later
in the year, the US president made claims over Danish‑controlled Greenland,
directly threatening a NATO state's sovereignty.

Central Bank Demand

Central Banks are likely to continue to look to diversify away from US
treasuries given the US's weaponisation of the US dollar, which has driven
strong purchases of gold since the Russian invasion of Ukraine. Whilst the
tonnage in 2025 was lower, the value was higher in dollar terms.

Source: Bloomberg

This has now seen gold exceed US treasuries as the largest Central Bank
holding, via a mix of purchases and price appreciation.

The US Dollar's role as the global reserve currency is waning at the margin,
but would take many years to really see a dramatic shift. Perhaps more
important has been the US's openness to encouraging a weaker dollar so to
support domestic manufacturing, with the dollar falling 9.4% in 2025 further
supporting flows to gold.

The knock-on impacts on this are the dollar being an inferior reserve
currency, with inflationary impacts domestically on imports, but perhaps most
significantly this reduces the appeal of holding US treasuries.

Bar and Coin Demand

Bar and coin demand has been a primary driver of the strength in precious
metals through 2025. Much of this has been driven by particularly strong
demand from China and to a lesser extent India. The Chinese side of demand is
supported by the restricted capital markets in the country that have
historically been weighted toward the domestic property sector, but given the
collapse in the property sector this has left precious metals as an attractive
alternative and continues to support flows into precious metals.

Debasement Fears

Debasement refers to the loss of purchasing power of domestic currencies. The
primary driver to this is persistent inflation and continued deterioration of
governments' fiscal stability, as higher rates increase the government debt
interest to unsustainable levels. They must print more currency to pay back
the interest and roll continued deficits into larger debt issuance, thus
reducing the purchasing power of their domestic currencies. This is driving
flows into real assets, with gold the largest beneficiary, but also supporting
associated precious and even base metals.

US Government debt x 30 yr interest rate showing implied interest burden

Source: Bloomberg

Silver

Silver's recent volatility can only be described as unprecedented. It rose
140% from the end of November 2025 through to mid-January 2026, with a 68%
rise in January alone, before experiencing a sharp reversal at the time of
writing. Whilst these moves are exciting, they are also unsustainable, and a
sharp reversal was certainly expected. However, all considered, silver is
still showing gains for the year to date despite the pull back, but the path
from here is less certain and remains heavily dependent on flows from China.

 

Whilst silver has shown this volatility and outperformance, we have found it
interesting that that the silver miners have shown minimal outperformance
relative to their gold peers despite silver's 100% outperformance. This has
been a primary driver of adding more silver exposure to 17.1% by year end, as
we felt it gives upside optionality for a catch up and downside protection on
a pullback of silver.

The volatility in silver has been heightened by speculative retail flows, with
added impacts from leveraged silver ETF's, the largest of which the 2x levered
silver ETF (AGQ) saw the drawdown in silver force further liquidations in the
market.

Our preference has been for the silver developers, with three companies
standing out as having world class projects, that trade at a meaningful
discount to NAV and imply a far lower silver price than current spot. These
are namely Abra Silver, Vizsla Silver and Highland Silver, which have shown
materially lower volatility than the underlying metal.

Whilst the move in silver is hard to justify, there are fundamental drivers
beyond the clear speculative flows. Silver really took off following the
Chinese including it in strategic metals that need licences for exports and
inversely to initial logic saw the Chinese silver price trade at a steady
premium of up to $30/oz in January. China runs ~70% of the global silver
smelting so thus controls the majority of the silver produced globally at that
bottleneck of the supply chain. Silver has been undersupplied for 4 years,
with demand of 1.2bn oz vs 1bn oz of production. Chinese stocks are low in a
metal that is critical in industries in which Chinese policy is focused on
growth, such as solar power, EV's, chips, wind power and other high-end
electronics. The majority of global silver is produced as a byproduct of
polymetallic mines, thus higher silver price does little to incentivise
production growth.

Outlook

After strong precious metal price action in January before pulling back, the
trust has reduced gearing to a neutral level of 3.0%. At the time of writing,
gold has pulled back to approximately $4,700/oz from $5,278/oz at the end of
February. This followed the start of the US led attacks on Iran and the
subsequent closure of the Strait of Hormuz through which 20% of the world's
oil transits. This has pushed the oil price up from $73/bbl at the end of
February to $110/bbl. This has pushed up central banks interest rate
expectations as a result of anticipated inflationary pressures, which is part
of the reason for this weakness month to date. Further to this we believe gold
has displayed its role as an insurance asset, meaning during times of stress
it is often initially sold due to its high liquidity, noting those holding it
are likely sat on material gains. This dynamic has been seen in prior times of
stress such as the 2008 GFC or Covid in 2020, when gold initially sold off
15-25%, before performing strongly in the following 12 months.

The duration of the closure of the strait is hugely significant for the oil
price and thus the global economy and with it precious metals. Many sector
specialists and commentators, we included, believe a loss of this magnitude
justifies a much higher oil price, with an excess of $200/bbl possible. This
could prove hugely inflationary for the global economy whilst weighing on
growth, a term known as stagflation. Historically this has been a very
supportive environment for the gold price. Even with the recently announced
ceasefire, it could take months to ramp back up closed Middle Eastern oil
fields, whilst the world has already lost >300M bbls of oil supply that
would ultimately need to be restocked tightening future markets.

Most of the drivers in 2025 remain and in many cases are stronger now. Even
with this pullback there are still good metal prices for the miners, and they
will be making strong cashflows at these levels. We have reduced exposure to
those miners we believe most exposed to higher oil prices, but ultimately
given the high margin levels the miners currently achieve, higher oil prices
are less impactful than if margins were tighter. That said, the market remains
highly wary of the miners' costs eroding margins and this cost creep could be
penalised in excess of the actual feed through to margin erosion.

We expect Central Banks to remain meaningful buyers of gold given the macro
backdrop, although some may become forced sellers to fund energy subsidies or
military spend, we believe the trend remains to additions. Higher interest
rates could further increase the interest burden on excessive global
government debt levels, which should leave gold remaining an important reserve
asset against a deteriorating quality of the world's largest 'risk free asset'
in US treasuries. We await to see the actions of the recently announced
chairman of the Federal Reserve, Kevin Warsh. Currently viewed in the market
as a hawk (keeps rates high to battle inflation) much of his commentary
appears more dovish (pre lower rates and growth). The interest rate path going
forward will be material for the dollar and US treasuries, with lower rates
seen as good for precious and higher as negative.

Trust positioning

 

The trust has increased its weighting to developers over producers in the
expectation of more M&A in 2026.

Stocks

Top 10 at 31 December 2025; market caps at 31 December 2025

The trust remains geographically diverse and weighted to producers with
development assets for growth offering catalysts through 2026 as they
transition to production. Below these is a weighting tilted to high quality
development projects.

 

The higher gold and silver price are leading to stronger cash generation from
the sector, with many mid tiers seeing further strengthening of their balance
sheets. Dividends and buybacks should increase through the year, but after
years of underinvesting in their organic pipelines we believe that acquiring
other single asset producers or late-stage developers will look increasingly
accretive. The developers especially trade at a notable discount to producing,
enhancing the accretive benefit, but should also provide some valuation
protection if we see a pull back in precious metal prices.

 

Gold developers such as Southern Cross, Osisko Development, Goliath Resources,
Liberty Gold, Collective Mining and Goldsky Resources already have 5M oz's of
gold or potential to get that level. We have already seen names like Reunion
Gold, Robex Resources, New Gold and Calibre Mining taken out in 2025.

 

In December we added to our weighting in silver developers, as they materially
lagged the increase in silver and the silver miners more broadly, thus
providing upside if the silver price holds and protection if it pulls back. We
believe names such as Abra Silver, Vizsla Silver, Highland Silver and Dolly
Varden are all M&A targets from larger peers. With limited silver projects
of this scale there is a higher potential for a competitive bid process that
could see a materially higher sale price given the large discount they
currently trade at compared to producing peers and the limited number of
projects of this true tier 1 silver scale.

 

Keith Watson and Robert Crayfourd

New City Investment Managers

Investment Manager

10 April 2026

 Enquiries

 Manulife | CQS Investment Management                 +44 (0) 20 7201 5368

 Craig Cleland

 Cavendish Capital Markets Limited                    +44 (0) 20 7908 6000

 Robert Peel (Corporate Finance)                      +44 (0) 20 7720 0500

 Daniel Balabanoff / Pauline Tribe (Sales)

 Apex Fund and Corporate Services (Guernsey) Limited  +44 (0) 203 5303 600

 James Taylor

 Tavistock                                            +44 (0) 20 7920 3150

 Jos Simson / Gareth Tredway / Eliza Logan

 

About Golden Prospect Precious Metals

Golden Prospect Precious Metals Limited is a closed-ended investment company
incorporated with limited liability in Guernsey on 16 October 2006. The
Company's investment objective is to provide Shareholders with capital growth
from a portfolio of companies involved in the precious metals

mining sector.

For the latest factsheet and other information, click here
(https://ncim.co.uk/golden-prospect-precious-metals-ltd/) .

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