REG-Invesco Global Equity Income Trust Plc: Annual Financial Report
Mon 07:02
LEI: 549300JZQ39WJPD7U596
Invesco Global Equity Income Trust plc
Annual Financial Report for the year ended 31 May 2025
The following text is extracted from the Annual Financial Report of the
Company for the year ended 31 May 2025. All page numbers below refer to the
Annual Financial Report which will be made available on the Company's website.
‘The Board is delighted to report that, in addition to the Portfolio
Managers delivering another year of strong absolute and relative investment
performance, IGET’s shares have re-rated to trade at a premium to NAV. The
Company is now regularly issuing shares and has raised £13.2 million since
the year end. Growing the size of the Company should improve liquidity in the
shares and lead to a lower ongoing charges ratio, as well as marginally
enhancing the NAV per share.
We believe the Company is well positioned to navigate what remains an
uncertain period for global markets, built on bottom-up stock selection and
the disciplined, long-term approach of the Portfolio Managers.’
Sue Inglis, Chair
‘It isn't often in your career that almost every business in the market goes
on sale, as it did in April following ‘Liberation Day’. There were many
businesses on our shopping list that we had been waiting to buy, and many of
those went on sale. This is potentially a very exciting time for future
returns.'
Stephen Anness, Portfolio Manager
Financial Performance
Total Return Statistics(1) (dividends reinvested)
Change for the year (%) 2025 2024
Net asset value (NAV) total return (2) 11.9% 21.0%
Share price total return (2) 24.6% 26.9%
Benchmark index total return (3) 7.4% 21.6%
Capital Statistics
At 31 May
2025 2024 % change
Net assets (£’000) 212,283 197,555 +7.5
NAV per ordinary share 337.36p 313.30p +7.7
Share price (1) 342.00p 286.00p +19.6
Premium/(discount) (2) per ordinary share 1.4% (8.7)%
Average discount over the year (1)(2) (6.9)% (13.2)%
Gearing (2) :
– gross 1.2% nil
– net 0.0% (0.9)%
Revenue Statistics
Year ended 31 May
2025 2024 (4) % change
Income (£’000) 4,379 7,433 –41.1
Net revenue available for ordinary
shares (£’000) 3,140 6,099 –48.5
Revenue return per ordinary share 5.01p 9.03p –44.5
Dividends per ordinary share (5)
– first interim 3.13p 1.60p
– second interim 3.13p 1.60p
– third interim 3.13p 1.60p
– final dividend 3.13p 2.55p
Total dividends 12.52p 7.35p +70.3
Ongoing charges ratio (2) 0.78% 0.82%
(1) Source: LSEG Data & Analytics.
(2) Alternative Performance Measure (‘APM’). See Glossary of Terms and
Alternative Performance Measures on pages 79 to 81 for details of the
explanation and reconciliations of APMs.
(3) Index returns are shown on a total return basis, with dividends
reinvested net of withholding taxes.
(4) With the exception of the income and net revenue available for ordinary
shares figures which reflect the Company figures, the 2024 comparative figures
reflect those of the Company excluding the revenue return per ordinary share
and dividends per share attributable to, and paid by, the UK Equity, Balanced
Risk Allocation and Managed Liquidity Share Portfolios prior to the
restructuring of the Company on 7 May 2024. Prior year revenue return per
share figures attributable to the UK Equity, Balanced Risk Allocation and
Managed Liquidity Share Portfolios can be found in the Income Statement on
page 57 and dividends per share paid in note 8 on page 65.
(5) Following the restructuring in May 2024 the Company’s dividend policy
is to pay an annual dividend of at least 4%, calculated on the unaudited prior
year-end NAV, paid quarterly in equal amounts.
Chair’s Statement
Highlights
• NAV total return of +11.9% over the year, significantly ahead of
benchmark index total return of +7.4%.
• Share price total return of +24.6%, reflecting share price moving from
discount of –8.7% to premium of +1.7% over year.
• Reduction in shares in circulation of –0.2% over year, with share
buy-backs in first nine months mostly offset by sales of treasury shares in
final quarter.
• Based on year-end NAV, projected annualised dividend of 13.50p per share
for year ending 31 May 2026, a 7.8% increase compared to previous year.
I am pleased to present your Company’s Annual Report for the year ended 31
May 2025. This was the first full year following the transformational
restructuring and simplification of your Company’s structure in May 2024,
creating a one share-class vehicle focused on global equity income.
Your Board is delighted to report that, in addition to your Portfolio Managers
delivering another year of strong absolute and relative investment
performance, the investment merits of your Company are now being recognised by
investors. Since the restructuring, the price at which the shares trade
relative to NAV has moved from a discount of –13.0% (at 3 May 2024, the last
trading day before the restructuring became effective) to a premium of +2.7%
(at 30 July 2025, the latest practicable date at the time of writing).
I thank my Board colleagues (past and present) and the Company’s Investment
Manager, broker and other advisers for their part in your Company’s
successful transformation. However, most importantly, I thank you, our
shareholders, for your ongoing support and welcome those who have invested
since the restructuring.
Market Overview
During the year, inflationary pressures, central bank policy shifts and
geopolitical tensions continued to affect global equity markets. However, the
biggest impact came from the outcome of the 2024 US presidential election.
Initial market euphoria, triggered by hopes of tax cuts and deregulation under
Donald Trump’s second term as US president, rapidly evaporated with his
erratic and chaotic policy approach leading to increased volatility across
global financial markets. In particular, his ‘Liberation Day’ announcement
of US tariffs resulted in widespread market declines and a spike in US
Treasury yields, economic growth downgrades and heightened economic
uncertainty worldwide. There was a very strong recovery in many markets
following the ‘tariff tantrum’ and global equity markets ended the Company
year having delivered resilient returns, masking the intra-year volatility.
Performance
Your Portfolio Managers’ rigorous process around bottom-up stock selection
enabled them to weather the market turbulence and capture attractive
opportunities.
The NAV total return per share was +11.9%, compared with the Company’s
benchmark, the MSCI World Index (£), total return of +7.4%, over the year. A
review of your Company’s investment performance during the year, and changes
in the portfolio positioning, can be found in the Portfolio Managers’ Report
an pages 12 to 15 and in the portfolio analysis on page 18.
The share price total return over the year was +24.6%, with the price at which
the shares trade relative to their NAV having moved from a discount of –8.7%
at the beginning of the year to a premium of +1.4% at the year end. The
average discount over the year was –6.9% (2024: –13.2%).
Whilst, for the purpose of this Annual Report, we are required to review your
Company’s performance over its last financial year, we believe that, in
assessing the performance of the Investment Manager (which we do at our
quarterly Board meetings), longer periods are more appropriate. Over the three
and five years ended 31 May 2025, the NAV total return per share was 48.6% and
120.8% respectively, outperforming the benchmark index total returns of 35.5%
and 77.9% respectively.
Gearing
Your Company has a £40 million revolving credit bank loan facility, which we
extended on 23 April 2025 for a further year.
During the year, the Company’s net gearing position ranged from a high of
6.3% to a net cash position (no borrowing) of 2.2%. (2024: net gearing high of
1.7% to a net cash position of 3.6%). At the year end, net gearing was nil
(2024: net cash of 0.9%), with £2.65 million (2024: £nil) drawn down under
the loan facility, equivalent to 1.2% (2024: n/a) of net assets.
Revenue and Dividends
Income and net revenue return per ordinary share for the year amounted to
£4,379,000 and 5.01p respectively (2024: £7,433,000 and 9.03p respectively).
This change reflects the new structure of your Company, with a global strategy
covering all assets held as opposed to the majority of the prior year where
the three share classes closed as part of the Company restructure towards the
end of the financial year followed different investment objectives, making
direct comparison at a Company level less relevant as markets now invested in
offer lower yielding companies but better total return prospects. The increase
in net assets of 7.5% over the financial year is reflective of the success of
this restructure.
One of the positive features of an investment trust is its ability to pay
dividends out of capital. At the time of last year’s restructuring, the
Board took advantage of this and adopted an enhanced dividend strategy. This
works by using the Company’s capital reserves to supplement the underlying
income the portfolio generates and then paying this combined amount out to
shareholders as dividends. The advantage of this approach is that, with no
specific portfolio income targets, it allows freedom for your Portfolio
Managers to select the best ideas unhindered and the Company to provide
shareholders with an attractive level of predictable income. Under the
enhanced dividend strategy, your Company pays an annual dividend of at least
4% of the unaudited previous year-end NAV, paid quarterly in equal amounts in
August, November, February and May of each financial year.
Your Company paid four interim dividends, each of 3.13p per share, in respect
of the year ended 31 May 2025. This equates to 12.52p in total, being 4% of
the NAV per share of 313.30p at 31 May 2024.
The NAV per share at 31 May 2025 was 337.36p. Accordingly, in line with the
enhanced dividend strategy, the total dividends payable in respect of the year
ending 31 May 2026 will be 13.50p per share. This is an increase of 0.98p per
share (or 7.8%) on the total dividends paid in respect of the last year. The
first interim of 3.375p per share will be paid on 14 August 2025 to
shareholders on the register at the close of business on 25 July 2025 (the
shares were marked ex-dividend on 24 July 2025).
Your Company is classified as an AIC ‘Next Generation Dividend Hero’, with
15 consecutive years of dividend increases. Appreciating that the reliability
of income can be important for shareholders, the Board expects, in normal
market conditions, to use the enhanced dividend strategy to keep your
Company’s status as an AIC ‘Next Generation Dividend Hero’.
Discount/Premium Management
During the period from 1 June 2024 to 4 February 2025, the Company bought back
1,342,282 shares (equivalent to 2.1% of the shares in circulation at the
beginning of that period) at an average discount of 9.8% and a total cost of
£4.3 million. All shares bought back are held in treasury and may be sold at
a premium to the NAV per share.
Shortly after 4 February 2025, the discount narrowed quickly and, on 20
February 2025, the shares moved to trading at a premium to their NAV. Over the
remaining period to 31 May 2025, the shares traded at an average premium of
1.0% and 1,210,000 shares were sold from treasury (equivalent to 1.9% of the
shares in circulation at 31 May 2024) at an average premium of 2.1%, raising
£4.1 million in total.
Your Board is pleased to see that the strength of your Company’s investment
proposition is now being reflected in the price at which the shares are
trading relative to their NAV. However, your Board recognises that a key
concern for investors is not only the price at which shares trade relative to
their NAV, but also the volatility in that relative price. So, your Board
intends, in normal market conditions, to actively use its share issue and
buy-back authorities to manage that volatility.
Marketing and Investor Engagement and Communication
A key priority for your Board, both last year and in the current year, is to
increase your Company’s profile, broadening the investor pool that is aware
of its investment proposition and strong investment track record. This is as
important now, when the shares are trading at a premium, as when they were
trading at a discount. Ultimately, your Board is looking to grow the size of
your Company which should bring added benefits of improved liquidity in the
shares and a lower ongoing charges ratio.
Engagement with our shareholders is of paramount importance. Over the past
year, your Investment Manager has welcomed opportunities to meet with
shareholders and potential new investors, both virtually and in person, to
discuss the Company’s strategy, performance and outlook. We value
the feedback received. If you wish to communicate with the Board or
Investment Manager, please contact us by email (investmenttrusts@invesco.com).
During the current year, we expect to enhance your Company’s website and
investor communication. If you have not already done so, I would encourage you
sign up for updates on the Company and its portfolio and your Portfolio
Managers’ views. You can do this by scanning the QR code on page 8
with your smartphone/device, visiting the Company’s specific page on the
Investment Manager’s website at
www.digitalservices.invesco.com/uk/en/investment-trusts-subscriptions or
contacting Invesco directly at investmenttrusts@invesco.com.
Board Succession
As reported in my interim statement, I joined the Board on 10 October 2024
and succeeded Victoria Muir as Chair following her retirement at the Annual
General Meeting on 21 November 2024. Davina Curling also retired at the AGM.
Helen Galbraith joined the Board on 1 December 2024 as Chair-elect of the
Audit Committee.
Craig Cleland, Chair of the Audit Committee, will be retiring at this year’s
AGM, having served nine years on the Board. On behalf of the Board, I thank
Craig for his valued contribution to your Company and wish him all the best
for the future.
Mark Dampier, Chair of the Marketing Committee, joined the Board in 2021 when
your Company merged with Invesco Income Growth Trust plc, where he had served
as a Director since 2016. We will be looking to recruit a new Director in 2026
and Mark intends to retire from the Board by next year’s AGM.
Annual General Meeting
I look forward to welcoming shareholders to the Company’s AGM which will
take place at 9.30am on Tuesday, 21 October 2025 at the offices of Invesco
Asset Management at 3rd Floor, 60 London Wall, London, EC2M 5TQ. Light
refreshments will be served. A circular, including the notice of AGM and
voting instructions, will be sent to shareholders during September 2025.
Post-period End Update
Since the year end, the NAV total return per share and share price total
return were +7.7% and +9.2% respectively, compared with the Company’s
benchmark total return +7.7% (to 30 July 2025).
Since the year end, the Company has sold 3,610,000 shares from treasury
(equivalent to 5.7% of the shares in circulation at 31 May 2025) at an average
premium of +1.9%, raising £13.2 million. At 30 July 2025, the shares were
trading at a premium of +2.7% and the yield on the shares was 3.6%, based on
the projected annualised dividend for the year ending 31 May 2026.
At the Company’s AGM in 2024, shareholders authorised the Company to issue,
or sell from treasury, shares representing approximately 10% of the issued
share capital (excluding treasury shares) at that time. Due to the recent high
level of demand for the Company’s shares and the resulting sales of shares
from treasury, the current share issuance authority is likely to have been
fully utilised before this year’s AGM, which will be held on 21 October
2025. To enable the Company to continue meeting demand, an additional general
meeting has been convened for 14 August 2025 at which additional share
issuance authorities will be sought. A copy of the circular convening the
general meeting is available at
www.invesco.com/uk/en/investment-trusts/invesco-global-equity-income-trust.html.
Outlook
The constant barrage of geopolitical tensions and tariff disputes has weighed
on the global growth outlook, though levels of uncertainty have eased somewhat
since the financial year end. Nonetheless, forecasting the year ahead remains
inherently difficult, particularly given the US president’s unpredictable
approach to policymaking.
Despite these headwinds, global equity market volatility has largely
normalised since the height of the ‘tariff tantrum’ as investors appear
more sanguine. While further bouts of equity market volatility are likely,
corporate fundamentals, particularly in the US, remain broadly supportive.
Valuations in other regions, notably Europe and the UK, also appear relatively
attractive, offering compelling opportunities for selective investment.
In this environment, your Portfolio Managers will continue to apply a
disciplined, long-term approach, focusing on fundamental stock selection to
build a resilient, well-diversified portfolio designed to perform across
market cycles.
We remain confident that your Company is well positioned to navigate
uncertainty and continue to meet its long-term objectives.
Sue Inglis
Chair
1 August 2025
Performance Record
Total Return
For the year ended 31 May
2025 2024 2023 2022 2021
Net asset value (1) 11.9% 21.0% 9.8% 9.6% 35.9%
Share price (1) 24.6% 26.9% 4.6% 4.4% 32.6%
MSCI World Index (£) (1) 7.4% 21.6% 3.8% 7.4% 22.3%
Revenue return per share 5.01p 9.03p 5.20p 4.85p 3.95p
Dividends 12.52p 7.35p 7.20p 7.15p 7.10p
(1) Source: LSEG Data & Analytics.
Historical Shareholder Returns from an Initial Investment of £1,000 on
31 May 2015
Annual Cumulative Capital Outcome if
Annual dividends dividends value (using dividends
dividends from from Mid-market mid-market reinvested on
per share(1)(2) investment (1)(2) investment (1)(2) share price share price) payment date
31 May pence £ £ pence £ £
2015 – – – 166.75 1,000 1,000
2016 6.00 35 35 156.00 936 972
2017 6.40 39 74 197.50 1,184 1,273
2018 6.70 40 114 202.00 1,211 1,345
2019 6.90 41 155 195.00 1,169 1,345
2020 7.05 42 197 176.50 1,058 1,263
2021 7.10 43 240 226.00 1,355 1,673
2022 7.15 43 283 229.00 1,373 1,748
2023 7.20 43 326 232.00 1,391 1,827
2024 7.35 44 370 286.00 1,714 2,318
2025 12.52 75 445 342.00 2,050 2,883
Source: LSEG Data & Analytics.
Portfolio Managers’ Report
Q&A
Q How has the Company performed in the year under review?
A In a period marked by significant market volatility, we are pleased to
report a net asset value total return of 11.9%, outperforming the MSCI World
Index (£), which delivered a total return of 7.4%. We look to construct an
all-weather portfolio that can deliver strong performance across market
cycles. We aim for returns to be driven by our individual stock selections
rather than by sector, geography or style biases. In a constantly evolving
geopolitical and market environment, we’re encouraged that this approach has
delivered results over the short and long term, with performance supported by
a broad and diverse range of holdings.
Q What have been some of the biggest contributors?
A Broadcom delivered an exceptional performance over the year. Under the
leadership of CEO Hock Tan, the company is strategically positioned to benefit
from the accelerating demand for AI infrastructure. Broadcom’s expertise in
custom Application-Specific Integrated Circuits (ASICs) enables clients to
perform AI workloads more efficiently and cost-effectively than with
traditional Graphics Processing Units (GPUs). As one of only two major players
in this space, Broadcom has secured significant new business and deepened
relationships with existing customers.
Rolls-Royce continues to build momentum under CEO Tufan Erginbilgic. The
company has experienced a strong recovery in revenues, coupled with
disciplined cost control, resulting in profit growth. This financial strength
has enabled the reinstatement of dividends. With ambitious plans, we remain
optimistic about the company’s trajectory.
3i Group had another strong year, driven by the continued expansion of Action,
its European discount retail holding. As Action has grown to represent a
larger share of 3i’s net asset value, the market has re-rated 3i’s
valuation to more closely reflect that of Action. While this reduces the
margin of safety, we believe it is a rational adjustment. We continue to see
significant growth potential ahead and are encouraged by the stewardship of
CEO Simon Borrows and his team.
Top contributors Average Average
portfolio benchmark Attribution
Name weight % weight % effect %
Rolls-Royce 4.5 0.1 3.2
3i Group plc 5.4 0.1 1.9
Broadcom 2.8 1.2 1.8
Standard Chartered 2.9 – 1.2
Apple 0.4 4.8 0.6
Q And detractors?
A Azelis faced a challenging year in equity markets, yet the underlying
business has demonstrated impressive resilience. Despite navigating one of the
most significant chemical industry downturns in recent history, Azelis has
managed to grow both revenues and profits from 2022 through to 2024. This
performance stands out, particularly when compared to peers in similarly
cyclical sectors that have experienced sharp earnings declines. We believe the
company is well positioned for a potential re-rating and continued earnings
growth, and we have maintained our position.
LVMH was another key detractor during the period. The company has faced
several headwinds, including economic softness in China, operational missteps
in certain divisions and a broader post-Covid normalisation across the luxury
sector. Nevertheless, we remain confident in LVMH’s long-term prospects. Its
portfolio of iconic brands and the leadership of founder-owner Bernard Arnault
(who remains highly aligned and focused) provide a strong foundation for
recovery and renewed growth.
Top detractors Average Average
portfolio benchmark Attribution
Name weight % weight % effect %
Azelis Group 3.2 – –1.2
LVMH 2.2 0.3 –1.0
Verallia 2.1 – –0.8
Novo Nordisk 1.3 0.5 –0.7
Texas Instruments 3.7 0.3 –0.7
Q How do you structure the portfolio?
A We take a flexible, stock-picking approach to investing, guided by three
key opportunity pools.
The core of our portfolio is made up of dividend companies with a strong track
record of consistently growing their dividends over time. These businesses
form the foundation of our long-term value creation strategy and can represent
between 70-100% of the fund depending on what opportunities the market
presents.
In addition, we allocate up to 20% of the portfolio to high-growth companies
that may offer little or no yield today but demonstrate exceptional capital
allocation and a clear roadmap to per share value creation. These are
businesses we believe can deliver outsized returns through disciplined
reinvestment and scalable growth.
Finally, up to 10% of the portfolio is reserved for turnaround opportunities -
companies currently facing temporary challenges but with credible plans to
restore their dividends. These positions allow us to add balance and
contrarian value to the portfolio.
This flexibility has been key in helping us to build a balanced
‘all-weather’ portfolio that has been resilient and outpaced the index
through some of the most turbulent markets in recent history.
Q Any interesting new purchases recently?
A On average there was higher turnover than usual as volatility has provided
some exciting new opportunities, across a range of sectors and geographies!
Here are just a handful of examples of new additions to the portfolio:
ASML: ASML is a Dutch-listed technology leader at the heart of the
semiconductor industry. Its advanced lithography machines are essential for
producing the smallest, most powerful chips that are critical for technologies
like AI, 5G and beyond.
The company holds a near-monopoly in extreme ultraviolet (EUV) lithography, a
position that makes it deeply embedded in its customers’ operations and
difficult to displace. With a strong balance sheet and minimal disruption
risk, ASML is a foundational player in a structurally growing industry.
Following a significant pullback in its share price, we found an attractive
long-term entry point into one of the most strategically important companies
in global tech.
Viking Holdings: Viking stands out as a founder-led cruise operator with
industry leading margins, returns and growth. The company made bold
investments during the pandemic, securing a long-term ship order book that
positions it well for years of supply growth.
At the same time, capacity has exited in the market, creating a supply-demand
imbalance that should support strong pricing and occupancy for the foreseeable
future. Cruise penetration remains low globally, suggesting a significant
runway for growth.
While there are concerns about consumer spending, cruising has historically
proven resilient even during downturns. Viking’s strong fundamentals and
disciplined execution make it well-placed to benefit from long-term tailwinds,
despite near-term market caution.
QXO: QXO is a building products distributor. The company distributes roofing,
waterproofing and other such products across the United States, and is the
largest publicly traded distributor in the industry. Brad Jacobs has a rare
talent of building giants out of fragments. As the founder and CEO of QXO,
he’s once again setting out to transform a fragmented industry, this time
building materials distribution. And if history is any guide, he’s got the
playbook to do it.
Over the past four decades, Jacobs has launched or scaled multiple
multibillion-dollar businesses, often starting in industries where he had no
prior experience. From United Waste Systems in the late 1980s, to United
Rentals in the 1990s, to XPO Logistics in the 2010s (and its spin-offs GXO and
RXO), he’s followed a remarkably consistent strategy: find inefficiencies,
consolidate aggressively, inject technology and scale with discipline.
Q Do you still feel like you have an edge on the market given how fast things
move?
A The market has changed for active managers, and the pace of change is
accelerating. A growing share of market participants now operate with very
different time horizons and objectives to ours. These include multi-manager
hedge funds, trend followers (momentum chasers) and volatility-focused risk
managers. Meanwhile, longterm discretionary investors, once key to price
discovery and liquidity, are losing influence.
Today, more capital is focused on short-term moves (from minutes to weeks),
and less on long-term fundamentals. Information flows faster than ever, and
markets react more quickly, leaving less time to respond thoughtfully.
Positions that take years to build can be unwound in days, often for reasons
unrelated to capital.
In this environment, our structural advantages matter more, if we use them
decisively:
• We have the rare benefit of a genuine 3-5 year investment horizon.
• Our small team can move quickly, without needing to deal with layers of
bureaucracy or committee-led decision making.
• We’ve been through drawdowns together and have built a clear playbook.
• We know our companies well and are confident in our research, even when
the market disagrees.
Q What are your thoughts on AI?
A AI is evolving at extraordinary speed, and businesses are beginning to
adopt generative tools in meaningful ways. This could have far-reaching
implications for productivity, profitability and competitive dynamics.
For knowledge-based industries, AI has the potential to significantly boost
output with fewer resources. Companies that successfully integrate AI to
enhance their customer offering could see faster growth and stronger margins.
But not all businesses will benefit. In some cases, AI may weaken a
company’s value proposition or introduce new forms of competition. Google
Search being a prime example.
As the pace of change accelerates, the risk of business model disruption
rises.
In this environment, we’re focused on backing adaptable, entrepreneurial
management teams and staying open-minded about how AI might reshape
industries. The winners could be significant, but so could the risks.
Q How are you thinking about the macro given there is so much going on?
A The investment landscape in 2025 has been shaped as much by government
policy as by fundamentals. European defence stocks have re-rated sharply
following a major shift in military spending. In contrast, healthcare has
de-rated due to proposed policy changes, including pressure on US drug pricing
and reduced government support. Trade tensions have also had an impact. The US
dollar has weakened over 10% on tariff concerns, creating headwinds for
European exporters. Some global businesses are being forced to rethink their
supply chains, though many are holding off on major investment decisions until
there’s more clarity.
Our focus has been on distinguishing between policy changes that will have
lasting effects and those that are likely to prove temporary. This helps us
stay aligned with businesses that can adapt and thrive through uncertainty.
Q Can you describe how you have taken advantage of the volatility and used it
as an opportunity?
A Stay focused on the long term. As mentioned earlier, we draw on our
experience from pervious crises and what that has taught us is that short-term
volatility is usually a source of opportunity to optimise the portfolio. The
muscle memory from managing money through various crises allows us to block
out the noise and stay focused on the best risk/return opportunities that are
presented at the stock level.
Re-test the thesis. We aim to buy good companies that have strong balance
sheets and are run by management teams we trust. If any of these critical
elements are no longer true then we may recycle capital, that is, sell
existing investments and reallocate the proceeds into more attractive
opportunities. The kind of questions we are asking ourselves are as follows:
Has their market position changed? Has their industry changed? What can
management do to take advantage of new opportunities?
Concentrate on the best risk/reward opportunities. It isn’t often in your
career that almost every business in the market goes on sale, as it did in
April following ‘Liberation Day’. There were many businesses on our
shopping list that we had been waiting to buy, and many of those went on sale.
This is potentially a very exciting time for future returns.
Q Any final thoughts on the outlook?
A Uncertainty still exists as to the end game for US tariffs and potential
retaliation and countermeasures from other countries. This has an impact on
investment and hiring decisions for many businesses. While slowing growth and
economic uncertainty are the focus for market participants today, any
resolution on tariffs or evidence that the US administration is to be
successful in igniting the private sector would shift the emphasis. We choose
not to second guess these outcomes, rather focusing our time and energy on
building a diversified portfolio of high-quality businesses, trading at
attractive valuations from the bottom-up. Diversification is key in this
market as we can’t rely on one definitive economic outcome. We will continue
to work through the economic implications at an individual business level, but
with the focus entirely on building a robust portfolio.
Stephen Anness Joe Dowling
Portfolio Manager Deputy Portfolio Manager
1 August 2025
List of Investments
AT 31 May 2025
Ordinary shares unless stated otherwise
At market
value % of
Company Industry (1) Country £’000 portfolio
3i Financial Services United Kingdom 12,157 5.8
Rolls-Royce Capital Goods United Kingdom 12,072 5.7
Canadian Pacific Kansas City Transportation Canada 11,489 5.4
Microsoft Software & Services United States 10,608 5.0
Coca-Cola Europacific Partners Food, Beverage & Tobacco United Kingdom 8,628 4.1
Broadcom Semiconductors & Semiconductor Equipment United States 8,376 4.0
AIA Insurance Hong Kong 7,903 3.7
Texas Instruments Semiconductors & Semiconductor Equipment United States 7,792 3.7
Standard Chartered Banks United Kingdom 6,836 3.2
Novo-Nordisk - B Shares Pharmaceuticals, Biotechnology & Life Sciences Denmark 6,447 3.0
Top Ten Holdings 92,308 43.6
Universal Music Media & Entertainment Netherlands 6,146 2.9
East West Bancorp Banks United States 6,140 2.9
Taiwan Semiconductor Manufacturing Semiconductors & Semiconductor Equipment Taiwan 5,606 2.7
London Stock Exchange Financial Services United Kingdom 5,567 2.6
Azelis Capital Goods Belgium 5,448 2.6
Ferguson Capital Goods United States 5,237 2.5
American Tower Equity Real Estate Investment Trusts (REITs) United States 5,023 2.4
Recordati Pharmaceuticals, Biotechnology & Life Sciences Italy 5,021 2.4
Aker BP Energy Norway 5,009 2.4
Herc Holdings Capital Goods United States 4,680 2.2
Top Twenty Holdings 146,185 69.2
Tractor Supply Consumer Discretionary Distribution & Retail United States 4,443 2.1
Corpay Financial Services United States 4,323 2.0
XPO Industrial Transportation United States 4,298 2.0
KKR & Co Financial Services United States 4,014 1.9
QXO Capital Goods United States 3,984 1.9
ASML Semiconductors & Semiconductor Equipment Netherlands 3,795 1.8
Abbott Laboratories Health Care Equipment & Services United States 3,734 1.8
Itochu Capital Goods Japan 3,681 1.7
Ametek Capital Goods United States 3,667 1.7
Zurich Insurance Insurance Switzerland 3,534 1.7
Top Thirty Holdings 185,658 87.8
Infrastrutture Telecommunication Services Italy 3,268 1.5
Howden Joinery Capital Goods United Kingdom 3,211 1.5
Viking Holdings Travel & Leisure United States 3,147 1.5
Union Pacific Transportation United States 3,014 1.4
LVMH Consumer Durables & Apparel France 2,982 1.4
Estee Lauder - A Shares Household & Personal Products United States 2,519 1.2
Amentum Commercial & Professional Services United States 2,492 1.2
Analog Devices Semiconductors & Semiconductor Equipment United States 2,432 1.2
CME Financial Services United States 1,091 0.5
Old Dominion Freight Line Transportation United States 1,038 0.5
Top Forty Holdings 210,852 99.7
Progressive Insurance United States 592 0.3
Sberbank (2) – ADR Banks Russia – –
Harbinger – Streamline Offshore Fund (3) Hedge Funds Cayman Islands – –
Total Holdings 43 (31 May 2024: 42) 211,444 100.0
ADR American Depositary Receipts – are certificates that represent shares
in the relevant stock and are issued by a US bank. They are denominated and
pay dividends in US dollars.
(1) MSCI and Standard & Poor’s Global Industry Classification Standard.
(2) The investment in Sberbank – ADR has been valued at zero as secondary
listings of the depositary receipts on Russian companies have been suspended
from trading.
(3) The hedge fund investment is a residual holding of one of the previous
investment strategies, transferred from the Balanced Risk Allocation Portfolio
as part of the Company’s restructure in May 2024, which is awaiting
realisation of underlying investments. Given lack of availability of recent
valuation, the market value has been written-down to zero.
Environmental, Social and Corporate Governance (‘ESG’) Statement from the
Portfolio Managers
What does ESG mean to us?
Stephen Anness
Head of Global Equities
Joe Dowling
Global Equities Fund Manager
• We draw upon ESGintel, Invesco’s proprietary tool, which helps us to
better understand how companies are addressing ESG issues
• Engaging with companies to understand corporate strategy today in order
to assess how this could evolve in the future
• Monitoring how companies are performing from an ESG perspective and if
the valuations fairly reflect the progress being made
Our focus as active portfolio managers is always on finding mispriced stocks
and ESG integration underpins our investment process.
The incorporation of ESG into our investment process considers ESG factors as
inputs into the wider investment process as part of a holistic consideration
of the investment risk and opportunity, from valuation through investment
process to engagement and monitoring. The core aspects of our ESG philosophy
include: materiality; ESG momentum; and engagement.
• Materiality refers to the consideration of ESG issues that are
financially material to the company we are analysing.
• The concept of ESG momentum, or improving ESG performance over time,
indicates the degree of improvement of various ESG metrics and factors and
help fund managers identify upside in the future. We find that companies which
are improving in terms of their ESG practices may enjoy favourable financial
performance in the longer term.
• Engagement is part of our responsibility as active owners which we take
very seriously, and we see engagement with companies as an opportunity to
encourage continual improvement. Dialogue with portfolio companies is a core
part of the investment process for our investment team. As such, we often
participate in board level dialogue and are instrumental in giving shareholder
views on management, corporate strategy, transparency and capital allocation
as well as wider ESG aspects.
ESG integration is an ongoing strategic effort to systematically incorporate
ESG factors into fundamental analysis. As illustrated by the diagram below,
the aim is to provide a 360 degree evaluation of financial and non-financial
materially relevant considerations and to help guide the portfolio strategy.
Our investment process has five stages. In this report we go through in detail
how ESG is integrated into each stage of the investment process.
Idea Generation
We believe it is important to spread our nets as wide as possible when trying
to come up with stock ideas which may find their way into our portfolios. We
remain open minded as to the type of companies we will consider. This means
not ruling out companies just because they happen to be unpopular at that time
and vice versa. Focusing on fundamentals and the broader investment landscape
can be a unique way for our portfolios to potentially generate returns in
excess of the benchmark as those businesses that have got ESG momentum behind
them have the potential to be rerated.
Fundamental Research & ESG Analysis
Research is at the core of what we do. Our fundamental analysis covers many
drivers, for example, corporate strategy, market positioning, competitive
dynamics, the macroeconomic environment, financials, regulation, valuation
and, of course, ESG considerations, which guide our analysis throughout.
We use a variety of tools from different providers to measure ESG factors. In
addition, at Invesco, we have developed ESGintel, Invesco’s proprietary tool
built by our Global ESG research team in collaboration with our Technology
Strategy Innovation and Planning (SIP) team.
ESGintel provides Invesco with environmental, social and governance insights,
metrics, data points and direction of change. In addition, ESGintel offers
Invesco an internal rating on a company, a rating trend and a rank against
sector peers. The approach ensures a targeted focus on the issues that matter
most for sustainable value creation and risk management.
This provides a holistic view on how a company’s value chain is impacted in
different ways by various ESG topics, such as compensation and alignment,
health and safety and low carbon transition/climate change.
We always try to meet with a company prior to investment. Based on our
fundamental research, including any ESG findings, we focus on truly
understanding the key drivers and, most importantly, the path to change. This
helps us better understand corporate strategy today and how this could evolve
in the future.
Portfolio Construction
We aim to create a well-diversified portfolio of active positions that reflect
our assessment of the potential upside for each stock weighted against our
assessment of the risks. Sustainability and ESG factors are assessed alongside
other fundamental drivers of valuation. The impact of any new purchases will
need to be considered at a portfolio level. How will it affect the shape of
the portfolio having regard to objectives, existing positions, overall size of
the portfolio, liquidity and conviction.
We do not seek out stocks which score well on internal or third party research
simply to reduce portfolio risk.
Ongoing Monitoring
Our team continuously monitors how the stocks are performing as well as
considering possible replacements. Is the company performing from an ESG
perspective and are the valuations fairly reflecting the progress being made
or not?
How do we monitor our holdings from an ESG perspective? Again, the same
resources used during the fundamental stage are available to us. Our regular
meetings with the management teams of the companies we own provides an ideal
platform to discuss key ESG issues, which will be researched in advance. We
draw on our own knowledge as well as relevant analysis from our ESG team and
data from our previously mentioned proprietary system ESGintel which allows us
to monitor progress and improvement against sector peers. Outside of company
management meetings we constantly discuss as a team all relevant ESG issues,
either stimulated internally or from external sources.
Challenge, Assessing & Monitoring Risk
In addition, there are two more formal ways in which our portfolios are
monitored:
There is a rigorous semi-annual review process which includes a meeting led by
the ESG team to assess how our portfolios are performing from an ESG
perspective. This ensures a circular process for identifying flags and
monitoring of improvements over time. These meetings are important in
capturing issues that have developed and evolved whilst we have been
shareholders.
There is also the ‘CIO challenge’, a formal review meeting held between
Joe and I individually and the Henley Investment Centre’s Chief Investment
Officer (CIO) and each fund manager. This review includes a full breakdown of
the ESG performance using Sustainalytics and ISS data, such as the absolute
ESG performance of the portfolio, relative performance to benchmarks, stocks
exposed to severe controversies, top and bottom ESG performers, carbon
intensity and trends. The ESG team review the ESG data and develop stock
specific or thematic ESG questions. The ESG performance of the portfolio is
discussed with the CIO using the data and the stock specific questions to
analyse the fund manager’s level of ESG integration. The aim of these
meetings is not to prevent us from holding any specific stock: rather, what
matters is that we can evidence understanding of ESG issues and show that they
have been taken into consideration when building the investment case.
Voting Policy
The Global Equity Team’s corporate engagement specialists review AGM and EGM
proposals taking into account our own knowledge of the companies in which our
funds are invested, as well as the comments and recommendations of ISS(1),
Glass Lewis and IVIS(2). In addition, Invesco provides proprietary proxy
voting recommendations and publishes these recommendations via its PROXYintel
platform.
Especially where there are situations of controversy or differing views
between the consultants mentioned above we will draw on the additional
expertise of our internal ESG team.
There will be times when we will follow the recommendations made by ISS, Glass
Lewis and IVIS but times where we disagree with the stance being taken. Voting
in line with management recommendations should not be seen as evidence of a
lack of challenge on our part, but rather that either the governance of the
companies in which we are invested is already good and worthy of support or we
have engaged with the company and our concerns have been addressed
satisfactorily.
Total Total
Category Number (%)
Ballots voted 44 100
Ballots against management recommendations 13 30
Ballots against ISS recommendations 21 48
Source: Invesco, relates to the period 1 June 2024 to 31 May 2025 for the
Invesco Global Equity Income Trust plc.
Engagements in 2024
Our ESG interactions with companies typically occur in group or 1:1 calls
between our fund manager(s)/analyst(s) and corporate representative(s).
We strive to meet with companies in order to better understand the management
team and their focus and outlook, and to bring up any concerns and
suggestions; this can often cover ESG.
Total ESG Engagements
Company % of
meetings times
Company where E/S/G Combinations E/S/G
Period meetings was discussed of E/S/G E only S only G only discussed
2024 142 55 17 8 7 23 39%
Source: Invesco, Data relates to the Henley-based Global Equities team, as at
31 December 2024.
Conclusion
The regulatory landscape is rapidly evolving, which increasingly compels
organisations and investors alike to clearly demonstrate their awareness of
ESG issues in their decisions. Landmark initiatives such as the European
Union’s new Sustainable Finance Disclosure Regulation (SFDR) are at the
forefront of this shift.
We believe that our approach is fair, coherent and pragmatic. Whilst we
consider ESG aspects, we are not bound by any specific ESG criteria and have
the flexibility to invest across the ESG spectrum from best to worst in class,
but we think that the principles behind ESG deserve to be embedded in an
investment framework which encourages positive change. Coupling this with a
focus on valuation is, to our minds, the best way to deliver strong investment
outcomes for our clients long term. This reinforces our fundamental belief
that responsible investing demands a long-term view and that a
stakeholder-centric culture of ownership and stewardship is at the heart of
ESG integration.
(1)ISS – Institutional Shareholder Services.
(2)IVIS – Institutional Voting Information Service
Business Review
Purpose, Business Model and Strategy
Invesco Global Equity Income Trust plc is an investment company and its
investment objective is set out below. The strategy the Board follows to
achieve that objective is to set investment policy and risk guidelines,
together with investment limits, and to monitor how they are applied. These
are also set out below and have been approved by shareholders.
The Company’s purpose is to generate returns for shareholders by investing
their pooled capital to achieve the Company’s investment objective through
the application of its investment policy and with the aim of spreading
investment risk.
The business model the Company has adopted to achieve its investment objective
has been to contract out investment management and administration to
appropriate external service providers, which are overseen by the Board.
The principal service provider is Invesco Fund Managers Limited, which
throughout this report is referred to as ‘the Manager’. Invesco Asset
Management Limited, an associate company of the Manager, manages the
Company’s investments and acts as Company Secretary under delegated
authority from the Manager. References to the Manager should consequently be
considered to include both entities.
The Manager provides company secretarial, sales, marketing and general
administration services including accounting and manages the portfolio in
accordance with the Board’s strategy.
Stephen Anness and Joe Dowling are the Portfolio Managers responsible for the
day-to-day management of the portfolio.
The Company also has contractual arrangements with MUFG Corporate Markets to
act as registrar and the Bank of New York Mellon (International) Limited
(BNYMIL) as depositary and custodian.
Investment Objective
The Company’s investment objective aims to provide an attractive level of
predictable income and capital appreciation over the long term, predominately
through investment in a diversified portfolio of equities worldwide.
Investment Policy and Risk
The portfolio will be invested predominantly in a portfolio of listed, quoted
or traded equities worldwide, but may also hold other securities from time to
time including, inter alia, fixed interest securities, preference shares,
convertible securities and depositary receipts. Investment may also be made in
regulated or authorised collective investment schemes. The portfolio will not
invest in companies which are not listed, quoted or traded at the time of
investment, although it may have exposure to such companies where, following
investment, the relevant securities cease to be listed, quoted or traded. The
Manager will at all times invest and manage the portfolio’s assets in a
manner that is consistent with spreading investment risk, but there will be no
rigid industry, sector, region or country restrictions.
The portfolio may utilise derivative instruments including index-linked notes,
contracts for differences, covered options and other equity-related derivative
instruments for efficient portfolio management and investment purposes. Any
use of derivatives for investment purposes will be made on the basis of the
same principles of risk spreading and diversification that apply to the
portfolio’s direct investments, as described above.
It is expected that, typically, the portfolio will hold between 40 and 60
securities.
The Directors believe that the use of borrowings can enhance returns to
shareholders, and the Company may use borrowings in pursuing its investment
objective.
The Company’s foreign currency investments will not be hedged to sterling as
a matter of general policy. However, the Manager may employ currency hedging,
either back to sterling or between currencies (i.e. cross hedging of portfolio
investments).
Investment Limits
The Board has prescribed the following limits on the investment policy of the
Company:
• no more than 20% of the gross assets of the Company may be invested in
fixed interest securities;
• no more than 10% of the gross assets of the Company may be held in a
single investment;
• no more than 10% of the gross assets of the Company may be held in other
listed investment companies (excluding REITs); and
• borrowings may be used to raise equity exposure up to a maximum of 20%
of the net assets of the Company, when it is considered appropriate.
Key Performance Indicators
The Board reviews the performance of the Company by reference to a number of
key performance indicators, which include the following:
• Investment performance
• Discount/premium
• Ongoing charges
Investment Performance
To assess investment performance the Board monitors the net asset value
(‘NAV’) performance of the Company relative to that of the benchmark index
it considers to be appropriate. However, given the requirements and
constraints of the investment objective and policy followed, no index can be
expected to fully represent the performance that might reasonably be expected
from the Company.
The NAV total return performance over one, three and five year periods to 31
May 2025 and of the relevant benchmark index was as follows:
One Three Five
Year Years Years
NAV total return per share 11.9% 48.6% 120.8%
MSCI World Index (£)
total return 7.4% 35.5% 77.9%
Source: LSEG Data & Analytics. The Board also monitors the Company’s NAV
total return performance relative to its investment companies peer group and
relevant open-ended funds.
Further details on the definition and calculation of total returns can be
found in the Glossary and Alternative Performance Measures on pages 79 to 81.
Discount/Premium
The Board recognises the need to address any sustained and significant
imbalance of buyers and sellers which might otherwise lead to the Company’s
shares trading at a material discount or premium to the NAV per share. The
Board intends to utilise its share buy-back and share issuance authorities,
where appropriate, in such a way as to mitigate the effects of any such
imbalance.
In exercising the Company’s power to buy back shares, the Board has complete
discretion as to the timing, price and volume of shares bought back. Shares
will only be bought back at prices that enhance the NAV of the remaining
shares and may be held in treasury or cancelled. The Board intends to use ad
hoc share buy-backs to seek to maintain a single digit discount in normal
market conditions.
The Board also has complete discretion as to the timing, price and volume of
shares issued pursuant to the Company’s issuance authorities. Shares may
only be issued or sold from treasury at a price which, after costs, is not
less than the net asset value per share at the relevant time.
The Board reviews the buy-back and issuance parameters from time to time
taking into account current market conditions and other factors and instructs
the brokers accordingly.
The operation of the Company’s liquidity policy is dependent upon the
authorities to buy back and issue shares being renewed by shareholders.
Notwithstanding the intended effect of this policy, there can be no guarantee
that the Company’s shares will trade at close to their respective NAV.
The Board and the Manager closely monitor movements in the Company’s share
price and dealings in the Company’s shares. Share movements in the year are
summarised on page 26. At 31 May 2025, the share price, net asset value
(‘NAV’) and the discount of the shares (known as Global Equity Income
shares prior to 2 December 2024) were as follows:
2025 2024
NAV Share NAV Share
per share price per share price
(Pence) (Pence) Premium (1) (Pence) (Pence) Discount (1)
337.36 342.00 1.4% 313.30 286.00 (8.7)%
(1) Further details on the definition and calculation of the
premium/(discount) can be found in the Glossary and Alternative Performance
Measures on pages 79 to 81 of the financial report.
Ongoing Charges
The expenses of managing the Company are reviewed by the Board at every
meeting. The Board aims to minimise the ongoing charges figure which provides
a guide to the effect on performance of all annual recurring operating costs
of the Company. The ongoing charges figure is calculated by dividing the
annualised ongoing charges, including those charged to capital, by the average
daily net asset value during the year, expressed as a percentage.
Further details on the definition and calculation of ongoing charges can be
found in the Glossary and Alternative Performance Measures on pages 79 to 81
of the financial report.
At the year end the ongoing charges figure of the Company was as follows:
Company
2025 0.78%
2024 0.82%
In addition to inflationary effects, shrinkage from buybacks in connection
with the discount control policy will tend to cause the ongoing charge
percentages to gradually increase. However, as noted above, the ongoing
charges figure reduced at the 2025 financial year end as a result of a number
of factors, including a growth in assets and share issuances.
Revenue and Dividends
The Directors review revenue estimates and prospective dividend levels
regularly. The Directors are able to sanction the use of the Company’s
capital reserves to supplement the underlying income generated by the
portfolio and therefore can pay dividends from a combination of capital and
revenue reserves. Details of dividends paid during the year are set out below.
Revenue earnings per share for the Company was 5.01p (2024: 9.03p), based on
net revenue for the year of £3,140,000 (2024: £6,099,000), which included
£282,000 (2024: £265,000) of non-recurring special dividends. Net revenue
for the year ended 31 May 2024 was derived from the four different portfolios
that existed prior to the Company’s restructuring in May 2024, some of which
were higher yielding than the Global Equities Income Portfolio into which the
other three portfolios were merged as part of the restructuring.
Dividend Policy
Under the current dividend policy, which was adopted with effect from the
financial year commencing 1 June 2024, the Company will pay an annual dividend
of at least 4% calculated on the unaudited prior year-end NAV, paid quarterly
in equal amounts.
The intention is that these dividends will be paid from the Company’s
revenues and, if required, capital reserves.
The Board believes that the dividend policy should provide shareholders with
an attractive level of predictable income whilst freedom for the investment
Manager to select the best ideas irrespective of their yield.
Dividends Declared
Four interim dividends were paid for the year ended 31 May 2025 totalling
12.52p (2024: 7.35p) per ordinary share, of which 5.01p (2024: 5.02p) was met
from revenue earned in the year. The aggregate of dividends paid in respect of
the year was £7,845,000 (2024: £1,864,000).
A first interim dividend for the year to 31 May 2026 of 3.375p was declared on
10 July 2025. In the absence of unforeseen circumstances, and in accordance
with the dividend policy set out above, the Board intends for this to set the
level for the next three quarterly dividends.
Financial Position
Assets and Liabilities
The Company’s balance sheet on page 59 shows the assets and liabilities at
the year end. Details of the Company’s borrowing facility are shown in note
13 of the financial statements on page 67, with interest paid (finance costs)
in note 5.
Owing to the readily realisable nature of the Company’s assets, cash flow
does not have the same significance as for an industrial or commercial
company. The Company’s principal cash flows arise from the purchases and
sales of investments and the income from investments against which must be set
the costs of borrowing and management and other expenses.
Borrowing Policy
Borrowing policy is under the control of the Board, which has established
effective parameters for the portfolio. Borrowing levels are regularly
reviewed. As part of the Company’s investment policy, the approved borrowing
limit is 20% of the Company’s net assets.
Issued Share Capital
The Company’s former Global Equity Income shares were redesignated as
ordinary shares on 2 December 2024. The ordinary shares have a nominal value
of 1 pence per share.
Authorities given to the Directors at the AGM on 21 November 2024 to allot
shares, disapply statutory pre-emption rights and buy back shares will expire
at the forthcoming AGM.
During the year the Company bought back into treasury 1,342,282 shares at an
average price of 316.01p and for an aggregate consideration of £4.27 million.
These shares had a nominal value of £13,423 and represented 2.13% of the
issued shares of the Company (excluding treasury shares) at the 1 June 2024.
During the year the Company sold 1,210,000 shares from treasury at an average
price of 340.70p and for an aggregate consideration of £4.11 million. These
shares had a nominal value of £12,100 and represented 1.92% of the issued
shares of the Company (excluding treasury shares) at the 1 June 2024.
For the period since the year end, and up to 30 July 2025, 3,610,000 shares
have been sold from treasury at an average price of 364.97p and for an
aggregate consideration of £13.18 million.
Further details on net changes in issued share capital are set out in note 14
to the financial statements on pages 67 and 68.
Current and Future Developments
As part of the Company’s overall strategy, the Company seeks to manage its
affairs so as to maximise returns for shareholders. The key driver behind
shareholder returns are investment performance, the share price
discount/premium and the Company’s ongoing charges. The Board has a
longer-term objective to increase the size of the Company through a
combination of strong investment performance and further share issuance. An
increase in the size of the Company should lower ongoing charges and make the
Company’s shares attractive to a broader range of potential investors, which
should result in improved liquidity in the Company’s shares.
Details of trends and factors likely to affect the future development,
performance and position of the Company’s business can be found in the
Chair’s Statement on pages 6 to 8 and the Portfolio Managers’ Report on
pages 12 to 15. Further details as to the risks affecting the Company are set
out under ‘Principal Risks and Uncertainties’ below.
Principal Risks and Uncertainties
The Audit Committee regularly undertakes a robust assessment of the risks the
Company faces, including those that would threaten its business model, future
performance, solvency, reputation or liquidity, and emerging risks, on behalf
of the Board (see the Audit Committee Report on pages 43 and 44). In carrying
out this assessment, the Audit Committee together with the Manager have
considered emerging risks such as recent geopolitical events, evolving cyber
threats (including risks associated with artificial intelligence), wider
shareholder activism impacting certain investment companies and ESG, including
climate-related risks.
The following are considered to be the most significant risks, after
consideration of mitigating factors, to the Company and to shareholders in
relation to their investment in the Company. Further details of risks and risk
management policies as they relate to the financial assets and liabilities of
the Company are detailed in note 17 to the financial statements on pages 69 to
73.
Category and principal Mitigating procedures Risk trend during
risk description and controls the year
Strategic Risk
Market Risk The Company’s investments are mainly traded on global stock markets including those in Asia, Continental Europe, the US and the UK. The principal risk for investors in the Company is a significant fall and/or a prolonged period of decline in these global markets. This could be triggered by unfavourable developments in a single country or region or on more global basis. The Company has a diversified investment portfolio by country, sector and stock. Due to its investment trust structure, no forced sales need to take place and investments ► Unchanged
can be held over a longer-term horizon. However, there are few ways to mitigate absolute market risk because it is engendered by factors which are outside the control of
the Board and the Manager. These factors include the general health of the world economy, interest rates, inflation, government policies, industry conditions and changing
investor demand and sentiment. Such factors may give rise to high levels of volatility in the prices of investments held by the Company. The performance of the Manager is
carefully monitored by the Board and the continuation of the Manager’s appointment is reviewed each year. The Board has established guidelines to ensure that the
investment objective and policy of the Company is pursued by the Manager. For a fuller discussion of the economic and market conditions facing the Company and the current
and future performance of the Company, please see both the Chair’s Statement on pages 6 to 8 and the Portfolio Managers’ Report on pages 12 to 15.
Geopolitical Risk Political risk has always been a feature of investing in stock markets and it is particularly so when investing on a global basis. Wider political developments in global geographies, such as the war in Ukraine and conflict in the Middle East, can create risks to the value of the Company’s assets. Global markets encompass a variety of political systems. There are many examples of diplomatic skirmishes and military tensions and sometimes these result in military engagement. The Manager evaluates and assesses political risk as part of the stock selection and asset allocation policy which is monitored at every Board meeting. This includes ▲ Increased
political, military and diplomatic events and changes to legislation. Balancing political risk and reward is an essential part of the active management process. The
Company has a nil-valued holding in Sberbank, a Russian bank, but no other direct investments in Russia or other holdings with significant links to Russia.
Investment Objectives and Strategy The Company’s investment objective and strategy are no longer meeting investors’ demands. The Board receives regular reports reviewing the Company’s investment performance against its stated objective, benchmark, investment companies peer group and relevant ► Unchanged
open-ended funds and reports from discussions with its broker and major shareholders. The Board also has a separate annual strategy meeting.
Widening Discount A lack of liquidity and/or lack of investor interest in the Company’s shares leads to a depressed share price and a widening discount to its NAV. A persistently high discount may lead to buy-backs of the Company’s shares and result in the shrinkage of the Company. The Board receives regular reports from both the Manager and the Company’s broker on the Company’s share price performance, level of share price discount/premium to NAV ▼ Decreased
and recent trading activity in the Company’s shares. As a result of the restructuring in 2024, the Board has introduced initiatives to help address the Company’s share
rating, including the liquidity policy referred to in the ‘Discount/Premium’ section on page 25 and the dividend policy referred to in the ‘Revenue and Dividends’ section
on page 26. It may seek to reduce any discount volatility and absolute level of any share price discount to NAV through buying back shares within stated shareholder
authorities. The Board also receives regular reports on investor relation meetings with shareholders and prospective investors and works to ensure that the Company’s
investment proposition is actively marketed through relevant messaging across many distribution channels.
Performance Risk that the Portfolio Managers consistently underperform the benchmark and/or peer group over 3-5 years. The Board regularly compares the Company’s NAV total return performance over both the short and long term to that of the benchmark, investment companies peer group and ▼ Decreased
relevant open-ended funds as well as reviewing the portfolio’s performance against benchmark (attribution) and risk-adjusted performance of the Company and its peers.
ESG (including climate risk) Risks associated with climate change and ESG considerations could affect the valuation of the Company’s holdings. ESG considerations are integrated as part of the investment decision-making in constructing the portfolio. The Manager’s process around ESG is described in the ESG ► Unchanged
Monitoring and Engagement section on pages 21 to 23.
Currency Fluctuation Risk Exposure to currency fluctuation risk negatively impacts the Company’s NAV. The movement of exchange rates may have an unfavourable or favourable impact on returns as nearly all of the Company’s assets are non-sterling denominated. With the exception of borrowings in foreign currency, the Company does not normally hedge its currency positions but may do so should the Portfolio Managers or the Board ► Unchanged
feel this to be appropriate. Contracts are limited to currencies and amounts commensurate with the asset exposure. The foreign currency exposure of the Company is
reviewed at Board meetings.
Third Party Service Providers Risk
Information Technology Resilience and Security The Company’s operational structure means that all cyber risk (information and physical security) arises at its third-party service providers (‘TPPs’). This cyber risk includes fraud, sabotage or crime perpetrated against the Company or any of its TPPs. The Audit Committee receives regular updates on the Manager’s information and cyber security. This includes updates on the cyber security framework, staff resource and ► Unchanged
training, and the testing of its security systems designed to protect against a cyber security attack. As well as conducting a regular review of TPPs’ audited service
organisation control reports, the Audit Committee monitors TPPs’ business continuity plans and testing including the TPPs’ and Manager’s regular ‘live’ testing of
workplace recovery arrangements should a cyber event occur.
Operational Resilience The Company’s operational capability relies upon the ability of its TPPs to continue working throughout the disruption caused by a major event such as the Covid-19 pandemic. The Manager’s business continuity plans are reviewed on an ongoing basis and the Directors are satisfied that the Manager has in place robust plans and infrastructure to ► Unchanged
minimise the impact on its operations so that the Company can continue to trade, meet regulatory obligations, report and meet shareholder requirements. The Manager has
arrangements and prioritises between work deemed necessary to be carried out on business premises and work from home arrangements should it be necessary. Meetings are
held in person, virtually or via conference calls. Other similar working arrangements are in place for the Company’s TPPs. The Audit Committee receives regular update
reports from the Manager and TPPs on business continuity processes.
Regulatory Risk
Regulatory and Tax-Related The Company is subject to various laws and regulations by virtue of its status as a public limited investment company registered under the Companies Act 2006, its status as an investment trust and its listing on the London Stock Exchange. Loss of investment trust status could lead to the Company being subject to UK capital gains tax on the sale of its investments. A serious breach of other regulatory rules could lead to suspension from the London Stock Exchange, a fine or a qualified Audit Report. Other control failures, either by the Manager or any other of the Company’s service providers, could result in operational or reputational problems, erroneous disclosures or loss of assets through fraud, as well as breaches of regulations. The Manager reviews the level of compliance with the Corporation Tax Act 2010 and other financial and regulatory requirements on a daily basis. All transactions, income ► Unchanged
and expenditure are reported to the Board. The Board ensures that satisfactory assurances are received from service providers. The depositary and the Manager’s compliance
and internal audit officers report regularly to the Company’s Audit Committee.
Continuation Vote
The Board will put forward a vote at the Company’s Annual General Meeting in
2026 for the continuation of the Company (the 2026 Continuation Vote). If the
2026 Continuation Vote is passed the Board will put forward a continuation
vote at the Company’s annual general meeting in 2031 and, if passed, at each
fifth annual general meeting thereafter.
Viability Statement
The Company is an investment company which operates as a collective investment
vehicle, designed and managed for long-term investment. The Board considers
long-term for this purpose to be at least three years and so has assessed the
Company’s viability over this period. However, the life of the Company is
not intended to be limited to that or any other period.
In assessing the viability of the Company the Board considered the principal
and emerging risks to which it is exposed, as set out on pages 27 to 29,
together with mitigating factors. The risk of failure to meet the Company’s
investment objective, contributory market and investment risks and the
challenges of lack of scale were considered to be of particular importance.
The Board also took into account the capabilities of the Manager and the
varying market conditions already experienced by the Company since its launch
in 2006, including the potential impact of the Covid-19 pandemic on global
economies and the war in Ukraine. Despite the disruption to markets from these
and other more recent geopolitical and macro-economic events such as the
ongoing conflict in the Middle East and the potential impact on global
economies of the imposition of increased tariffs on international trade, the
Directors remain confident that the Company’s investment strategy will
continue to serve shareholders well over the longer term.
In terms of financial risks to viability, materially all of the investments
are readily realisable. The portfolio also produces a stream of dividend
income, which may fluctuate but which the Board expects to continue. The
Company has no long-term liabilities and the total value of the portfolio more
than covers the value of the Company’s short-term liabilities and annual
operating costs. In arriving at this assessment, the Board considered stressed
scenario-testing for both income and loan covenants; borrowing structure;
level of gearing; and the liquidity of the portfolio. Consequently, there
appears little to no prospect of the Company not being able to meet its
financial obligations as they fall due in the next three years.
Based on the above, the Board has a reasonable expectation that,
notwithstanding the continuation vote in 2026, the Company will be able to
continue in operation and meet its liabilities as they fall due over the
three-year period of its assessment.
Audit Committee Report
The Audit Committee Report required by the AIC Corporate Governance Code is
set out on pages 43 and 44. There are no areas of concern in relation to
the financial statements to bring to the attention of shareholders.
Duty to Promote the Success of the Company (s.172)
The Directors have a statutory duty under section 172 of the Companies Act
2006 to promote the success of the Company whilst also having regard to
certain broader matters, including the need to engage with employees,
suppliers, customers and others, and to have regard to their interests. The
Company has no employees and no customers in the traditional sense and, in
accordance with the Company’s nature as an investment trust, the Board’s
principal concern has been, and continues to be, the interests of the
Company’s shareholders taken as a whole. In doing so, it has due regard to
the desirability of the Company maintaining a reputation for high standards of
business conduct, the need to foster the Company’s business relationships
and the impact of its actions on other stakeholders including the Manager and
other third-party service providers and the impact of the Company’s
operations on the community and the environment, all which are all taken into
account, to the extent relevant, during all discussions and as part of the
Board’s decision making.
The Board is committed to maintaining open channels of communication and
engagement with stakeholders in a manner which they find most meaningful. The
table below sets out how the Board engages with each of its key stakeholders:
Stakeholder Key considerations and engagement
Shareholders – continued shareholder support and engagement are important to the Company and the delivery of its long-term strategy. Further details of our strategy can be found on page 24. To help the Board in its aim to act fairly as between the Company’s members, shareholder relations are given high priority by the Board and the Manager. The prime means by which the Company communicates with shareholders are the annual and half-yearly
financial reports, which aim to provide shareholders with a full understanding of the Company’s activities and its results. This information is supplemented by daily publication of the NAV of the Company’s shares via the London Stock Exchange, ad hoc
regulatory announcements, the monthly factsheet and other information on the Manager’s website, www.invesco.com/uk/en/investment-trusts/invesco-global-equity-income-trust.html, including pre-investment information, Key Information Document (‘KID’),
shareholder circulars, portfolio disclosures, Stock Exchange announcements, schedule of matters reserved for the Board, terms of reference of Board Committees, Directors’ letters of appointment, the Company’s share price and proxy voting results. The Chair
and other Directors welcome contact with shareholders. There is a regular dialogue between the Manager and individual major shareholders to discuss aspects of investment performance, governance and strategy and to listen to shareholder views in order to
help develop a balanced understanding of their issues and concerns. The Company’s corporate broker, Cavendish Capital Markets Limited, is also consulted. General presentations to institutional shareholders and analysts take place throughout the year. All
meetings between the Manager and institutional shareholders are reported to the Board. It is the intention of the Board that the Annual Financial Report and the notice of the AGM be issued to shareholders so as to provide at least twenty working days’
notice of the AGM. Shareholders wishing to lodge questions in advance of the AGM are invited to do so in writing to the Company Secretary at the address given on page 78.
The Manager – the Manager’s performance is critical for the Company to successfully deliver its investment strategy and meet its objective to provide shareholders with consistent long-term returns. Further details of the Portfolio Managers’ investment approach can be found in the Portfolio Managers’ Report on pages 12 to 15 and the summary of the Investment Team and Process on page 16. The Board engages with the Manager at every Board meeting and reviews the Company’s relationships with other service providers, such as the broker, registrar, depositary and custodian, at least annually. During the year the most significant engagement was
with the Manager, including the Portfolio Managers. At every Board meeting the Directors receive an investor relations update from the Manager, which details any significant changes in the Company’s shareholder register and shareholder feedback, as well as
notifications of any publications or press articles. Maintaining a close and constructive working relationship with the Manager is crucial as the Board and the Manager both aim to achieve consistent, long-term returns in line with the Company’s investment
strategy. Important components in the collaboration with the Manager, representative of the Company’s culture, are: – encouraging an open discussion with the Manager, allowing time and space for original and innovative thinking; – recognising that the
interests of shareholders and the Manager are, for the most part, well aligned, adopting a tone of constructive challenge, balanced with robust negotiation of the Manager’s terms of engagement if those interests should not be fully united; – the regular
review of underlying strategic and investment objectives; – drawing on Directors’ individual experience and knowledge to support and challenge the Manager in its monitoring of and engagement with its investee companies; and – willingness to make the
Directors’ experience available to support and challenge the Manager in the sound long-term development of its business and resources, recognising that the long-term health of the Manager’s business is in the interests of shareholders in the Company.
Third-party Service Providers – in order to function as an investment trust with a listing on the London Stock Exchange, the Company relies on a diverse range of reputable service providers for support in meeting all relevant obligations. The Board, principally through the Manager, maintains regular contact with its key external service providers and receives regular reporting from them, both through the Board and Committee meetings, as well as outside of the regular meeting cycle. Their
advice, as well as their needs and views, are routinely taken into account. The Board (through the Management Engagement Committee) formally assesses the third-party service providers’ performance, fees and continuing appointment annually to ensure that
the key service providers continue to function at an acceptable level and are appropriately remunerated to deliver the expected level of service. The Audit Committee reviews and evaluates the financial reporting control environments in place at each
service provider. There have been no material changes to the level of service provided by the Company’s third-party suppliers during the financial year.
Investee Companies – the Board recognises the importance of good stewardship and communication with investee companies in meeting the Company’s investment objective and strategy. On the Company’s behalf the Portfolio Managers engage with investee companies, particularly in relation to ESG matters, and shares held in the portfolio are voted at general meetings.
Regulators – the Company can only operate as an investment trust if it conducts its affairs in compliance with such status. Interaction with regulators such as the Financial Conduct Authority (‘FCA’) and Financial Reporting Council (‘FRC’), who have a legitimate interest in how the Company operates in the market and treats its shareholders, and industry bodies such as the Association of Investment Companies remains an area of Board focus. The Company regularly considers how it meets various regulatory and statutory obligations and how any governance decisions it makes can have an impact on its stakeholders, both in the shorter and in the longer term. The Board receives reports from the
Manager and Auditor on their respective regulatory compliance and any inspections or reviews that are commissioned by regulatory bodies. The Company is a member of the AIC, which looks after the interests of investment companies and provides information to
investment company boards and the market. Comprehensive information relating to the Company can be found on the AIC website, www.theaic.co.uk. As a member of the AIC, the Company is welcomed to comment on consultations and proposal documents on matters
affecting the Company and annually to nominate and vote for future board members.
The mechanisms for engaging with stakeholders are kept under review by the
Directors are discussed on a regular basis at Board meetings to ensure that
they remain effective. Examples of key discussions and considerations of the
Board made during the year were:
• to consider and approve the renewal of the Company’s loan facility;
• to consider and approve four quarterly dividend payments (see page 26 for
further details);
• to consider and approve the ongoing use of share buy-backs and issuances
as part of the Board’s adopted liquidity policy (see the Discount/Premium
section page 25 for further details);
• to approve an increased marketing budget, the additional cost of which is
expected to be more than offset by attracting new demand for the Company’s
shares and the resulting issue of new shares; and
• to consider and approve the appointment of Sue Inglis and Helen Galbraith
as Directors of the Company.
Board Diversity
The Company’s policy on diversity is set out on page 38, under the section
‘Nomination Committee’. The Board considers diversity, including the
balance of skills, knowledge, experience and gender amongst other factors,
when reviewing its composition and appointing new Directors. The Board
continues to recognise the importance of having a range of skilled,
experienced individuals with the right knowledge represented on the Board in
order to allow it to fulfil its obligations.
In view of its relatively small size, the Board will continue to ensure that
all appointments are made on the basis of merit against the specification
prepared for each appointment. In doing so, the Board will seek to meet the
targets set out in the FCA’s UK Listing Rule 6.6.6R (9)(a), which are
summarised below.
In accordance with UK Listing Rule (‘UKLR’) 6.6.6R (9), (10) and (11) the
Board has provided the following information in relation to its diversity as
at 31 May 2025, being the financial year end of the Company. The information
included in the tables below has been obtained following confirmation from the
individual Directors. As shown in the tables, the Company did not meet the FCA
ethnic diversity target as at 31 May 2025. Given its small size, which it
considers appropriate, and the relative infrequency with which appointments
are made, the Board is aware that achieving this target is more challenging.
It will be mindful of this target when making any future appointments and will
continue to take all matters of diversity into account as part of its
succession planning.
Board Gender as at 31 May 2025
Number of Number in Percentage of
Number of Percentage senior positions executive executive
Board members of the Board on the Board management (1) management (1)
Men 3 60% 1 (3) n/a n/a
Women 2 40% 2 1 (3)(4) n/a n/a
(1) The Company does not disclose the number of directors in executive
management as this is not applicable for an investment trust.
(2) Meets the target of 40% as set out in UKLR 6.6.6R (9)(a)(i).
(3) The position of Chair is held by a woman. The position of Senior
Independent Director is held by a man. The position of Chair of the Audit
Committee is held by a man but this is not currently defined as a senior
position.
(4) Meets the target of 1 as set out in UKLR 6.6.6R (9)(a)(ii).
Number of Number in Percentage of
Number of Percentage of senior positions executive executive
Board members the Board on the Board management (1) management (1)
White British or other White
(including minority-white groups) 5 100% 2 n/a n/a
Minority ethnic 0 (2) 0% 0 n/a n/a
(1) The Company does not disclose the number of directors in executive
management as this is not applicable for an investment trust.
(2) Does not meet the target as set out in UKLR 6.6.6R (9)(a)(iii).
There have been no changes since the year end that have affected the
Company’s ability to meet the targets set in UK LR 6.6.6R (9)(a).
Environment, Social and Governance (‘ESG’) Matters
In relation to the portfolio, the Company has delegated the management of the
Company’s investments to the Manager, who has an ESG Guiding Framework which
sets out a number of principles that are considered in the context of its
responsibility to manage investments in the financial interests of
shareholders.
The Manager is committed to being a responsible investor and applies, and is a
signatory to, the United Nations Principles for Responsible Investment
(‘PRI’), which demonstrates its extensive efforts in terms of ESG
integration, active ownership, investor collaboration and transparency. The
Manager scored four stars for its Investment & Stewardship Policy under new
scoring methodology produced by PRI. This followed five consecutive years of
achieving an A+ rating for responsible investment (Strategy & Governance)
under the previous methodology. In addition, the Manager is an active member
of the UK Sustainable Investment and Finance Association as well as a
supporter of the Task Force for Climate Related Financial Disclosure
(‘TCFD’) since 2019 and published its fourth iteration of its TCFD-aligned
Climate Change Report in 2023.
The Manager is complying with the spirit of the Sustainable Finance Disclosure
Regulation (‘SFDR’) which came into effect within the European Union on 10
March 2021 and is disclosing in its AIFM document as well as its website how
sustainability risks are integrated.
The wider Invesco investment team incorporates ESG considerations in its
investment process as part of the evaluation of new opportunities, with
identified ESG concerns feeding into the final investment decision and
assessment of relative value. The Portfolio Managers make their own
conclusions about the ESG characteristics of each investment held and about
the overall ESG characteristics of the portfolio, although third party ESG
ratings may inform their view. Additionally, the Manager’s ESG team provides
formalised ESG portfolio monitoring. This is a rigorous semi-annual process
where the portfolio is reviewed from an ESG perspective.
Regarding stewardship, the Board considers that the Company has a
responsibility as a shareholder towards ensuring that high standards of
corporate governance are maintained in the companies in which it invests. To
achieve this, neither the Board or the Manager seek to intervene in daily
management decisions, but both aim to support high standards of governance
and, where necessary, will take the initiative to ensure those standards are
met. The principal means of putting shareholder responsibility into practice
is through the exercise of voting rights. The Company’s voting rights are
exercised on an informed and independent basis.
Further details are shown in the ESG Statement from the Manager on pages 21 to
23.
The Company’s stewardship functions have been delegated to the Manager. The
Manager has adopted a clear and considered policy towards its responsibility
as a shareholder on behalf of the Company. As part of this policy, the Manager
takes steps to satisfy itself about the extent to which the companies in which
it invests look after shareholders’ value and comply with local
recommendations and practices, such as the UK Corporate Governance Code. The
Manager is also a Tier 1 signatory of the Financial Reporting Council’s
Stewardship Code, which seeks to improve the quality of engagement between
institutional investors and companies to help improve long-term returns to
shareholders and the efficient exercise of governance responsibilities.
A copy of the Manager’s Stewardship Policy can be found at
www.invesco.com/uk.
A greenhouse gas emissions statement is included in the Directors’ Report on
page 40.
Whilst TCFD is currently not applicable to the Company, the Manager has
produced a product level report on the Company in accordance with the
Financial Conduct Authority’s (‘FCA’) rules and guidance regarding the
disclosure of climate-related financial information consistent with TCFD
Recommendations and Recommended Disclosures. These disclosures are intended to
help meet the information needs of market participants, including
institutional clients and consumers of financial products, in relation to the
climate-related impact and risks of the Manager’s TCFD in-scope business.
The product level report on the Company is available on the Manager’s
website at
www.invesco.com/uk/en/investment-trusts/invesco-global-equity-income-trust.html.
Key elements of the product level report include a scenario analysis of how
climate change is likely to impact the portfolio valuation under net zero
2050, delayed transition and hothouse scenarios, and a discussion of the most
significant drivers of performance under those scenarios.
Invesco’s Group Level Task Force on Climate-Related Financial Disclosures
(‘TCFD’) is available on the Manager’s website at
www.invesco.com/content/dam/invesco/emea/en/pdf/ivz_global-tcfd-report.pdf.
Modern Slavery
As an investment vehicle the Company does not provide goods or services in the
normal course of business, and does not have customers. Accordingly, the
Directors consider that the Company is not within the scope of the Modern
Slavery Act 2015.
This Strategic Report was approved by the Board on 1 August 2025.
James Poole
Senior Company Secretary
Invesco Asset Management Limited
Corporate Company Secretary
Statement of Directors’ Responsibilities
IN RESPECT OF THE PREPARATION OF THE ANNUAL FINANCIAL REPORT.
The Directors are responsible for preparing the Annual Financial Report in
accordance with applicable law and regulations.
Company law requires the Directors to prepare financial statements for each
financial year. Under the law the Directors have elected to prepare financial
statements in accordance with UK Accounting Standards, including FRS 102
‘The Financial Reporting Standard applicable in the UK and Republic of
Ireland.’ Under company law, the Directors must not approve the financial
statements unless they are satisfied that they give a true and fair view of
the state of affairs of the Company and of the 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 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
which enable them to ensure that the financial statements comply with the
Companies Act 2006. They have general responsibility for taking such steps as
are reasonably open to them to safeguard the assets of the Company and to
prevent and detect fraud and other irregularities.
Under applicable law and regulations, the Directors are also responsible for
preparing a Strategic Report, a Directors’ Report, which includes a
Corporate Governance Statement, and a Directors’ Remuneration Report that
comply with that law and those regulations.
The Directors confirm that:
• in so far as they are aware, there is no relevant audit information of
which the Company’s Auditor is unaware; and
• each Director has taken all the steps that they ought to have taken as a
Director in order to make themselves aware of any relevant audit information
and to establish that the Company’s Auditor is aware of that information.
The Directors of the Company each confirm to the best of their knowledge that:
• the financial statements, prepared in accordance with the applicable set
of accounting standards, give a true and fair view of the assets, liabilities,
financial position, net return and cash flows of the Company; and
• this Annual Financial Report includes a fair review of the development
and performance of the business and the position of the Company together with
a description of the principal risks and uncertainties that it faces.
The Directors consider that this Annual Financial Report, taken as a whole, is
fair, balanced and understandable and provides the information necessary for
shareholders to assess the Company’s position and performance, business
model and strategy.
Signed on behalf of the Board of Directors
Sue Inglis
Chair
1 August 2025
Electronic Publication
The Annual Financial Report is published on the Manager’s website
www.invesco.com/uk/en/investment-trusts/invesco-global-equity-income-trust.html.
The Directors are responsible for the maintenance and integrity of the
corporate and financial information included on the Company’s website, which
is maintained by the Company’s Manager. Legislation in the UK governing the
preparation and dissemination of financial statements may differ from
legislation in other jurisdictions.
Income Statement
Year ended 31 May 2025 Year ended 31 May 2024
Revenue Capital Total Revenue Capital Total
Notes £’000 £’000 £’000 £’000 £’000 £’000
Gains on investments held at fair value 9 – 20,482 20,482 – 23,634 23,634
(Losses)/gains on derivative instruments 10 – – – (10) 261 251
Losses on foreign exchange – (4) (4) – (68) (68)
Income 2 4,379 – 4,379 7,433 – 7,433
Investment management fees 3 (332) (775) (1,107) (340) (788) (1,128)
Other expenses 4 (563) 6 (557) (551) (702) (1,253)
Net return before finance costs and taxation 3,484 19,709 23,193 6,532 22,337 28,869
Finance costs 5 (50) (116) (166) (194) (453) (647)
Return before taxation 3,434 19,593 23,027 6,338 21,884 28,222
Tax 6 (294) – (294) (239) 59 (180)
Return after taxation for the financial year 3,140 19,593 22,733 6,099 21,943 28,042
Return per ordinary share (basic and diluted) 7
– Ordinary (formerly Global Equity Income) 5.01p 31.29p 36.30p 9.03p 54.72p 63.75p
– UK Equity (1) n/a n/a n/a 5.12p 9.89p 15.01p
– Balanced Risk Allocation (1) n/a n/a n/a 4.45p 8.72p 13.17p
– Managed Liquidity (1) n/a n/a n/a 17.07p 1.15p 18.22p
(1) This share class was closed on 7 May 2024, as such, only comparative
figures are shown.
The total column of this statement represents the Company’s income statement
prepared in accordance with UK Accounting Standards. The return after taxation
is the total comprehensive income and therefore no additional statement of
other comprehensive income is presented. The supplementary revenue and capital
columns are presented for information purposes in accordance with the
Statement of Recommended Practice issued by the Association of Investment
Companies. All items in the above statement derive from continuing operations
of the Company. No operations were acquired or discontinued in the current
year.
The accompanying accounting policies and notes are an integral part of these
financial statements.
Statement of Changes in Equity
Capital
Share redemption Special Capital Revenue
capital reserve reserve reserve reserve Total
Notes £’000 £’000 £’000 £’000 £’000 £’000
At 31 May 2023 1,707 377 137,424 60,129 102 199,739
Cancellation of deferred shares – 233 (233) – – –
Shares bought back and held in treasury 14 – – (2,702) – – (2,702)
Share conversions (348) 116 232 – – –
Return after taxation per the income statement – – – 21,943 6,099 28,042
Dividends paid 8 – – (597) – (6,099) (6,696)
Costs associated with tender offer 14 – – (145) – – (145)
Tender offer in respect of the share
class reclassification 14 – – (20,683) – – (20,683)
Treasury shares cancellation (559) 559 – – – –
At 31 May 2024 800 1,285 113,296 82,072 102 197,555
Shares bought back and held in treasury 14 – – (4,270) – – (4,270)
Shares sold from treasury – – 4,110 – – 4,110
Return after taxation per the income statement – – – 19,593 3,140 22,733
Dividends paid 8 – – (4,603) – (3,242) (7,845)
At 31 May 2025 800 1,285 108,533 101,665 – 212,283
The accompanying accounting policies and notes are an integral part of these
financial statements.
Balance Sheet
At At
31 May 2025 31 May 2024
Notes £’000 £’000
Fixed assets
Investments held at fair value through
profit or loss 9 211,444 195,824
Current assets
Debtors 11 1,314 1,639
Cash and cash equivalents 2,618 1,859
3,932 3,498
Creditors: amounts falling due within one year
Other creditors 12 (443) (1,767)
Bank facility 13 (2,650) –
(3,093) (1,767)
Net current assets 839 1,731
Net assets 212,283 197,555
Capital and reserves
Share capital 14 800 800
Special reserve 15 108,533 113,296
Capital redemption reserve 15 1,285 1,285
Capital reserve 15 101,665 82,072
Revenue reserve 15 – 102
Shareholders’ funds 212,283 197,555
Net asset value per ordinary share 16 337.36p 313.30p
The financial statements were approved and authorised for issue by the Board
of Directors on 1 August 2025.
Signed on behalf of the Board of Directors
Sue Inglis
Chair
Company No. 05916642
The accompanying accounting policies and notes are an integral part of these
financial statements.
Cash Flow Statement
Year ended Year ended
31 May 2025 31 May 2024
Notes £’000 £’000
Cash flows from operating activities
Net return before finance costs and taxation 23,193 28,869
Tax paid on overseas income 6 (294) (180)
Purchase of investments (137,107) (177,227)
Sale of investments 141,822 212,682
Sale of futures – 190
Scrip dividends – (109)
Gains on investments 9 (20,482) (23,634)
Losses on derivatives – (251)
(Increase)/decrease in debtors (212) 954
Decrease in creditors (120) (12)
Net cash inflow from operating activities 6,800 41,282
Cash flows from financing activities
Interest paid on bank borrowings (176) (641)
Increase/(decrease) in bank facility(1) 2,650 (9,650)
Shares bought back and held in treasury (4,270) (2,702)
Costs associated with tender offer – (145)
Tender offer in respect of the share class reclassification – (20,683)
Shares sold from treasury 3,600 –
Equity dividends paid 8 (7,845) (6,696)
Net cash outflow from financing activities (6,041) (40,517)
Net increase in cash and cash equivalents 759 765
Cash and cash equivalents at the start of the year 1,859 1,094
Cash and cash equivalents at the end of the year 2,618 1,859
Reconciliation of cash and cash equivalents to the Balance Sheet is as follows:
Cash held at custodian 618 559
Invesco Liquidity Funds plc – Sterling, money market fund 2,000 1,300
Cash and cash equivalents 2,618 1,859
Cash flow from operating activities includes:
Interest received 27 47
Dividends received 3,662 6,599
(1) Due to the nature of the bank facility allowing weekly marginal changes
to the amount borrowed, rather than full repayment and new drawdown amount,
management judges it appropriate to show the net increase/(decrease) over the
year rather than the gross repayments and drawdowns separately, as defined in
FRS 102 section 7.10A (b).
The accompanying accounting policies and notes are an integral part of these
financial statements.
Notes to the Financial Statements
1. Accounting Policies
Accounting policies describe the Company’s approach to recognising and
measuring transactions during the year and the position of the Company at the
year end.
The principal accounting policies are set out below:
(a) Basis of Preparation
(i) Accounting Standards Applied
The financial statements have been prepared in accordance with applicable
United Kingdom Accounting Standards, including FRS 102 ‘The Financial
Reporting Standard applicable in the UK and Republic of Ireland’, and
applicable law (UK Generally Accepted Accounting Practice (‘UK GAAP’))
and with the Statement of Recommended Practice Financial Statements of
Investment Trust Companies and Venture Capital Trusts, updated by the
Association of Investment Companies (‘AIC’) in July 2022. The financial
statements are issued on a going concern basis as disclosed on page 39.
The accounting policies applied to these financial statements are consistent
with those applied for the preceding year.
(ii) Functional and Presentational Currency
The Company’s investments are made in several currencies. However, the
financial statements are presented in sterling, which is the Company’s
functional currency. In arriving at this conclusion, the Directors considered
that the Company’s shares are listed and traded on the London Stock
Exchange, the shareholder base is predominantly in the United Kingdom and the
Company pays dividends and expenses in sterling.
(iii) Transactions and Balances
Transactions in foreign currency, whether of a revenue or capital nature, are
translated to sterling at the rates of exchange ruling on the dates of such
transactions. Foreign currency assets and liabilities are translated to
sterling at the rates of exchange ruling at the balance sheet date. Any gains
or losses, whether realised or unrealised, are taken to the capital reserve or
to the revenue account, depending on whether the gain or loss is of a capital
or revenue nature. All gains and losses are recognised in the income
statement.
(iv) Significant Accounting Estimates and Judgements
The preparation of the financial statements may require the Directors to make
estimations where uncertainty exists. It also requires the Directors to make
judgements, estimates and assumptions in the process of applying the
accounting policies. There have been no significant judgements, estimates or
assumptions for the current or preceding year.
(b) Financial Instruments
The Company has chosen to apply the provisions of sections 11 and 12 of FRS
102 in full in respect of the financial instruments, which is explained below.
(i) Recognition of Financial Assets and Financial Liabilities
The Company recognises financial assets and financial liabilities when the
Company becomes a party to the contractual provisions of the instrument. The
Company will offset financial assets and financial liabilities if the Company
has a legally enforceable right to set off the recognised amounts and
interests and intends to settle on a net basis.
(ii) Derecognition of Financial Assets
The Company derecognises a financial asset when the contractual rights to the
cash flows from the asset expire or it transfers the right to receive the
contractual cash flows on the financial asset in a transaction in which
substantially all the risks and rewards of ownership of the financial asset
are transferred. Any interest in the transferred financial asset that is
created or retained by the Company is recognised as an asset.
(iii) Derecognition of Financial Liabilities
The Company derecognises financial liabilities when its obligations are
discharged, cancelled or expire.
(iv) Trade Date Accounting
Purchases and sales of financial assets are recognised on trade date, being
the date on which the Company commits to purchase or sell the assets.
(v) Classification and Measurement of Financial Assets and Financial
Liabilities
Financial assets
The Company’s investments, including financial derivative instruments, are
classified as held at fair value through profit or loss.
Financial assets held at fair value through profit or loss are initially
recognised at fair value, which is taken to be their cost, with transaction
costs expensed in the income statement, and are subsequently valued at fair
value.
Fair value for investments, including financial derivative instruments, that
are actively traded in organised financial markets is determined by reference
to stock exchange quoted bid prices at the balance sheet date. For investments
that are not actively traded or where active stock exchange quoted bid prices
are not available, fair value is determined by reference to a variety of
valuation techniques including broker quotes and price modelling. Where there
is no active market, unlisted/illiquid investments are valued by the Directors
at fair value with regard to the International Private Equity and Venture
Capital Valuation Guidelines and on recommendations from the Manager’s
pricing committee, both of which use valuation techniques such as earnings
multiples, recent arm’s length transactions and net assets.
Financial liabilities
Financial liabilities, excluding financial derivative instruments but
including borrowings, are initially measured at fair value, net of transaction
costs and are subsequently measured at amortised cost using the effective
interest method.
(c) Cash and Cash Equivalents
Cash and cash equivalents may comprise cash (including short-term deposits
which are readily convertible to a known amount of cash and are subject to an
insignificant risk of change in value) as well as cash equivalents, including
money market funds. Investments are regarded as cash equivalents if they meet
all of the following criteria: highly liquid investments held in the
Company’s base currency that are readily convertible to a known amount of
cash, are subject to an insignificant risk of change in value, have a maturity
of less than three months at date of origination and provide a return no
greater than the rate of a three-month high quality government bond.
(d) Income
Dividend income from investments is recognised when the shareholders’ right
to receive payment has been established, normally the ex-dividend date. UK
dividends are stated net of related tax credits. Interest income arising from
cash is recognised on an accruals basis and underwriting commission is
recognised as earned. Special dividends are taken to revenue unless they arise
from a return of capital, when they are allocated to capital in the income
statement. Income from fixed income securities is recognised in the income
statement using the effective interest method.
(e) Expenses and Finance Costs
All expenses are accounted for on an accruals basis. Expenses are charged to
the income statement and shown in revenue except where expenses are presented
as capital items when a connection with the maintenance or enhancement of the
value of the investments held can be demonstrated and thus management fees and
finance costs are charged to revenue and capital to reflect the Directors’
expected long-term view of the nature of the investment returns from the
portfolio.
Finance costs are accounted for on an accruals basis using the effective
interest rate method.
The investment management fee and finance costs are allocated 70% to capital
and 30% to revenue. This is in accordance with the Board’s expected
long-term split of returns, in the form of capital gains and income
respectively, from the portfolio.
(f) Dividends
Dividends are accrued in the financial statements when there is an obligation
to pay the dividends at the balance sheet date.
(g) Taxation
Tax expense represents the sum of tax currently payable and deferred tax. Any
tax payable is based on taxable profit for the period. Taxable profit differs
from profit before tax as reported in the income statement because it excludes
items of income or expenses that are taxable or deductible in other years and
it further excludes items that are never taxable or deductible. The
Company’s liability for current tax is calculated using tax rates that have
been enacted or substantively enacted by the balance sheet date.
For the Company, any allocation of tax relief to capital is based on the
marginal basis, such that tax allowable capital expenses are offset against
taxable income.
Deferred taxation is recognised in respect of all timing differences that have
originated but not reversed at the balance sheet date where transactions or
events that result in an obligation to pay more tax or a right to pay less tax
in the future have occurred. Timing differences are differences between the
Company’s taxable profits and its results as stated in the financial
statements. Deferred taxation assets are recognised where, in the opinion of
the Directors, it is more likely than not that these amounts will be realised
in future periods.
A deferred tax asset has not been recognised in respect of surplus management
expenses as the Company is unlikely to have sufficient future taxable revenue
to offset against these.
Investment trusts which have approval under the appropriate tax regulations
are not liable for taxation on capital gains.
(h) Segmental Reporting
The Directors are of the opinion that the Company is engaged in a single
segment of business being investment business.
2. Income
This note shows the income generated from the portfolio (investment assets) of
the Company and income received from any other source.
2025 2024
£’000 £’000
Income from investments:
UK dividends:
– ordinary dividends 844 3,881
– scrip dividends – 109
844 3,990
Overseas dividends
– ordinary dividends 3,227 3,027
– special dividends 282 265
Interest from Treasury bills – 103
3,509 7,385
Other income:
Deposit interest 26 47
Rebates of management fee – 1
Total income 4,379 7,433
Special dividends recognised as revenue for the year are as shown above. No
special dividends have been recognised in capital during the year (2024:
£nil).
3. Investment Management Fees
This note shows the investment management fee due to the Manager which is
calculated and paid quarterly.
2025 2024
Revenue Capital Total Revenue Capital Total
£’000 £’000 £’000 £’000 £’000 £’000
Investment management fee 332 775 1,107 340 788 1,128
332 775 1,107 340 788 1,128
Details of the Investment Management Agreement are given on page 39 in the
Directors’ Report.
4. Other Expenses
The other expenses of the Company, including those paid to Directors and the
auditor, are presented below; those paid to the Directors and the auditor are
separately identified.
2025 2024
Revenue Capital Total Revenue Capital Total
£’000 £’000 £’000 £’000 £’000 £’000
Directors’ remuneration (1)(2) 176 – 176 166 10 176
Auditor’s fees (3) :
– for audit of the Company’s
annual financial statements 67 – 67 74 – 74
– non-audit fees – – – – 37 37
Other expenses (4) 320 (14) 306 311 648 959
Custodian transaction charges – 8 8 – 7 7
563 (6) 557 551 702 1,253
(1) The Director's Remuneration Report provides further information on
Directors’ fees. Included within other expenses is £18,000 (2024: £16,000)
of employer’s national insurance payable on Directors’ remuneration.
(2) As at 31 May 2025, the amounts outstanding on Directors’ fees and
employer’s national insurance was £30,000 (2024: £30,000).
(3) The auditor’s fees shown include out-of-pocket expenses, but exclude
VAT, which is included in other administrative expenses. (2024: An additional
fee of £10,000 was paid to the auditor in respect of extra audit work
performed in relation to the share class reclassification; Grant Thornton UK
LLP provided non-audit services related to work on the Company’s
restructuring, which amounted to £37,000).
(4) Includes fees for depositary, broker and registrar, and also marketing,
printing, postage and listing costs. Capital costs related to an over accrual
in the prior year of costs related to the Company’s restructuring.
5. Finance Costs
Finance costs arise on any borrowing the Company has utilised in the year. The
Company has a committed £40 million revolving credit facility (see note 13
for further details).
2025 2024
Revenue Capital Total Revenue Capital Total
£’000 £’000 £’000 £’000 £’000 £’000
Commitment fees due on loan facility 18 41 59 – – –
Interest payable on borrowings 32 75 107 194 453 647
50 116 166 194 453 647
6. Tax
As an investment trust, the Company pays no tax on capital gains. However, the
Company suffers tax on certain overseas dividends that is irrecoverable and
this note shows details of the tax charge. In addition, this note clarifies
the basis for the Company having no deferred tax asset or liability.
(a) Tax Charge
2025 2024
£’000 £’000
Overseas taxation 431 180
Corporation tax – prior year adjustment (137) –
294 180
The accounting policy for taxation is disclosed in note 1(g).
(b) Reconciliation of Tax Charge
2025 2024
£’000 £’000
Return before taxation 23,027 28,222
Theoretical tax at the current UK corporation tax rate of 25% (2024: 25%) 5,757 7,056
Effect of:
- Non-taxable UK dividends (211) (937)
- Foreign tax expensed (6) –
- Non taxable scrip dividends – (27)
- Non-taxable overseas dividends (755) (626)
- Non-taxable overseas special dividends (70) (66)
- Non-taxable gains on investments (5,121) (5,958)
- Non-taxable losses on foreign exchange 1 17
- Excess of allowable expenses over taxable income 407 382
- Disallowable expenses (2) 159
- Overseas taxation 431 180
– Corporation tax - prior year adjustment (137) –
Tax charge for the year 294 180
Given the Company’s status as an investment trust, and the intention to
continue meeting the conditions required to retain such status for the
foreseeable future, the Company has not provided any UK corporation tax on any
realised or unrealised capital gains or losses arising on investments.
(c) Factors That May Affect Future Tax Charges
The Company has excess management expenses and loan relationship deficits of
£21,830,000 (2024: £20,209,000) that are available to offset future taxable
revenue.
A deferred tax asset of £5,458,000 (2024: £5,052,000), measured at the
standard corporation tax substantively enacted rate of 25% (2024: 25%), has
not been recognised in respect of these expenses since the Directors believe
that there will be no taxable profits in the future against which the deferred
tax assets can be offset.
7. Return per Ordinary Share
Return per share is the amount of profit (or loss) generated for the financial
year divided by the weighted average number of the shares in issue. The basic
and diluted returns per share are identical as the ordinary shares of the
Company are not dilutive.
Revenue, capital and total return per ordinary share is based on each of the
returns after taxation shown by the income statement and on the following
numbers of shares, being the weighted average number of shares in issue
throughout the year:
Average
number of shares
Share 2025 2024
Ordinary (formerly Global Equity Income) shares 62,623,090 28,258,528
UK Equity (1) n/a 62,061,213
Balanced Risk Allocation (1) n/a 3,757,960
Managed Liquidity (1) n/a 1,177,858
(1) As this share class was closed on 7 May 2024, the 2024 figures above are
calculated to 3 May 2024, being the date of the final computed net asset value
of the share class.
Return per ordinary share is shown in the income statement on page 57.
8. Dividends
Dividends represent a return of income to shareholders for investing in the
Company’s shares. These are determined by the Directors and paid four times
a year.
Dividends paid for each applicable share class, which represent distributions
for the purpose of section 1159 of the Corporation Tax Act 2010, follows:
2025 2024
Dividend Total Dividend Total
rate (pence) £’000 rate (pence) £’000
Ordinary (formerly Global Equity Income) shares
First interim 3.13 1,974 1.60 402
Second interim 3.13 1,970 1.60 402
Third interim 3.13 1,969 1.60 409
Fourth interim 3.13 1,932 2.55 651
12.52 7,845 7.35 1,864
Combined closed share classes (1)
First interim n/a n/a 3.60 1,156
Second Interim n/a n/a 1.60 1,083
Third interim n/a n/a 1.60 1,067
Fourth interim n/a n/a 2.55 1,443
Special dividend n/a n/a 2.00 83
n/a n/a 11.35 4,832
Total paid in the year 7,845 6,696
(1) The combined closed share class dividends were those paid by UK Equity,
Balanced Risk Allocation and Managed Liquidity shares along with a special
dividend on Balanced Risk Allocation shares prior to the Company restructure
on 7 May 2024.
The Company’s dividend policy permits the payment of dividends from capital.
An analysis of dividends paid in the year from revenue and capital follows:
2025 2024
£'000 £'000
Dividends in respect of the year:
From revenue – current year 3,140 6,099
From revenue – brought forward 102 –
From revenue 3,242 6,099
From capital 4,603 597
7,845 6,696
9. Investments Held at Fair Value
The portfolio is made up of investments which are listed, i.e. traded on a
regulated stock exchange, and a small proportion of investments which are
valued by the Directors as they are unlisted or not regularly traded. Gains
and losses are either:
• realised, usually arising when investments are sold; or
• unrealised, being the difference from cost on the investments held at the
year end.
(a) Analysis of Investments by Listing Status
2025 2024
£’000 £’000
UK listed investments 48,471 40,398
Overseas listed investments 162,973 155,426
211,444 195,824
(b) Analysis of investment gains
2025 2024
£’000 £’000
Opening valuation 195,824 207,389
Movements in year:
Purchases at cost 135,913 178,530
Sales proceeds (140,775) (213,729)
Gains on investments in the year 20,482 23,634
Closing valuation 211,444 195,824
Closing book cost 194,110 179,567
Closing investment holding gains 17,334 16,257
Closing valuation 211,444 195,824
The Company received £140,775,000 (2024: £213,729,000) from investments sold
in the year. The book cost of these investments when they were purchased was
£121,370,000 (2024: £192,972,000) realising a profit of £19,405,000 (2024:
profit of £20,757,000). These investments have been revalued over time and
until they were sold any unrealised profits/losses were included in the fair
value of the investments.
(c) Transaction Costs
Transaction costs were £95,000 (2024: £236,000) on purchases and £41,000
(2024: £103,000) on sales.
10. Derivative Instruments
Derivative instruments are contracts whose price is derived from the value of
other securities or indices. The Balanced Risk Allocation Portfolio used
futures, which represented agreements to buy or sell commodities or financial
instruments at a pre-determined price in the future.
2025 2024
£’000 £’000
Opening derivative assets held at fair value through profit or loss – 125
Opening derivative liabilities held at fair value through profit or loss – (186)
Opening net derivative liabilities held at fair value as shown in balance sheet – (61)
Closing derivative assets held at fair value through profit or loss – –
Closing derivative liabilities held at fair value through profit or loss – –
Closing net derivative liabilities held at fair value shown in balance sheet – –
Movement in derivative holding liabilities – 61
Net realised gains on derivative instruments – 200
Net capital gains on derivative instruments as shown in the income statement – 261
Net expense arising on derivatives – (10)
Total gains on derivative instruments – 251
The derivative assets/(liabilities) shown in the opening balance for the year
to 31 May 2024 are the unrealised gains/(losses) arising from the revaluation
to fair value of futures contracts held in the Balanced Risk Allocation
Portfolio. Following the Company restructure in May 2024 there are no
derivative positions held.
11. Debtors
Debtors are amounts due to the Company, such as monies due from brokers for
investments sold and income which has been earned (accrued) but not yet
received.
2025 2024
£’000 £’000
Amounts due from brokers – 1,047
Share reissues from treasury awaiting settlement 510 –
Tax recoverable 353 256
Prepayments and accrued income 451 336
1,314 1,639
12. Other Creditors
Creditors are amounts owed by the Company and include amounts due to brokers
for the purchase of investments and amounts owed to suppliers, such as the
Manager and auditor.
2025 2024
£’000 £’000
Tax payable – 137
Amounts due to brokers – 1,194
Accruals 443 436
443 1,767
Interest payable on the bank facility is included within the amounts
outstanding on the bank facility as shown in the balance sheet.
13. Bank Facility and Overdraft
At the year end the Company had a £40 million (2024: £40 million) committed
364 day multicurrency revolving credit facility, which is due for renewal on
22 April 2026 (2024: 23 April 2025). In addition, an overdraft facility for
the purpose of short-term settlement is also available; however, this was
unutilised at the year end (2024: unutilised). Both facilities are with The
Bank of New York Mellon. The interest payable on the credit facility is based
on the adjusted reference rate (principally SONIA, SOFR and €STR
respectively in respect of loans drawn in GBP, USD and Euro) plus a margin for
amounts drawn.
Under the bank facility’s covenants, the Company’s total indebtedness must
not exceed 30% of total assets and the total assets must not be less than
£100 million (2024: £100 million). The Company was in compliance with the
covenants throughout the year and at the year end.
At the year end, the bank facility drawn down was £2,650,000 (2024: £nil),
and the interest payable on the bank facility was £nil (2024: £nil).
14. Share Capital
Share capital represents the total number of shares in issue, including
treasury shares.
All shares have a nominal value of 1 pence.
2025 2024
Number £’000 Number £’000
Allotted, called-up and fully paid:
Ordinary shares of 1p each 62,924,182 629 63,056,464 631
Treasury shares of 1p each 17,062,404 171 16,930,122 169
79,986,586 800 79,986,586 800
(a) Movements in Share Capital During the Year
Issued and fully paid:
Total
share
capital
Ordinary Shares (number)
At 31 May 2024 63,056,464
Shares bought back into treasury (1,342,282)
Shares sold from treasury 1,210,000
At 31 May 2025 62,924,182
Total
share
capital
Treasury shares (number)
At 31 May 2024 16,930,122
Shares bought back into treasury 1,342,282
Shares sold from treasury (1,210,000)
At 31 May 2025 17,062,404
Total
Share
Capital
Ordinary shares of 1 pence each (£’000)
At 31 May 2024 631
Shares bought back into treasury (14)
Shares sold from treasury 12
At 31 May 2025 629
Treasury shares of 1 pence each (£’000)
At 31 May 2024 169
Shares bought back into treasury 14
Shares sold from treasury (12)
At 31 May 2025 171
Total share capital (£’000)
Ordinary share capital 629
Treasury share capital 171
At 31 May 2025 800
Average buyback price 316.01p
Average sold price 340.70p
The total cost of share buy-backs was £4,270,000 (2024: £2,702,000). The
total proceeds from shares that were sold from treasury during the year was
£4,110,000 (2024: nil).
(b) Movements in Share Capital After the Year End
Since the year end the Company has sold from treasury 3,610,000 ordinary
shares. As at the date of this report the Company has 66,534,182 ordinary
shares in issue and holds 13,452,404 ordinary shares in treasury.
(c) Voting Rights
Rights attaching to the shares are described in the Directors’ Report on
page 40.
15. Reserves
This note explains the different reserves attributable to shareholders. The
aggregate of the reserves and share capital (see previous note) make up total
shareholders’ funds.
The special reserve arose from the cancellation of the share premium account,
in January 2007, and is available as distributable profits to be used for all
purposes under the Companies Act 2006, including buy back of shares and
payment of dividends.
The capital redemption reserve arises from the nominal value of shares bought
back and cancelled; this and the share premium are non-distributable.
Capital investment gains and losses are shown in note 9(b), and form part of
the capital reserve. The revenue reserve shows the net revenue retained after
payments of any dividends. The capital and revenue reserves are distributable.
16. Net Asset Value per Ordinary Share
The Company’s total net assets (total assets less total liabilities) are
often termed shareholders’ funds and are converted into net asset value per
ordinary share by dividing by the number of shares in issue as at the
reporting date.
The net asset value per share and the net assets attributable at the year end
were as follows:
2025 2024
Net asset Net asset
value per Net assets value per Net assets
share attributable share attributable
pence £’000 pence £’000
Ordinary shares 337.36 212,283 313.30 197,555
Net asset value per share is based on net assets at the year end and on the
number of shares in issue (excluding treasury shares) at the year end.
17. Financial Instruments
This note summarises the risks deriving from the financial instruments that
comprise the Company’s assets and liabilities.
At 31 May 2025 the Company’s financial instruments comprised the following:
• investments in equities and liquidity funds which are held in accordance
with the Company’s investment objectives; and
• short-term debtors, creditors and cash arising directly from operations.
The financial instruments held by the Company are shown on pages 19 and 20.
The accounting policies in note 1 include criteria for the recognition and the
basis of measurement applied for these financial instruments. Note 1 also
includes the basis on which income and expenses arising from financial assets
and liabilities are recognised and measured.
The Company’s principal risks and uncertainties are outlined in the
Strategic Report on pages 26 to 29. This note expands on risk areas in
relation to the Company’s financial instruments. The portfolio is managed in
accordance with the Company’s investment objective and policies, which are
set out on page 24. The management process is subject to risk controls, which
the Audit Committee reviews on behalf of the Board, as described on page 44.
The principal risks that an investment company faces in its portfolio
management activities are set out below:
Market risk – arising from fluctuations in the fair value or future cash
flows of a financial instrument because of changes in market prices. Market
risk comprises three types of risk: currency risk, interest rate risk and
other price risk:
• Currency risk – arising from fluctuations in the fair value or future
cash flows of a financial instrument because of changes in foreign exchange
rates;
• Interest rate risk – arising from fluctuations in the fair value or
future cash flows of a financial instrument because of changes in market
interest rates; and
• Other price risk – arising from fluctuations in the fair value or
future cash flows of a financial instrument for reasons other than changes in
foreign exchange rates or market interest rates, whether those changes are
caused by factors specific to the individual financial instrument or its
issuer, or factors affecting all similar financial instruments traded in the
market.
Liquidity risk – arising from any difficulty in meeting obligations
associated with financial liabilities.
Credit risk incorporating counterparty risk – arising from financial loss
for a company where the other party to a financial instrument fails to
discharge an obligation.
Risk Management Policies and Procedures
As an investment trust the Company invests in equities and other investments
for the long-term in accordance with its investment policies so as to meet its
investment objectives. In pursuing its objectives, the Company is exposed to a
variety of risks that could result in a reduction in the Company’s net
assets or a reduction of the profits available for dividends. The risks
applicable to the Company and the Directors’ policies for managing these
risks follow. These have not changed from those applying in the previous year.
The Directors have delegated to the Manager the responsibility for the
day-to-day investment activities of the Company as more fully described in the
Directors’ Report.
The main risk that the Company faces arising from its financial instruments is
market risk – this risk is reviewed in detail below. Since the Company
mainly invests in quoted investments, liquidity risk and credit risk are
significantly mitigated.
17.1 Market Risk
Market risk arises from changes in the fair value of future cash flows of a
financial instrument because of movements in market prices. Market risk
comprises three types of risk: currency risk (17.1.1), interest rate risk
(17.1.2) and other price risk (17.1.3).
The Company’s Portfolio Managers assess the Company’s exposure when making
each investment decision, and monitors the overall level of market risk on the
whole of the investment portfolio on an ongoing basis. The Board meets at
least quarterly to assess risk and review investment performance. Borrowings
can be used, which will increase the Company’s exposure to market risk and
volatility. The borrowing limit is 20% of net assets.
17.1.1 Currency Risk
The majority of the Company consists of assets, liabilities and income
denominated in currencies other than sterling. As a result, movements in
exchange rates will affect the sterling value of those items.
Management of the currency risk
The Portfolio Managers monitor the Company’s exposure to foreign currencies
on a daily basis and report to the Board on a regular basis. Forward foreign
currency contracts can be used to limit the Company’s exposure to
anticipated future changes in exchange rates and to achieve portfolio
characteristics that assist the Company in meeting its investment objectives
in line with its investment policies. All contracts are limited to currencies
and amounts commensurate with the exposure to those currencies. No such
contracts were in place at the current or preceding year end. Income
denominated in foreign currencies is converted to sterling on receipt. The
Company does not use financial instruments to mitigate the currency exposure
in the period between the time that income is accrued and its receipt.
Foreign currency exposure
The fair values of the Company’s monetary items that have currency exposure
at 31 May are shown below. Where the Company’s investments (which are not
monetary items) are priced in a foreign currency they have been included
separately in the analysis so as to show the overall level of exposure.
Year ended 31 May 2025
Debtors Investments
(due from Foreign at fair value
brokers, Creditors currency through
prepayments, (due to exposure profit or
accrued Cash brokers on net loss Total net
income and cash and monetary that are foreign
and tax) equivalents accruals) items equities currency
Currency £’000 £’000 £’000 £’000 £’000 £’000
Australian dollar – 4 – 4 – 4
Canadian dollar 1 4 – 5 11,489 11,494
Danish krone 30 – – 30 6,447 6,477
Euro 142 45 – 187 26,659 26,846
Hong Kong dollar 158 – – 158 7,903 8,061
Japanese yen 38 5 – 43 3,682 3,725
Norwegian krone 6 – – 6 5,009 5,015
Swiss franc 208 – – 208 3,534 3,742
Taiwan dollar 7 – – 7 5,606 5,613
US dollar 98 8 – 106 101,272 101,378
688 66 – 754 171,601 172,355
Year ended 31 May 2024
Australian dollar – 4 – 4 – 4
Canadian dollar – 5 – 5 2,671 2,676
Danish krone 23 – (8) 15 4,804 4,819
Euro 120 72 (161) 31 37,488 37,519
Hong Kong dollar 121 – – 121 6,115 6,236
Japanese yen – 5 – 5 – 5
Norwegian krone 17 – – 17 4,815 4,832
South Korean won – – – – 1,791 1,791
Swiss franc 159 – – 159 4,375 4,534
Taiwan dollar 1 – – 1 1,890 1,891
US dollar 1,121 1 (753) 369 97,332 97,701
1,562 87 (922) 727 161,281 162,008
Foreign currency sensitivity
The preceding exposure analysis is based on the Company’s monetary foreign
currency financial instruments held at each balance sheet date and takes
account of forward foreign exchange contracts, if used, that offset the
effects of changes in currency exchange rates.
The effect of strengthening or weakening of sterling against other currencies
to which the Company is exposed is calculated by reference to the volatility
of exchange rates during the year using the standard deviation of currency
fluctuations against the mean, giving the following exchange rate
fluctuations:
2025 2024
£/Australian dollar +/–2.9 +/–1.3%
£/Canadian dollar +/–2.0 +/–1.2%
£/Danish krone +/–1.0 +/–0.7%
£/Euro +/–1.1 +/–0.7%
£/Hong Kong dollar +/–2.4 +/–1.6%
£/Japanese yen +/–2.5 +/–2.9%
£/Norwegian krone +/–1.6 +/–1.7%
£/South Korean won n/a +/–1.9%
£/Swedish krona +/–2.6 +/–2.1%
£/Swiss franc +/–1.5 +/–1.8%
£/Taiwan dollar +/–1.9 +/–1.5%
£/US dollar +/–2.4 +/–1.6%
The tables that follow illustrate the exchange rate sensitivity of revenue and
capital returns arising from the Company’s financial non-sterling assets and
liabilities for the year using the exchange rate fluctuations shown above.
If sterling had strengthened against other currencies by the exchange rate
fluctuations shown in the table above, this would have had the following after
tax effect:
2025 2024
Revenue Capital Total Revenue Capital Total
return return return return return return
£’000 £’000 £’000 £’000 £’000 £’000
Canadian dollar (1) (230) (231) – (32) (32)
Danish krone (2) (64) (66) – (34) (34)
Euro (8) (294) (302) (6) (262) (268)
Hong Kong dollar (5) (190) (195) (3) (98) (101)
Japanese yen (1) (92) (93) – – –
Norwegian krone (1) (80) (81) (4) (82) (86)
South Korean won – – – (1) (34) (35)
Swiss franc (3) (53) (56) (3) (79) (82)
Taiwan dollar (1) (107) (108) – (28) (28)
US dollar (45) (2,431) (2,476) (12) (1,562) (1,574)
Total return (67) (3,541) (3,608) (29) (2,211) (2,240)
Net assets (67) (3,541) (3,608) (29) (2,211) (2,240)
If sterling had weakened by the same amounts, the effect would have been the
converse.
17.1.2 Interest Rate Risk
Interest rate movements may affect:
• the fair value of the investments in fixed interest rate securities;
• the level of income receivable on cash deposits; and
• the interest payable on variable rate borrowings.
Management of interest rate risk
The possible effects on fair value and cash flows that could arise as a result
of changes in interest rates are taken into account as part of the portfolio
management and borrowings processes of the Portfolio Managers. The Board
reviews on a regular basis the investment portfolio and borrowings. This
encompasses the valuation of fixed-interest and floating rate securities and
gearing levels.
When the Company has cash balances, they are held in variable rate bank
accounts yielding rates of interest dependent on the base rate of the
custodian or deposit taker. The Company has a £40 million (2024: £40
million), 364 day multicurrency revolving credit facility which is due for
renewal on 22 April 2026. The Company uses the facility when required at
levels approved and monitored by the Board.
Interest rate exposure
The Company also has available an uncommitted overdraft facility for
settlement purposes and interest is dependent on the base rate determined by
the custodian.
At 31 May the exposure of financial assets and financial liabilities to
interest rate risk is shown by reference to:
• floating interest rates (giving cash flow interest rate risk) – when
the interest rate is due to be reset; and
• fixed interest rates (giving fair value interest rate risk) – when the
financial instrument is due for repayment.
The following table sets out the financial assets and financial liabilities
exposure at the year end:
Company
Total
2025 £’000
Exposure to floating interest rates:
Cash and short-term deposits 2,618
Bank facility (2,650)
Net exposure to interest rates (32)
Company
Total
2024 £’000
Exposure to floating interest rates:
Cash and short-term deposits 1,859
Net exposure to interest rates 1,859
Interest rate sensitivity
At the maximum possible borrowing level of £40 million (2024: £40 million),
the maximum effect over one year of a 3.5% movement in interest rates would
be a £1,400,000 (2024: maximum effect over one year of a 3.5% movement:
£1,400,000) movement in the Company’s income and net assets.
The effect of a 3.5% movement in the interest rates on investments held at
fair value through profit and loss would result in a £nil (2024: 3.5%
movement: £nil) maximum movement in the Company’s income statement and net
assets.
The above exposure and sensitivity analysis are not representative of the year
as a whole, since the level of exposure changes frequently throughout the
year.
Other price risks (i.e. changes in market prices other than those arising from
interest rate risk or currency risk) may affect the value of the equity
investments, but it is the role of the Portfolio Managers to manage the
portfolio to achieve the best return.
17.1.3 Other Price Risk
Management of other price risk
The Directors monitor the market price risks inherent in the investment
portfolio by meeting regularly to review performance.
The Company’s investment portfolio is the product of the Manager’s
investment processes and the application of the portfolio investment policy.
The value will move according to the performance of the shares held within the
portfolio. However, the portfolio does not replicate its benchmark or the
markets in which it is invested, so the performance may not correlate.
Notwithstanding the issue of correlation, if the fixed asset value of the
portfolio moved by 10% at the balance sheet date, the profit after tax and net
assets for the year would increase/decrease by the following amounts:
2025 2024
£,000 £,000
Profit after tax increase/decrease due to rise/fall of 10% 21,144 19,582
17.2 Liquidity Risk
Management of liquidity risk
Liquidity risk is mitigated by the investments held by the Company’s
portfolio being diversified and the majority being readily realisable
securities which can be sold to meet funding commitments. If required, the
Company’s borrowing facilities provide additional long-term and short-term
flexibility.
The Directors’ policy is that in normal market conditions short-term
borrowings be used to manage short-term liabilities and working capital
requirements rather than realising investments.
Liquidity risk
The contractual maturities of financial liabilities at the year end, based on
the earliest date on which payment can be required, are as follows:
2025 2024
3 months More than 3 months More than
or less 3 months or less 3 months
£’000 £’000 £’000 £’000
Bank facility (1) 2,650 – - -
Amount due to brokers – – 1,194 –
Other creditors and accruals 443 – 573 –
3,093 – 1,767 –
(1) Interest due on the bank facility at the year end was £nil (2024:
£nil).
17.3 Credit Risk
Credit risk is that the failure of the counterparty in a transaction to
discharge its obligations under that transaction could result in the Company
suffering a loss.
This risk is managed as follows:
• investment transactions are carried out with a selection of brokers,
approved by the Manager and settled on a delivery versus payment basis.
Brokers’ credit ratings are regularly reviewed by the Manager, so as to
minimise the risk of default to the Company;
• the risk of counterparty exposure due to failed trades causing a loss to
the Company is mitigated by the daily review of failed trade reports and the
use of daily stock and cash reconciliations. Only approved counterparties are
used;
• the Company’s ability to operate in the short-term may be adversely
affected if the Company’s Manager, other outsource service providers, or
their delegates suffer insolvency or other financial difficulties. The Board
reviews annual controls reports from major service providers; and
• cash balances are limited to a maximum of 4% of NAV, across all deposit
takers. Only deposit takers approved by the Manager are used.
The following table sets out the maximum credit risk exposure at the year end:
2025 2024
£’000 £’000
Cash and short-term deposits 2,618 1,859
2,618 1,859
18. Fair Value of Financial Assets and Financial Liabilities
‘Fair value’ in accounting terms is the amount at which an asset can be
bought or sold in a transaction between willing parties, i.e. a market-based,
an independent measure of value. This note sets out the fair value hierarchy
comprising three ‘levels’ and the aggregate amount of investments in each
level.
The financial assets and financial liabilities are either carried in the
balance sheet at their fair value (investments and derivative instruments), or
the balance sheet amount is a reasonable approximation of fair value.
FRS 102 as amended for fair value hierarchy disclosures sets out three fair
value levels. These are:
Level 1 – fair value based on quoted prices in active markets for
identical assets.
Level 2 – fair values based on valuation techniques using observable
inputs other than quoted prices within Level 1.
Level 3 – fair values based on valuation techniques using inputs that are
not based on observable market data.
Categorisation within the hierarchy is determined on the basis of the lowest
level input that is significant to the fair value measurement of each relevant
asset/liability.
The valuation techniques used by the Company are explained in the accounting
policies note. All of the Company’s non-zero valued investments are quoted
equity investments which are deemed to be Level 1.
2025 2024
£’000 £’000
Financial assets designated at fair value through profit or loss:
Level 1 211,444 195,824
Level 2 – –
Level 3 – –
Total for financial assets 211,444 195,824
19. Capital Management
This note is designed to set out the Company’s objectives, policies and
processes for managing its capital. The capital is funded from monies invested
in the Company by shareholders (both initial investment and any retained
amounts) and any borrowings by the Company.
The Company’s total capital employed at 31 May 2025 was £214,933,000 (2024:
£197,555,000) comprising borrowings of £2,650,000 (2024: £nil) and equity
share capital and other reserves of £212,283,000 (2025: £197,555,000).
The Company’s total capital employed is managed to achieve the Company’s
investment objective and policy as set out on page 24, including that
borrowings may be used to raise equity exposure up to a maximum of 20% of net
assets. At the balance sheet date, maximum gross gearing was 1.2% (2024:
nil%). The Company’s policies and processes for managing capital are
unchanged from the preceding year.
The main risks to the Company’s investments are shown in the Directors’
Report under the ‘Principal Risks and Uncertainties’ section on pages 26
to 29. These also explain that the Company has borrowing facilities which can
be used in accordance with the Company’s investment objective and policies
and that this will amplify the effect on equity of changes in the value of the
portfolio.
The Board can also manage the capital structure directly since it has taken
the powers, which it will be seeking to renew at the 2025 AGM, to issue and
buy back shares and it also determines dividend payments. Details of the
Company's liquidity policy can be found under the Discount/Premium section on
page 25.
The Company is subject to externally imposed capital requirements with respect
to the obligation and ability to pay dividends by the Corporation Tax Act 2010
and by the Companies Act 2006, respectively, and, with respect to the
availability of the overdraft facility, by the terms imposed by the lender.
The Board regularly monitors, and has complied with, the externally imposed
capital requirements. This is unchanged from the prior year.
Borrowings can comprise any drawings on the credit and/or overdraft
facilities, details of which are given in note 13.
20. Contingencies, Guarantees and Financial Commitments
Liabilities the Company is committed to honour but which are dependent on a
future circumstance or events occurring would be disclosed in this note if any
existed.
There were no contingencies, guarantees or financial commitments of the
Company at the year end (2024: £nil).
21. Analysis of Changes in Net Debt
This note summarises the changes in net debt from the start of the year to the
end of the year.
At At
1 June Cash 31 May
2024 flows 2025
£’000 £’000 £’000
Cash and cash equivalents 1,859 759 2,618
Bank facility – (2,650) (2,650)
Total 1,859 (1,891) (32)
22. Related Party Transactions and Transactions with the Manager
A related party is a company or individual who has direct or indirect control
or who has significant influence over the Company. Under accounting standards,
the Manager is not a related party.
Under UK GAAP, the Company has identified the Directors as related parties.
The Directors’ remuneration and interests have been disclosed on pages 45
and 46 with additional disclosure in note 4. No other related parties have
been identified.
Details of the Manager’s services and fees are disclosed in the Director’s
Report on page 39 and note 3.
23. Post Balance Sheet Events
Any significant events that occurred after the Company’s financial year end
but before the signing of the balance sheet will be shown here.
There are no significant events after the end of the reporting period
requiring disclosure.
The figures and financial information for the year ended 31 May 2025 are
extracted from the Company's annual financial statements for that year and do
not constitute statutory accounts. The Company's annual financial statements
for the year to 31 May 2025 have been audited but have not yet been delivered
to the Registrar of Companies. The Auditor's report on the 2025 annual
financial statements was (i) unqualified, (ii) did not include a reference to
any matters to which the auditor drew attention by way of emphasis without
qualifying their report and (iii) did not contain a statement under section
498 (2) or (3) of the Companies Act 2006.
The figures and financial information for the year ended 31 May 2024 are
compiled from an extract of the published accounts for that year and do not
constitute statutory accounts. Those accounts have been delivered to the
Registrar of Companies. The Auditor's report on the 2024 annual financial
statements was (i) unqualified, (ii) did not include a reference to any
matters to which the auditor drew attention by way of emphasis without
qualifying their report and (iii) did not contain a statement under section
498 (2) or (3) of the Companies Act 2006.
The audited annual financial report will be posted to shareholders during
September 2025 (along with a circular setting out details of the AGM,
including the notice of AGM and voting instructions), and will be delivered to
the Registrar of Companies in due course. Copies may be obtained during
normal business hours from the Company’s Registered Office, from its
correspondence address, 60 London Wall, London EC2M 5TQ, and via the
Manager’s website
at https://www.invesco.com/uk/en/investment-trusts/invesco-global-equity-income-trust.html.
A copy of the annual financial report will be submitted shortly to the
National Storage Mechanism ("NSM") and will be available for inspection at the
NSM, which is situated
at https://data.fca.org.uk/#/nsm/nationalstoragemechanism.
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