REG - JPMorgan EuroG&I PLC - Final Results
23/06/2025 07:00
For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20250623:nRSW8553Na&default-theme=true
RNS Number : 8553N JPMorgan European Grwth & Inc PLC 23 June 2025
LONDON STOCK EXCHANGE ANNOUNCEMENT
JPMORGAN EUROPEAN GROWTH & INCOME PLC
FINAL RESULTS FOR THE YEAR ENDED 31ST MARCH 2025
Legal Entity Identifier: 549300D8SPJFHBDGXS57
Information disclosed in accordance with the DTR 4.1.3
HIGHLIGHTS
Performance
• Best performing investment trust in its sector with an
outperformance over benchmark and the investment trusts within the Company's
peer group over one, three and five year periods.
All periods to 31st March 2025 One Year Three Years Five Years
% % %
Total Return on Net Asset Value per Share +3.5 +36.1 +115.3
Benchmark +2.5 +25.4 +76.6
Excess +1.0 +10.7 +38.7
Return on Share Price +11.8 +49.8 +147.8
• The dividend for the 12 months to 31st March 2025 was
4.8p per share, resulting in an
estimated dividend yield of 4.3%. (Based on dividend of 4.8p for the year
ended 31st March 2025 divided by the share price of 111.0p as at 31st
March 2025.)
The Chair of the Company, Rita Dhut, commented:
"In this twelve-month reporting period to 31st March 2025, I am delighted to
report that the Company outperformed its benchmark by 1.0%, making five years
of consistent outperformance.
This positive result is even more pleasing given the backdrop of volatile
asset markets. Our Investment Manager, empowered by a clear mandate, has the
freedom to skilfully navigate European markets, whilst delivering to our
shareholders the best of capital growth combined with a consistent income."
Portfolio Managers Alexander Fitzalan Howard, Zenah Shuhaiber and Tim Lewis
commented:
"There are reasons to be optimistic about the outlook for European equities.
The recent change to German fiscal policy is a sign that Europe may be
starting to change direction. The scale of the potential spend on both defence
and infrastructure is dramatic and if delivered will lift economic growth and
create investment opportunities."
Chair's Statement
Introduction
In this twelve-month reporting period to 31st March 2025, I am delighted to
report that the Company outperformed its benchmark by 1.0% making five years
of consistent outperformance. This positive result is even more pleasing given
the backdrop of volatile asset markets. Our Investment Manager, empowered by a
clear mandate, has the freedom to skilfully navigate European markets, whilst
delivering to our shareholders the best of capital growth combined with a
consistent income.
The election of President Trump in the USA has led to the introduction of
geo-economics. It has brought with it much disruption and uncertainty across
the globe for the future trajectory of economic growth and inflation. The
tragic continuation of the devastating conflicts in Ukraine and the Middle
East adds to the risky environment.
The European economy faced significant challenges during the reporting period,
with muted economic growth projections and a particularly weak German economy.
In response the European Central Bank (ECB) reduced interest rates six times
in this reporting period, together with two further quarter point reductions
in April and June 2025, reducing the Eurozone interest rate from 3.75% to
2.00%. Inflation in the Eurozone has remained relatively stable, reducing from
approximately 2.4% at the start of the reporting period to 2.2% at the close.
European equity markets seemed to have shrugged off any concerns regarding the
French hung parliament result in July 2024 and the increased share of the vote
achieved by the AfD party in Germany's February 2025 elections, won by the
conservative CDU party. In addition, the expected reductions in US military
aid to Europe was a major boost to the European defence industry, with
European governments' announcing increases in their defence budgets.
In the final quarter of this reporting period, European equities benefited
from a positive change in investor sentiment experiencing significant inflows
arising from uncertainty in the current US government's economic policy.
Performance
Return on net asset value per share and return on share price
For the Company's financial year ended 31st March 2025 the total return on net
asset value per share was +3.5% (debt at fair value). This was an
outperformance of 1.0% over its benchmark, which returned +2.5% driven by
strong relative stock selection. On 18th June 2025, the total return on net
asset value per share since the end of this reporting period was +7.3% (debt
at fair value). In their report on page 12 of the annual report and financial
statements, the Portfolio Managers review in more detail some of the factors
underlying the performance of the Company as well as commenting on the
economic and market background over the period.
The total return on share price, which takes into account the movement of the
share price and dividends received, over the 12 months delivered a return of
+11.8%, which was also an outperformance of the benchmark by a significantly
higher margin than the net assets performance. On 18th June 2025, the total
return on share price since the end of this reporting period was +10.1%.
For an explanation of the calculation of the Company's total return on net
asset value per share and the total return on share price, please see the
Glossary of Terms and Alternative Performance Measures on page 99 of the
annual report and financial statements.
Revenue and Dividends
During the 12 months to 31st March 2025, the Company's net revenue
attributable to shareholders (net return after taxation) was -11.2% at
£12,145,000 (2024: £13,683,000) largely as a result of the decrease in
dividends received from portfolio companies during the period.
As detailed in the Company's previous annual report and latest RNS
announcement on 8th May 2025, the Board's intention is to provide shareholders
with a predictable and regular dividend based on 4% of the preceding year end
net asset value ('NAV') per share. The Company pays four interim dividends in
July, October, January and March.
In line with the above aim, in respect of the year ending 31st March 2025, the
Company's dividend was 4.8 pence per share, amounting to £20.4 million. This
represents an increase from the £18.1 million paid for 2024, as illustrated
in note 10(b) on page 75 of the annual report and financial statements.
For the Company's financial year ending 31st March 2026 the Board has decided
to maintain the dividend per share at the same level as the year ended 31st
March 2025, despite a small reduction in the Company's NAV as at 31st March
2025 as compared with 31st March 2024. This will result in total annual
dividends for the Company's financial year ending 31st March 2026 of
marginally in excess of 4% of NAV as at 31st March 2025. Therefore, the Board
expects to declare dividends totalling 4.8 pence per ordinary share for the
year ending 31st March 2026, being paid in four equal instalments of 1.2 pence
per ordinary share in the months as stated above.
On 8th May 2025, the Board declared a first interim dividend of 1.2 pence per
share in respect of the financial year ending 31st March 2026, payable on 4th
July 2025. As was the case for the Company's dividends in respect of the year
ended 31st March 2025, to the extent that brought forward revenue reserves are
not sufficient, dividends will be paid from distributable capital reserves for
the financial year ending 31st March 2026, as permitted by the Company's
Articles.
Gearing
There has been no change in the Investment Manager's permitted gearing range,
as previously set by the Board, of between 10% net cash to 20% geared. At 31st
March 2025 the Company was 4.3% geared (31st March 2024: 4.5%).
Discounts, Share Issuance and Repurchase
During the period under review, the average discount across the Investment
Trust sector has remained relatively high. This has been particularly
noticeable in those investment trusts with significant alternative investments
with worries over liquidity, realisation and valuation of the underlying
positions. For the first three quarters of the Company's financial year the
Company's discount hovered around 10% and broadly unchanged relative to its
peers. In the early part of the year, the Board undertook buybacks to ensure
the discount did not widen beyond our stated objective of 10% under normal
market conditions (using the cum-income NAV with debt at fair). However, in
the final quarter of the Company's financial year to 31st March 2025, a
combination of improving sentiment towards European equities combined with a
greater interest in the Company's shares caused the Company's discount to
narrow considerably without requiring the Board to be active.
The Company's Ordinary share discount to NAV with debt at fair value as at
31st March 2025 was 5.5%. The average discount of a peer group of six
companies as at the same date was approximately 7.5% and reflects the
Company's narrowing level of discount in both absolute and relative terms. On
18th June, 2025, the Company's ordinary share's discount was 3.1%, which
compares to an average discount of the same peer group of 6.7% as at the same
date, though this hides variation in strategy and performance across the
sector as well as significant buyback and tender activity which your Board
monitors carefully for any implications for the Company.
In the period under review, 7,153,261 Ordinary shares were bought into
Treasury. From 1st April 2025 to 18th June 2025, 250,000 Ordinary shares were
bought into Treasury. No Ordinary shares were issued.
Marketing and Shareholder Interaction
The Company continues to raise its profile with shareholders and potential
investors. It is the Board's view that enhancing the Company's profile will
benefit all shareholders, by creating sustained demand for its shares, thereby
improving liquidity and scale. Our range of activity is broad seeking to
showcase the Company to as wide a relevant audience as possible. The Manager
follows an established marketing and investor relations programme targeting
institutions, private client stockbrokers and platforms via video conferences,
podcasts and in-person meetings. Additionally, we have on-going interaction
with national and investment industry journalists demonstrating the knowledge
and insight of our managers.
We are careful to undertake this promotional activity in the most effective
and controlled manner.
The Board and the Investment Manager maintain a dialogue with the Company's
shareholders via regular email updates, which deliver news and views, and
discuss the latest performance. If you have not already signed up to receive
these communications and you wish to do so, you can opt in via
https://tinyurl.com/JEGI-Sign-Up or by scanning the QR code in the margin.
It is the Board's hope that these initiatives will give many more of the
Company's current and potential shareholders the opportunity to interact with
the Board and portfolio managers.
AIC Investment Week 2024 Nomination
As referred to in my report included in the Company's half year report
released in November 2024, the Company was again a nominee in the best
investment company in the European sector at the annual AIC Investment Week
Award ceremony. When the Company won the award in 2023 the judges had
commended the Company's performance and the benefits provided by its
simplified and shareholder focused structure.
Board of Directors
As referred to in my report included in the Company's half year report
released in November 2024, in line with the Company's Board succession plan,
Jutta af Rosenborg retired at the Company's Annual General Meeting on 3rd July
2024 as Director and Audit Committee Chair on reaching her nine-year tenure.
Andrew Robson was appointed as the Company's Audit Committee Chair on the same
date. On behalf of the Board thanks were given to Jutta af Rosenborg for the
diligence, commitment and clear vision that she provided to the Company during
her tenure.
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 of the Directors
retire by rotation at this year's AGM and will offer themselves for
re-election/election.
Environmental, Social and Governance
Environmental, Social and Governance ('ESG') considerations are integrated
into the Investment Manager's investment process as set out in the ESG Report
on page 21 of the annual report and financial statements.
Investment Manager
In January 2025, the Management Engagement Committee undertook a formal review
of the Manager and Investment Manager, covering the investment management,
company secretarial, administrative and marketing services provided to the
Company. The review took account of the Investment Manager's investment
performance record, management processes, investment style, resources and risk
control mechanisms. I am pleased to report that the Board agreed with the
Committee's recommendation that the continued appointment of the Manager is in
the interests of shareholders.
Annual General Meeting
The Company's ninety-sixth Annual General Meeting (AGM) will be held at 60
Victoria Embankment, London EC4Y 0JP at 2.00 p.m. on Monday, 28th July 2025.
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.jpmeuropeangrowthandincome.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 95 to
98 of the annual report and financial statements.
If you hold your shares via an online platform, for further details of how to
vote your shares and/or attend the Company's AGM, please see the 'Investing in
JPMorgan European Growth & Income plc' on page 103 of the annual report
and financial statements.
If there are any changes to these arrangements for the AGM, the Company will
update shareholders via the Company's website and an announcement on the
London Stock Exchange.
Outlook
European equity markets fell significantly following the announcement of the
new US tariff regime in early April 2025, mirroring falls across global
equities. Since then, the ongoing US tariff negotiations have continued to
dominate the global economic outlook and cause large intraday movements in
equity markets creating disruption and uncertainty. Despite the recent
volatile backdrop, there are positive signs. Europe's forecast economic growth
is projected to move closer to the levels of growth currently forecast in the
US. The German government's €500 billion infrastructure fund, announced in
March 2025, aims to revitalise the economy with construction, defence and
energy sectors expected to benefit. Inflation in the Eurozone is close to the
ECB target of 2% and the ECB's vigorous reductions in interest rates signify a
positive intent. These are several of the reasons why some forecasters are
upgrading their expectations for the Eurozone economy.
Our Investment Manager invests in companies whose fortunes are not immune to
the travails of the political machinations taking place. However, as we pass
through the three-year mark since the restructuring of the company, it is
pleasing to reflect back on the consistency and repeatability of their process
which allows them to navigate uncertain times. This approach has delivered
robust performance and having invested through many cycles the Board are fully
confident in the Portfolio Managers' ability to continue delivering attractive
returns going forward.
For and on behalf of the Board
Rita Dhut
Chair
20th June 2025
Portfolio Managers' Report
Market Background
Following a subdued start to the Company's fiscal year Europe ex UK equities
finished the year to 31st March 2025 up a modest 2.5% in Sterling terms. The
market struggled throughout the autumn in the face of heightened volatility in
the bond market and renewed concerns about economic growth. The Eurozone
composite Purchasing Managers Index fell to a ten-month low in November as
both manufacturing and services contracted. Both Germany and France suffered
downturns in economic activity. France in particular suffered from a period of
political instability as Prime Minister Michel Barnier lost a no-confidence
vote and OAT (French government bond) spreads widened sharply.
Inflationary pressures eased, with headline inflation halving from 2023 levels
to 2.2% in March. Despite a slight October uptick due to energy prices, the
disinflationary trend continued, providing relief to consumers and businesses.
Against this backdrop Monetary policy remained accommodative as the European
Central Bank (ECB) cut rates again in June 2025 to 2.00%, with President
Lagarde expressing confidence in the disinflation trend whilst reinforcing the
message that future moves would be data dependent.
The early months of 2025 saw the market rally sharply. Economic news improved,
particularly on the services side, as consumer confidence rose while inflation
remained benign and the possibility of a ceasefire in Ukraine led to renewed
optimism. However, by March volatility returned to markets as President
Trump's tariff and increasingly erratic geopolitical announcements alarmed
investors. One consequence has been a decisive response from the European
Union regarding raising defence spending. Perhaps most significantly Germany's
incoming Chancellor, Friedrich Merz, pushed through a vote to exempt defence
and security spending from its conservative debt rules as well as creating a
Euro 500 billion fund for infrastructure spending.
Portfolio positioning
Our investment process focuses on identifying companies with improving
operational momentum, quality characteristics, and lower valuations. Not every
company in the portfolio ticks all three boxes but the portfolio as a whole
does. One sector where we continue to find a plethora of ideas is Financials,
including both Banks and Insurance stocks, which are in their fifth year of
outperforming the broader market. Despite this strong outperformance, stocks
within these sectors, such as Unicredit and Allianz (two of our largest active
positions), continue to look attractively valued given the strong earnings
growth, while returning cash to shareholders via dividends and buybacks
continue to be a prevalent theme.
We are also overweight Commercial & Professional Services, an area where
our process has shone a light on smaller companies within our investment
universe. SPIE, a French company, provides multi-technical engineering
services across multiple sectors with strong growth prospects. Consolidating a
fragmented market and labour shortages have allowed for pricing power, while
they are well-placed to benefit from the announced German fiscal package in
early 2025, particularly from the country's investments in electricity
distribution.
To view the graph of SPIE SA please see the Company's annual report and
financial statements, which will be available to view on the Company's website
shortly after release of this announcement.
One area where the Company's position has changed is within consumer sectors,
where we have sold some of the more cyclical areas which had done well in the
previous year and rotated into stocks within Food/Beverages which showed signs
of inflection. As an example, we sold out of Industria de Diseno Textil
(Inditex), the brand owner of Zara, as weaker than expected sales in the US
led to the first earnings downgrades for the stock in a number of years. On
the other hand, the Company initiated a position in Heineken, the Dutch beer
producer. After a period of significant inflation in input costs, Heineken
demonstrated strong margin improvement in their results by focusing on raising
prices, productivity gains, and cost savings programmes while continuing to
focus on marketing. Management also announced a shift in capital allocation
with the introduction of a Euro 1.5 billion buyback over two years.
The Company has moved further underweight in the Materials sector, and this is
now the biggest sector underweight. For instance, Bekaert was sold out of the
portfolio as it was impacted by lower wire rod pricing as well as weakness in
their rubber business due to a sluggish European automotive market. We also
remain underweight Givaudan and Sika as we view them as being relatively
expensive.
The portfolio continues to exhibit the characteristics we seek to have, namely
that it remains cheaper than the benchmark, and has better quality and
momentum characteristics.
To view the graph of portfolio positions please see the Company's annual
report and financial statements, which will be available to view on the
Company's website shortly after release of this announcement.
Performance Attribution
The portfolio outperformed its benchmark index by 1% with the net asset value
(NAV) per share rising 3.5% (with debt valued at fair), predominantly driven
by stock selection. As alluded to above, Unicredit, the Italian bank, was once
again a main outperformer. Despite lower interest rates, the bank managed to
continue to deliver strong financial performance across all lines of its
income statement. Unicredit also returned more than Euro 10 billion to
shareholders in dividends and buybacks in 2024, a theme which has so far
continued into 2025.
Stock selection in the Materials sector was also positive, led by a holding in
Heidelberg Materials. The German cement producer is benefiting from a more
rational market given regulation which is forcing the cost of carbon onto all
producers, forcing some to exit. More recently the stock has also benefitted
from hopes of a resolution with Russia and Ukraine and the announced German
fiscal stimulus.
On the other hand, the main detracting sector was Capital Goods. This was
primarily driven by not owning stocks within the defence sector such as
Rheinmetall given their high initial valuations. These stocks, nonetheless,
rallied strongly on anticipation that European nations would need to increase
their percentage of GDP spent on defence from 2% to 3%.
Portfolio Performance
Year ended 31st March 2025
% %
Contributions to total returns
Benchmark total return 2.5
Asset Selection (stock/sector/currency) 1.4
Gearing contribution(1) 0.0
Return on cash 0.1
Cost of gearing(2) (0.2)
Cash/Gearing impact (0.1)
Portfolio return 3.8
Management fee and Other expenses (0.7)
Share buyback/Issuance 0.2
Other effects (0.5)
Return on net asset value per share with debt at par value(A) 3.3
Impact of debt at fair value(3) 0.2
Return on net asset value per share with debt at fair value(A) 3.5
Effect of movement in discount 8.3
Return on share price(A) 11.8
Source: JPMAM and Morningstar. All figures are on a total return basis.
Performance attribution analyses how the portfolio achieved its recorded
performance relative to its benchmark.
1 Gearing contribution is the aggregated effect of daily gearing on the
daily benchmark return during the period.
2 Cost of Gearing calculation is based on finance costs in the financial
statements and includes the amortisation of private placement issue costs.
3 See note 17 on page 79 of the annual report and financial statements
for reference to fair value of debt.
A Alternative Performance Measure ('APM').
A glossary of terms and APMs is provided on page 99 of the annual report and
financial statements.
Outlook
There are reasons to be optimistic about the outlook for European equities.
The recent change to German fiscal policy is a sign that Europe may be
starting to change direction. The scale of the potential spend on both defence
and infrastructure is dramatic and if delivered will lift economic growth and
create investment opportunities. Moreover, there is scope for the ECB to
continue cutting interest rates to mitigate the negative impact of increased
trade tariffs if they materialize. Your managers remain confident that they
will continue to find investment opportunities that satisfy our criteria
relating to valuation, quality and operational momentum.
Alexander Fitzalan Howard
Zenah Shuhaiber
Tim Lewis
Portfolio Managers 20th June 2025
Principal and Emerging Risks
Movement from
Principal risk Description Mitigation/Control Prior Year
Investment The Board recognises that performance of the Company's investment portfolio is In order to achieve the objectives given the risks inherent in investment such No movement
fundamental to the success of the Company. as market, gearing, currency and interest rates, investment guidelines,
policies and processes are in place which aim to mitigate these risks. They
Investment includes market risk and this arises from uncertainty about the are designed to ensure that the portfolios are managed in a way which is aimed
future prices of the Company's investments. It represents the potential loss at identifying the best stocks and diversifying risk. Regular reports are
the Company might suffer through holding investments in the face of negative received by the Board from the Manager on stock selection, asset allocation,
market movements. Market risk is currently heightened due to various factors gearing, hedging and costs of running the Company and these are reviewed at
highlighted in the Chair's Statement and Portfolio Managers' Report, these each Board meeting in detail. Compliance with investment guidelines and
include global trade issues, geopolitical conflicts and uncertainty over policies are reviewed by the Manager and the Board, and discussed at each
inflation, interest rates and government deficits. Geopolitical concerns will board meeting in detail together with an analysis of market parameters
also impact the market; the current conflicts in the Middle East and Ukraine, affecting the business.
tensions with China and the changes in trade and tariff policies introduced by
the US government are causing increased volatility in the markets. The Board considers asset allocation, stock selection and levels of gearing on
a regular basis and has set Investment Restrictions and Guidelines which are
monitored and reported on by JPMF. The Board monitors the implementation and
results of the investment process with the Manager.
Further details regarding financial instruments are disclosed in note 21 on
pages 81 to 87 of the annual report and financial statements.
Operational In common with most investment trusts the Board delegates the operation of the Details of how the Board monitors the services provided by JPMF and its No movement
business to third parties, the principal delegate being the Manager JPMF. associates and the Depositary and Custodian and the key elements designed to
Disruption to, failure of, or fraud in JPMF's accounting, dealing or payments provide effective internal control are included within the Internal Control
systems or the Depositary or Custodian's records could prevent timely section of the Audit Committee report on page 47 of the annual report and
implementation of investment decisions, and potentially shortfalls in the financial statements. The Board has received the cyber security policies of
accuracy of reporting and monitoring of the Company's financial position and its key third party service providers and JPMF has provided assurance to the
loss. Cyber crime is a threat to business continuity and security. Directors that the Company benefits directly or indirectly from all elements
of JPMorgan's cyber security programme. The information technology controls
around the physical security of JPMorgan's data centres, security of its
networks and trading applications are tested and reported on every six months
against the AAF standard.
Regulatory The Company operates in an environment with significant regulation including The Board relies on the services of its Company Secretary, the Manager and its No movement
the FCA Listing Rules, The UK Companies Act, the Corporation Taxes Act, Market professional advisers to ensure compliance with the Companies Act 2006, the
Abuse Regulation, Disclosure Guidance and Transparency Regulations and the FCA Prospectus Rules, Listing Rules, DTRs and the Alternative Investment Fund
Alternative Investment Fund Managers Directive (AIFMD). Managers Directive.
There has been no significant change to this risk during the year though the
environment as a whole is considered to be one of increasing costs for
compliance. The Company also operates under the requirements of the Bribery
Act 2010 as referred to in the Directors Report on page 39 of the annual
report and financial statements.
Discount There is a risk that the share price lags NAV by significant level. A The discount is monitored daily and compared to peers/sector by both the No movement
consistent, wide, discount can lead to action by arbitraguers/activist Manager and the Broker and a share buy-back programme is in place which can be
shareholders, who may have undue influence due to lack of retail voting. It used when required. The Board has stated it does not wish to see the discount
can also result in the Company not being able to react to relevant market widen beyond 10% in normal market conditions. Industry wide developments are
events (e.g potential consolidation opportunities). The discount may become also monitored and considered when evaluating the need for buyback activity.
persistent due to market issues affecting all investment trusts, and may be Regular updates and reporting are provided to the Board.
difficult to manage using normal control mechanisms (eg buy-backs).
Sales and Marketing Plans are in place and are designed to increase demand and
diversification of the share register. The Board is prepared to consider and
implement other discount control mechanisms. For details of the Performance
related Tender Offer see Key Features at the front of this document.
Strategy An inappropriate investment strategy, for example asset allocation may lead to The Board reviews the overall strategy and structure of the Company in No movement
underperformance against the Company's benchmark index and peer companies. comparison to performance against benchmark, peer group and share activity.
The Board holds a separate meeting devoted to strategy each year which
Significant hostile action by shareholder/s - arbitrageurs diverts attention includes consideration of whether the Company's objectives and structures are
from normal business. These activists may have undue influence due to low appropriate for the long term interests of shareholders.
level of retail voting, and may have interests not aligned with the majority
of shareholders. The Board and Manager regularly monitor the Company's share register and
receipts of formal disclosures of significant transactions. Regular
discussions are held with the Company's Brokers. Consideration of possible
options to improve retail participation, including through S793 circulation to
platform holders.
Climate Change Climate change, which barely registered with investors a decade ago, continues The Company's investment process integrates considerations of environmental, No movement
to be one of the most critical issues confronting asset managers and their social and governance factors into decisions on which stocks to buy, hold or
investors. Investors can no longer ignore the impact that the world's changing sell.
climate will have on their portfolios, with the impact of climate change on
returns now inevitable. This includes the approach investee companies take to recognising and
mitigating climate change risks. 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.
Geopolitical and Economic concerns The recent global trade tensions arising from the changes to U.S trade policy The Board addresses these global developments in regular questioning of the Increase
since Trump's election in November 2024, Russia's invasion of Ukraine in Manager and with external expertise as required will continue to monitor these
February 2022 and conflict in Gaza, with potential for a wider Middle East issues, should they develop. The Manager regularly monitors the Company's
conflict, may cause long term changes in global trade and technology. This may portfolio holdings to ensure compliance with any applicable sanctions.
challenge future growth potential and increased frictions in accessing global
markets. Changes in financial or tax legislation in the UK or in some of the
countries in which the Company invests may impact the operating model of the
Company. In addition policies adopted by Governments/Central banks in response
to the issues being seen in markets (e.g. inflation, interest rates and
government deficits) may lead to adverse movements in asset prices and could
result in concerns for the ongoing exposure to specific investee markets.
Movement from
Emerging risk Description Mitigation/Control Prior Year
Artificial Intelligence (AI) While it might equally be deemed a great opportunity and force for good, there The Board will work with the Manager to monitor the developments concerning AI No movement
appears also to be an increasing risk to business and society more widely from and its potential impact on the portfolio, our service providers and the wider
AI. Advances in computing power means that AI has become a powerful tool that market.
will impact a huge range of areas. AI could be a significant driver for new
business as well as a disrupter to current business and processes leading to
added uncertainty in corporate valuations.
Transactions with the Manager and related parties
Details of the management contract are set out in the Directors' Report on
page 39 of the annual report and financial statements. The management fee
payable to the Manager for the year was £2,530,000 (2024: £2,381,000), of
which £nil (2024: £nil) was outstanding at the year end.
Included in administration expenses in note 6 on page 73 of the annual report
and financial statements are safe custody fees amounting to £48,000 (2024:
£51,000) payable to JPMorgan Chase Bank, N.A of which £8,000 (2024:
£13,000) 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. Commission
amounting to £19,000 (2024: £26,000) was payable to JPMorgan Securities
Limited for the year of which £nil (2024: £nil) was outstanding at the year
end.
The Company holds investments in JPMorgan European Discovery Trust plc,
managed by JPMAM. At 31st March 2025 these were valued at £12.2 million
(2024: £11.7 million) and represented 2.3% (2024: 2.2%) of the Company's
investment portfolio. During the year the Company made £nil purchases of such
investments (2024: £nil) and sales with a total value of £nil (2024: £nil).
Income amounting to £277,000 (2024: £259,000) was receivable from these
investments during the year of which £nil (2024: £nil) was outstanding at
the year end.
Securities lending income amounting to £25,000 (2024: £30,000) was
receivable by the Company during the year. JPMorgan Chase Bank, N.A,
commissions in respect of such transactions amounted to £2,700 (2024:
£3,000).
Handling charges on dealing transactions amounting to £14,000 (2024:
£10,000) were payable to JPMorgan Chase Bank N.A. during the year of which
£1,000 (2024: £1,000) was outstanding at the year end.
At the year end, total cash of £0.6 million (2024: £4.7 million) was held
with JPMorgan Chase Bank N.A. A net amount of interest of £2,000 (2024:
£3,000) was receivable by the Company during the year from JPMorgan Chase
Bank, N.A of which £nil (2024: £nil) was outstanding at the year end.
The Company invests in the JPMorgan EUR Liquidity Fund, a triple A-rated money
market fund managed by JPMorgan Asset Management (Europe) S.à r.l.. At the
year end this was valued at £14.9 million (2024: £10.4 million). Interest
amounting to £489,000 (2024: £490,000) was receivable during the year of
which £nil (2024: £nil) was outstanding at the year end.
Full details of Directors' remuneration and shareholdings can be found on
pages 50 to 52 and in note 6 on page 73 of the annual report and financial
statements.
Statement of Directors' Responsibilities
The Directors are responsible for preparing the Annual Report and the
Financial Statements in accordance with applicable law and regulation.
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, comprising FRS 102 'The
Financial Reporting Standard applicable in the UK and Republic of Ireland',
and applicable law).
Under company law, Directors must not approve the financial statements unless
they are satisfied that , taken as a whole, the Annual Report and the
Financial Statements are fair, balanced and understandable, provide the
information necessary for shareholders to assess the Company's position and
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 order to provide these confirmations, and in
preparing these financial statements, the Directors are required to:
• select suitable accounting policies and then apply them
consistently;
• state whether applicable United Kingdom Accounting Standards,
comprising FRS 102 have been followed, subject to any material departures
disclosed and explained in the financial statements;
• make judgements and accounting estimates that are reasonable and
prudent; and
• prepare the financial statements on a going concern basis unless
it is inappropriate to presume that the company will continue in business;
and the Directors confirm that they have done so.
The Directors are 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 Directors are also responsible for keeping adequate accounting records
that are sufficient to show and explain the Company's transactions and
disclose with reasonable accuracy at any time the financial position of the
Company and enable them to ensure that the financial statements and the
Directors' Remuneration Report comply with the Companies Act 2006.
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.
Legislation in the United Kingdom governing the preparation and dissemination
of financial statements may differ from legislation in other jurisdictions.
Directors' confirmations
The Directors consider that the annual report and financial statements, 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.
Each of the Directors, whose names and functions are listed in page 38 of the
annual report and financial statements confirm that, to the best of their
knowledge:
• the Company financial statements, which have been prepared in
accordance with United Kingdom Accounting Standards, comprising FRS 102, give
a true and fair view of the assets, liabilities, financial position and return
of the Company; and
• The Strategic Report and the Directors' 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.
For and on behalf of the Board
Rita Dhut
Chair, 20th June 2025
Statement of Comprehensive Income
For the year ended 31st March
2025 2024
Revenue Capital Total Revenue Capital Total
£'000 £'000 £'000 £'000 £'000 £'000
Gains on investments and derivatives held at
fair value through profit or loss - 2,685 2,685 - 62,285 62,285
Foreign exchange losses on JPMorgan EUR
Liquidity Fund - (298) (298) - (355) (355)
Net foreign currency gains - 2,275 2,275 - 716 716
Income from investments 16,565 789 17,354 16,572 129 16,701
Interest receivable and similar income 516 - 516 523 - 523
Gross return 17,081 5,451 22,532 17,095 62,775 79,870
Management fee (759) (1,771) (2,530) (714) (1,667) (2,381)
Other administrative expenses (747) - (747) (640) - (640)
Net return before finance costs and taxation 15,575 3,680 19,255 15,741 61,108 76,849
Finance costs (346) (808) (1,154) (345) (814) (1,159)
Net return before taxation 15,229 2,872 18,101 15,396 60,294 75,690
Taxation (3,084) - (3,084) (1,713) - (1,713)
Net return after taxation 12,145 2,872 15,017 13,683 60,294 73,977
Return per share (Note 2) 2.85p 0.67p 3.52p 3.17p 13.97p 17.14p
All revenue and capital items in the above statement derive from continuing
operations. No operations were acquired or
discontinued in the year.
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.
Net return after taxation represents the profit for the year and also Total
Comprehensive Income.
The notes on pages 69 to 89 of the annual report and financial statements form
an integral part of these financial statements.
Statement of Changes in Equity
Called up Share Capital
share premium redemption Capital Revenue
capital account reserve reserves(1) reserve(1) Total
£'000 £'000 £'000 £'000 £'000 £'000
At 31st March 2023 2,185 131,163 18,273 299,679 3,946 455,246
Repurchase of shares into Treasury - - - (4,934) - (4,934)
Net return - - - 60,294 13,683 73,977
Dividends paid in the year (note 3) - - - - (13,598) (13,598)
At 31st March 2024 2,185 131,163 18,273 355,039 4,031 510,691
Repurchase of shares into Treasury - - - (7,259) - (7,259)
Net return - - - 2,872 12,145 15,017
Dividends paid in the year (note 3) - - - (3,694) (16,176) (19,870)
At 31st March 2025 2,185 131,163 18,273 346,958 - 498,579
1 These reserves form the distributable reserves of the Company and may
be used to fund distribution of profits to investors via dividend payments.
Statement of Financial Position
At 31st March
2025 2024(1)
£'000 £'000
Non current assets
Investments held at fair value through profit or loss(1) 512,436 518,303
Investments on loan held at fair value through profit or loss(1) 7,409 15,388
Total investments held at fair value through profit or loss 519,845 533,691
Current assets
Derivative financial assets 31 218
Debtors 5,254 5,541
Cash and cash equivalents 15,490 15,074
20,775 20,833
Current liabilities
Creditors: amounts falling due within one year (280) (392)
Derivative financial liabilities (41) (833)
Net current assets 20,454 19,608
Total assets less current liabilities 540,299 553,299
Non current liabilities
Creditors: amounts falling due after more than one year (41,720) (42,608)
Net assets 498,579 510,691
Capital and reserves
Called up share capital 2,185 2,185
Share premium account 131,163 131,163
Capital redemption reserve 18,273 18,273
Capital reserves 346,958 355,039
Revenue reserve - 4,031
Total shareholders' funds 498,579 510,691
Net asset value per share (Note 4) 118.1p 119.0p
1 The value of investments on loan, previously included within the total
value of investments held at fair value through profit or loss, has been
disclosed separately this year. Prior year figures have been restated
accordingly. These changes do not impact the Company's Net assets, Statement
of Comprehensive Income, or Statement of Cash Flows.
Statement of Cash Flows
For the year ended 31st March
2025 2024
£'000 £'000
Cash flows from operating activities
Net return before finance costs and taxation 19,255 76,849
Adjustment for:
Net gains on investments held at fair value through profit or loss (2,685) (62,285)
Foreign exchange losses on JPMorgan EUR Liquidity Fund 298 355
Net foreign currency gains (2,275) (716)
Dividend income (17,354) (16,701)
Interest income (491) (493)
Realised gains on foreign exchange transactions 56 25
Realised exchange (losses)/gains on JPMorgan EUR Liquidity Fund (375) 155
(Increase)/decrease in accrued income and other debtors (1) 2
(Decrease)/increase in accrued expenses (10) 33
Net cash outflow from operations before dividends, interest and taxation (3,582) (2,776)
Dividends received 13,970 13,858
Interest received 491 493
Overseas withholding tax recovered 1,218 370
Net cash inflow from operating activities 12,097 11,945
Purchases of investments and derivatives (163,135) (129,717)
Sales of investments 179,036 127,480
Settlement of forward foreign currency contracts 716 33
Net cash inflow/(outflow) from investing activities 16,617 (2,204)
Equity dividends paid (19,870) (13,598)
Repurchase of shares into Treasury (7,364) (4,924)
Interest paid (1,138) (1,159)
Net cash outflow from financing activities (28,372) (19,681)
Increase/(decrease) in cash and cash equivalents 342 (9,940)
Cash and cash equivalents at start of year 15,074 25,523
Exchange movements 74 (509)
Cash and cash equivalents at end of year 15,490 15,074
Cash and cash equivalents consist of:
Cash and short term deposits 632 4,698
Cash held in JPMorgan EUR Liquidity Fund 14,858 10,376
Total 15,490 15,074
Notes to the Financial Statements
For the year ended 31st March 2025
1. Accounting policies
(a) Basis of accounting
The financial statements are prepared under the historical cost convention,
modified to include fixed asset investments and derivatives at fair value, and
in accordance with the Companies Act 2006, United Kingdom Generally Accepted
Accounting Practice ('UK GAAP'), including 'the Financial Reporting Standard
applicable in the UK and Republic of Ireland' ('FRS 102') 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. In
forming this opinion, the Directors have considered as part of its risk
assessment: the nature of the Company, its business model and related risks
including ongoing conflict between Ukraine and Russia, the requirements of the
applicable financial reporting framework, the covenants in respect of the
Company's private placement debt and the system of internal control.
The Directors believe that, having considered the Company's investment
objectives, future cash flow projections, risk management policies, liquidity
risk, principal and emerging risks, capital management policies and
procedures, nature of the portfolios and expenditure projections, the Company
has adequate resources, an appropriate financial structure and suitable
management arrangements in place to continue in operational existence to 30th
June 2026, being at least 12 months from approving this annual report and
financial statements.
For these reasons, they consider that there is reasonable evidence to continue
to adopt the going concern basis in preparing the report.
The policies applied in these financial statements are consistent with those
applied in the preceding year.
2. Return per share
2025 2024
£'000 £'000
Return per share is based on the following:
Revenue return 12,145 13,683
Capital return 2,872 60,294
Total return 15,017 73,977
Weighted average number of shares in issue during the year 426,040,273 431,452,567
Revenue return per share 2.85p 3.17p
Capital return per share 0.67p 13.97p
Total return per share 3.52p 17.14p
3. Dividends
(a) Dividends paid and declared
2025 2024
Pence £'000 Pence £'000
Dividends paid
Fourth interim dividend in respect of prior year 1.05 4,510 - -
First interim dividend 1.20 5,148 1.05 4,556
Second interim dividend 1.20 5,128 1.05 4,529
Third interim dividend 1.20 5,084 1.05 4,513
Total dividends paid in the year 4.65 19,870 3.15 13,598
Dividends declared
Fourth interim dividend 1.20 5,064 1.05 4,510
Total dividends declared(1) 1.20 5,064 1.05 4,510
1 In accordance with the accounting policy of the Company, these
dividends will be reflected in the financial statements of the following year.
The fourth quarterly dividend of 1.20p was paid on 4th April 2025 for the
financial year ended 31st March 2025. In accordance with the accounting policy
of the Company, this dividend will be reflected in the financial statements
for the year ending 31st March 2026.
The first interim dividend of 1.20 pence per share in respect of the Company's
financial year ending 31st March 2026 was declared on 8th May 2025 for
shareholders on the register on 16th May 2025 with payment on 4th July 2025.
During the year, dividends paid amounted to £19,870,000 (2024: £13,598,000),
of which £16,176,000 (2024: £13,598,000) were paid from current year revenue
and revenue reserves of £16,176,000 (2024: £17,629,000). The remaining
dividend of £3,694,000 (2024: nil) was funded from capital reserves as show
in the Statement of Changes in Equity on page 78 of the annual report and
financial statements.
(b) Dividend 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 dividends
declared in respect of the financial year, as follows:
The revenue available for distribution by way of dividend for the year is
£12,145,000 (2024: £13,683,000).
2025 2024
Pence £'000 Pence £'000
First interim dividend 1.20 5,148 1.05 4,556
Second interim dividend 1.20 5,128 1.05 4,529
Third interim dividend 1.20 5,084 1.05 4,513
Fourth interim dividend 1.20 5,064 1.05 4,510
Total 4.80 20,424 4.20 18,108
4. Net asset value per share
The net asset value per Ordinary share and the net asset value attributable to
the Ordinary shares at the year end are shown below. These were calculated
using 422,016,188 (2024: 429,169,449) Ordinary shares in issue at the year end
(excluding Treasury shares).
2025 2024
Net asset value attributable Net asset value attributable
£'000 pence £'000 pence
Net asset value - debt at par 498,579 118.1 510,691 119.0
Add: Amortised cost of the Euro 50 million
2.69% Private Placement Note with Metlife,
repayable on 26th August 2035 41,720 9.9 42,608 9.9
Less: Fair Value of the Euro 50 million 2.69%
Private Placement Note with Metlife, repayable
on 26th August 2035 (39,321) (9.3) (41,110) (9.6)
Net asset value - debt at fair value(1) 500,978 118.7 512,189 119.3
1 See the glossary of terms on page 99 of the annual report and
financial statements.
5. Analysis of Changes in Net Debt
As at Other As at
31st March Exchange non-cash 31st March
2024 Cash flows movements changes 2025
£'000 £'000 £'000 £'000 £'000
Cash and cash equivalents
Cash and short term deposits 4,698 (4,063) (3) - 632
Cash held in JPMorgan EUR Liquidity Fund 10,376 4,405 77 - 14,858
15,074 342 74 - 15,490
Borrowings
Debt due after one year
- Metlife Private Placement (42,608) - 900 (12) (41,720)
Net debt (27,534) 342 974 (12) (26,230)
2024 Financial Information
The figures and financial information for 2024 are extracted from the
published Annual Report and Financial Statements for the year ended 31st March
2024 and do not constitute the statutory accounts for that year. The Annual
Report and Financial Statements has been delivered to the Registrar of
Companies and included the Report of the Independent Auditors which was
unqualified and did not contain a statement under either section 498(2) or
section 498(3) of the Companies Act 2006.
2025 Financial Information
The figures and financial information for 2025 are extracted from the Annual
Report and Financial Statements for the year ended 31st March 2025 and do not
constitute the statutory accounts for the year. The Annual Report and
Financial Statements includes the Report of the Independent Auditors 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 Financial
Statements will be delivered to the Registrar of Companies in due course.
JPMORGAN FUNDS LIMITED
23rd June 2025
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
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
Annual Report and Financial Statements
The Annual Report and Financial Statements will be posted to shareholders soon
after the release of this report and will shortly be available on the
Company's website www.jpmeuropeangrowthandincome.com or in hard copy format
from the Company's Registered Office, 60 Victoria Embankment London EC4Y 0JP.
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
Up to date information on the Company, including daily NAV and share prices,
factsheets and portfolio information can also be found on the Company's
website at www.jpmeuropeangrowthandincome.com
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
or visit
www.rns.com (http://www.rns.com/)
.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
. END FR SELFWSEISEFMRecent news on JPMorgan European Growth & Income
See all newsREG - JPMorgan Inv. Trusts - Net Asset Value(s)
AnnouncementREG - JPMorgan EuroG&I PLC - Net Asset Value(s)
AnnouncementREG - JPMorgan Inv. Trusts - Gearing announcement
AnnouncementREG - JPMorgan Inv. Trusts - Net Asset Value(s)
AnnouncementREG - JPMorgan EuroG&I PLC - Gearing announcement
Announcement