REG - JPMorgan Emerg. EMEA - Final Results
30/01/2026 07:00
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RNS Number : 0022R JPMorgan Emerging EMEA Securities 30 January 2026
LONDON STOCK EXCHANGE ANNOUNCEMENT
JPMORGAN EMERGING EUROPE, MIDDLE EAST & AFRICA SECURITIES PLC
FINAL RESULTS FOR THE YEAR ENDED 31ST OCTOBER 2025
Legal Entity Identifier: 549300II3MHI98ZLVH37
Information disclosed in accordance with the DTR 4.1.3
CHAIRMAN'S STATEMENT
"The Company delivered a 6% outperformance versus its reference index. Our
income continues to remain resilient and in light of this, the Board is
announcing a modest increase to the dividend."
Eric Sanderson
Chairman
Overview and Performance
I am pleased to report that in the year ended 31st October 2025, the Company's
net asset value on a total return basis increased by 25.5%, an outperformance
of 6.0% against the Company's reference index, the S&P Emerging Europe,
Middle East & Africa BMI Net Return in GBP (the 'Reference Index'), which
increased 19.5% on a total return basis over the same period. The main reason
for the outperformance was stock selection. The Investment Manager's Report on
pages 12 to 16 in the Annual Report provides further details.
On a share price total return basis, the Company returned +79.6% in the
12-month reporting period. As at 31st October 2025, the Company's share price
was 216.0 pence, an increase of 79.3% in the reporting period. As at 28th
January 2026 the share price was 246.0 pence. The share price is of course
very volatile and seems to be heavily influenced by different perceptions at
different times of the likelihood of recovering value from the assets located
in Russia.
The Company's Portfolio
The Company continues to invest in higher quality companies, with a tilt
towards value and income and a focus on maximising total return for
shareholders. The portfolio's geographical focus is on South Africa, Saudi
Arabia, and the United Arab Emirates, which at the year-end represented 25.6%,
20.5% and 12.7% of the portfolio respectively - see page 26 in the Annual
Report .
The tragic events in Ukraine since Russia's military invasion on 24th February
2022 sadly continue whilst recent US led proposals for peace negotiations seem
to have faltered.
The strict economic sanctions that followed the invasion have continued to
reduce the valuation of the Company's Russian assets. The Company continues to
apply the 99% provision for valuation of the Russian assets, as detailed in
note 19. Extensive details on the negative impact that the events in Ukraine
have had on the Company are provided in my Chairman's Statement within
previous annual reports, which are available on the Company's website
www.jpmeemeasecurities.com.
The Company is not allowed to and has not engaged in any disposals of its
Russian assets during this reporting period due to the continuation of the
current strict economic sanctions that followed Russia's invasion of Ukraine
in February 2022.
Update on Russian Court Cases
As detailed in the numerous RNS announcements that the Company has released in
this reporting period and up until the date of this report, since the first
half of 2024 when VTB made its $439.5 million claim in the Russian courts
against a number of J.P.Morgan legal entities, including JPMorgan Bank
International (the Russian sub-custodian for the Company's Russian assets) and
the Company, VTB has made additional claims of $81.3 million, $74.5 million
and €108 million and Sberbank has made a $830,183 claim against the same
defendants. A summary of the status of the each of the claims is detailed in
an RNS released on 15th December 2025 which in short, indicates that the
Russian court has upheld VTB's $439.5 million claim, but enforcement has not
yet been undertaken and proceedings on this and the other cases continue.
As stated in the previous year's annual report, enforcement of the claim by
VTB may result in the insolvency of the Company's sub-custodian in Russia and
may constitute a Force Majeure and or Country Risk event (as defined in the
contracts that clients have with J.P. Morgan). If the Russian sub-custodian
were to be declared insolvent, the Manager has advised us that the Company's
Russian assets could not be serviced by them. Russian Presidential Decree 48
suggests that securities and cash held in type 'S' accounts of an insolvent
institution will be transferred to an alternative credit organisation or
professional participant of the securities market as determined by the Central
Bank of Russia. However, the precise mechanism and how this would work in
practice with the current sanctions regime is unknown. The Board will provide
a further update once more information becomes available.
The Russian Court continues to allow VTB to include the Company in the list of
defendants despite being a separate client entity, rather than a proprietary
entity of the J.P. Morgan Asset Management group.
The RNS announcements released in the reporting period have referred to the
protection that the Company may derive from Russian Decree 8 which offers
protection to client securities and RUB cash in S type accounts from the
enforcement of court decisions issued after 3rd January 2024. The Russian
courts have so far respected this. However, the situation remains dynamic. In
addition, Presidential Decree 442 published on 23rd May 2024 established a
framework for compensating the Russian Federation and/or the Central Bank of
Russia for damage caused by 'unfriendly' actions of the United States of
America. Decree 442 indicated that a detailed procedure would be published
within four months of its issue, however, details of that further procedure
remain yet to be published and analysed by market participants.
In view of the unknown outcome of the VTB and Sberbank cases, there has been
no impact on the financial statements as at 31st October 2025. As at 31st
October 2025 the Company's Russian investments amounted to 5.7% of the
portfolio, although that figure should be considered in the context of the
Company's share price premium to net asset value per share of 230.8% as
detailed in the Discount Control section below and in the context of the
considerable uncertainty attaching to the value of its Russian assets. All
these developments reinforce that there is much uncertainty of these values
ever being realisable by the Company. The Board has sought to keep
shareholders informed of material developments arising in relation to the
Company's holdings in its Russian stocks during this continuing difficult
period.
The RNS announcements made by the Company regarding VTB's claims are available
to view on the London Stock Exchange website
https://www.londonstockexchange.com/stock/JEMA/jpmorgan-emerging-europe-middle-east-africa-securities-plc/analysis
Revenue, Earnings, and Dividend
The Company's net revenue for the 12 month period to 31st October 2025 after
taxation was £247,000 (31st October 2024: £225,000) and the return per
share, calculated on the basis of the average number of shares in issue, was
0.61 pence (31st October 2024: 0.56 pence) per share. The Company's ongoing
charge of 3.3% (on an annualised basis) as at 31st October 2025 (31st October
2024: 4.2%) although relatively high is reduced from the prior year, in part
due to the agreed reduction in the custody fees on Russian assets that the
Board negotiated with the Company's custodian JPMorgan Chase Bank, N.A.
effective from 1st August 2024.
The management fee charged by the Manager continues to be based on the
Company's assets, excluding the value of the Russian holdings.
I am pleased to announce that the Company will recommend the payment of a
dividend of 0.6p per share (2024: 0.5p per share). This will be funded from
net revenue received during the year. Subject to shareholder approval, the
dividend will be paid on 20th March 2026 to shareholders on the Company's
register on 13th February 2026, with the ex-dividend date set for 12th
February 2026. Going forward, the Board's expectation is that an annual
dividend will be paid if net revenue allows.
'S' Account Balances
At present, the dividends paid from the Russian securities in the Company's
portfolio are held in a custody 'S' account in Moscow. As previously detailed,
these dividends cannot be remitted to the Company and may never be received.
They are not recognised in the Company's net asset value or in its income
statement.
The balance on the 'S' account attributed to the Company as at 23rd January
2026 was equivalent to approximately £54.2 million at the exchange rate
applicable on that date. The Company's Manager is monitoring the receipts into
the 'S' account against dividends announced by the portfolio companies,
although there is no certainty that the sums in the 'S' account will ever be
received by the Company. The Board also monitors the underlying local value of
the Russian assets, although there remains uncertainty of these values ever
being realisable by the Company. See above for reference to the protection
afforded to 'S' Accounts by Decree 8. As at 23rd January 2026, an additional
£2.4 million of dividend income from Russian portfolio companies has been
announced but is yet to be credited to the 'S' account. Your Board also
monitors this in order to assess whether all dividends due are in fact
accurately recorded in the 'S' account. The addition of these sums to
dividends already in an 'S' account brings the total dividends received or
announced in relation to our Russian holdings to £56.6 million. For further
details regarding 'S' accounts please see the Glossary of Terms and
Alternative Performance Measures on page 98 in the Annual Report.
Furthermore, as detailed in the RNS that the Company announced on 14th August
2025, VTB filed a claim in the Russian court seeking to avoid paying its 2024
dividends due to J.P.Morgan entities and the Company. VTB dividends announced
but not yet received are estimated to have a value of £0.9 million as at 23rd
January 2026. The case is ongoing.
Discount Control
Due to the continuing extreme market conditions that have created the unusual
situation whereby the Company's shares are currently trading at a very
elevated premium to its net asset value, the Board has no current plans to
reinstate the Company's share discount control programme. As at 31st October
2025, the premium was 230.8%. The premium as at 28th January 2026 was 242.8%.
The Board believes that this premium arises due to a difference in the view of
the valuation of the Company's net assets and should not be interpreted as an
indication that investors are more likely to derive any value from the
Company's Russian shareholdings.
Investment Management
Oleg Biryulyov and Luis Carrillo continue to be the Company's Portfolio
Managers supported by JPMorgan Asset Management's Emerging Markets and Asia
Pacific equities team (EMAP). JPMAM's EMAP team consists of 100+ investment
professionals based in both the UK and overseas.
The Board receives regular reports on the service levels of the Manager,
Investment Manager and the Company's key service providers. Through the
Management Engagement Committee, the Board formally evaluated their
performance in September 2025. Following that review, the Board concluded that
it was satisfied with the current levels of service.
Investment Manager's Investment Process
The Investment Manager's Investment Process is detailed on pages 17 to 21 in
the Annual Report. The Board shares the Investment Manager's view of the
importance of considering financially material ESG factors when making
investments for the long term, and in particular, the necessity of continued
engagement with investee companies over the duration of the investment. The
Board is satisfied that financially material ESG considerations are integrated
in the investment process.
Board Composition
Following a thorough selection process undertaken with the assistance of a
third party independent search consultancy, the Board are delighted that as
previously announced, Ms Joanne Irvine was appointed as a Non-executive
Director of the Company on 1st May 2025.
During the year, the Board evaluation process reviewed Directors, the Chair,
the Committees and the working of the Board as a whole. It was concluded that
all aspects of the Board and its procedures were operating effectively.
In accordance with corporate governance best practice, all Directors will
retire by rotation at this year's AGM and will offer themselves for
re-election/election.
Annual General Meeting
The Company's Annual General Meeting (AGM) will be held on Wednesday 11th
March 2026 at 2.00 p.m. at 60 Victoria Embankment, London EC4Y 0JP. We are
pleased to invite shareholders to join us in person for the Company's AGM,
hear from the Portfolio Managers and ask questions. Shareholders wishing to
follow the AGM proceedings but choosing not to attend in person will be able
to view proceedings live and ask questions (but not vote) through conferencing
software. Details on how to register, together with access details, will be
available shortly on the Company's website at www.jpmeemeasecurities.com or by
contacting the Company Secretary at jpmam.investment.trusts@jpmorgan.com
My fellow Board members, representatives of JPMorgan and I look forward to
the opportunity to meet and speak with shareholders after the formalities of
the meeting have been concluded. Shareholders who are unable to attend the AGM
are strongly encouraged to submit their proxy votes in advance of the meeting,
so that they are registered and recorded at the AGM. Proxy votes can be lodged
in advance of the AGM either by post or electronically: detailed instructions
are included in the Notes to the Notice of Annual General Meeting on pages 94
to 95 in the Annual Report.
In addition, Shareholders are encouraged to send any questions ahead of the
AGM to the Board via the Company Secretary at the email address above. We will
endeavour to answer relevant questions at the meeting or via the website
depending on arrangements in place at the time.
If there are any changes to these arrangements for the AGM, the Company will
update shareholders via the Company's website.
Stay in Touch
Your Board would like to ensure Shareholders have regular information about
the Company's progress. Please consider signing up for our email updates
featuring news and views, as well as the latest performance of the portfolio.
You can opt in via the QR Code on page 2 in the Annual Report or via the
following link visit https://tinyurl.com/JEMA-Sign-Up.
Outlook
Despite the recent US led proposals for peace in Ukraine, the path to a
meaningful resolution to the conflict remains unclear. The decision of the
Russian court to uphold VTB's $439.5 million claim and their as yet
unexercised right to enforce the claim means that we remain unclear about the
outcome of this action. We will continue to keep shareholders informed of the
decision by RNS announcement.
Despite these unprecedented and complex events, the Company's investment
objective at least helps the Company steer through this very difficult period.
Although cognisant of the impact of the Russian holdings on the Company, the
challenge for the Board is to use the investment objective to grow the
Company's assets in a way that promotes the success of the Company for the
benefit of the shareholders as a whole.
The Board is confident that, with the assistance of the JPMorgan EMAP team
over the long term and a supportive political and regulatory environment, the
Company's investment objective is achievable.
Eric Sanderson
Chairman
29th January 2026
INVESTMENT MANAGER'S REPORT
"Over the year, the Company returned +25.5% on an NAV total return basis,
outperforming the Company's Reference Index, which returned +19.5% over the
same period. This outperformance was mainly the result of stock selection,
although asset allocation decisions also made a meaningful contribution to
returns."
Introduction
As mentioned by the Chairman in his latest statement, and in previous
reporting, the Company's Russian holdings continue to be subject to strict
sanctions, and their valuations have been discounted accordingly. In addition,
the numerous Russian court cases including VTB's $439.5 million claim against
eight J.P.Morgan legal entities and the Company continue as detailed in the
Chairman's statement. This Investment Manager's Report therefore relates to
the Company's strategy and portfolio activity under its revised investment
objective, which is to maximise total return to shareholders from a
diversified portfolio of investments in Emerging Europe (including Russia)
Middle East and Africa (EMEA). It covers the 12-month period ended 31st
October 2025.
Performance
Over the year, the Company returned +25.5% on an NAV total return basis,
outperforming the Company's Reference Index, which returned +19.5% over the
same period. This outperformance was mainly the result of stock selection,
although asset allocation decisions also made a meaningful contribution to
returns.
Portfolio
At the end of the 12-month review period, the Company's portfolio comprised 92
stocks and securities, compared to 106 holdings at the end of the previous
year. Of these, 25 were Russian, the same as at the end of last year. The
Company's Russian securities comprise approximately 5.7% of the written down
value of the portfolio, as compared to 7% at end of the previous financial
year. The Company's holding in the JPMorgan Liquidity Fund is not included in
the above numbers.
Market backdrop
The review period was characterised by strong absolute and relative
performance by emerging European, Middle East and African markets, although
there were large disparities between markets, and these gains also mask
significant intra-year volatility. Markets made steady but modest progress in
the first months of the review period, supported by a rotation out of US
markets, which was fuelled by investors' concerns about the incoming US
administration's tariff policies and associated risks to growth. Emerging
European equities were a particular beneficiary of this trend. As was the case
in developed markets, emerging market equities dropped sharply in April 2025
as fears about the US's aggressive trade policy escalated. However, this
adverse market reaction prompted the US to postpone threatened tariff rises
subject to further negotiations with its major trading partners. Global
investors welcomed this delay, and emerging market share prices climbed
steadily in the second half of the year, further encouraged by
better-than-expected earnings results and higher dividend payouts. However,
initial public offerings (IPOs), which were a key feature for emerging markets
in the previous two years, were less relevant during 2025.
South Africa fared much worse than other EMEA nations in subsequent trade
negotiations. The US imposed a 30% tariff on South African imports - the
highest rate imposed on any African country. Tensions between the two nations
continue to simmer, with the US threatening to bar South Africa from attending
the next G20 meeting, to be held in Miami.
Performance attribution
31st October 2025
% %
Contributions to total returns
Reference index return 19.5
Asset allocation 2.0
Stock selection 8.6
Gearing/(net cash) (0.6)
Investment Manager contribution 10.0
Portfolio return 29.5
Management fee and other expenses(1) (4.0)
Return on net asset value per ordinary share(APM) 25.5
Effect of movement in premium over the year 54.1
Return on share price(APM) 79.6
Source: FactSet, Morningstar and J.P.Morgan. All figures are on a Cum Income
total return basis.
Performance attribution analyses how the Company achieved its recorded
performance relative to its Reference Index.
(1) The Ongoing charges of 4.03% (which includes the one off legal
expense) has been used in these calculations.
(APM) Alternative Performance Measure ('APM').
A glossary of terms and APMs is provided on pages 96 to 98 in the Annual
Report.
Other significant political developments over the year included the
intensification of negotiations to end the war in Ukraine, although an early
end to the conflict seems unlikely. The Turkish government's repression of
opposition parties has raised political uncertainty in this market, and while
the Gaza peace deal, struck in October, is holding, regional tensions remain
high due to Iran's ongoing efforts to enhance its nuclear capability.
In commodity markets, global economic and geopolitical uncertainties ensured
that demand for gold and other precious metals was strong. A 10% depreciation
in the US dollar over the review period encouraged this trend, as investors
unsettled by erratic US policymaking and economic uncertainty sought the safe
haven of real assets. The gold price reached a record above US$4,000 per ounce
in late 2025, significantly boosting South African gold mining stocks.
However, oil price weakness persisted. Oil prices have, historically, been a
key driver of emerging markets, but this relationship has broken down over the
past 18 months. Fears that a global trade war would slow global growth saw oil
prices decline by more than 15% to less than US$65 pbbl in the first half of
the year, and oversupply by some OPEC+ members, combined with higher US oil
production, high inventories and weak demand, notably from China, kept prices
around this level through to year-end.
At the country level, Greek equities were the standout performer as the
economy continued to outpace its regional peers. Growth is being driven by
tourism and restructuring of the country's financial, energy and real estate
sectors. South Africa also outperformed thanks to the surge in precious metal
prices, and despite punitive US tariffs. The Kingdom of Saudi Arabia (KSA) was
the worst performer of the year, with oil price weakness contributing to a
significant derating. Turkish stocks saw intra-year volatility and general
weakness due to the escalation in political risks.
Investment strategy
The Company's investment objective is to maximise the total return from
investments in EMEA markets. We aim to meet this objective by identifying high
quality businesses with strong expected returns and the capacity to compound
earnings and generate sustainable dividends, over the long term. This includes
companies with the potential to grow due to their positions as national or
global market leaders. However, we aim to buy stocks at reasonable prices, so
recent acquisitions have a value tilt. We adopt a bottom-up stock selection
process, drawing on the in-depth fundamental analysis of JPMorgan's Emerging
Markets and Asia Pacific equity research team, which includes assessments of
the longevity of a business's investment case, and the quality of its
management and governance practices. We believe the depth and breadth of
JPMorgan's research resources give us a competitive advantage in a region
where research coverage by other investors remains limited and shallow.
Our investment approach is permeated by three broad themes:
Commodity sensitivities: EMEA countries are rich in a variety of commodities -
not only oil and gas, but also gold, platinum and copper. We are especially
interested in companies with exposure to the global transition to renewable
energy. Portfolio holdings driven by the commodities theme include Gold
Fields, a South African gold miner which is one of the portfolio's largest
positions, and Valterra Platinum.
Mass market consumption: 60% of the population of EMEA countries is less than
25 years old, and this percentage is forecast to continue rising. The
youthfulness of the population is a major boon for consumption, as this
demographic is tech savvy and thus easy for digital marketers to access, and
younger people have a higher propensity to spend than older generations. As
incomes across EMEA regions are relatively low by global standards, we look
for companies selling affordable products which are differentiated from their
competitors by their strong branding and customer service. Many day-to-day
household spending decisions are made by women, so companies focused on
products of potential interest to them are another focus. Portfolio holdings
underpinned by this theme include the Greek company, Sarantis, a national and
potentially regional leader in the production of cosmetics and household
products.
Technology adopters: Many EMEA countries, especially in Africa, are dogged by
structural challenges which can often seem intractable, given the economic and
fiscal constraints and political uncertainties endemic in the region, so we
seek out companies that are able to 'leapfrog' these challenges or provide
much-needed consumer services which the market, or governments, have otherwise
failed to supply. For example, Benefit Systems, a Polish provider of non-pay
employee benefits, provides consumers in many Central and Eastern European
countries with electronic access to sports facilities and cultural events. We
opened a position in this name during the year as we expect it to benefit from
the evolution of consumer spending towards health and fitness and well-being.
Our out-of-index positions in two Kazakhstan banks, Kaspi and Halyk Savings
Bank are similarly underpinned by their astute and rapid adoption of digital
technology.
How did specific stocks and sectors fare over the year?
Stock selection was by far the most significant contributor to performance
over the past year. It is particularly gratifying that returns were boosted by
the re-rating of a variety of holdings, many of which benefited from
better-than-expected earnings results and higher dividend payouts. Top
contributors included our overweights to several Greek banks - Alpha Bank,
National Bank of Greece and Piraeus Bank. Our overweights to several other
financial names, including out-of-index positions in Halyk Bank, Slovenia's
Nova Ljubjanska Bank and Georgia's Lion Finance and TBC Bank, also enhanced
relative returns, although we took profits and closed these latter two
positions in the second quarter of 2025. Our overweights to South African gold
miner, Gold Fields, and Kazatomprom, a Kazakhstani uranium producer, were
notable beneficiaries of stronger gold and uranium prices respectively, while
our decision to underweight ACWA, KSA's very expensive utility company, also
paid off as the stock came under pressure and re-rated towards the norm.
On the negative side, our decision to hold Kaspi was the most significant
detractor. The stock derated in response to disappointing earnings following
Kaspi's ill-judged acquisition of Turkish fintech company Hepsiburada.
However, we still hold this stock due to our conviction in the company's
longer-term prospects and potential for higher dividend payments. Our decision
to avoid MTN, a South African mobile telecommunications company which we view
as a poor-quality business, also hurt performance, as the stock re-rated
following a rise in Nigerian phone tariffs. We also opted not to hold Orlen, a
Polish energy company, for similar reasons, but the stock benefited from a
one-off increase in its dividend. Several other positions also detracted, but
their individual impacts on performance were relatively limited.
At the country level, our overweight to Greece was the most significant
contributor to relative returns, comprising a material element (+300bps) of
the Company's outperformance over the period. Our decision to underweight KSA
was the second largest contributor (+194bps), while an underweight to UAE also
added (+135bps). Our exposure to small peripheral markets including Georgia,
Slovenia and Kazakhstan also lifted performance over the period thanks to a
combination of low valuations and attractive yields. We are particularly
pleased with positioning in Georgia, as we managed to trade Georgian banks
within the year, locking in profits with limited risk. In all, our exposure to
Georgia added 77bps to performance over the period. Our South African exposure
made a similar contribution.
At the sector level, gold and platinum outshone other sectors, as discussed
above, and our holdings in several South African mining names, not only top
performer Gold Fields, recent additions Anglo Gold Ashanti and Valterra
Platinum (now a top 10 holding), proved a great proxy for this theme.
Financials did extremely well in central and eastern Europe (CEE), as EU banks
vied for market share in the region. Greek banks were notable outperformers,
as restructuring efforts paid off. These efforts, combined with relatively
strong growth and investment, were recognised by credit rating upgrades by all
the major rating agencies during the year. Banks in peripheral countries such
as Georgia, Slovenia, Romania and Kazakhstan also did well, as noted above.
However, the performance of South African, Saudi and Turkish banks was
mediocre, with large cap names underperforming.
On the downside, oil service names were mixed, with performance linked to
volumes of production. Saudi oil and gas drilling companies ADES and ADNOC
Drilling did well accordingly, while Arabian Drilling suffered. We maintained
our holding in ADES, as we still like this name. We locked in profits by
closing the position in ADNOC, and we sold Arabian Drilling to stem further
losses. Consumer names were weak across the board as potential was not
realised. Retailers such as Poland's Dino and Greece's Jumbo and OPAP, a
lottery company, along with Saudi gym operator Leejam, all underperformed
their domestic markets. We closed our position in OPAP due to increased
competition.
Portfolio positioning
Our investment strategy has a quality bias, but it is important to note that
the investment universe defined by our reference index is presently dominated
by companies rated by JPMorgan analysts as 'standard' stocks, the lowest of
their three designations of 'premium', 'quality' and 'standard'. This is in
part because regional equity markets are still young, and in the initial
stages of development. In addition, JPMorgan's analytical framework requires
companies to possess a track record of at least five years before they can be
rated more highly. Another notable feature of the EMEA investment universe is
that financials and commodity names feature heavily, although the index will
broaden out over time as economies and financial markets develop, and we look
forward to exploring these markets more deeply as they evolve. However,
despite the current market concentration around these sectors, the Company's
reference index already contains more than 680 names - a much larger and more
diverse investment universe than the extremely limited number of stocks
previously available to us in Russia, and we see many compelling opportunities
across the EMEA region.
Our preference is for quality names and our strategy favours income (yield),
high expected returns and earnings momentum.
These criteria were the drivers behind all the new acquisitions we made during
the past year. Our positive view on gold and other commodities underpinned our
decision to increase exposure to this sector. In addition to the acquisition
of AngloGold Ashanti and Valterra Platinum, mentioned above, we also purchased
Kumba Iron Ore and KGHM, a Polish copper miner. We added new banking names
across several countries, including South Africa's Nedbank, Greece's Optima
and Alpha Bank, Arab National Bank, Bank of Cyprus and the National Bank of
Kuwait (NBK), which is the repository of the proceeds of Kuwait's oil
revenues, and offers a dividend yield of more than 5%. NBK is now a top 10
holding.
We took profits on a few positions, including the two Georgian banks discussed
above, but most of the sales we conducted over the past year were motivated by
deterioration in the investment outlook and dividend expectations of these
companies. Disposals tended to be names with domestic exposure to KSA, South
Africa and Turkey. In addition to the sale of ADNOC and Arabian Drilling, we
also closed a position in BUPA, a Saudi insurance company, Bidvest, a South
African business services company and Turkcell, a Turkish mobile phone
company whose earnings have deteriorated.
These portfolio changes have not had a major impact on overall portfolio
structure. At the country level, we are most positive about, and therefore
overweight, Greece, Kazakhstan and South Africa. Our heaviest underweights are
to Turkey, due to political uncertainty and concerns about the macroeconomic
outlook, and KSA, where many companies are vulnerable to persistently low oil
prices.
At the sector level, we still favour Financials, Materials and Energy, while
avoiding Communications services and Utilities. We are particularly positive
on Financials, which comprise 40% of our index, as banks are continuing to
enjoy elevated net interest margins (NIMs) thanks to higher interest rates.
Our preferences are reflected in the composition of the portfolio's top 10
holdings, which include six bank names and two mining companies. Our
relatively positive view on energy is based on our expectation that oil and
gas supply is unlikely to increase further. This suggests prices have bottomed
and have scope to firm up in 2026.
Outlook
There has been much focus in recent months on the huge amounts of investment
in artificial intelligence (AI) being made by the US's mega cap tech
companies. Investors are concerned that much of this investment is speculative
and will not deliver projected returns. Many fear this so-called 'AI bubble'
will eventually burst, triggering precipitous falls in tech stocks and
sustained market volatility reminiscent of the 'dot com' crash of 2000-2002.
This is undoubtedly an uncomfortable prospect and a major risk as we consider
the outlook for 2026 and beyond. However, based on our assessment, the EMEA
region has limited exposure to AI, and is negatively correlated to the current
AI investment boom. If our analysis is correct, emerging markets across
Europe, the Middle East and Africa may be major beneficiaries if the
AI bubble does burst, as domestic investors are likely to seek refuge in
their home markets, and global investors will look for more attractive
opportunities beyond the US. We saw what may have been a foretaste of this
trend in South Africa in 2025, when local investors were caught short by the
rally in gold and other material stocks.
On the economic front, the outlook for EMEA countries is mixed. In Europe,
Greece is set to continue to outperform, growing by 2-3% in 2026, thanks in
part to the ongoing benefits of structural reforms, as well as the boost
provided by European Union funding from the NextGenerationEU (NGEU) programme
aimed at supporting the transition to green energy and digitalisation.
However, Poland, Hungary and the Czech Republic are forecast to perform below
trend with military spending and broader fiscal pressures likely to drive
taxation increases and constrain investment and domestic consumption. Hungary
will hold elections in the spring of 2026, and we expect the vote to deliver
another term of office to President Orban. The Turkish economy is likely to
lose momentum, hampered by high inflation, which appears to be stuck above
30%.
Elsewhere, we expect to see a marginal improvement in the South African
economy. GDP growth is likely to be 1.0-1.5% in 2026, although further reforms
to the electricity industry and transportation may add a further 0.5-1.5% to
annual growth. In the Middle East, the oil-related sectors of both KSA and UAE
are likely to grow more quickly in 2026 in the region of circa 3-5% in the UAE
thanks to oil production increases implemented in 2025, while the non-oil
parts of these economies will also do well, growing by 3-4%, due to support
from state investment. On the downside, US dollar weakness over the past year
has created a challenge for the central banks of KSA, UAE and the other Gulf
Cooperation Countries (GCC) which peg their currencies to the greenback. This
peg used to be a very useful stabilisation mechanism for these economies, but
dollar deprecation means local central banks must balance the necessity of
maintaining the currency peg against their need to support their domestic
economies.
This varied economic environment underlies our expectation that earnings
growth will remain specific to companies, not regions. Following EPS growth of
7-8% within our portfolio in 2025, consistent with our forecast, we expect
earnings to grow by a further 5-10% in 2026. This is less positive than some
current market consensus, which assume EPS growth in the region of +13% for
the emerging markets sector in 2026.
Yet whatever the immediate future holds, we remain optimistic about the
prospects for emerging markets in Europe, the Middle East and Africa over the
longer term. These economies, and their capital markets, are relatively young
and developing rapidly, and the investment universe is expanding as more
companies enter the market. This dynamism will continue to spawn compelling
opportunities for investment in good quality growth, value and income, at
attractive valuations. This should ensure that the balance between reward and
risk remains skewed in investors' favour, especially given these markets' lack
of correlation to AI-related stocks, whose valuations are looking increasingly
excessive. Against this positive backdrop, we intend to maintain our efforts
to discover the most interesting ideas across EMEA's vibrant markets, and to
capitalise on these opportunities as they emerge. The portfolio will continue
to evolve as our target markets develop and deepen, and we are excited by what
the future holds for the Company and its shareholders.
We thank you for your ongoing support.
For and on behalf of the Investment Manager
Oleg I. Biryulyov
Portfolio Manager
Luis Carrillo
Portfolio Manager
29th January 2026
PRINCIPAL AND EMERGING RISKS
The Directors confirm that they have carried out a robust assessment of the
principal and emerging risks facing the Company, including those that would
threaten its business model, future performance, solvency or liquidity. With
the assistance of JPMF, the Audit Committee has drawn up a risk matrix, which
identifies the key risks to the Company. These are reviewed and noted by the
Board. The risks identified and the broad categories in which they fall, and
the ways in which they are managed or mitigated are summarised below. The AIC
Code of Corporate Governance requires the Audit Committee to put in place
procedures to identify emerging risks. The key emerging risks identified are
also summarised below.
Movement from
Principal risk Description Mitigating activities prior year
Investment Management and Performance
Investing in Emerging Markets Investors should note that there are significant risks inherent in investing Following Russia's invasion of Ukraine on 24th February 2022, the prohibition â
in emerging market securities not typically associated with investing in of trading of Russian securities, prohibition on the ultimate receipt of
securities of companies in more developed countries. In terms of gauging the dividends and reduction in the value of the Company by circa 95% led the Board
economic and political risk of investing in emerging markets, it frequently to propose a shareholder resolution to widen the Company's investment
appears in the higher risk categories when compared with most Western objective and permit investments in Emerging Europe, Africa & Middle East.
countries. The value of emerging market securities, and therefore the net Shareholders approved the widening of the Company's investment objective on
asset value of the Company, may be affected by uncertainties such as economic, 23rd November 2022 and the Company implemented its new investment objective in
political or diplomatic developments, social and religious instability, the first quarter of 2023. The Board also temporarily suspended its dividend
taxation and interest rates, currency repatriation restrictions, crime and payment policy and the Company's financial statements no longer reflect
corruption and developments in the law or regulations in emerging markets and, dividends receivable from the Company's Russian stocks. The Board's activities
in particular, the risks of expropriation, nationalisation and confiscation of also included reviewing the value of the Company's portfolio, discount/premium
assets and changes in legislation relating to the level of foreign ownership. to share price, sanctions, counter-parties status, inability to trade stocks
Some of these risks arise in the current VTB and Sberbank legal cases against and review of investment strategy. The Board has sought external professional
JPM entities and the Company as referred to in the Chairman's statement and advice where appropriate.
recent RNS announcements. Such factors may lead to a reduction in the size of
the Company's net assets and it becoming unviable. Russia's invasion of
Ukraine on 24th February 2022 led to the realisation of some of the above
risks and Russia becoming a pariah state for western investors. The fragility
of relations in the Middle East and risk of further instability in the region
continues.
Share Price Discount to Net Asset Value ('NAV') per Share If the share price of an investment trust is lower than the NAV per share, the The prohibition of trading of securities in Russian companies held in the â
shares are said to be trading at a discount. The widening of the discount can Company's portfolio which was introduced following Russia's invasion of
be seen as a disadvantage of investment trusts which could discourage Ukraine on 24th February 2022 led the Board to suspend its share buy back
investors. Although it is common for an investment trust's shares to trade at policy. In addition the Board has withdrawn its commitment to provide
a discount, particular events can negatively impact market sentiment. Due to a tender offer based on performance of the Company against the RTS benchmark
the substantial reduction in the book value of the Company's assets following in the five year period to 31st October 2026.
Russia's invasion of Ukraine the Company's shares have traded at a premium.
In normal market conditions the Board monitors the Company's discount level
and seeks, where deemed prudent, to address imbalances in the supply and
demand of the Company's shares through a programme of share buybacks. For
details of the Company's Continuation Vote, including recent updates, see the
Key Features at the front of this document.
Investment Under-performance An inappropriate investment strategy, for example asset allocation may lead to Following Russia's invasion of Ukraine on 24th February 2022, the prohibition â
underperformance against the Company's reference index and peer companies. of the trading of Russian securities led to the closure of the Russian market
and Strategy to the Company and its peers together with the cessation of reporting of
benchmark data by western news companies. The Board managed these
unprecedented events by keeping regularly updated regarding compliance with
sanctions and ensuring sufficient liquidity in order to maintain a going
concern basis.
In normal market conditions, the Board manages these risks by diversification
of investments through its investment restrictions and guidelines, which are
monitored and reported on by the Manager. The Manager provides the Directors
with timely and accurate management information, including performance data
and attribution analyses, revenue estimates, liquidity reports and shareholder
analyses. The Board monitors the implementation and results of the investment
process with the Portfolio Manager, who attends all Board meetings, and
reviews data which show statistical measures of the Company's risk profile.
Following adoption of the new mandate the Board re-commenced this process for
its new investments.
The Company amended its investment objective in 2022 to widen its investment
to include Emerging Europe, Middle East and Africa. Possible actions that the
Board may consider to address underperformance include changing the Portfolio
Manager or selecting another manager.
Failure of Investment Process A failure of process could lead to losses. The Manager mitigates this risk through internal controls and monitoring. An â
incidence of fraud is required to be notified immediately to the Board and
regular reports are provided on control processes.
Loss of Investment Team or Portfolio Managers The sudden departure of the Portfolio Manager or several members of the wider The Investment Manager takes steps to reduce the likelihood of such an event â
investment management team could result in a short term deterioration in by ensuring appropriate succession planning and the adoption of a team based
investment performance. approach, as well as special efforts to retain key personnel. The Board
engages privately with the Portfolio Manager on a regular basis.
Market and Financial The Company's assets consist of listed securities and it is therefore exposed In normal market conditions the Board considers asset allocation and stock â
to movements in the prices of individual securities and the market generally. selection on a regular basis and has set investment restrictions and
The financial risks faced by the Company include market price risk, interest guidelines, which are monitored and reported on by the Manager. During the
rate risk, foreign currency risk, liquidity risk and credit risk. current period of prohibition on the trading of Russian securities, a fair
value valuation method involving a 99% provision against the Company's Russian
investments is applied.
Further details are disclosed in note 20 on pages 82 to 87 in the Annual
Report. The Manager regularly monitors the liquidity of the portfolio
including determining the market valuation of securities held, the average
daily volume and number of days to liquidate a holding.
Operational Risks
Cyber Crime Disruption to, or failure of, the Manager's accounting, dealing or payments Details of how the Board monitors the services provided by JPMF and its â
systems or the Depositary or custodian's records could prevent accurate associates and the key elements designed to provide effective internal control
reporting and monitoring of the Company's financial position. Under the terms are included within the Risk Management and Internal Control section of the
of its agreement, the Depositary has strict liability for the loss or Corporate Governance Statement on page 51 in the Annual Report. The threat of
misappropriation of assets held in custody. See note 20(c) for further details Cyber attack is increasing and regarded as having the ability to cause
on the responsibilities of the Depositary. equivalent disruption to the Company's business as more traditional business
continuity and security threats. The Company benefits from JPMorgan's Cyber
Security Programme. The information technology controls around the physical
security of JPMorgan's data centres, security of its networks and security of
its trading applications are tested by independent auditors
PricewaterhouseCoopers and reported every six months against the Audit and
Assurance Faculty (AAF) standard.
Counterparty Risk Local custodian or broker counterparty failure resulting in loss of The Manager monitors counterparty exposures closely and has set limits â
stock/money. Inability of Custodian to service the Company's assets. according to various criteria (including an assessment of financial stability
of counterparty). The Board receives information relating to counterparties.
In the Chairman's statement and recent RNS announcements, the Company has said
that if the VTB claim is successful then the Company's sub-custodian may The possibility of the Company's custodian in Russia becoming insolvent and a
become insolvent and may constitute a Force Majeure event and/or Country risk force majeure scenario arising in respect of the Company's Russian assets is
event, as defined in the contracts that clients have with J.P. Morgan. referred to in detail in the Chairman's Statement and in recent RNS
announcements. The Board has sought external professional advice where
appropriate.
Regulatory Risks
Board Relationship with Shareholders The risk that the Company's strategy and performance does not align with The Manager addresses this by the organisation of an email address on the â
shareholders expectations. Company's website whereby shareholders can raise questions. Feedback from
shareholders is received directly through the email address provided on the
Company's website and via brokers which is fed back to the Board regularly.
In addition, the Board is in regular contact with significant shareholders and
also meets with other shareholders informally after AGMs to better understand
shareholder expectations.
Political and Economic Changes in financial or tax legislation may adversely affect the Company. In The Manager makes recommendations to the Board on accounting, dividend and tax â
addition, the Company is subject to administrative risks, such as policies and the Board seeks external advice where appropriate. The Manager
the imposition of restrictions on the free movement of capital. closely monitors political, legal and economic developments and reports
significant events to the Board either at scheduled meetings or when an event
In addition, The Russian Government may change legislation which currently arises. The Board factors in the status of current political and economic
protects 'S' accounts against loss from legal action. developments in its decision making.
See above for details of the Board's responses to Russia's invasion of Ukraine
including the prohibition on trading and ultimate receipt of dividends from
Russian held companies, and successful proposal to widen the Company's
investment objective. The Board has sought external professional advice where
appropriate.
Regulatory and Legal Breach of regulatory rules, including sanctions could lead to suspension of The Board has remained informed of the impact of the sanctions and â
the Company's Stock Exchange listing, financial penalties, or a qualified restrictions that followed Russia's invasion of Ukraine on 24th February 2022.
audit report. Loss of investment trust status could lead to the Company being Moreover, the Board sought and received FCA approval for the change to the
subject to tax on capital gains. Legal claims against the Company may arise Company's investment objective, which includes investment in Russia. HMRC also
due to sanctions effectively 'freezing' Russian assets. confirmed the continuation of the Company's investment trust status. The
Board, with the assistance of the Manager, monitors the Company's activities
to ensure that they remain compliant with the current sanctions regime
including the specific requirements applicable to the Manager as a company
subject to the laws of the United States of America and other jurisdictions
that it operates in. The Directors seek to comply with all relevant regulation
and legislation and rely on the services of the Company Secretary, the
Manager, and the Company's professional advisors to monitor compliance with
all relevant requirements. The Board and its Committees review the status of
the Company's regulatory and legal requirements at regular intervals. The
Board is kept updated of the status of the ongoing Russian court cases against
eight JPM entities and the Company as referred to in the Chairman's Statement.
Climate Risks
Climate Change Climate change, which barely registered with investors a decade ago, has today The Investment Manager's investment process integrates consideration of â
become one of the most critical issues confronting asset managers and their financially material environmental, social and governance factors into
investors. Investors can no longer ignore the impact that the world's changing investment decisions. This includes the approach investee companies take to
climate will have on their portfolios, with the impact of climate change on recognising and mitigating climate change risks. The Manager aims to influence
returns now inevitable. the management of climate related risks through engagement and voting and is
a participant of Climate Action 100+ and a signatory of the United Nations
Principles for Responsible Investment. The Board is also considering the
threat posed by the direct impact on climate change on the operations of the
Manager and other major service providers. As extreme weather events become
more common, the resiliency, business continuity planning and the location
strategies of our services providers will come under greater scrutiny.
Movement from
Emerging risk Description Mitigating activities prior year
Global Crisis A wide scale economic crisis which could be caused by a number of catastrophic The Board keeps informed of economic developments and latest ESG requirements â
events such as climate change, may cause significant reductions in the through regular updates from the Investment Manager.
valuations of companies in the portfolio.
Global Trade Protectionism A reduction in global trading arising from increased barriers to trade, The Portfolio Manager manages the Company's portfolio in light of ongoing â
including the recent shifts in US trade policy and the increased use of current events. The Board can, with shareholder approval, seek to amend the
tariffs and protectionist measures, is a risk to economic growth, to investment policy and objectives of the Company to mitigate the risks.
investors' risk appetites and, consequently, to the valuations of companies in
the portfolio.
Artificial Intelligence (AI) Advances in computing power means that AI has become a powerful tool that will The Board monitors developments concerning AI as its use evolves and considers â
impact society, with a wide range of applications that include the potential how it might threaten the Company's activities, which may include a heightened
to harm. While it might equally be deemed a force for good, there appears to threat to cybersecurity. The Board works closely with the Manager in
be an increasing risk to society from the threat posed by AI. identifying these threats and monitors the strategies of our service
providers.
TRANSACTIONS WITH THE MANAGER
Details of the management contract are set out in the Directors' Report on
page 46 in the Annual Report. The management fee payable to the Manager for
the year was £195,000 (2024: £164,000) of which £nil (2024: £2,000) was
outstanding at the year end.
Included in note 6 on page 76 in the Annual Report are safe custody fees
amounting to £177,000 (2024: £284,000) payable to JPMorgan Chase Bank N.A.
during the year of which £35,000 (2024: £66,000) was outstanding at the year
end.
The Manager may carry out some of its dealing transactions through group
subsidiaries. These transactions are carried out at arm's length. The
commission payable to JPMorgan Securities Limited for the year was £3,000
(2024: £nil) of which £nil (2024: £nil) was outstanding at the year end.
Other capital charges (handling charges) on dealing transactions amounting to
£20,000 (2024: £21,000) were payable to JPMorgan Chase Bank N.A. during the
year of which £3,000 (2024: £3,000) was outstanding at the year end.
The Company also invests in JPMorgan USD Liquidity Fund, which is managed by
JPMorgan Asset Management (Europe) S.à r.l. At the year end this was valued
at £1,000 (2024: £nil). Interest amounting to £1,000 (2024: £32,000) was
receivable during the year of which £nil (2024: £nil) was outstanding at the
year end.
At the year end, total cash of £259,000 (2024: £50,000) was held with
JPMorgan Chase Bank, N.A. A net amount of interest of £3,000 (2024: £3,000)
was receivable by the Company during the year from JPMorgan Chase Bank, N.A.
STATEMENT OF DIRECTORS' RESPONSIBILITIES
The Directors are responsible for preparing the annual report and financial
statements, and the Directors' Remuneration Report in accordance with
applicable law and regulations.
Company law requires the Directors to prepare financial statements for each
financial year. Under that law, the Directors have prepared the financial
statements in accordance with United Kingdom Generally Accepted Accounting
Practice (United Kingdom Accounting Standards and applicable law) and
Financial Reporting Standard (FRS) 102. Under company law the Directors must
not approve the financial statements unless they are satisfied that, taken as
a whole, the annual report and financial statements provide the information
necessary for shareholders to assess the Company's performance, business model
and strategy and that they give a true and fair view of the state of affairs
of the Company and of the total return or loss of the Company for that period.
In addition, to provide these confirmations, and in preparing these financial
statements, the Directors must be satisfied that, taken as a whole, the annual
report and financial statements are fair, balanced and understandable. In
order to provide these confirmations and in preparing these annual statements
the Directors are required to:
• select suitable accounting policies and then apply them consistently;
• make judgements and accounting estimates that are reasonable and
prudent;
• state whether applicable UK Accounting Standards have been followed,
subject to any material departures disclosed and explained in the financial
statements; and
• prepare the financial statements on the going concern basis unless it
is inappropriate to presume that the Company will continue in business
and the Directors confirm they have done so.
The Directors are responsible for keeping proper accounting records that are
sufficient to show and explain the Company's transactions and disclose with
reasonable accuracy at any time the financial position of the Company and
enable them to ensure that the financial statements comply with the Companies
Act 2006. They are also responsible for safeguarding the assets of the
Company and hence for taking reasonable steps for the prevention and detection
of fraud and other irregularities.
The report and financial statements are published on the
www.jpmeemeasecurities.com website which is maintained by the Company's
Manager. The maintenance and integrity of the website maintained by the
Manager is, so far as it relates to the Company, the responsibility of the
Manager. The work carried out by the Auditor does not involve consideration of
the maintenance and integrity of this website and, accordingly, the Auditor
accepts no responsibility for any changes that have occurred to the financial
statements since they were initially presented on the website. The financial
statements are prepared in accordance with UK legislation, which may differ
from legislation in other jurisdictions.
Under applicable law and regulations the Directors are also responsible for
preparing a Strategic Report, a Directors' Report, Directors' Remuneration
Report and Statement of Corporate Governance that comply with that law and
those regulations.
Each of the Directors, whose names and functions are listed in the Directors'
Report, confirms that, to the best of their knowledge:
• the financial statements, which have been prepared in accordance with
United Kingdom Generally Accepted Accounting Practice (United Kingdom
Accounting Standards) and applicable law, give a true and fair view of the
assets, liabilities, financial position and return or loss of the Company.
• The Directors confirm that, taken as a whole, the annual report and
financial statements are fair, balanced and understandable and provide the
information necessary for shareholders to assess the strategy and business
model of the Company; and of the total return or loss of the Company for that
period.
• That the Strategic Report and Directors Report include a fair review
of the development and performance of the business and the position of the
Company together with a description of the principal risks and uncertainties
that the Company faces.
The Board confirms that it is satisfied that the Annual Report and Financial
Statements, taken as a whole, are fair, balanced and understandable and
provide the information necessary for shareholders to assess the Company's
position, performance, business model and strategy.
For and on behalf of the Board
Eric Sanderson
Chairman
29th January 2026
STATEMENT OF COMPREHENSIVE INCOME
Year ended Year ended
31st October 2025 31st October 2024
Revenue Capital Total Revenue Capital Total
£'000 £'000 £'000 £'000 £'000 £'000
Gains on investments held at fair value through
profit or loss - 5,241 5,241 - 2,431 2,431
Net foreign currency exchange losses - (8) (8) - (29) (29)
Income from investments 1,127 28 1,155 974 2 976
Interest income 4 - 4 35 - 35
Gross return 1,131 5,261 6,392 1,009 2,404 3,413
Management fee (78) (117) (195) (66) (98) (164)
Other administrative expenses (751) - (751) (666) - (666)
Net return before taxation 302 5,144 5,446 277 2,306 2,583
Taxation (55) - (55) (52) - (52)
Net return after taxation 247 5,144 5,391 225 2,306 2,531
Return per ordinary share 0.61p 12.72p 13.33p 0.56p 5.70p 6.26p
All revenue and capital items in the above statement derive from continuing
operations.
The 'Total' column of this statement is the profit and loss account of the
Company and the 'Revenue' and 'Capital' columns represent supplementary
information prepared under guidance issued by the Association of Investment
Companies. The net return after taxation represents the profit for the year
and also total comprehensive income.
STATEMENT OF CHANGES IN EQUITY
Called up Capital
share redemption Capital Revenue
capital reserve reserves(1) reserve(1) Total
£'000 £'000 £'000 £'000 £'000
At 31st October 2023 405 196 9,772 8,507 18,880
Net return after taxation - - 2,306 225 2,531
Dividend paid in the year - - - (202) (202)
At 31st October 2024 405 196 12,078 8,530 21,209
Net return after taxation - - 5,144 247 5,391
Dividend paid in the year - - - (202) (202)
At 31st October 2025 405 196 17,222 8,575 26,398
( )
(1) Revenue reserve and the capital reserves form the distributable
reserves of the Company and may be used to fund distributions to shareholders.
See note 14 on page 80 in the Annual Report for details.
STATEMENT OF FINANCIAL POSITION
31st October 31st October
2025 2024
£'000 £'000
Fixed assets
Investments held at fair value through profit or loss 25,853 21,241
Current assets
Debtors 428 247
Current asset investment 1 -
Cash at bank 259 50
688 297
Current liabilities
Creditors: amounts falling due within one year (143) (329)
Net current assets/(liabilities) 545 (32)
Total assets less current liabilities 26,398 21,209
Net assets 26,398 21,209
Capital and reserves
Called up share capital 405 405
Capital redemption reserve 196 196
Capital reserves 17,222 12,078
Revenue reserve 8,575 8,530
Total shareholders' funds 26,398 21,209
Net asset value per ordinary share 65.3p 52.5p
STATEMENT OF CASH FLOWS
Year ended Year ended
31st October 31st October
2025 2024
£'000 £'000
Cash flows from operating activities
Net return before taxation 5,446 2,583
Adjustment for:
Net gains on investments held at fair value through profit or loss (5,241) (2,431)
Net foreign currency exchange losses 8 29
Dividend income (1,155) (976)
Interest income (4) (35)
Realised losses on foreign currency exchange transactions (18) (24)
Realised foreign currency exchange losses on the JPMorgan USD Liquidity Fund (3) -
Decrease/(increase) in other debtors and VAT recoverable 20 (46)
Decrease in accrued expenses (69) (11)
Net cash outflow from operating activities before dividends, interest and (1,016) (911)
taxation
Dividends received 1,057 907
Interest income received 4 35
Overseas withholding tax recovered - 2
Net cash inflow from operating activities 45 33
Purchases of investments (12,241) (10,643)
Sales of investments 12,595 9,827
Net cash inflow/(outflow) from investing activities 354 (816)
Equity dividends paid (202) (202)
Net cash outflow from financing activities (202) (202)
Increase/(decrease) in cash and cash equivalents(1) 197 (985)
Cash and cash equivalents at start of year(1) 50 1,040
Foreign currency exchange movements 13 (5)
Cash and cash equivalents at end of year(1) 260 50
Cash and cash equivalents consist of(1):
Cash at bank 259 50
JPMorgan USD Liquidity Fund 1 -
Total 260 50
( )
(1) The term 'cash and cash equivalents' is used for the purposes of
the Statement of Cash Flows.
NOTES TO THE FINANCIAL STATEMENTS
1. Accounting policies
(a) Basis of accounting
The financial statements are prepared under the historical cost convention,
modified to include fixed asset investments at fair value, and in accordance
with the Companies Act 2006, United Kingdom Generally Accepted Accounting
Practice ('UK GAAP'), including FRS 102 'The Financial Reporting Standard
applicable in the UK and Republic of Ireland' and with the Statement of
Recommended Practice 'Financial Statements of Investment Trust Companies and
Venture Capital Trusts' (the 'SORP') issued by the Association of Investment
Companies in July 2022.
All of the Company's operations are of a continuing nature.
The financial statements have been prepared on a going concern basis. The
Directors have a reasonable expectation that the Company has adequate
resources to continue in operational existence up to 31st January 2027 which
is at least 12 months from the date of approval of these Financial
Statements. In forming this opinion, the Directors have considered the impact
of Russia's invasion of Ukraine and fragility of relations in the Middle East
and risk of further instability in the region. They have considered the
mitigation measures which key service providers, including the Manager, have
in place to maintain operational resilience. The Directors have broadened the
Company's investment mandate to include emerging European, Middle Eastern and
African countries and concluded that this is sufficient to apply the going
concern basis. The Directors have reviewed income and expense projections and
the liquidity of the investment portfolio in making their assessment.
In addition to the above, the Company carried out stress testing that included
modelling significantly reduced market liquidity and considered the impact of
stressed revenue. In even the most stressed scenario, the Company was shown to
have sufficient cash, or to be able to liquidate a sufficient portion of its
listed holdings, in order to meet its liabilities as they fall due.
The policies applied in these financial statements are consistent with those
applied in the preceding year.
2. Dividends
(a) Dividends paid and proposed
2025 2024
Pence £'000 Pence £'000
Dividend paid
Final dividend in respect of prior year 0.5 202 0.5 202
Total dividends paid in the year 0.5 202 0.5 202
(b) Dividends for the purposes of Section 1158 of the Corporation Tax
Act 2010 ('Section 1158')
The requirements of Section 1158 are considered on the basis of the dividend
proposed in respect of the financial year, shown below. The revenue available
for distribution by way of dividend is £247,000 (2024: £225,000).
2025 2024
Pence £'000 Pence £'000
Final dividend proposed 0.6 243 0.5 202
Total dividend for Section 1158 purposes 0.6 243 0.5 202
3. Return per ordinary share
2025 2024
£'000 £'000
Revenue return 247 225
Capital return 5,144 2,306
Total return 5,391 2,531
Weighted average number of ordinary shares in issue during the year 40,436,176 40,436,176
Revenue return per ordinary share 0.61p 0.56p
Capital return per ordinary share 12.72p 5.70p
Total return per ordinary share 13.33p 6.26p
4. Net asset value per ordinary share
2025 2024
Net assets (£'000) 26,398 21,209
Number of ordinary shares in issue 40,436,176 40,436,176
Net asset value per ordinary share 65.3p 52.5p
5. Status of announcement
2024 Financial Information
The figures and financial information for 2024 are extracted from
the Annual Report and Accounts for the year ended 31st October 2024 and do not
constitute the statutory accounts for that year. The Annual Report and
Accounts includes the Report of the Independent Auditor which is unqualified
and does not contain a statement under either section 498(2) or section 498(3)
of the Companies Act 2006. The Annual Report and Accounts has been delivered
to the Registrar of Companies.
2025 Financial Information
The figures and financial information for 2025 are extracted from
the Annual Report and Accounts for the year ended 31st October 2025 and do not
constitute the statutory accounts for that year. The Annual Report and
Accounts includes the Report of the Independent Auditor which is unqualified
and does not contain a statement under either section 498(2) or section 498(3)
of the Companies Act 2006. The Annual Report and Accounts will be delivered to
the Registrar of Companies in due course.
JPMORGAN FUNDS LIMITED
30th January 2026
For further information, please contact:
Paul Winship
For and on behalf of
JPMorgan Funds Limited
Telephone: 0800 20 40 20 or or +44 1268 44 44 70
E-mail: jpmam.investment.trusts@jpmorgan.com
(mailto:jpmam.investment.trusts@jpmorgan.com)
Neither the contents of the Company's website nor the contents of any website
accessible from hyperlinks on the Company's website (or any other website) is
incorporated into, or forms part of, this announcement.
ENDS
A copy of the Annual Report will shortly be submitted to the FCA's National
Storage Mechanism and will be available for inspection at
https://data.fca.org.uk/#/nsm/nationalstoragemechanism
(https://data.fca.org.uk/#/nsm/nationalstoragemechanism)
The Annual Report will be available on the Company's website at
www.jpmeemeasecurities.com (http://www.jpmeemeasecurities.com) where
up-to-date information on the Company, including daily NAV and share prices,
factsheets and portfolio information can also be found.
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. END FR SEAESUEMSEEF
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