REG - JPMorgan Global Core JPM Glbl Core - JARU JPM Glbl Core - JARE - Final results for the year ended 28 February 2025
30/06/2025 16:00
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RNS Number : 0409P JPMorgan Global Core Real Assets Ld 30 June 2025
LONDON STOCK EXCHANGE ANNOUNCEMENT
JPMORGAN GLOBAL CORE REAL ASSETS LIMITED (the "Company")
FINAL RESULTS FOR THE YEAR ENDED 28TH FEBRUARY 2025
Legal Entity Identifier: 549300D8JHZTH6GI8F97
Information disclosed in accordance with DTR 4.1.3
CHAIRMAN'S STATEMENT
On behalf of the Board, I am pleased to present the Annual Report for the year
ended 28th February 2025, a period that has seen significant change for the
Company. As shareholders will be aware, the Company's continuation vote failed
to pass at the 2024 Annual General Meeting. Following shareholder approval at
an Extraordinary General Meeting of the Company held on 20th December 2024,
the Company adopted a new investment objective and entered a managed
wind-down, embarking on the process of liquidating assets and returning
capital to shareholders on a timely basis.
This is being achieved by way of the compulsory partial redemptions of the
Company's ordinary shares, as described in the Company's circular dated 3rd
December 2024 (the 'Circular'). The Circular can be found on the Company's
website; www.jpmrealassets.co.uk.
Managed wind-down
As detailed in the Circular, the Company's portfolio at the time of entering a
managed wind-down, consisted of liquid and less-liquid assets. The timing of
redemptions from illiquid assets is influenced by a range of factors, which
are outside the control of the Board and the Investment Manager. These include
prevailing redemption queues, transaction activity, market conditions,
exchange rates and commercial considerations at the underlying strategy level,
which determine the timing and sterling value of the redemption receipts. In
consequence, any estimates regarding the quantum and timetable of redemptions
are, and will continue to be, subject to revision.
Redemption requests have been submitted in all of the Company's underlying
strategies. As of 28th February 2025, the Company had realised its holdings
in the Listed Real Assets Strategy, with the exception of a holding in Home
REIT plc. Following the year end, the Company has now fully redeemed its
holding in the Mezzanine Debt Strategy and the majority of its holding in the
Infrastructure Strategy, which in aggregate represented 29.3% of the Company's
net assets as at 30th November 2024. The proceeds from these redemptions are
USD16.7 million(1) and USD50.6 million, respectively.
The first five months of 2025 have been an exceptionally volatile period for
all financial markets, driven by a dramatic series of policy announcements
from the incoming US administration. This market volatility and consequential
shift in sentiment have introduced additional uncertainty into both the
economic and monetary policy outlook, key sensitivities for some of the real
asset sectors.
At the time of the Circular, it was envisaged that the process of fully
realising the Company's portfolio and distributing the resultant proceeds to
Shareholders would be substantially completed by the end of 2026. But for the
reasons noted above, it is now expected that JARA's redemptions from its real
asset strategies will take longer than originally envisaged.
The Board has been notified that, based on the Investment Manager's latest
estimates, by the end of 2025 the Company should have realised and returned to
Shareholders more than 55%, and by the end of 2026, more than 80% of the
assets which it held as at the announcement of the managed wind-down proposals
in December 2024, with the balance of unredeemed investments being represented
predominantly by real estate holdings.
Given the market uncertainty, it is premature to provide a definitive
assessment of the remaining redemption timeline. The Board and Investment
Manager will continue to monitor developments and provide further updates as
appropriate, while at the same time exploring options for the acceleration of
the return of capital.
The Board continues to monitor the costs of operating the Company in its
current form and, with that in mind, the Company's listing will be maintained
for so long as the Directors believe it to be cost-effective and in the
interests of Shareholders.
(1) In accordance with its terms, 10% of the Company's gross proceeds
held in the Mezzanine Debt Strategy has been withheld for potential tax
liabilities. Once these liabilities are settled any balance will be returned
to the Company.
Redemptions
Following the realisation of the holdings in the Listed Real Assets strategy
on 28th February 2025, the Company announced the first compulsory partial
redemption of its ordinary shares. 34,748,578 shares were redeemed
(representing 16.88% of the Company's issued share capital) for cancellation
at a price of 97.0465 pence per share. Payments were made on or around 19th
March 2025. This redemption was made in line with the estimated quantum and
timing outlined in the Circular.
Following the receipt of the proceeds of the redemptions in the Mezzanine Debt
Strategy and the majority of its holding in the Infrastructure Strategy, the
Board is now preparing for a second capital distribution to shareholders by
way of a compulsory partial redemption of shares, which is expected to occur
in early Q3 2025, in line with the timetable provided in the Company's
Circular. A further announcement confirming the quantum and timing will be
made in due course.
Performance
JARA's return on net asset value ('NAV') for the year was +5.2%. The Company's
return to shareholders was +36.8%, reflecting the narrowing of the discount
since the publication of the Company's Circular in December 2024. The discount
at the year end was 10.6%.
More details on the Company's NAV performance can be found in the Investment
Manager's Report below.
Currency Exposure
In view of the impact of currency movements on the Company's capital, as
detailed in the Circular, any cash received by the Company as part of the
realisation process will be converted into Sterling as soon as practicable and
will be held by the Company as cash on deposit and/or in Sterling liquid cash
equivalents securities pending its return to shareholders.
Dividends
In aggregate, total distributions of 3.15 pence were paid in respect of the
2024/25 financial year. First, second and third interim distributions of 1.05
pence per share were declared and paid on 31st May, 30th August and 29th
November 2024, respectively. As stated in the Circular, no further dividends
will be announced. Any income generated and accumulated from the remaining
holdings will be distributed as part of the Company's capital redemption
process.
Share Buybacks
The disconnect between the price at which the Company's shares traded and the
NAV per share continued throughout the year, with the discount ranging from
10.6% to 30.5%. Over the past year, the Company repurchased 4,625,000 of its
own shares into treasury at a total cost of c.£3.5 million. The Company held
a total of 13,587,814 shares in treasury, which were cancelled ahead of the
first compulsory partial redemption of shares to return capital to
shareholders.
The Board and Corporate Governance
Chris Russell retired from the Board on 30th November 2024. The Board now
consists of the remaining three Directors and, with a focus on cost
efficiency, it is expected that this will continue as the Company is wound
down. On behalf of the Board, I would like to extend my gratitude to Chris for
his outstanding service and dedication during his tenure on the Board.
In accordance with the Company's Articles of Incorporation and the AIC Code of
Corporate Governance, all Directors will be retiring and seeking re-election
by shareholders at the Company's Annual General Meeting. The Board's
collective knowledge and experience is detailed in the full Annual Report. The
Board and I believe that each Director, and the Board as whole, has the
necessary expertise and skillsets to effectively oversee the managed wind-down
of the Company to ensure the best outturn for shareholders.
The Board is sensitive to expenses and, in particular, that shareholders will
welcome a reduction in costs as the Company's portfolio shrinks, including the
costs of the Board itself. The Directors' fees remained unchanged in the past
year and, as reported in the Directors' Remuneration Report in the full Annual
Report, with effect from 1st March 2025 these fees were reduced. The combined
effects of a smaller Board and the fee reductions should result in a 27.5%
reduction in Directors' fees for 2025/26. Other fees, such as broker advisory,
have also been reduced and the Audit Committee has agreed with the Company's
auditor that its fees will be reduced in the 2025/26 financial year.
The Board has agreed the disbandment of its Nomination Committee and Market
Risk Committee following the Company's implementation of a managed wind-down
phase. All matters previously overseen by these committees will now be
directly handled by the Board. This shift is aimed at streamlining
decision-making processes during the wind-down period, and reflects the
Board's responsibility for the managed wind-down of the Company. The Audit
Committee will remain intact and will continue to hold responsibility for all
audit and risk-related matters, ensuring that financial oversight and
integrity are maintained throughout the managed wind-down.
Stay Informed
The Company releases monthly NAVs to the market, as well as quarterly NAVs
with more detailed commentary at the end of May, August, November and
February, all via the London Stock Exchange's Regulatory News Service. The
monthly NAVs contain the latest exchange rates, with the private strategies
being priced on a quarterly basis.
Annual General Meeting
The Company's sixth Annual General Meeting will be held on Thursday, 28th
August 2025 at 2.30 p.m. at the offices of JPMorgan, Level 3, Mill Court, La
Charroterie, St Peter Port, Guernsey GY1 1EJ. I would encourage all
shareholders to vote in advance. Details on how to submit your proxy vote can
be found in the notes to the Notice of Meeting in the full Annual Report.
If shareholders are unable to attend the Annual General Meeting, they are
welcome to raise any questions in advance of the meeting with the Company
Secretary at the Company's registered address, or via the 'Ask Us a Question'
link which can be found in the 'Contact Us' section on the Company's website,
or by writing to the Company Secretary at the address in the full Annual
Report or via email to jpmam.investment.trusts@jpmorgan.com.
Outlook
As I have observed before, JARA has been unfortunate in its timing. The
Company was launched in the autumn of 2019 and its investment deployment was
severely affected by the Covid-19 pandemic which arrived in 2020. As soon as
the world was learning to live with Covid, the Russian invasion of Ukraine
caused major disruption to world markets and impeded JARA's ability to grow by
means of new issues of equity. After five years of steady, but unspectacular
performance, with the shares trading at a significant discount to NAV and the
Company capitalised at less than £200 million, JARA's shareholders took the
decision not to support the 2024 continuation vote.
Your Board's response to this has been well documented, and involves a focus
on liquidating assets as quickly as practicable and returning proceeds to
shareholders in an efficient and cost-effective manner.
John Scott
Chairman
30 June 2025
INVESTMENT MANAGER'S REPORT
Performance Review
Following the implementation of the new investment objective, JARA is now in a
managed wind-down. All redemption requests were submitted and the listed
assets, with the exception of the investment in Home REIT plc, were sold ahead
of the Company's year-end. No capital deployment is being made by the Company.
This report gives a review of the performance of the portfolio over the year
under review.
During the financial year, JARA's existing allocation across different parts
of the real asset market proved crucial, amidst a backdrop of persistently
high interest rates, despite rate cuts in major economies, as well as
geopolitical and economic uncertainties. In this context, JARA's diversified
approach resulted in greater NAV stability compared to many standalone
single-sleeve real asset allocations, while also maintaining a steady income
stream. Notwithstanding that redemptions into each of the strategies have been
made, JARA continues to provide access to investment opportunities that are
otherwise difficult for retail investors to access by leveraging the scale and
breadth of the J.P. Morgan Asset Management - Global Alternatives platform.
For the reporting period, the NAV total return was +5.2% in GBP, while the
local currency performance was +7.0%. The difference between the GBP return
and the local currency return was due to sterling strengthening over the
period compared to the underlying currencies in JARA's portfolio, which
negatively impacted the Company's GBP NAV. Compared to the previous fiscal
year, U.S. real estate has gradually recovered from its low point as
conditions continue to improve across the sector. APAC real estate returns
were slightly down due to cap rate expansion, particularly in Australia and
New Zealand, and softening market conditions in China. Transportation and
infrastructure were more resilient, providing strong, positive returns due to
the demand-insensitive nature of the underlying assets and key structural
tailwinds such as the energy transition and geopolitical disruption. Other
private real assets, specifically real estate debt for JARA, represent a small
allocation within the portfolio, but also contributed positively as income
payments remained steady throughout the year. Finally, listed real assets
provided a positive return across real estate, infrastructure, and transport
before being fully redeemed from the JARA portfolio. The table below shows the
contributors to JARA's performance by asset class, calculated using the
average weighting within the portfolio throughout the year.
JARA's return contribution
Real Estate 0.5%
Infrastructure 3.4%
Transport 2.5%
Other Real Assets 0.6%
Total Local Return 7.0%
Currency Impact -1.9%
Company Impact 0.0%
Total GBP Return 5.2%
Source: J.P. Morgan Asset Management. Numbers may not sum due to rounding.
Currency impact also includes return earned from cash holdings over the year.
Table shows the components of return contribution made up of income and
capital. Asset class level returns are net of associated management fees.
Company impact (costs) includes the management fee charged by JPMF (0.05% pa)
and the Company's other administration expenses. The strategy returns above
are net returns and include the impact of the relevant management fee of each
strategy. Capital contribution may be negative for reasons including asset
depreciation, asset write downs or due to income return including some return
of capital.
Portfolio Update
The portfolio's holdings in listed real assets have been fully liquidated as
of February 2025 (with the exception of Home REIT plc), resulting in the
Company's portfolio as at 28th February 2025 being invested in the private
strategies and cash. In accordance with the timeline outlined in the Circular,
redemption requests were submitted for each private strategy, therefore
meeting the managed wind-down timeline, as outlined in the Circular. Dividends
are no longer being paid to the Company's shareholders; income generated and
accumulated from the remaining holdings will be distributed as part of the
capital redemption process.
Current Asset Allocation
Global Real Estate US 19%, APAC 18%
Global Infrastructure 25%
Global Transport 27%
Other Real Assets 9%
Source: J P. Morgan Asset Management. Data as of February 2025.
JARA's sector exposures
Sector Allocation (%)
Industrial / Logistics 17%
Office 8%
Residential 8%
Retail 4%
Total Real Estate (private % / public %) 37% (37% / 0%)
Utilities 12%
Renewable Energy 7%
Liquid Bulk Storage 3%
Conventional Energy 3%
Fixed Transportation Assets 1%
Total Infrastructure (private % / public %) 25% (25% / 0%)
Maritime 12%
Energy Logistics 9%
Rolling Stocks 3%
Aviation 2%
Other Transportation 1%
Total Transportation (private % / public %) 27% (27% / 0%)
Real Estate Mezzanine Debt 9%
Other Real Asset Debt 0%
Other Real Assets (private % / public %) 9% (9% / 0%)
Source: J P. Morgan Asset Management. Data as of February 2025.
Review of Underlying Strategies and Market Outlook
Global Infrastructure
JARA is invested in core private infrastructure, which typically includes
assets that provide essential services in a regulated or contracted manner.
This encompasses assets such as contracted power generation (e.g.,
renewables), utilities, and storage assets within OECD economies. Over the
year, JARA's private infrastructure allocation increased from 20% to 25%,
partially driven by the strong performance of the private allocation. The
asset class benefitted from the relatively high inflationary environment, as
contracts and regulatory structures often allow for some inflationary
pass-through in relation to costs and revenues, and from infrastructure's
crucial role in enabling the energy transition. At year-end, the Company had
look-through exposure to over 950 private infrastructure assets, spanning 26
countries and 14 subsectors.
Following the year end, the Company has received the majority of its proceeds
from its redemption in the Infrastructure strategy.
Global Transportation
JARA's private transportation allocation increased from 21% over the year,
contributing 2.4% to the Company's total return. Transportation has
demonstrated resilience in the face of ongoing geopolitical turbulence
affecting traditional shipping routes. This disruption acts as an artificial
supply constraint, which, combined with moderate order books, supports both
lease rates and values in this market. By the year-end, the Company had
look-through exposure to over 150 private transportation assets.
The transportation strategy focuses on leasing out large, 'backbone' transport
assets such as ships, aircraft, rail and fleet leasing and energy logistics,
which are critical to the functioning of global trade.
In 2024, global seaborne trade trends have been positive, with a
year-over-year ton-mile increase of 6.2% as of December 31st, 2024. Shipping
demand has remained robust, bolstered by longer trade routes due to
geopolitical disruption. The airline industry saw a notable increase in
international traffic in 2024 with industry total Revenue Passenger-Kilometers
(RPKs) growing 10.4% year-on-year, surpassing the pre-pandemic 2019 threshold
by 3.8%. The North American railcar market remains capacity constrained with
high utilisation and limited supply presenting tailwinds for lease rates.
Looking ahead, renewed trade tensions, escalating tariffs, and intensifying
economic nationalism will require monitoring. As supply chains reconfigure in
response to tariffs, transport assets may benefit from more complex trade
routes, higher shipping rates, and increased demand for domestic rail and
trucking services. Historically, transport lease rates and asset values have
tracked increases in inflation and interest rates. However, increased economic
and trade policy uncertainty may weigh on demand sentiment, posing a potential
headwind to transport assets in the short to medium term.
Global Real Estate Equity
JARA's private real estate equity allocation was relatively stable, with a
minor increase from 35% last year to 37% this year. JARA's private real estate
equity allocation focuses on high quality assets across the U.S. and
Asia-Pacific regions. The focus is on core property sectors - logistics,
warehouses, residential, office and retail - in major growth markets and most
dynamic gateway cities. These extended sectors include data centres,
self-storage, and other facilities that support new, high-growth industries
such as healthcare and biotech. These high-growth areas are more prevalent in
the listed real estate space and complement the more established sectors.
For U.S. private real estate, market conditions have continued to improve
across sectors following the Federal Reserve's rate cut in 2024. Debt spreads
have tightened as the number of lenders quoting transactions has increased
across all product types, including office spaces, and all-in borrowing costs
have decreased by approximately 100 basis points since mid-year 2024. Equity
transaction volumes have risen, with core capital actively participating and
securing deals. Despite a recent uptick in long-term U.S. Treasury rates, we
expect continued momentum in the property market due to strengthening supply
and demand fundamentals and a healthy net operating income growth outlook.
Over the near-term, the introduction of tariffs may be expected to increase
the cost of construction as imported materials become more costly. This may
dampen the appetite for new construction activity and reduce the pace of
supply growth across sectors. Tariffs may also increase the cost of imported
manufactured goods which may lead to a reduction in consumer spending,
directly impacting the retail sector. In the current market environment, high
quality real estate assets that are well-located can benefit from higher
replacement costs; furthermore, fundamentals are currently balanced and
quality assets have the potential for moderate NOI growth from a starting
point of elevated yields.
In the residential sector, improving fundamentals have led to a reacceleration
in rent growth. With both supply and demand drivers moving in the right
direction, we expect this positive momentum to persist. In the industrial
sector, while vacancy rates increased again in the fourth quarter of 2024,
infill and shallow bay assets continue to perform well, and the return of
manufacturing demand provides an additional boost to the sector. The office
sector is showing more positive indicators as a recovery appears to be taking
hold. Although current conditions remain challenging, there are signs of
better days ahead. In the retail sector, strong consumer activity and
persistent demand maintain favourable conditions for landlords, and with a
healthy economic backdrop, we expect continued strength in the short to
mid-term.
For APAC private real estate, the expansion of cap rates in Australia and New
Zealand continued to influence valuations in 2024. However, this trend has
recently started to reverse, with New Zealand initiating policy easing in
August 2024 and Australia following suit in February 2025. In China, softening
market conditions affected returns in 2024. Nonetheless, most rents within the
holdings in China have been adjusted to align with market levels, and we
expect that further declines in market rents will moderate throughout 2025. As
monetary policy across the region begins to normalise, yields remain above
historical averages, and rent growth is robust across most markets, offering
positive signals for a stronger 2025.
Other Real Assets
JARA's other real asset allocation consists of U.S. real estate debt. Separate
to real estate equity, this is an income-focused part of the portfolio backed
by high quality, moderately leveraged assets. This part of the portfolio
consists of both an income diversifier, and as a dampener on volatility, as it
is less sensitive to macroeconomic fluctuations in comparison to real estate
equity. At the year-end, the Company had exposure to over 20 private assets.
Since the year end, the Company has fully liquidated its positions in this
strategy.
Outlook
Global economic growth forecasts have moderated but remain positive for 2025,
with recession risks increasing on the margins. Macroeconomic and policy
uncertainty has led to a decrease in confidence and increased risk premia
across asset classes. Over the near-term, we expect lower growth, elevated
inflation, and increased recession risks relative to our expectations coming
into 2025. These risks have been exacerbated by the introduction, and
subsequent escalation and implementation, of tariffs worldwide.
Notwithstanding this outlook, the Company continues to progress the managed
wind-down, having submitted redemptions into each of the underlying
strategies.
Investment Manager
J.P. Morgan Asset Management, Inc.
Security Capital Research & Management Inc. and J.P. Morgan Alternative
Asset Management Inc.
30 June 2025
PRINCIPAL AND EMERGING RISKS
The Board, through delegation to the Audit Committee, has undertaken a robust
assessment and review of the principal risks facing the Company, together with
a review of any new and emerging risks that may have arisen during the year to
28th February 2025. With the assistance of JPMF, the Audit Committee has drawn
up a risk matrix, which identifies the key risks to the Company. The risk
matrix, including emerging risks, are reviewed formally by the Audit Committee
every six months or more regularly as appropriate. As a result of the
shareholder approval of the new investment objective and investment policy
placing the Company into managed wind-down, the Audit Committee has updated
the risk matrix to better represent the current principal risks and the
relevant mitigation measures.
Actions taken by the Board to manage and mitigate the Company's principal and
emerging risks and uncertainties are set out in the table below. The end
column on the right highlights at a glance the Board's assessment of any
increases or decreases in risk during the year after mitigation and
management. The arrows show the risks as increased, decreased or unchanged.
Principal risk Description Mitigation/Control Movement in risk status in the year to 28th February 2025
Investment management and performance
Maximising returns The Company may not achieve its investment objective to undertake a managed The realisation process will be carried out in a way that seeks to achieve a This is a new risk, reflecting shareholder approval to place the Company into
wind-down of the Company and realise all existing assets in the Company's balance between maximising the value received from investments and making a managed wind-down.
portfolio in an orderly manner. timely returns to shareholders. The net proceeds from realisations will be
used to make timely returns of capital to Shareholders (net of provisions for
The realisation proceeds to be received by the Company from each underlying the Company's costs and expenses) in such manner as the Board considers
private strategy will be determined by the net asset value of the relevant appropriate.
private strategy prevailing at the time that the redemption request is
settled, less any costs or charges arising as a result of, or in connection Any cash received by the Company as part of the realisation process will be
with, the redemption. converted into Sterling as soon as practicable and will be held by the Company
as cash on deposit and/or in Sterling liquid cash equivalents securities
pending its return to Shareholders.
Delay in redemptions Delays in capital being redeemed by the private strategies delaying the The Manager monitors and reports to the Board on the expected timing of áâ
managed wind-down of the Company. redemptions from the underlying strategies. However, it is recognised that the
Board has no control over the redemptions from the underlying strategies. Redemptions have been submitted into each of the underlying strategies
following shareholder approval to implement a managed wind-down of
the Company.
The Board is aware of the considerable length of time that it is taking for
these redemption requests to be fulfilled and the consequential impact that
this could have on the timetable for the implementation of the Company's
managed wind-down. Please see the update in the Chairman's Statement above.
Foreign exchange risk to income There is a risk that material sterling strength or volatility will result in The Board is aware of the impact that fluctuating currency movements can have áâ
a diminution of the value of income received when converted into sterling. on the Company's returns. Any cash received by the Company as part of the
realisation process will be converted into Sterling as soon as practicable and The USD/GBP exchange rate continued to fluctuate over the year under review,
will be held by the Company as cash on deposit and/or in Sterling liquid cash which was marginally positive for the NAV.
equivalents securities pending its return to Shareholders.
Foreign exchange risk to NAV There is a risk that material sterling strength or volatility will result in
a volatile NAV/share price since most the Company's assets are denominated in
U.S. dollars, or in currencies which tend to be closely correlated with the
dollar.
Operational risks
Cyber crime The threat of cyber-attack, in all guises, is regarded as at least as The Company benefits directly or indirectly from all elements of JPMorgan's áâ
important as more traditional physical threats to business continuity and Cyber Security programme. The information technology controls around physical
security. security of JPMorgan's data centres, security of its networks and security of The Manager's extensive cyber security arrangements remained in operation over
its trading applications, are tested by independent auditors and reported the year under review.
In addition to threatening the Company's operations, such an attack is likely every six months against the AAF Standard.
to raise reputational issues which may damage the Company's share price and
reduce demand for its shares.
Counterparty risk The nature of the contractual frameworks that underpin many of the real assets The Board is able to seek information from the Manager in relation to áâ
within the underlying strategies necessitate close partnerships with a range counterparty concentration and correlation of providers. As counterparty
of counterparties. In addition to the financial risks arising from exposure to quality is key to maintaining predictable income streams, the Manager seeks The operations and controls of the Company's counterparties have proven robust
customers, client and lenders, there are a large number of operational regular contact with key counterparties throughout the supply chain and with over the year under review. The Company has not been impacted by any
counterparties including construction and maintenance subcontractors. revenue-providing counterparties, while also actively monitoring the financial operational issues from its counterparties.
Counterparty risk would primarily manifest itself as either counterparty strength and stability of all these entities.
failure or underperformance of contractors.
Regulatory risks
Outsourcing Disruption to, or failure of, the Manager's accounting, dealing or payments Details of how the Board monitors the services provided by JPM and its áâ
systems or the Depositary or Custodian's records may prevent accurate associates and the key elements designed to provide effective risk management
reporting and monitoring of the Company's financial position or and internal control are included within the Risk Management and Internal The Manager's operations and controls have proven robust over the year under
a misappropriation of assets. Controls section of the Corporate Governance Statement in the full annual review. The Company has not been impacted by any operational issues.
report
The Manager has a comprehensive business continuity plan which facilitates
continued operation of the business in the event of a service disruption.
Directors have received reassurance that the Manager and its key service
providers have business continuity plans in place and that these are regularly
tested.
Regulatory change Various legal and regulatory changes may adversely impact the Company and its The Manager and its advisers continually monitor any potential or actual áâ
underlying investments. This could take the form of legislation impacting the changes to regulations to ensure its assets and service providers remain
supply chain or contractual costs or obligations to which the underlying compliant. Most social and transportation infrastructure concessions provide The Company continued to adhere to relevant requirements.
strategies are exposed. Certain investments in the underlying strategies are a degree of protection, through their contractual structures, in relation to
subject to regulatory oversight. Regular price control reviews by regulators changes in legislation which affect either the asset or the way the services
determine levels of investment and service that the portfolio company must are provided. Regulators seek to balance protecting customer interests with
deliver and revenue that may be generated. Particularly severe reviews may making sure that investments have enough money to finance their functions.
result in poor financial performance of the affected investment.
Notwithstanding that the Company has been placed into a managed wind-down,
Company is invested in real assets via a series of private funds. The
operation of these entities including their ability to be bought, held or sold
by investors across a number of jurisdictions and the taxation suffered
within the funds and by investors into the funds depend on a complex mix of
regulatory and tax laws and regulations across a wide range of countries.
These may be subject to change that may threaten the Company's access to and
returns earned from the private funds.
Environmental risks
Climate change The Company may be exposed to substantial risk of loss from environmental While the Company waits for the redemptions in the private strategies to be áâ
claims arising in respect of its underlying real assets that have redeemed, the Manager continues to manage and review the portfolio, which
environmental problems, and the loss may exceed the value of such underlying includes consideration of climate-related risks to understand the impact The Investment Manager has responsibility for ESG. The Company is not a
assets, although for some real assets this can be mitigated to some extent by (if any) these risks could pose on the strategies and the redemptions. sustainable or ESG investment vehicle. The Company is in a wind-down position;
contracted lease commitments. Furthermore, changes in environmental laws and as such, the opportunity to implement material ESG changes across its
regulations or in the environmental condition of investments may create portfolio is limited and ESG considerations are expected to be limited.
liabilities that did not exist at the time of acquisition of an underlying
asset and that could not have been foreseen. It is also possible that certain
underlying assets to which the Company will be exposed could be subject to
risks associated with natural disasters (including wildfire, storms,
hurricanes, cyclones, typhoons, hail storms, blizzards and floods).
Global risks
Geopolitical risk The Company's portfolio is exposed to various geopolitical and macro-economic This risk is managed to some extent by diversification of the portfolio. The ã
risks incidental to investing. Political, economic, military and other events Manager updates the Board regularly on the redemption queues, as well as
around the world (including trade disputes) may impact the economic conditions performance of the strategies whilst the Company waits for the return of The rise in geopolitical tensions contributed to volatility and economic
in which the Company operates, by, for example, causing exchange rate capital. As part of the update on performance of the underlying strategies, disruption over the year.
fluctuations, interest rate changes, heightened or lessened competition, tax the Manager updates the Board of the impact (if any) of geopolitical risks on
advantages or disadvantages, inflation, reduced economic growth or recession, the strategies.
and so on. Such events are not in the control of the Company and may impact
the receipt of redemptions from the underlying strategies.
Emerging Risks
The Board continually monitors the changing risk landscape and any emerging
and increasing threats to the Company's business model, as they come into view
via a variety of means, including advice from the Manager, the Company's
professional advisors and Directors' knowledge of markets, changes and events.
These threats and/or changes have a degree of uncertainty in terms of
probability of occurrence and possible effects on the Company. Should an
emerging risk become sufficiently clear, and the implications evaluated, it
may be moved to a principal risk. The Board does not currently believe there
to be any emerging risks. All principal risks to the Company in relation to
its managed wind-down are detailed above.
TRANSACTIONS WITH THE MANAGER AND RELATED PARTIES
Details of the management contract are set out in the Directors' Report in the
full Annual Report. The management fee payable to the Manager for the year was
£555,000 (2024: £709,000) of which £175,000 (2024: £243,000) was
outstanding at the year end.
Included in administration expenses in note 7 in the full Annual Report are
safe custody fees amounting to £1,000 (2024: £2,000) payable to JPMorgan
Chase Bank N.A. of which £nil (2024: £nil) was outstanding at the year end.
Handling charges on dealing transactions amounting to £19,000 (2024:
£27,000) were payable to JPMorgan Chase Bank N.A during the year of which
£8,000 (2024: £3,000) was outstanding at the year end.
At the year end, a bank balance of £35,248,000 (2024: £2,709,000) was held
with JPMorgan Chase N.A. A net amount of interest of £52,000 (2024: £33,000)
was receivable by the Company during the year from JPMorgan Chase N.A. of
which £nil (2024: £nil) was outstanding at the year end.
The Company holds cash in the JPMorgan Sterling Liquidity Fund, which is
managed by JPMF. At the year end, this was valued at £0.01 million (2024:
£0.51 million). Interest amounting to £180,000 (2024: £26,000) was
receivable during the year of which £nil (2024: £nil) was outstanding at the
year end.
The Company can also hold cash in the JPMorgan US Dollar Liquidity Fund, which
is managed by JPMF. At the year end, no cash was held in this fund (2024:
£0.46 million). Interest amounting to £24,000 (2024: £25,000) was
receivable during the year of which £nil (2024: £nil) was outstanding at the
year end.
Please see below for details of the Directors' remuneration.
Single total figure of remuneration(1)
The single total figure of remuneration for each Director is detailed below.
2025 2024
Total Total
Directors £ £
John Scott 64,280 64,280
Helen Green 53,560 53,560
Simon Holden 57,876 57,876
Chris Russell(2) 33,776 45,032
Total 209,492 220,748
(1 ) Other subject headings for the single figure table are not
included because there is nothing to disclose in relation thereto.
(2 ) Retired on 30th November 2024.
Whilst not required by the Company and not constituting part of the Directors'
remuneration, the Directors own shares in the Company. The Directors' received
a dividend from their shares over the reporting period commensurate with their
shareholdings, which does not constitute part of their remuneration. There are
no balances payable to the Directors at the year end.
STATEMENT OF DIRECTORS' RESPONSIBILITIES
The Directors are responsible for preparing the Annual Report & Financial
Statements in accordance with applicable law and regulations.
The Companies (Guernsey) Law, 2008 ('the law') requires the Directors to
prepare the Financial Statements for each financial year. Under that law, the
Directors have elected to prepare the financial statements in accordance with
International Financial Reporting Standards to meet the requirements of
applicable law and regulations. Under Company law the Directors must not
approve the Financial Statements unless they are satisfied that, taken as
a whole, the Annual Report & Financial Statements are fair, balanced and
understandable, provide the information necessary for shareholders to assess
the Company's position, 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;
• make judgements and accounting estimates that are reasonable and
prudent;
• state whether applicable International Financial Reporting Standards
have been followed, subject to any material departures disclosed and explained
in the financial statements; 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 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 to
enable them to ensure that the financial statements comply with the law. 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 accounts are published on the www.jpmrealassets.co.uk 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 accounts since they were initially presented on the website.
Legislation in Guernsey governing the preparation and dissemination of
financial statements may differ from legislation in other jurisdictions. The
accounts are prepared in accordance with International Financial Reporting
Standards.
Under applicable law and regulations, the Directors are also responsible for
preparing a Directors' Report, Corporate Governance Statement and Directors'
Remuneration Report that comply with that law and those regulations.
Each of the Directors, whose names and functions are listed in the full Annual
Report confirms that, to the best of their knowledge:
• the financial statements, which have been prepared in accordance
with International Financial Reporting Standards and applicable law, give a
true and fair view of the assets, liabilities, financial position and return
or loss of the Company; and
• the Strategic 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 and emerging risks and uncertainties that it
faces.
The Board also confirms that it is satisfied 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 and emerging risks and uncertainties that the Company faces.
For and on behalf of the Board
John Scott
Chairman
30 June 2025
STATEMENT OF COMPREHENSIVE INCOME
For the year ended 28th February 2025
Year ended Year ended
28th February 29th February
2025 2024
£'000 £'000
Gains/(losses) on investments held at fair value through profit or loss 1,758 (20,488)
Net foreign currency losses (73) (41)
Income from investments 10,348 11,239
Interest receivable and similar income 256 84
Total return/(loss) 12,289 (9,206)
Management fee (555) (709)
Other administrative expenses (734) (705)
Return/(loss) before finance costs and taxation 11,000 (10,620)
Finance costs (2) -
Return/(loss) before taxation 10,998 (10,620)
Taxation (1,160) (1,259)
Net return/(loss) after taxation 9,838 (11,879)
Return/(loss) per share 4.75p (5.49)p
The Company does not have any income or expense that is not included in the
net profit for the year. Accordingly the 'Return for the year', is also the
'Total comprehensive income for the year, as defined in IAS 1 (revised).
All Items in the above statement derive from discontinuing operations. No
operations were acquired or discontinued in the year.
STATEMENT OF CHANGES IN EQUITY
Share Retained
premium earnings Total
£'000 £'000 £'000
Year ended 29th February 2024
At 28th February 2023 219,278 4,450 223,728
Repurchase of shares into Treasury - (6,356) (6,356)
Loss for the year - (11,879) (11,879)
Dividends paid in the year (note 2) - (9,082) (9,082)
At 29th February 2024 219,278 (22,867) 196,411
Year ended 28th February 2025
At 29th February 2024 219,278 (22,867) 196,411
Repurchase of shares into Treasury - (3,499) (3,499)
Partial redemption of shares(1) - (33,722) (33,722)
Costs in respect of partial redemption - (181) (181)
Return for the year - 9,838 9,838
Dividends paid in the year (note 2) - (6,536) (6,536)
At 28th February 2025 219,278 (56,967) 162,311
(1) The Company returned monies to Shareholders by way of a compulsory
partial redemption of shares.
STATEMENT OF FINANCIAL POSITION
At 28th February 2025
2025 2024
Notes £'000 £'000
Assets
Non current assets
Investments held at fair value through profit or loss 160,112 192,122
Current assets
Debtors 1,146 1,080
Cash and cash equivalents 35,260 3,682
36,406 4,762
Liabilities
Current liabilities
Other payables (34,207) (473)
Net current assets 2,199 4,289
Total assets less current liabilities 162,311 196,411
Net assets 162,311 196,411
Amounts attributable to shareholders
Share premium 219,278 219,278
Retained earnings (56,967) (22,867)
Total shareholders' funds 162,311 196,411
Net asset value per share 4 94.9p 93.3p
STATEMENT OF CASH FLOWS
For the year ended 28th February 2025
2025 2024
£'000 £'000
Cash flows from operating activities
Return/(loss) before taxation 10,998 (10,620)
Deduct dividends received (10,270) (11,133)
Deduct investment income - interest (78) (106)
Deduct deposit and liquidity fund interest income (256) (84)
Add interest paid 2 -
(Deduct gains)/add losses on investments held at fair value through profit (1,758) 20,488
& loss
Add exchange losses on cash and cash equivalents 73 41
Decrease/(increase) in prepayments and accrued income 6 (2)
Increase/(decrease) in other payables (75) (92)
Tax paid (1,159) (1,265)
Net cash outflow from operating activities before interest (2,517) (2,773)
Investing activities
Dividends received 10,179 11,043
Interest received 83 104
Deposit and liquidity fund interest received 256 84
Interest paid (2) -
Purchases of investments held at fair value through profit or loss (11,311) (49,387)
Sales of investments held at fair value through profit or loss 45,073 56,549
Net cash inflow from operating and investing activities 41,761 15,620
Financing activities
Dividends paid (6,536) (9,082)
Repurchase of shares into treasury (3,499) (6,356)
Costs in respect of partial redemption of shares (75) -
Net cash outflow from financing activities (10,110) (15,438)
Increase in cash and cash equivalents 31,651 182
Cash and cash equivalents at start of year 3,682 3,541
Exchange movements (73) (41)
Cash and cash equivalents at end of year(1) 35,260 3,682
(1) Cash and cash equivalents includes liquidity funds.
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 28th February 2025
1. General information
The Company is a closed-ended investment company incorporated in accordance
with The Companies (Guernsey) Law, 2008. The address of its registered office
is at Level 3, Mill Court, La Charroterie, St Peter Port, Guernsey GY1 1EJ.
The principal activity of the Company is investing in securities as set out in
the Company's Objective and Investment Policies.
The Company was incorporated on 22nd February 2019. The Company was admitted
to the Market of the London Stock Exchange and had its first day of trading on
24th September 2019.
Investment objective
The Company's investment objective is to realise all existing assets in the
Company's portfolio in an orderly manner and make timely returns of capital to
shareholders.
Investment policy
The Company will pursue its investment objective by effecting an orderly
realisation of its assets. The Company will cease to make any new investments
in private funds or managed accounts managed or advised by entities within
J.P. Morgan Asset Management. The Company will cease to undertake capital
expenditure except as deemed necessary or desirable by the Board in connection
with the realisation.
Going Concern
At the fifth Annual General Meeting, the Company, in line with its Articles of
Incorporation, was subject to a continuation vote by its shareholders. The
vote did not pass, indicating a lack of support for the future of the
Company's operations in their current form. Consequently, the Board, having
consulted with the Company's major shareholders and considered all options
available, has made the decision to place the Company into a managed
wind-down. Subsequently, on 20th December 2024, shareholders approved a change
in investment objective and investment policy, allowing the Company to undergo
an orderly realisation of assets, returning capital to shareholders.
The assessment of the Company's going concern status considers two distinct
aspects. First, no material uncertainties related to the Company's ability to
meet its liabilities as they fall due have been identified. The Company
presently has sufficient resources to cover its foreseeable financial
obligations.
Second, uncertainty exists regarding the timeframe for the Company's continued
operations as a going concern during the voluntary wind-down period. This
uncertainty arises from the inherent challenges in predicting the timing and
successful completion of redemptions from the underlying strategies necessary
to return proceeds to shareholders. The speed and efficiency of these
divestments will significantly impact the length of time the Company remains
operational. As at the date of this report, based on the Investment Manager's
latest estimates, the Board now expects that the orderly realisation of the
remaining real assets will extend into calendar year 2027, at the very least.
Notwithstanding the decision to place the Company into a managed wind-down,
the Directors have prepared the financial statements on a going concern basis,
focusing on the Company's financial viability. They are required to assess
whether the Company has adequate resources to continue operations for at least
12 months. In making this assessment, the Directors considered the Company's
revenue forecast and net cash position. In terms of the longer viability of
the Company, the Board has assessed its current position and the period over
which its assets are likely to be realised and agreed that a three year period
ending 28th February 2028 was appropriate. There is however, no guarantee on
this timeline.
The Board has therefore determined that it is appropriate to continue to
prepare these financial statements on a going concern basis.
2. Dividends
2025 2024
Pence £'000 Pence £'000
Dividends paid
First interim dividend 1.05 2,207 1.05 2,304
Second interim dividend 1.05 2,168 1.05 2,304
Third interim dividend 1.05 2,161 1.05 2,247
Fourth interim dividend - - 1.05 2,227
Total dividends paid in the year 3.15 6,536 4.20 9,082
Dividends declared
2025 First interim dividend - - 1.05 2,209
3. Return/(loss) per share
2025 2024
£'000 £'000
Total return/(loss) 9,838 (11,879)
Weighted average number of shares in issue during the year 207,127,101 216,377,222
Total return/(loss) per share 4.75p (5.49)p
4. Net asset value per share
2025 2024
Shareholders' funds (£'000) 162,311 196,411
Number of shares in issue 171,071,560 210,445,138
Net asset value per share 94.9p 93.3p
Status of results announcement
2024 Financial Information
The figures and financial information for 2024 are extracted from the
published Annual Report and Financial Statements for the year ended 29th
February 2024, and do not constitute the statutory accounts for that year.
The Annual Report and Financial Statements include the Report of the
Independent Auditors which was unqualified.
2025 Financial Information
The figures and financial information for 2025 are extracted from the
published Annual Report and Financial Statements for the year ended 28th
February 2025 and do not constitute the statutory accounts for that year.
The Annual Report and Financial Statements include the Report of the
Independent Auditors which is unqualified.
JPMORGAN FUNDS LIMITED
30 June 2025
For further information, please contact:
JPMorgan Funds Limited - Company Secretary
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 be submitted to the National Storage
Mechanism and will shortly be available for inspection at
https://data.fca.org.uk/#/nsm/nationalstoragemechanism
(https://data.fca.org.uk/#/nsm/nationalstoragemechanism)
The Annual Report will also shortly be available on the Company's website at
www.jpmrealassets.co.uk (http://www.jpmrealassets.co.uk) 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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