REG - PCGH ZDP PLC Polar Cap Glb Health - Final Results
12/12/2022 07:01
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RNS Number : 2860J PCGH ZDP PLC 12 December 2022
PCGH ZDP PLC
Legal Entity Identifier: 5493004C3YRF9HEVQI09
Annual Report and Financial Statements
for the year ended 30 September 2022
COMPANY INFORMATION
PCGH ZDP plc (the 'Company') is a public limited company incorporated and
domiciled in England and Wales on 30 March 2017, with registration number
10700107. The principal legislation under which the Company operates is the
Companies Act 2006. The Company has a standard listing on the London Stock
Exchange.
KEY CONTACTS
Board of Directors Registered Office
Lisa Arnold (Chair) 16 Palace Street
Neal Ransome London
Andrew Fleming SW1E 5JD
Jeremy Whitley
Investment Manager and AIFM Company Secretary
Polar Capital LLP Polar Capital Secretarial Services Limited
16 Palace Street 16 Palace Street
London London
SW1E 5JD SW1E 5JD
Independent Auditors Depositary
PricewaterhouseCoopers LLP HSBC Bank plc
7 More London Riverside 8 Canada Square
London London
SE1 2RT E14 5HQ
Legal Adviser
Registrar Herbert Smith Freehills LLP
Equiniti Limited Exchange House, Primrose Street
Aspect House, Spencer Road London
Lancing, West Sussex EC2A 2EG
BN99 6DA
Company identification codes: TICKER: PGHZ LEI: 5493004C3YRF9HEVQI09
SEDOL: BDHXP96 ISIN: GB00BDHXP963
STRATEGIC REPORT for the year ended 30 September 2022
The Strategic Report has been prepared under s414A of the Companies Act 2006
(Strategic Report and Directors' Report) Regulations 2013 and the Companies
Act 2006 (the 'Act'). Its purpose is to inform members of the Company and help
them assess how the directors have performed their statutory duties listed in
s171-177 of the Companies Act 2006. Under s172, Directors have a duty to
promote the success of the Company for the benefit of its members (our
Shareholders) as a whole and in doing so have regard to the consequences of
any decision in the long term, as well as having regard to the Company's
stakeholders amongst other considerations. The fulfilment of this duty ensures
decisions are made in a responsible and sustainable way for Shareholders.
The Company is a financing vehicle with neither employees nor premises. The
Board seeks to understand the needs and priorities of the Company's
stakeholders and these are taken into account during all of its discussions
and as part of its decision-making. The Board considers its key stakeholders
to be its shareholders, its Investment Manager and its third-party service
providers while also taking into account the Company's responsibilities to
regulators and the wider community.
This Strategic Report is intended to provide information about the Company's
strategy and business, its performance and the results for the year under
review. The Company is a public limited company with the sole purpose of
issuing Zero Dividend Preference ('ZDP') shares. The Company is managed by a
board of non-executive directors and the day-to-day operations of the Company
are delegated to the Investment Manager, Polar Capital LLP. The Company's
entire ordinary share capital is owned by Polar Capital Global Healthcare
Trust plc (the 'parent' or 'PCGH') while the Company's ZDP shares are listed
on the London Stock Exchange. PCGH and the Company form the Group (the
'Group').
Chair's Statement
My report on the activities of the Group for the year ended 30 September 2022
is provided in the Annual Report of the parent company which can be found on
both the National Storage Mechanism ('NSM') at
https://data.fca.org.uk/#/nsm/nationalstoragemechanism and the following
website www.polarcapitalglobalhealthcaretrust.com
Performance and Dividends
The sole purpose of the Company is to issue ZDP shares and to advance the
proceeds of the issue by way of a loan to PCGH. The sole objective of the
Company is to repay the ZDP shareholders on 19 June 2024 (the 'ZDP Repayment
Date') their entitlement of 122.99 pence per ZDP share (the 'Final Capital
Entitlement') and the performance of the Company in meeting this objective is
directly linked to the performance of the portfolio of the parent company. The
Directors do not recommend the payment of a dividend.
Key Performance Indicators
Due to the limited nature of the Company's activities, the Board does not
consider it necessary to assess the performance of its activities using key
performance indicators.
Loan Agreement
The Company and PCGH entered into an intra-group loan agreement (the
'Agreement') on 20 June 2017. Under the Agreement the gross initial ZDP
placing proceeds were lent to PCGH. The Agreement provides that interest will
accrue daily at an annual rate of 2.5% compounded annually on each anniversary
of the ZDP shares admission to listing and will be rolled up and paid to the
Company along with any repayment of the principal amount on a date falling 2
business days before the ZDP Repayment Date. PCGH has further provided an
Undertaking (the 'Undertaking') to provide additional funding in the event of
a shortfall between the final capital entitlement of 122.99 pence per ZDP
share and the aggregate principal amount and interest due pursuant to the
Agreement at that date. Further information is provided in the notes to the
Financial Statements.
The Board and Diversity
The Board has considered the targets published within the FCA policy,
Diversity and Inclusion on Company Boards and
Executive Committees (PS22/3), issued in April 2022. For financial years
commencing on or after 1 April 2022, the policy requires under new Listing
Rules 9.8.6R(9) and 14.3.33R(1), all UK listed companies, on a comply or
explain
basis, to meet the following targets:
· At least 40% of the Board are women;
· At least one senior board position is held by a woman;
· At least one member of the Board is from a minority ethnic
background.
The Company has no employees and the Board is comprised of one female and
three male Independent non-executive Directors. The Board is aware that, with
the exception of the requirement to have a senior woman on the Board, Lisa
Arnold has been the Chair of the Company since February 2020, the above
targets are not currently met. The composition of the Board is considered
regularly to determine whether the needs of the Company in terms of experience
and areas of expertise are met by the directors in office. While the Board
agree that a company can benefit from greater diversity, at present, it has
not been deemed necessary to make a change to the composition of the Board.
Management and Service Providers
As the Company's only purpose is to issue ZDP Shares, all of the day-to-day
operational, administration and other activities are outsourced to third party
service providers. The key service providers are listed on page 2.
Corporate and Social Responsibility and Modern Slavery
As a financing vehicle, the Company has no direct social, community, employee
or environmental responsibilities. The Company has no direct investments as
its sole purpose is to provide financing to the Group through the issue of ZDP
shares. As the Company does not make any investments it does not subscribe to
a socially responsible investment policy and does not exercise any voting
powers. The Company does not provide goods or services in the normal course of
business and does not have any customers. Accordingly, it is considered that
the Company is not required to make any statements in relation to modern
slavery, human trafficking or human rights.
The Environment and Greenhouse Gas Emissions
The Company's core activities are undertaken by its Investment Manager, which
seeks to limit the use of non-renewable resources and to reduce waste where
possible. Further details of the Investment Manager's ESG policy can be found
in the document library of the Company's website. The Companies Act 2006
(Strategic Report and Directors' Reports) Regulations 2013 require companies
listed on the Main Market of the London Stock Exchange to report on the
greenhouse gas ('GHG') emissions for which they are responsible. The Company
is a financing vehicle as described above, with neither employees nor
premises, consequently, it has no GHG emissions to report from its operations
nor does it have responsibility for any other emissions.
Principal Risks and Uncertainties
The Board acknowledges its ultimate responsibility for managing the risks
associated with the Company. The principal risks and uncertainties as
identified by the Board are:
Capital Value:
The primary risk to the ZDP shareholders is that the assets of the Company are
insufficient to repay the final capital entitlement of the ZDP Shares of
122.99 pence per share on the repayment date of 19 June 2024. The payment will
be dependent on the parent company's ability to comply with its obligations
under the Agreement and the Undertaking.
Investment tenure:
There is a risk that there may not be a liquid secondary market for the ZDP
Shares. The investment should therefore be regarded as long-term in nature and
should not be considered a suitable short-term investment.
Further details of financial risk management policies and procedures are set
out in note 10.
Future Developments
The Company does not have, and does not expect to have, any other business
interests, and the current activities of the Company are expected to continue
until the scheduled ZDP Repayment Date of 19 June 2024 at which time the
Company will enter into voluntary liquidation to wind up its operations.
Approved by the Board of Directors on 9 December 2022 and signed on its behalf
by:
Lisa Arnold,
Chair
REPORT OF THE DIRECTORS for the year ended 30 September 2022
The Directors have pleasure in submitting the audited Annual Financial Report
of the Company for the year to 30 September 2022.
Principal Activities
The Company was incorporated for the sole purpose of issuing ZDP shares to
raise finance for the Group and consequently it has no investment policy. The
Company has a limited life and unless prior alternative arrangements are made,
the Directors shall convene a general meeting of the Company on 19 June 2024
for the purposes of proposing a resolution to wind up the Company voluntarily.
The Company's only material financial obligations are in respect of the ZDP
shares and the only material assets are its loan to the parent company.
Directors
The Directors who served in office during the year under review and to the
date of signing were as follows:
Lisa Arnold (Chair)
Neal Ransome
Andrew Fleming
Jeremy Whitley
Each Director was appointed pursuant to a letter of appointment entered into
with the Group. No Director had a service contract with the Company, nor are
any such contracts proposed. Apart from the exception noted below none of
the Directors had a direct material beneficial interest in any contract to
which the Company was a party and which is or was significant in relation to
the Company's business during the year under review.
All of the current Directors are Directors of PCGH and therefore have an
indirect non-beneficial interest in the Agreement and Undertaking entered into
by the Company and PCGH. The Directors are also shareholders in PCGH and their
interests in that company's shares are set out in the annual report of that
company.
In accordance with the Articles of Association each Director is required to
retire and may offer themselves for re-election at every third AGM. However,
in line with good corporate governance practice and the proceedings of the
parent company, all directors shall offer themselves for re-election annually.
Directors' Share Interests
None of the Directors had an interest in the share capital of the Company at
any time during the year, or between the year end and the date of this report.
Directors' Indemnity
Directors' and Officers' Liability insurance has been put in place. In
addition, the Group provides, subject to the provisions of s234 of the
Companies Act 2006, qualifying third party indemnity provision, an indemnity
for Directors in respect of costs incurred in the defence of any proceedings
brought against them and also liabilities owed to third parties, in either
case arising out of their positions as Directors. This was in place throughout
the financial year under review and up to and including the date of the
Financial Statements.
Share Capital
The Company was incorporated with a share capital of 50,000 ordinary shares of
nominal value £1.00 each; on 16 June 2017, following an initial placing,
32,128,437 Zero Dividend Preference ('ZDP') shares were issued for
consideration of 100 pence each and a nominal value of 1 pence each. The ZDP
shares were admitted to a standard listing on the London Stock Exchange on 20
June 2017.
The ZDP Shares have a limited life of seven years and, on that basis, a final
capital entitlement of 122.99 pence per ZDP share on the ZDP Repayment Date,
equivalent to a redemption yield of 3.0 per cent. per annum (compounded
annually) on the initial ZDP placing price of 100 pence per share. The
Redemption Yield of a ZDP Share is not, and should not be taken as, a forecast
of profits. The final capital entitlement is not a guaranteed or a secured
repayment amount and there can be no assurance that the final capital
entitlement will be repaid in full on the ZDP Repayment Date (or at all).
The final capital entitlement will rank behind any liabilities of the Group
and in priority to the capital entitlements of the Company's ordinary shares.
The ZDP shares carry no entitlement to income and the whole of their return
accordingly takes the form of capital. The ZDP shareholders are not entitled
to receive any part of the revenue profits (including any accumulated revenue
reserves) of the Company on a winding-up, even if the accrued capital
entitlement of the ZDP Shares will not be met in full.
The ZDP shares do not carry the right to vote at general meetings of the
Company, although they carry the right to vote as a class on certain matters
affecting their class in accordance with paragraph 1.5 of Part VI (The ZDP
Shares and Principal Bases and Assumptions) of the Prospectus published on 12
May 2017. Further information on the rights attaching to the ZDP Shares are
set out in Part VI of the Prospectus which is available on the parent
company's website www.polarcapitalglobalhealthcaretrust.com.
Substantial Share Interests
The Company's ordinary share capital is wholly owned by the parent company.
The Company's ZDP share capital has limited voting capacity and as a result,
ZDP shareholders are not required to disclose holdings to the Company or the
market. The ZDP share capital is publicly traded on the London Stock Exchange.
Going Concern
The Board has considered the ability of the Company to adopt the going concern
basis for the preparation of the Financial Statements and considered the
financial position of the Company, its cash-flows and its liquidity position.
The Board has also considered in making its assessment any material
uncertainties and events that might cast significant doubt upon the Company's
ability to continue as a going concern, such assessment included the stress
testing carried out by the parent company using a variety of falling
parameters to demonstrate the effects on the parent company's share price and
net asset value. With regard to the information available and the assessment
of the financial position of the Company the Board believes the going concern
basis should be adopted for the preparation of the Financial Statements for
the year ended 30 September 2022 and that the Company can continue in
operational existence for at least 12 months from the date of signing of this
report.
The Company has a standard listing on the London Stock Exchange and is
therefore not required to comply with the enhanced UK corporate governance
requirement to provide a longer-term viability statement. The Company was
incorporated with a limited life of seven years ending on 19 June 2024 on
which date the ZDP Shares will be repaid and the Board will convene a general
meeting to propose a resolution to voluntarily wind up the operations of the
Company.
STATEMENT ON CORPORATE GOVERNANCE AND INTERNAL CONTROLS
As referred to above the Company's ZDP shares are subject to a standard
listing and the Board is therefore not required to provide a statement of
compliance with the principles of the UK Corporate Governance Code.
The Board has overall responsibility for the Company's internal controls. The
Board aims to maintain full and effective control over appropriate strategic,
financial, operational and compliance issues. There is no separate audit or
other committee given the activities of the Company are limited.
It is the Company's policy to achieve the best terms available for all
services provided to the Company from suppliers and there is therefore no
single policy adopted when negotiating terms. The Company had no trade
creditors at the year-end.
Each of the Directors, at the date of approval of this report, confirms that:
a) so far as the Director is aware, there is no relevant audit
information of which the Company's auditors are unaware; and
b) the Directors have taken all the steps that they ought to have taken
as Directors to make themselves aware of any relevant audit information and to
establish that the Company's auditors are aware of that information.
This confirmation is given and should be interpreted in accordance with the
provisions of s418 of the Companies Act 2006.
Independent Auditors
PricewaterhouseCoopers LLP (PwC) were selected to continue as independent
auditors of both the parent and the Company. PwC have confirmed their
independence and have expressed their willingness to be re-appointed, in
accordance with s489 of the Companies Act 2006. A resolution proposing their
re-appointment will be proposed to the AGM.
Annual General Meeting
The sixth AGM of the Company will be held at the conclusion of the parent
company AGM on 9 February 2023.
A Notice of Meeting incorporated at the end of this Annual Report sets out in
full the resolutions to be proposed at the meeting. Resolutions shall be
proposed to receive the Annual Report and Financial Statements, receive and
approve the Directors' Remuneration Implementation Report, re-elect Lisa
Arnold, Neal Ransome, Andrew Fleming and Jeremy Whitley, re-appoint the
auditors and authorise the Directors to set their fees. The Directors are also
seeking renewal of the authorisation to make market purchases of the Company's
ZDP shares.
Listing Rule 9.8.4
Listing Rule 9.8.4 requires the Company to include certain further information
in relation to the Company which is not otherwise disclosed. The Directors
confirm there are no additional disclosures to be made pursuant to this rule.
By order of the Board
Tracey Lago, FCG
Polar Capital Secretarial Services Ltd
Company Secretary
STATEMENT OF DIRECTORS' RESPONSIBILITIES IN RESPECT OF THE FINANCIAL
STATEMENTS
The Directors are responsible for preparing the Annual Report and 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 UK-adopted International Accounting Standards
("UK-adopted IAS"). Additionally, the Financial Conduct Authority's Disclosure
Guidance and Transparency Rules require the directors to prepare the group
financial statements in accordance with UK-adopted IAS standards. Under
company law, the Directors must not approve the Financial Statements unless
they are satisfied that they give a true and fair view of the state of affairs
of the Company and of the profit or loss of the Company for that year. In
preparing the Financial Statements, the Directors are required to:
· select suitable accounting policies and then apply them
consistently;
· state whether, for the group and company, UK-adopted IAS 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 the going concern basis
unless it is inappropriate to presume that the Company will continue in
business.
The Directors are responsible for keeping adequate accounting records that are
sufficient to show and explain the Company's transactions and disclose with
reasonable accuracy at any time the financial position of the Company and
enable them to ensure that the Financial Statements and the Directors'
Remuneration Implementation Report comply with the Companies Act 2006.
The Directors 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 Directors are responsible for the maintenance and integrity of the
Company's information on the parent company's website. Legislation in the
United Kingdom governing the preparation and dissemination of financial
statements may differ from legislation in other jurisdictions.
Directors' Confirmations
Each of the Directors, whose names and functions are listed in Company
Information section confirm that, to the best of their knowledge:
· the Company financial statements, which have been prepared in
accordance with UK-adopted IAS, give a true and fair view of the assets,
liabilities, financial position and results 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 risks and uncertainties that it faces.
The financial statements were approved by the Board on 9 December 2022 and the
responsibility statements were signed on its behalf by Lisa Arnold, Chair of
the Board.
Lisa Arnold,
Chair
DIRECTORS' REMUNERATION IMPLEMENTATION REPORT
The Board has prepared this report, in accordance with the requirements of
Schedule 8 to the Large and Medium-sized Companies and Groups (Accounts and
Reports) Regulations 2008 (as amended) (the 'Regulations'). An ordinary
resolution for the approval of the Directors' Remuneration Policy will be
proposed to shareholders at least every three years. The Remuneration
Implementation Report shall be put to shareholders at the AGM annually.
The law requires the Group's Auditors, PricewaterhouseCoopers LLP, to audit
certain disclosures provided. Where disclosures have been audited, they are
indicated as such. The Auditors' opinion is included in their report on page
11.
Report from the Company Chair
As set out in the Directors' Report, the Company has a standard listing and is
not required to report on its compliance with the provisions or application of
the principles of the UK Corporate Governance Code. The parent company
considers the Directors' remuneration for the Group as a whole and the
Directors see no benefit in creating a separate Remuneration Committee. The
Board, with Mrs Arnold as Chair, considers and approves Directors'
remuneration, for services provided to the Company.
Directors' Remuneration Policy
In accordance with the Company's Articles of Association, the Directors'
Remuneration Policy is that no fees, expenses or any other financial benefits
are payable to the Directors in connection with their duties to the Company.
Directors are also not eligible for bonuses, pension benefits, share options
or long-term incentive schemes as the Board does not consider such
arrangements or benefits necessary or appropriate.
The Directors receive fees relating to their duties to the parent company.
This policy will continue for future years and is set out in full in the
Directors' Remuneration Report of the parent company.
The Remuneration Policy was last approved by shareholders at the AGM in
February 2020 for the period from 1 October 2020 to 30 September 2023. As
stated above, a resolution to approve the Remuneration Policy will be put to
shareholders at least once in every three-year period. Accordingly, a
resolution to approve the Directors' Remuneration Policy will be put to
shareholders at the AGM to be held on 9 February 2023 and if approved, the
Remuneration Policy will remain in force for the period 1 October 2023 to the
end of life of the Company's fixed life or 30 September 2026, whichever is the
sooner.
Directors' service contracts and terms
None of the Directors have a contract of service with the Company or the
parent company, nor has there been any contract or arrangement between the
Company and any Director at any time during the year. The terms of their
appointment provide that a Director shall retire and be subject to re-election
at the first AGM after their appointment, and at least every three years
thereafter. A Director's appointment can be terminated in accordance with the
Articles and without compensation.
Directors' interests and emoluments for the year (audited)
None of the Directors had interests in the ZDP shares at the year end of 30
September 2022 and no personal account transactions have been undertaken since
the year end. The ordinary shares are wholly owned by the parent company. No
fees are payable to the Directors regarding their duties to the Company.
The Directors' interests in the shares of the parent company are shown in the
Annual Report of the parent company.
Company's performance
As a finance company which has lent all of its assets (other than the cash
received on the initial allotment of its ordinary share capital) to the parent
company the performance of the Company is therefore best reflected by looking
at the performance of the parent company. The Directors' remuneration report
within the Annual Report of the parent company contains a graph comparing the
total return (assuming all dividends are reinvested) to the parent company
ordinary shareholders, compared to the total shareholder return of the MSCI
ACWI Healthcare Index. A copy of the parent company's Annual Report can be
found on the following website www.polarcapitalglobalhealthcaretrust.com and
the National Storage Mechanism (NSM) at
https://data.fca.org.uk/#/nsm/nationalstoragemechanism.
In accordance with the Regulations, the graph below compares the share price
of ZDP shares with the MSCI ACWI Healthcare Index over the period since
listing of the ZDP shares on 20 June 2017 to the end of the period on 30
September 2022. The MSCI ACWI Healthcare Index has been selected as it is
considered to represent a broad equity market index against which the
performance of the parent company's assets may be adequately assessed.
There has been no demonstration of relative importance of spend on pay for the
Company as no remuneration is payable to Directors.
Approval
The Directors' Remuneration Implementation Report was approved by the Board on
9 December 2022.
On behalf of the Board of Directors
Lisa Arnold
Chair
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF PCGH ZDP PLC
Report on the audit of the financial statements
Opinion
In our opinion, PCGH ZDP plc's financial statements:
· give a true and fair view of the state of the company's affairs as at
30 September 2022 and of its result and cash flows for the year then ended;
· have been properly prepared in accordance with UK-adopted
international accounting standards; and
· have been prepared in accordance with the requirements of the
Companies Act 2006.
We have audited the financial statements, included within the Annual Report
and Financial Statements (the "Annual Report"), which comprise: the Balance
Sheet as at 30 September 2022; the Statement of Comprehensive Income, Cash
Flow Statement, and the Statement of Changes in Equity for the year then
ended; and the Notes to the Financial Statements, which include a description
of the significant accounting policies.
Our opinion is consistent with our reporting to the Audit Committee of Polar
Capital Global Healthcare Trust plc.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing
(UK) ("ISAs (UK)") and applicable law. Our responsibilities under ISAs (UK)
are further described in the Auditors' responsibilities for the audit of the
financial statements section of our report. We believe that the audit evidence
we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Independence
We remained independent of the company in accordance with the ethical
requirements that are relevant to our audit of the financial statements in the
UK, which includes the FRC's Ethical Standard, as applicable to listed public
interest entities, and we have fulfilled our other ethical responsibilities in
accordance with these requirements.
To the best of our knowledge and belief, we declare that non-audit services
prohibited by the FRC's Ethical Standard were not provided.
We have provided no non-audit services to the company in the period under
audit.
Our audit approach
Overview
Audit scope
· The Company is a wholly-owned subsidiary of Polar Capital Global
Healthcare Trust plc, and it serves as a financing vehicle which issues Zero
Dividend Preference (ZDP) shares and loans the proceeds to its parent company.
· The Company and engages Polar Capital LLP (the "Manager") to manage
its day to day operations.
· We conducted our audit of the financial statements using information
from HSBC Securities Services (the "Administrator") to whom the Manager has,
with the consent of the Directors, delegated the provision of certain
administrative functions.
· We tailored the scope of our audit taking into account the types of
investments within the Company, the involvement of the third parties referred
to above, the accounting processes and controls, and the industry in which the
Company operates.
Key audit matters
· Accounting for the Zero Dividend Preference shares and loan to
parent company
Materiality
· Overall materiality: £376,000 (2021: £365,000) based on 1% of
total assets.
· Performance materiality: £282,000 (2021: £273,750).
The scope of our audit
As part of designing our audit, we determined materiality and assessed the
risks of material misstatement in the financial statements.
Key audit matters
Key audit matters are those matters that, in the auditors' professional
judgement, were of most significance in the audit of the financial statements
of the current period and include the most significant assessed risks of
material misstatement (whether or not due to fraud) identified by the
auditors, including those which had the greatest effect on: the overall audit
strategy; the allocation of resources in the audit; and directing the efforts
of the engagement team. These matters, and any comments we make on the results
of our procedures thereon, were addressed in the context of our audit of the
financial statements as a whole, and in forming our opinion thereon, and we do
not provide a separate opinion on these matters.
This is not a complete list of all risks identified by our audit.
The key audit matters below are consistent with last year.
Key audit matter How our audit addressed the key audit matter
Accounting for the Zero Dividend Preference shares and loan to parent company
Refer to the Accounting Policies and the Notes to the Financial Statements. We performed testing to agree the loan balance to the loan agreement and
payment schedule between the Company and Polar Capital Global Healthcare Trust
plc. We recalculated the loan interest and contribution received from the
parent Company and the appropriation to ZDP shares to test that they have been
On 19 June 2017, the Company issued Zero Dividend Preference (ZDP) shares and accounted for in accordance with this stated accounting policy.
entered into an agreement to lend the gross initial ZDP Placing proceeds to
its parent, Polar Capital Global Healthcare Trust plc.
No material misstatements were identified by our testing.
We focused on the appropriateness of the accounting policy for the ZDP shares
and the loan due from the parent, and the presentation of these balances in
the financial statements as set out in the requirements of accounting
standards.
How we tailored the audit scope
We tailored the scope of our audit to ensure that we performed enough work to
be able to give an opinion on the financial statements as a whole, taking into
account the structure of the company, the accounting processes and controls,
and the industry in which it operates.
In particular, we looked at where the Directors made subjective judgements,
for example in respect of accounting estimates that involved making
assumptions and considering future events that are inherently uncertain.
Materiality
The scope of our audit was influenced by our application of materiality. We
set certain quantitative thresholds for materiality. These, together with
qualitative considerations, helped us to determine the scope of our audit and
the nature, timing and extent of our audit procedures on the individual
financial statement line items and disclosures and in evaluating the effect of
misstatements, both individually and in aggregate on the financial statements
as a whole.
Based on our professional judgement, we determined materiality for the
financial statements as a whole as follows:
Overall company materiality £376,000 (2021: £365,000).
How we determined it 1% of total assets
Rationale for benchmark applied We have applied this benchmark because the Company's total assets reflect its
purpose to raise financing and represent its contribution to its parent
company.
We use performance materiality to reduce to an appropriately low level the
probability that the aggregate of uncorrected and undetected misstatements
exceeds overall materiality. Specifically, we use performance materiality in
determining the scope of our audit and the nature and extent of our testing of
account balances, classes of transactions and disclosures, for example in
determining sample sizes. Our performance materiality was 75% (2021: 75%) of
overall materiality, amounting to £282,000 (2021: £273,750) for the company
financial statements.
In determining the performance materiality, we considered a number of factors
- the history of misstatements, risk assessment and aggregation risk and the
effectiveness of controls - and concluded that an amount at the upper end of
our normal range was appropriate.
We agreed with the Audit Committee of Polar Capital Global Healthcare Trust
plc that we would report to them misstatements identified during our audit
above £18,800 (2021: £18,200) as well as misstatements below that amount
that, in our view, warranted reporting for qualitative reasons.
Conclusions relating to going concern
Our evaluation of the directors' assessment of the company's ability to
continue to adopt the going concern basis of accounting included:
· evaluating the Directors' updated risk assessment and considering
whether it addressed relevant threats, including the ongoing impact of
COVID-19, rising inflation, Russia's Invasion of Ukraine, and the subsequent
economic uncertainty;
· evaluating the Directors' assessment of potential operational
impacts, considering their consistency with other available information and
our understanding of the business and assessed the potential impact on the
financial statements; and
· reviewing the Directors' assessment of the Company's financial
position in the context of its ability to meet future expected finance costs,
their assessment of liquidity as well as their review of the operational
resilience of the Company and oversight of key third-party service providers.
Based on the work we have performed, we have not identified any material
uncertainties relating to events or conditions that, individually or
collectively, may cast significant doubt on the company's ability to continue
as a going concern for a period of at least twelve months from when the
financial statements are authorised for issue.
In auditing the financial statements, we have concluded that the directors'
use of the going concern basis of accounting in the preparation of the
financial statements is appropriate.
However, because not all future events or conditions can be predicted, this
conclusion is not a guarantee as to the company's ability to continue as a
going concern.
Our responsibilities and the responsibilities of the directors with respect to
going concern are described in the relevant sections of this report.
Reporting on other information
The other information comprises all of the information in the Annual Report
other than the financial statements and our auditors' report thereon. The
directors are responsible for the other information. Our opinion on the
financial statements does not cover the other information and, accordingly, we
do not express an audit opinion or, except to the extent otherwise explicitly
stated in this report, any form of assurance thereon.
In connection with our audit of the financial statements, our responsibility
is to read the other information and, in doing so, consider whether the other
information is materially inconsistent with the financial statements or our
knowledge obtained in the audit, or otherwise appears to be materially
misstated. If we identify an apparent material inconsistency or material
misstatement, we are required to perform procedures to conclude whether there
is a material misstatement of the financial statements or a material
misstatement of the other information. If, based on the work we have
performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report
based on these responsibilities.
With respect to the Strategic report and Report of the Directors, we also
considered whether the disclosures required by the UK Companies Act 2006 have
been included.
Based on our work undertaken in the course of the audit, the Companies Act
2006 requires us also to report certain opinions and matters as described
below.
Strategic report and Report of the Directors
In our opinion, based on the work undertaken in the course of the audit, the
information given in the Strategic report and Report of the Directors for the
year ended 30 September 2022 is consistent with the financial statements and
has been prepared in accordance with applicable legal requirements.
In light of the knowledge and understanding of the company and its environment
obtained in the course of the audit, we did not identify any material
misstatements in the Strategic report and Report of the Directors.
Directors' Remuneration
In our opinion, the part of the Directors' Remuneration Report to be audited
has been properly prepared in accordance with the Companies Act 2006.
Responsibilities for the financial statements and the audit
Responsibilities of the directors for the financial statements
As explained more fully in the Statement of Directors' Responsibilities in
Respect of the Financial Statements, the directors are responsible for the
preparation of the financial statements in accordance with the applicable
framework and for being satisfied that they give a true and fair view. The
directors are also responsible for such internal control as they determine is
necessary to enable the preparation of financial statements that are free from
material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for
assessing the company's ability to continue as a going concern, disclosing, as
applicable, matters related to going concern and using the going concern basis
of accounting unless the directors either intend to liquidate the company or
to cease operations, or have no realistic alternative but to do so.
Auditors' responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial
statements as a whole are free from material misstatement, whether due to
fraud or error, and to issue an auditors' report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that
an audit conducted in accordance with ISAs (UK) will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and
are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on
the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and
regulations. We design procedures in line with our responsibilities, outlined
above, to detect material misstatements in respect of irregularities,
including fraud. The extent to which our procedures are capable of detecting
irregularities, including fraud, is detailed below.
Based on our understanding of the company and industry, we identified that the
principal risks of non-compliance with laws and regulations related to Chapter
17 of the Listing Rules, and we considered the extent to which non-compliance
might have a material effect on the financial statements. We also considered
those laws and regulations that have a direct impact on the financial
statements such as Companies Act 2006. We evaluated management's incentives
and opportunities for fraudulent manipulation of the financial statements
(including the risk of override of controls), and determined that the
principal risks were related to posting inappropriate journal entries to
increase revenue or to increase total assets. Audit procedures performed by
the engagement team included:
· discussions with the manager and the Audit Committee of Polar Capital
Global Healthcare Trust plc, including consideration of known or suspected
instances of non-compliance with laws and regulation and fraud;
· reviewing relevant meeting minutes, including those of the Audit
Committee of Polar Capital Global Healthcare Trust plc;
· evaluation of the controls implemented by the Company and the
Administrator designed to prevent and detect irregularities; and
· identifying and testing journal entries, in particular year end
journal entries posted by the administrator during the preparation of the
financial statements and any journals with unusual account combinations.
There are inherent limitations in the audit procedures described above. We are
less likely to become aware of instances of non-compliance with laws and
regulations that are not closely related to events and transactions reflected
in the financial statements. Also, the risk of not detecting a material
misstatement due to fraud is higher than the risk of not detecting one
resulting from error, as fraud may involve deliberate concealment by, for
example, forgery or intentional misrepresentations, or through collusion.
Our audit testing might include testing complete populations of certain
transactions and balances, possibly using data auditing techniques. However,
it typically involves selecting a limited number of items for testing, rather
than testing complete populations. We will often seek to target particular
items for testing based on their size or risk characteristics. In other cases,
we will use audit sampling to enable us to draw a conclusion about the
population from which the sample is selected.
A further description of our responsibilities for the audit of the financial
statements is located on the FRC's website at:
www.frc.org.uk/auditorsresponsibilities. This description forms part of our
auditors' report.
Use of this report
This report, including the opinions, has been prepared for and only for the
company's members as a body in accordance with Chapter 3 of Part 16 of the
Companies Act 2006 and for no other purpose. We do not, in giving these
opinions, accept or assume responsibility for any other purpose or to any
other person to whom this report is shown or into whose hands it may come save
where expressly agreed by our prior consent in writing.
Other required reporting
Companies Act 2006 exception reporting
Under the Companies Act 2006 we are required to report to you if, in our
opinion:
· we have not obtained all the information and explanations we require
for our audit; or
· adequate accounting records have not been kept by the company, or
returns adequate for our audit have not been received from branches not
visited by us; or
· certain disclosures of directors' remuneration specified by law are
not made; or
· the financial statements and the part of the Directors' Remuneration
Report to be audited are not in agreement with the accounting records and
returns.
We have no exceptions to report arising from this responsibility.
Appointment
Following the recommendation of the Audit Committee of Polar Capital Global
Healthcare Trust plc, we were appointed by the members on 30 March 2017 to
audit the financial statements for the year ended 30 September 2017 and
subsequent financial periods. The period of total uninterrupted engagement is
6 years, covering the years ended 30 September 2017 to 30 September 2022.
Kevin Rollo (Senior Statutory Auditor)
for and on behalf of PricewaterhouseCoopers LLP
Chartered Accountants and Statutory Auditors
London
9 December 2022
STATEMENT OF COMPREHENSIVE INCOME
For the year ended 30 September 2022
Year ended Year ended
30 September 2022 30 September 2021
Notes £ £
Loan interest 1 892,850 871,073
Contribution from parent 2 201,158 191,073
Total income 1,094,008 1,062,146
Total expenses 3 - -
Profit before finance costs and tax 1,094,008 1,062,146
Finance costs
Appropriation to ZDP shares 4 (1,094,008) (1,062,146)
Total finance costs (1,094,008) (1,062,146)
Result before taxation - -
Taxation 5 - -
Net result for the year and total comprehensive income
- -
The amounts dealt with in the Statement of Comprehensive Income are all
derived from continuing activities.
The notes to follow form part of these financial statements.
STATEMENT OF CHANGES IN EQUITY
For the year ended 30 September 2022
Year ended 30 September 2022
Called up share capital Capital reserve Total equity
£ £ £
Total equity at 1 October 2021 50,000 - 50,000
Result and total comprehensive income for the year ended 30 September 2022 - - -
Total equity at 30 September 2022 50,000 - 50,000
Year ended 30 September 2021
Called up share capital Capital reserve Total equity
£ £ £
Total equity at 1 October 2020 50,000 - 50,000
Result and total comprehensive income for the year ended 30 September 2021 - - -
Total equity at 30 September 2021 50,000 - 50,000
The notes to follow form part of these financial statements.
BALANCE SHEET
As at 30 September 2022
Notes 30 September 2022 30 September 2021
£ £
Non-current assets
Loan to parent company 6 37,560,975 36,466,967
Current assets
Cash and cash equivalents 50,000 50,000
Total assets 37,610,975 36,516,967
Non-current liabilities
Zero Dividend Preference shares 7 (37,560,975) (36,466,967)
Total liabilities (37,560,975) (36,466,967)
Net assets 50,000 50,000
Equity attributable to equity shareholders
Called up share capital 8 50,000 50,000
Capital reserve - -
Total equity 50,000 50,000
The financial statements of PCGH ZDP plc were approved by the Board of
Directors and authorised for issue on 9 December 2022. They were signed on
behalf of the Board by:
Lisa Arnold,
Chair
The notes to follow form part of these financial statements.
CASH FLOW STATEMENT
For the year ended 30 September 2022
Year ended Year ended
30 September 2022 30 September 2021
£ £
Cash flows from operating activities
Profit before finance costs and taxation 1,094,008 1,062,146
Increase in receivable* (1,094,008) (1,062,146)
Net cash inflow from operating activities - -
Cash flows from financing activities
Net cash outflow from financing activities - -
Net increase in cash and cash equivalents - -
Cash and cash equivalents at the beginning of the year 50,000 50,000
Cash and cash equivalents at the end of the year 50,000 50,000
The notes to follow form part of these financial statements.
* The 'increase in payables' under financing activities shown in prior years
has been moved and reclassified as an 'increase in receivables' under
operating activities. There have been no changes to amounts shown in prior
years and there is no impact on the final cash flow position.
NOTES TO THE FINANCIAL STATEMENTS - POLICIES
A. General Information
The Company's presentational and functional currency is pounds sterling as
this is the currency of the primary economic environment in which the Company
operates.
The Directors believe it is appropriate to adopt the going concern basis. In
order to be able to continue as a going concern, the Company relies on the
parent company to pay the operational costs and the repayment of the loan when
it falls due. Based on the assessment carried out against the parent company,
the parent company has adequate financial resources to meet its liabilities as
and when they fall due. In addition to the assessment, the parent company
carried out stress testing using a variety of falling parameters to
demonstrate the effects on the parent company's share price and net asset
value. The Company does not have, and does not expect to have, any other
business interests, and the current activities of the Company are expected to
continue until the scheduled ZDP Repayment Date of 19 June 2024 at which time
the Company will enter into voluntary liquidation.
B. Accounting Policies
The principal accounting policies which have been applied consistently
throughout the year are set out below:
Basis of Preparation
In line with the Company's parent, the financial statements have been prepared
and approved by the Directors in accordance with UK-adopted international
accounting standards ("UK-adopted IAS").
a) Income
(i) Loan Interest
Under a Loan Agreement the gross initial ZDP Placing proceeds have been lent
to the parent, Polar Capital Global Healthcare Trust plc. The Loan Agreement
provides that interest will accrue daily at an annual rate of 2.5%
compounded annually on each anniversary of ZDP Admission and will be rolled up
and paid to PCGH ZDP plc along with any repayment of the principal amount on a
date falling 2 business days before the ZDP Repayment Date.
(ii) Transfer re Parent Undertaking
Polar Capital Global Healthcare Trust plc and the Company, PCGH ZDP plc, have
entered into an Undertaking whereby to the extent that the Final Capital
Entitlement multiplied by the number of outstanding ZDP shares as at the ZDP
Repayment Date exceeds the aggregate principal amount and accrued interest due
pursuant to the Loan Agreement as at that date (the Additional Funding
Requirement), the parent shall: (i) subscribe for additional subsidiary
shares to a value equal to or greater than the Additional Funding Requirement;
and (ii) make a capital contribution or gift or otherwise pay an amount equal
to or greater than the Additional Funding Requirement.
b) Finance costs
The ZDP shares are designed to provide a pre-determined capital growth from
their original issue price of 100p on 20 June 2017 to a Final Capital
Entitlement of 122.99p on 19 June 2024. The initial capital of 100p at 20 June
2017 will increase at an interest rate of 3% compounding annually (see note
4). The provision for the capital growth entitlement on the ZDP shares is
included as a finance cost. No dividends are payable on the ZDP shares.
c) Taxation
Taxation is currently payable based on the taxable profits for the year ended
30 September 2022. Taxable profit differs from net profit as reported in the
Statement of Comprehensive Income because it excludes items of income or
expense that are taxable or deductible in other years and it further excludes
items that
are never taxable or deductible. The Company's liability for current tax is
calculated using tax rates that have been enacted or substantively enacted at
the balance sheet date.
Deferred tax is the tax expected to be payable or recoverable on temporary
differences between the carrying amounts of assets and liabilities in the
financial statements and the corresponding tax bases used in the computation
of taxable profit, and is accounted for using the balance sheet liability
method. Deferred tax liabilities are recognised for all taxable temporary
differences and deferred tax assets are recognised to the extent that it is
probable that taxable profits will be available against which deductible
temporary differences can be utilised.
Deferred tax is calculated at the tax rates that are expected to apply in the
period when the liability is settled, or the asset is realised based on tax
rates that have been enacted or substantively enacted at the balance sheet
date.
d) Investments Held at Fair Value Through Profit or Loss
The Company holds no investments, rather the proceeds from the issue of the
ZDP shares have been lent to the parent, Polar Capital Global Healthcare Trust
plc, for investment purposes.
e) Loan to the Parent Company
On 20 June 2017, the Company provided an interest-bearing loan to its parent
company, Polar Capital Global Healthcare Trust plc. The loan is carried at
amortised cost, which represents the initial cost of the loan plus accrued
interest and any contribution due from the parent to meet the total ZDP
entitlement.
f) Impairment
IFRS 9 requires the Company to record expected credit losses on all financial
assets measured at amortised cost, either on a 12-month or lifetime basis.
At each reporting date, the Company reviews the carrying amounts of financial
assets to determine whether there is any indication that those assets have
suffered an impairment loss. If any such indication exists, the recoverable
amount of the asset is estimated in order to determine the extent of the
impairment loss (if any). Where it is not possible to estimate the recoverable
amount of an asset, the Company estimates the recoverable amount to which the
asset belongs. If the recoverable amount of an asset is estimated to be less
than its carrying amount, the carrying amount of the asset is reduced to its
recoverable amount. An impairment loss is recognised immediately in the
Statement of Comprehensive Income. Recognised impairment losses are reversed
if the reasons for the impairment loss have ceased to apply.
g) Cash and Cash Equivalents
Cash comprises cash on hand and demand deposits. Cash equivalents are
short-term, highly liquid investments that are readily convertible to known
amounts of cash.
h) Segmental Reporting
Under IFRS 8, 'Operating Segments', operating segments are considered to be
the components of an entity about which separate financial information is
available that is evaluated regularly by the chief operating decision maker in
deciding how to allocate resources and in assessing performance. The chief
operating decision maker has been identified as the Investment Manager (with
oversight from the Board). The Directors are of the opinion that the Company
has only one operating segment and as such no distinct segmental reporting is
required.
i) Key Estimates and Judgements
Estimates and assumptions used in preparing the financial statements are
reviewed on an ongoing basis and are based on historical experience and
various other factors that are believed to be reasonable under the
circumstances. The results of these estimates and assumptions form the basis
of making judgements about carrying values of assets and liabilities that are
not readily apparent from other sources. The Company does not consider that
there have been any significant estimates or assumptions in the current
financial year.
j) New and Revised Accounting Standards
There were no new UK-adopted IAS or amendments to UK-adopted IAS applicable to
the current year which had any significant impact on the Company's Financial
Statements.
i) The following new or amended standards became effective for the current
annual reporting period and the adoption of the standards and interpretations
have not had a material impact on the Financial Statements of the Company.
Standards & Interpretations Effective for periods commencing on or after
IFRS 9, IAS 39, IFRS 7, IFRS 16 and IFRS 4: Interest Rate Benchmark Reform - IBOR Reform - Phase 2 addresses issues that might affect financial reporting 1 January 2021
phase 2 (amended) during the reform of an interest rate benchmark, including the effects of
changes to contractual cash flows or hedging relationships arising from the
replacement of an interest rate benchmark with an alternative benchmark rate.
The Phase 2 amendments apply only to changes required by the interest rate
benchmark reform to financial instruments and hedging relationships.
ii) At the date of authorisation of the Company's financial statements, there
were no relevant standards that potentially impact the Company that are in
issue but are not yet effective.
NOTES TO THE FINANCIAL STATEMENTS - NOTES
1. Loan Interest
Under a Loan Agreement the gross initial ZDP Placing proceeds have been lent
to the Parent. The Loan Agreement provides that interest will accrue daily at
an annual rate of 2.5% compounded annually.
2. Contribution from parent
The contribution represents the additional funding required from the parent to
meet the entitlement due to the ZDP shareholders at the year end. The
contribution from the parent for the year ended 30 September 2022 was
£201,158 (2021: £191,073).
3. Total expenses
The Directors receive no remuneration in respect of their services to the
Company. Auditors' fees for audit services are paid by the Company's parent,
Polar Capital Global Healthcare Trust plc and amounted to £6,875 (2021:
£6,250).
4. Finance costs
The ZDP shares are designed to provide a pre-determined capital growth from
their original issue price of 100p on 20 June 2017 to a final capital
entitlement of 122.99p on 19 June 2024. The initial capital of 100p at 20 June
2017 will increase at a growth rate of 3% compounding annually. The provision
for the capital growth entitlement for the year on the ZDP shares is included
as a finance cost.
5. Taxation
a) Analysis of tax charge for the year
The corporation tax for the year ended 30 September 2022 was £nil (2021:
£nil).
b) Factors affecting tax charge for the year
The charge for the year can be reconciled to the result per the Statement of
Comprehensive Income. The result before taxation for the year ended 30
September 2022 was £nil (2021: £nil).
6. Loan to parent company
Year ended Year ended
30 September 30 September
2022 2021
£ £
Opening balance 36,466,967 35,404,821
Loan interest accrued 892,850 871,073
Additional contribution to meet ZDP entitlement 201,158 191,073
Closing balance 37,560,975 36,466,967
The carrying value of receivables approximates to its fair value.
PCGH ZDP plc has an outstanding inter-group loan with the parent, Polar
Capital Global Healthcare Trust plc. The Company carried out an analysis which
considers both historical and forward-looking qualitative and quantitative
information to determine if the inter-group loan is low credit risk as at 30
September 2022. The results of the analysis demonstrated that the risk of
default or impairment was very low and that there has not been a significant
increase (if any) in credit risk since the loan was first recognised. There is
not expected to be material adverse changes in the economic and investment
conditions during the year which would reduce the ability of Polar Capital
Global Healthcare Trust plc to repay the loan due on 19 June 2024.
7. Zero Dividend Preference shares
Year ended Year ended
30 September 30 September
2022 2021
£ £
Opening balance 36,466,967 35,404,821
Capital growth entitlement of ZDP shares 1,094,008 1,062,146
Closing balance 37,560,975 36,466,967
8. Called up share capital
30 September 30 September
2022 2021
£ £
Allotted, called up and fully paid:
50,000 (2021: 50,000) Ordinary shares of £1 each: 50,000 50,000
At 30 September 50,000 50,000
9. Parent undertaking and controlling party
At 30 September 2022 the Company was a wholly owned subsidiary undertaking of
Polar Capital Global Healthcare Trust plc, the Ultimate Parent Undertaking, a
Company registered in England and Wales, number 07251471. Copies of the
Ultimate Parent Undertaking's consolidated financial statements may be
obtained from the Company Secretary, Polar Capital Secretarial Services Ltd,
16 Palace Street, London SW1E 5JD.
10. Financial instruments - Risk management policies and procedures for the
Company
The Company's exposure to financial instruments can comprise cash, liquid
resources and long-term receivables and payables that arise directly from the
Company's operations.
The main risks arising from financial instruments are liquidity risk, credit
risk and market risk. The risks have remained unchanged since the beginning of
the year to which these financial statements relate and are summarised below:
(a) Liquidity risk
The Company's assets comprise cash and long-term receivables which it is
expected will be collectable to meet ZDP funding requirements.
(b) Credit risk
This is the risk that a counterparty to a financial instrument will fail to
discharge an obligation or commitment that it has entered into with the
Company. As at 30 September 2022, the Company's financial assets which are
exposed to credit risk is the loan to the parent company, Polar Capital Global
Healthcare Trust plc and it amounted £37,560,975 (2021: £36,466,967). The
loan to the parent company has low credit risk as the parent has a strong
capacity to meet its contractual cash flow obligations as they fall due.
The Company does not consider this risk to be significant as it has limited
exposure to non-group third parties in respect of amounts receivable. Cash
balances are only deposited with financial institutions with a high credit
rating. The Company assesses all external counterparties for the credit risk
before contracting with them.
(c) Market risk
The Company has no direct exposure to market risk as it does not hold or trade
any direct investment positions. Any indirect market risks though the parent
company are actively monitored throughout the year as part of the parent
company's risk management policies and procedures.
11. Related party
On 20 June 2017, the Company provided an interest-bearing loan to its parent
company, Polar Capital Global Healthcare Trust plc. The loan is carried at
amortised cost, which represents the initial cost of the loan plus accrued
interest and any contribution due from the parent to meet the total ZDP
entitlement. At the year end, £37,560,975 was due from the parent company
in respect of the loan.
NOTICE OF ANNUAL GENERAL MEETING of PCGH ZDP plc (the 'Company')
NOTICE IS HEREBY GIVEN that the sixth ANNUAL GENERAL MEETING of the Company
will be held following the conclusion of the Annual General Meeting of the
parent company Polar Capital Global Healthcare Trust plc, on Thursday, 9
February 2023 at the offices of Polar Capital LLP, 16 Palace Street, London
SW1E 5JD to consider and if thought fit to pass the following Resolutions of
which resolutions 1 to 9 will be proposed as Ordinary Resolutions and
resolutions 10 and 11 will be proposed as Special Resolutions:
Ordinary Resolutions
1. To receive the Annual Report and Financial Statements for the year
ended 30 September 2022.
2. To approve the Directors' Remuneration Policy as contained in the
Report on Directors' Remuneration Implementation Report, such approval to
begin from the expiry of the current Policy on 30 September 2023 and until the
end of life of the Company's fixed life or 30 September 2026, whichever is the
sooner.
3. To receive and approve the Directors' Remuneration Implementation
Report for the year ended 30 September 2022.
4. To re-elect Lisa Arnold as a Director of the Company.
5. To re-elect Neal Ransome as a Director of the Company.
6. To re-elect Andrew Fleming as a Director of the Company.
7. To re-elect Jeremy Whitley as a Director of the Company.
8. To re-appoint PricewaterhouseCoopers LLP as Auditors to the Company
to hold office until the conclusion of the next Annual General Meeting of the
Company.
9. To authorise the Directors to determine the remuneration of the
Auditors.
Special Resolutions
10. THAT the Company be and is hereby generally and unconditionally
authorised pursuant to Section 701 of the Companies Act 2006 (the "Act") to
make market purchases (within the meaning of Section 693 of the Act) of Zero
Dividend Preference (ZDP) shares of 1 pence each in the capital of the
Company, on such terms and in such manner as the Directors may from time to
time determine PROVIDED THAT:
(a) the maximum number of ZDP shares hereby authorised to be purchased
shall be 4,816,052; or such number representing approximately 14.99% of the
issued share capital at 9 December 2022;
(b) the minimum price excluding expenses which may be paid for an ZDP
share is 1 pence;
(c) the maximum price excluding expenses payable by the Company for each
ZDP share is the higher of:
(i) 105 per cent. of the average of the middle-market
quotations of the ZDP shares for the five business days prior to the date of
the market purchase; and
(ii) the price of the last independent trade and the
highest current independent bid for a ZDP share on the trading venues where
the market purchases by the Company pursuant to the authority conferred by
this Resolution 10 will be carried out.
(d) the authority hereby conferred shall expire at the conclusion of the
next AGM of the Company, unless such authority is renewed prior to such time;
(e) the Company may make a contract to purchase ZDP shares under the
authority hereby conferred prior to the expiry of such authority which will or
may be executed wholly or partly after the expiration of such authority and
may make a purchase of ordinary shares pursuant to any such contract; and
(f) any ZDP shares so purchased shall be cancelled immediately upon
completion of the purchase.
11. THAT a general meeting, other than an annual general meeting, may be
called on not less than 14 clear days' notice.
BY ORDER OF THE BOARD
Tracey Lago, FCG
Polar Capital Secretarial Services Limited
Company Secretary
9 December 2022
Registered office:
16 Palace Street,
London
SW1E 5JD
NOTES TO THE NOTICE OF ANNUAL GENERAL MEETING of PCGH ZDP plc
1. The holders of the Ordinary shares have the right to receive
notice, attend, speak and vote at the Annual General Meeting. Holders of ZDP
shares have the right to receive notice of general meetings of the Company but
do not have any right to attend, speak or vote at any general meeting of the
Company unless the business of the meeting includes any resolution to vary,
modify or abrogate any of the special rights attached to ZDP shares.
2. A member entitled to attend, vote and speak at this meeting may
appoint one or more persons as his/her proxy to attend, speak and vote on
his/her behalf at the meeting. A proxy need not be a member of the Company. If
multiple proxies are appointed, they must not be appointed in respect of the
same shares. To be effective, the enclosed form of proxy, together with any
power of attorney or other authority under which it is signed or a certified
copy thereof, should be lodged at the office of the Company Secretary, 16
Palace Street, London SW1E 5JD not later than 48 hours before the time of the
meeting. The appointment of a proxy will not prevent a member from attending
the meeting and voting and speaking in person if he/she so wishes. A member
present in person or by proxy shall have one vote on a show of hands and on a
poll, shall have one vote for every Ordinary share of which he/she is the
holder.
3. A person to whom this notice is sent who is a person nominated
under Section 146 of the Companies Act 2006 to enjoy information rights (a
"Nominated Person") may, under an agreement between him/her and the
shareholder by whom he/she was nominated, have a right to be appointed (or to
have someone else appointed) as a proxy for the Annual General Meeting. If a
Nominated Person has no such proxy appointment or does not wish to exercise
it, he/she may, under any such agreement, have a right to give instructions to
the shareholder as to the exercise of voting rights. The statements of the
rights of members in relation to the appointment of proxies in Note 2 above do
not apply to a Nominated Person. The rights described in that Note can only be
exercised by registered members of the Company.
4. As at 9 December 2022 (being the last business day prior to the
publication of this notice) the Company's issued voting share capital and
total voting rights amounted to 50,000 Ordinary shares of 100 pence each. In
addition, there are 32,128,437 ZDP shares of 1 pence each nominal value in
issue with no voting rights attached.
5. The Company specifies that only those Ordinary shareholders
registered on the Register of Members of the Company as at 2.00pm on 7
February 2023 (or in the event that the meeting is adjourned, only those
shareholders registered on the Register of Member of the Company as at 11.30am
on the day which is 48 hours prior to the adjourned meeting) shall be entitled
to attend in person or by proxy and vote at the Annual General Meeting in
respect of the number of shares registered in their name at that time. Changes
to entries on the Register of Members after that time shall be disregarded in
determining the rights of any person to attend or vote at the meeting.
6. Any question relevant to the business of the Annual General Meeting
may be asked at the meeting by anyone permitted to speak at the meeting. You
may alternatively submit your question in advance by letter addressed to the
Company Secretary at the registered office.
7. In accordance with Section 319A of the Companies Act 2006, the
Company must cause any question relating to the business being dealt with at
the meeting put by a member attending the meeting to be answered. No such
answer need be given if:
a. to do so would:
i. Interfere unduly with the preparation for the meeting, or
ii. Involve the disclosure of confidential information;
b. the answer has already been given on a website in the form of an answer to
a question; or
c. it is undesirable in the interests of the Company or the good order of the
meeting that the question be answered.
8. Shareholders should note that it is possible that, pursuant to
requests made by shareholders of the Company under section 527 of the
Companies Act 2006, the Company may be required to publish on a website a
statement setting out any matter relating to: (i) the audit of the Company's
financial statements (including the auditors' report and the conduct of the
audit) that are to be laid before the Annual General Meeting; or (ii) any
circumstances connected with an auditor of the Company ceasing to hold office
since the previous meeting at which annual accounts and reports were laid in
accordance with section 437 of the Companies Act 2006. The Company may not
require the shareholders requesting any such website publication to pay its
expenses in complying with sections 527 or 528 of the Companies Act 2006.
Where the Company is required to place a statement on a website under section
527 of the Companies Act 2006, it must forward the statement to the Company's
auditors not later than the time when it makes the statement available on the
website. The business which may be dealt with at the Annual General Meeting
includes any statement that the Company has been required under section 527 of
the Companies Act 2006 to publish on a website.
9. A person authorised by a corporation is entitled to exercise (on
behalf of the corporation) the same powers as the corporation could exercise
if it were an individual member of the Company (provided, in the case of
multiple corporate representatives of the same corporate shareholder, they are
appointed in respect of different shares owned by the corporate shareholder
or, if they are appointed in respect of those same shares, they vote those
shares in the same way). To be able to attend and vote at the meeting,
corporate representatives will be required to produce prior to their entry to
the meeting evidence satisfactory to the Company of their appointment.
Corporate shareholders can also appoint one or more proxies in accordance with
Note 2. On a vote on a resolution on a show of hands, each authorised person
has the same voting rights to which the corporation would be entitled. On a
vote on a resolution on a poll, if more than one authorised person purports to
exercise a power in respect of the same shares:
a. if they purport to exercise the power in the same was as each
other, the power is treated as exercised in that way;
b. if they do not purport to exercise the power in the same way as
each other, the power is treated as not exercised.
10. Members satisfying the thresholds in Section 338 of the Companies Act
2006 may require the Company to give, to members of the Company entitled to
receive notice of the Annual General Meeting, notice of a resolution which
those members intend to move (and which may properly be moved) at the Annual
General Meeting. A resolution may properly be moved at the Annual General
Meeting unless (i) it would, if passed, be ineffective (whether by reason of
any inconsistency with any enactment or the Company's constitution or
otherwise); (ii) it is defamatory of any person; or (iii) it is frivolous or
vexatious. A request made pursuant to this right may be in hard copy or
electronic form, must identify the resolution of which notice is to be given,
must be authenticated by the person(s) making it and must be received by the
Company not later than six weeks before the date of the Annual General
Meeting.
11. Members satisfying the thresholds in Section 338A of the Companies Act
2006 may request the Company to include in the business to be dealt with at
the Annual General Meeting any matter (other than a proposed resolution) which
may properly be included in the business at the Annual General Meeting. A
matter may properly be included in the business at the Annual General Meeting
unless (i) it is defamatory of any person or (ii) it is frivolous or
vexatious. A request made pursuant to this right may be in hard copy or
electronic form, must identify grounds for the request, must be authenticated
by the person(s) making it and must be received by the Company not later than
six weeks before the date of the Annual General Meeting.
12. Under section 360BA of the Companies Act 2006, a member may, subject to
conditions, request confirmation that their vote on a resolution at a general
meeting where a poll has been taken has been validly recorded and counted.
The conditions are that:
a) the member makes a request for the information which is received by
the company no later than 30 days from the date of that general meeting; and
b) the member does not have any other reasonable means by which to
determine that their vote has been validly recorded and counted by the
company.
Upon receipt of the request, the Company must provide the information to the
member as soon as reasonably practicable and in any event by the end of the
period of 15 days beginning with whichever is the later of the first working
day after the day on which:
a) the result of the poll is declared for that resolution; or
b) the request for information under subsection (a) is received by the
company.
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